Introduction
Recent developments in the area of EU State aid law promise to support the expanded roll out of affordable housing in Ireland.
On 16 December 2025, the European Commission adopted the new Decision on Services of General Economic Interest (SGEI Decision), as part of European Affordable Housing Plan. The revision updates the State aid rules to facilitate investments in affordable housing. It follows a public consultation, on which we reported in a recent article.
And on 25 February 2026, the European Commission launched a public consultation on the draft of a simpler and more streamlined General Block Exemption Regulation (GBER). The new version is intended align the GBER with current social, market and technological conditions, including updated provisions to help address the housing crisis, by allowing higher aid intensities for energy-efficiency measures in social or affordable housing projects and for social enterprises providing housing.
In this article, we outline the changes brought about by the SGEI decision, and the likely impact of the proposed revisions to the GBER, in relation to the provision of affordable housing in Ireland
Background
Current State aid rules are insufficient for EU Member States, including Ireland, to effectively tackle the ongoing acute housing crisis. While the previous SGEI rules allowed Ireland and other Member States to invest flexibly in social housing without the need to notify the Commission, such housing was primarily targeted at disadvantaged households. At present, however, an increasing number of citizens, including middle-income households, face growing difficulties in accessing quality housing at an affordable price.
Conditions for State support for Affordable Housing
It is against this backdrop that the SGEI Decision seeks to facilitate support for affordable housing. Affordable housing SGEIs are services that public authorities view as essential to households that not able, due to market condition and market failures, to access housing at affordable conditions, and for which, without public intervention, the market would not adequately provide. The new SGEI Decision sets out seven conditions which Ireland (and other EU Member States) must comply in order to support affordable housing SGEIs without the need to notify the Commission:
- Target group: Under the SGEI Decision, the Irish authorities will determine the beneficiaries of affordable housing SGEIs, by taking into account primarily household income compared to housing market prices and household composition. They can also give priority access to persons likely to have difficulties accessing the housing markets, including persons fulfilling an essential societal role (such as teachers, the Garda Siochana, firefighters, social care and childcare workers), persons with disabilities, older persons, students or single parents.
- Quality, environmental and accessibility requirements: Affordable housing must be of appropriate quality and accessibility, comply with environmental standards, and be adapted to household needs. In this regard, the Irish authorities must apply the minimum quality, environmental and accessibility requirements that exist here in the State. Thus, the new SGEI Decision does therefore not impose new or additional quality, environmental or accessibility requirements at EU level.
- Price: The Irish authorities must ensure that prices of affordable housing are set in a transparent manner and remain below market prices but, at the same time, are not reduced more than necessary to achieve their affordability objectives. Within these constraints, the Irish authorities will remain free to set precise prices depending on national, regional and local contexts.
- Eligible costs: the list of costs eligible for compensation is broad and includes:
- Investment costs for land and building acquisition
- Renovation, transformation
- Compliance with accessibility requirements for older persons or persons with disabilities
- Compliance with environmental standards
- Adaptation for climate resilience
- Operating costs where necessary
- Duration: In principle, affordable housing units must remain used for that purpose for a minimum of 20 years subject to some exceptions.
- Use: The Irish authorities must ensure that the housing is and remains used for affordable housing, and for instance not for secondary residence or short-term rentals.
- Open systems: The provision of affordable housing SGEIs must be open on equal terms to all providers able to deliver the service, regardless of their legal status and/or public or private nature.
Proposed changes to the GBER
The GBER allows Member States to implement a wide range of aid measures directly, without prior Commission approval. (Member States implement most aid measures under the GBER. For example, in 2024, Member States reported providing aid under 6,509 GBER measures, which represents 69% of all active measures.)
The Commission initiated the revision of the GBER before it expires at the end of 2026, to ensure a seamless transition to a new GBER. The proposed revision follows a public consultation and call for evidence launched last year.
Under the draft revision of the GBER, in order to allow effective support for social and affordable housing, the GBER provisions applicable to energy-efficiency measures in buildings will be updated with a corresponding ‘top-up’ on the permitted basic aid intensity.
While the SGEI Decision allows Member States to cover all costs relating to the provision of social and affordable housing, including energy-efficiency costs, Member States may wish to provide their support to energy-efficiency measures for social housing and for affordable housing without taking SGEI measures. In such cases, they may increase the aid intensity by 20 percentage points.
Conclusion
While Ireland has successfully applied to the European Commission for specific State aid approval of an affordable housing scheme, namely the Croí Cónaithe (Cities) Scheme, the SGEI Decision should in future allow Irish authorities to support affordable housing without notifying each affordable housing scheme provided the relevant conditions outlined, above, and all other relevant requirements of the Decision are met.
Moreover, this dual-track approach ought to allow the Irish government to directly support Social Housing Retrofit Programmes under the SGEI framework and provide grants to private owners or developers who are retrofitting buildings that will be used for affordable housing (e.g., Cost Rental), without needing to notify the European Commission for individual project approval.
(Updated on 4 March 2026)
For more information, please contact our Head of Housing, Fidelma McManus or Head of EU, Competition & State Aid, John Gaffney, or your usual contact in Beauchamps LLP.