Presentation on theme: " Energy Efficiency funding and the EU Cohesion Policy"— Presentation transcript:
1 Energy Efficiency funding and the EU Cohesion Policy Energy Cities – Open Days 2011Energy & Territory: from multilevel governance to local agreementsDr. Tudor ConstantinescuEuropean CommissionDirectorate-General for Energy1
2Energy strategy 2020 – Five priorities Efficient use of energyIntegrated energy marketSecure, safe and affordable energy for consumersTechnological leadershipStrong international partnership2
3Meeting our “20-20-20 by 2020” goals Meeting our “ by 2020” goalsReduce greenhouse gas levels by 20%Increase share of renewables to 20%Reduce energy consumption by 20%100%Current trend to 2020Current trend to 2020-20%-10%Current trend to 202020%[ Energy networks, diversifying energy sources and increasing energy efficiency ]33
4European funding mobilised Financial supportEuropean funding mobilisedStructural funds/ERDF (incl. JESSICA)Intelligent Energy – Europe ProgrammeELENA FacilityEuropean Energy Efficiency Fund (EEE F)Smart cities(within the 7th Framework programme for Research)Public Private Partnerships4
5Cohesion Policy 2007-2013 Cohesion Policy 07-13 European Regional (€ 347 billion)European RegionalDevelopment Fund(ERDF)Cohesion FundEuropean Social Fund(ESF)DG REGIODG EMPLOYMENT
6Cohesion PolicyConvergence objective: regions with GDP per capita under 75% of the EU average. 81.5% of the funds are spent on this objective.Regional competitiveness and employment objective.
7Functioning of Cohesion Policy European Commission & Member States negotiated / agreed National Strategic Reference Framework (NSRF) and Operational Programmes (OPs) at national and/or regional level forMember States alone select and implement the projects in line with priorities of the OPs (principle of ‘shared management’).Major Projects: Investments of more than € 50 million are submitted and approved by the Commission.
8Functioning of Cohesion Policy Co-financing rate of 50% (competitiveness regions) or 75/85% (convergence regions) at programme level.Different rate for ‘revenue-generating’ projects (possibility also to use revolving financing instruments for such projects)EU funds always completed by national, regional, EIB funds.Programmes managed by “Managing Authorities” (MAs) at national/regional level. Often national or regional Ministry for finance/economy/regional development.
10Cohesion Policy allocations to Energy Petroleum products2%Natural gas6%Electricity (TEN-E)3%ElectricityNatural gas (TEN-E)Wind7%Solar10%Biomass17%Hydroelectric, geothermaland otherEnergy efficiency, co-generation, energymanagement39%total = € 11 billion (3 % of total)€ 9.2 billion EE & RES plus € 1.8 billion traditional energies & interconnectors.
11Energy Efficiency in the “Recovery Package” Amendment to ERDF regulation (May 2009)Up to 4% of the national ERDF allocation can go to energy efficiency and renewable energy in housing, potentially € 8 billionMember States define eligible categories of existing housing, to support social cohesionJune 2010: Further regulatory amendment to facilitate the use of innovative financial instruments in this area, in addition to JEREMIE and JESSICA (JESSICA initiative also delivering EE & RES investments in the urban context)
12Uptake of the regulatory amendments According to first qualitative assessment by DG REGIO in autumn 2010, activities in this area triggered by the regulatory amendments in BE, BG, EL, FR, IT, LT, MT, NL, PL, PT, UK.In addition, EE and LV active in this area already from the outset of the period.Some further MS show interest and could take advantage of this new opportunity (DE, ES, HU,…?).
13Uptake of the regulatory amendments Only EL making immediate use of the new financial engineering opportunity by establishing a revolving fund of EUR 300 million to provide repayable assistance for energy efficiency in housing.However, it seems like the amendment has triggered further MS interest, as the set-up of additional financial engineering instruments with an energy efficiency and/or renewable energies component is currently considered in BG, DE, HU, SK, UK.Also eight JESSICA funds with energy component set up in seven MS: EE, LT, ES, IT, PL, PT, UK.
