Subsidy Control
As from Wednesday 4 January 2023, public funding became subject to the UK-wide subsidy control regime. This page provides guidance on subsidy control as it relates to CARES funding. If your application is successful, Local Energy Scotland are responsible to assess whether the funding to be offered to you is classified as a subsidy or not, and if it is a subsidy, how we will award the aid to you.
Where we assess that the funding offered to you should be classified as a subsidy we will clearly notify you of this in writing at the time the funding is offered to you and will state what subsidy control provision we are using to offer the CARES funding to you. Our assessment of whether CARES funding is a subsidy will be based on the standard four subsidy control limbed test, all of which must be met for the funding we offer you to be classed as a subsidy.
Although it will be Local Energy Scotland to make an assessment of this, to help us with this exercise please complete the relevant subsidy control questions on CARES project portal. A description of each of the four limbs/rules are set out below.
| Subsidy Test | Description |
| Limb A | Will the measure be given, directly or indirectly, from public resources by a public authority?
As CARES funding is from the Scottish Government the answer to this is always ‘Yes’ |
| Limb B | The financial assistance confers an economic advantage on one or more enterprises
This limb has two components. First, are you an enterprise involved in economic activity. Economic activity essentially means offering goods and/or services on any given market (this can include social enterprises, third sector organisations and charities). Secondly could, at least in principle, this be carried out by a private operator for remuneration in order to make profits.
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| Limb C | Is the measure specific insofar as it benefits, as a matter of law or fact, your organisation as an economic actor over other economic actors in relation to the production of goods or the provision of services (this covers any funding that is provided directly or indirectly to specific beneficiaries determined on a discretionary basis by the public authority, as well as assistance that benefits (directly or indirectly) only enterprises in a particular sector, industry, or area, or with certain characteristics)?
The key consideration here is about whether the subsidy benefits your organisation over another. |
| Limb D | Will the intervention have, or is it capable of having, an effect on competition or investment within the UK, or an effect on trade or investment between the UK and another country or territory, or both?
Where there is a risk that funding for a CARES project could effect trade across the UK or with another country we will treat this test as having been met. For example projects selling electricity to the National grid would meet this test. |
Where funding is classified as a subsidy
Where we determine that the funding to be offered to you is a subsidy, we usually notify you that the funding will be offered under the Community and Renewable Energy Scheme (CARES) Grant and Loan Scheme SC11309 (if you are interested you can view the Published Notice (SC11309)). If your organisation receives various public sector funding its worth knowing that CARES funding offered under the CARES Grant and Loan subsidy (SC11309) scheme does not effect the amount of public funding you can receive under the separate Minimum Financial Assistance (MFA) provision.
Whilst we will generally use the CARES Grant and Loan subsidy scheme, in some cases we may offer funding to you under the Minimum Financial Assistance (MFA) provision and will notify you of this at the time of offering the funding to you if this is the case. The MFA provision permits your organisation to receive up to £315,000 over the current and two previous financial years. If we offer funding as MFA we will ask you to declare that receipt of this MFA award will not cause you to breach the £315,000 threshold.
If you have any queries about subsidy control please contact your CARES Development Officer or email info@localenergy.scot.