European Commission Expands Fiscal Flexibility for Energy Spending, Up to 0.6% of GDP Over 2026-2028 (eco.sapo.pt)

• European Commission extends national safeguard clause to energy spending, within 1.5% GDP defense flexibility limit.
• Dedicated annual limit of 0.3% GDP (cumulative 0.6% GDP) for 2026-2028 for energy resilience measures.
• Eligible measures include renewables, grid investments, EV subsidies, heat pumps; price support excluded.
• Countries already at full defense flexibility may exceed 1.5% GDP cap with sustainability check.

"The European Commission announced on Wednesday that EU member states can request fiscal rule flexibility for measures enhancing energy security and reducing fossil fuel dependence. The flexibility extends the existing national safeguard clause (1.5% GDP limit for defense) to include energy spending, with a dedicated annual limit of 0.3% GDP and cumulative 0.6% GDP for 2026-2028. Eligible measures include large-scale renewable energy projects, grid investments, and subsidies for electric vehicles or heat pumps, but not general price support measures. Countries that have already used full defense flexibility may exceed the 1.5% GDP limit subject to additional sustainability review."