14Refurbishment of social housing (FR) Investments of € 320 M of ERDF in whole countryAverage support by ERDF = € 2,886 per dwelling (14% of total needs)Impacts:generated over € 1 billion in investment in energy performance in social housing in FRhelped to create and maintain 15,000 local jobs & potentially 31,000 with measures in the pipeline50,000 households with modest incomes supported to fight energy poverty (heating costs reduced on average by 40%)14
15Revolving fund example Estonia Switch from grants to a revolving fundKredEx (Credit and Export Guarantee Fund of the State) supports thisWhy revolving fund?Opportunity for re-usage of the fundsFunds stay in stateLoan is needed for reconstruction anywayEasier to administer, lower administrative costsEnd-beneficiary is used to take loanInnovative scheme, help from kfWStarted 06/2009March 2010: 70 contracts with multi-apartment buildings, total 5,1 mn € (average €, 2035 apartments, saving 33%)15
16JESSICA fund in Lithuania JESSICA Holding Fund amounts to € 227 million:€ 127 million ERDF€ 100 million National co-financingExpected later: some funds by commercial bankImplementation started June 2010Planned to modernize houses, by the year 2020This example:45 apartment multi family buildingInsulated external walls and roof Windows replacedGlazing of balconiesModernization of heating substation & heating systemsEnergy efficiency improvement of 60 %16
17European Local Energy Assistance (ELENA) facility – ELENA EIB ELENA is a technical assistance facility, providing grants to cities, provinces, regions and entities acting on their behalf, of up-to 90% of eligible costs, for development of bankable sustainable energy investment programmes/projects at their territories.Minimum leverage factor - 25, as ofELENA is financed through the IEE Programme, no call deadlinesApplications sent directly to EIB
18ELENA projects until 31/3/2011 -6 signed, 6 approved ELENA contribution: EUR 21,877,929 – Expected investment: EUR 1.6bnProject nameBeneficiaryLocationSectorREDIBAProvince of Barcelona (E)over 300 small and medium municipalitiesEE &RECHP/DHCity of Purmerend (NL)1 medium-size municipalityRE & Local infrastructureEE Milan Covenant of MayorsProvince of Milan (I)100 small municipalitiesEE &MADEVCity of Madrid (E)1 large municipalityTransportEE Ecoles ParisCity of Paris (F)EEVila Nova de Gaia Sustainable ProgrammeCity of VN de Gaia (P)EE & transportDevelopment of smart grid infrastructure in autonomous islands of the Aegean SeaDAFNI (GR)5 Islands, 10 small-size municipalitiesLocal infrastructure & RERE-FITGreater London Authority (UK)Several London BoroughsElectrobus: EE efficient bus network for BarcelonaCity of Barcelona1 large municipality to large citiesSPIS – Sparvagnar I SkaneCity of Malmö (S)3 mediumLondon – Decentralised EnergyMinimum of 15 DE projectsLocal infrastructureELENA - MODENAProvince of Modena (IT)Municipalities in the provincePV, buildings, public lighting
19Other EU fundingELENA facility: technical assistance for municipalities since 2009New European Energy Efficiency Fund (EEE F) 265 million Launched 1st July 2011 (EUR 146 million EERP, + financing from EIB, CDP and DB). Beneficiaries: Local & regional Public authorities, but PPPs are possible. Financing in form of loans, guarantees, forfeiting schemes (to finance ESCO)…Technical assistance (grant) is available to structure projects.Also ongoing: DG ENER Impact Assessment on the best financing instruments for energy efficiency (also with a view to new EU Financial Framework ) as well as an analysis of the appropriateness of EU funding for the EPBD as requested by the EPBD Directive
20“Factories of the future” PPP initiative The 3 Public Private Partnerships (PPP’s)Part of the European Economic Recovery PlanAdopted by the EC on 26 Nov 2008Endorsed by the EU Council on Dec 2008“Factories of the future” PPP initiative€ 1.2 billion in 4 years“Energy-efficient buildings” PPP initiative€ 1 billion in 4 years“Green cars” PPP initiative