Energy Energy Efficiency and Cohesion in an EU Energy Policy perspective Energy Dr. Tudor Constantinescu Principal Advisor European Commission - Energy

Energy Decarbonisation Technology External Legislation Cohesion Internal Market Objectives & Targets European Energy Policy

Energy Energy strategy 2020 – Five priorities Efficient use of energy Integrated energy market Secure, safe and affordable energy for consumers Technological leadership Strong international partnership

Energy Meeting our “ by 2020” goals Reduce greenhouse gas levels by 20% Increase share of renewables to 20% 100% Reduce energy consumption by 20% -10% Current trend to % 20% Current trend to 2020

Energy A NEW ENERGY EFFICIENCY DIRECTIVE Services Energy supply House- holds Industry General measures promoting EE New EED Sectoral measures Monitoring & Reporting Indicative national EE targets Public sector

Energy  Supported by multiple scenario analyses, to show how to reach the 80 % / 95 % goal while at the same meeting other policy objectives (Competitiveness and Security of Supply)  Containing robust assumptions for all possible scenarios Looking to the future - Energy Roadmap 2050 Basis: 20/20/20 objectives of the EU energy policy Roadmap 2050: Cutting GHG emissions until 2050 down to 80 – 95 % below the level of 1990 The Energy Roadmap 2050: the basis for the elaboration of a low carbon 2050 strategy

Energy Fuel Ranges (primary energy consumption) 0% 25% 50% 75% RESGasNuclearOilSolid fuels 0% 25% 50% 75% RESGasNuclearOilSolid fuels

Energy Conclusions and “no regret options” Energy efficiency gains throughout the system Major role of renewables But all options can contribute  EE, RES, Nuclear, CCS, Gas Act in time and together – timely investments cost less Gas – important role until 2030/35- more uncertainties after that period  Contribution after 2030 depends on (delayed) CCS

Energy European funding mobilised Structural funds/ERDF (incl. JESSICA) Intelligent Energy – Europe Programme ELENA Facility European Energy Efficiency Facility Smart cities (within the 7th Framework programme for Research) Public Private Partnerships (within the 7th Framework programme for Research

Energy Cohesion Policy (€ 347 billion) European Regional Development Fund (ERDF) Cohesion Fund European Social Fund (ESF) DG REGIO DG EMPLOYMENT

Energy Cohesion Policy Convergence 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.

Energy Functioning of Cohesion Policy European Commission & Member States negotiated / agreed National Strategic Reference Framework (NSRF) and Operational Programmes (OPs) at national and/or regional level for Member 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. EU funds always completed by national, regional, EIB funds.

Energy Eco- Innovation €3 bn Low Carbon Economy €48 bn Environmental Rulebook €54 bn = €105 billion 30% of Cohesion Policy funding “Green economy” investments Renewables €4.8 bilion Energy Efficiency €4.4 billion

Energy Petroleum products 2% Natural gas 6% Electricity (TEN-E) 3% Electricity 3% Natural gas (TEN-E) 3% Wind 7% Solar 10% Biomass 17% Hydroelectric, geothermal and other 10% Energy efficiency, co- generation, energy management 39% Cohesion Policy allocations to Energy total = € 11 billion (3 % of total) € 9.2 billion EE & RES plus € 1.8 billion traditional energies & interconnectors.

Energy

Energy 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 billion Member States define eligible categories of existing housing, to support social cohesion June 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)

Energy Uptake 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.

Energy 18 Refurbishment of social housing (FR) Investments of € 320 M of ERDF in whole country Average 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 FR helped to create and maintain 15,000 local jobs & potentially 31,000 with measures in the pipeline 50,000 households with modest incomes supported to fight energy poverty (heating costs reduced on average by 40%)

Energy European Union Cohesion Policy │ 19 Proposed EU budget "Ambitious but realistic" proposals issued by the Commission in June 2011 for a Multiannual Financial Framework Cohesion Policy 33% (€336 billion) Connecting Europe Facility 4% (€40 billion) Other policies (agriculture, research, external,…) 63% (649 billion) MFF

Energy European Union Cohesion Policy │ 20 Concentrating resources to maximise impact Less developed regionsMore developed & transition regions Concentration of ERDF investments on: energy efficiency & renewable energy research & innovation competitiveness of SMEs flexibility – different regions have different needs special arrangements for ex-convergence regions 60 % 20% 44 % 6%

Energy European Union Cohesion Policy │ 21 How will funding be allocated? Budget allocation (in %) Population covered (in millions) Less developed regions/MSTransition regionsMore developed regions Cohesion Fund¹68.7 Less developed regions162.6 Transition regions38.9 More developed regions53.1 European Territorial Cooperation 11.7 Outermost regions and sparsely populated areas 0.9 Total336.0 ¹ €10 billion from the Cohesion Fund will be allocated to the Connecting Europe Facility

Energy ROMANIA, NSRF ( Energy Efficiency in ERDF Operational Programmes : 100 MEURhttp:// Large enterprises/SMEs (Increase of the Economic Competitiveness programme) Total allocation: 100 M€ (245) Implementation: European Regional Development Fund supports investments in installations/ equipments of industrial operators leading to reducing the energy consumption. Calls: on going Public buildings for Regional, Local and Municipal Authorities (Regional operational programme) No separate energy-efficiency measures are taken. European Regional Development Fund supports the rehabilitation of public buildings (schools, hospitals, social buildings); the projects are required to comply with reinforced energy efficiency national legislation; Housing Total allocation: 0 M€ Implementation: this was not a priority for the Romanian authorities and no programme included this type of projects. Discussions are on-going on the possibility and opportunity to set up a financing scheme for energy efficiency projects in housing under the Regional Operational programme. Contacts Intermediate Body for Energy from the Ministry of Economy, Trade and Bussiness Environment, Tel: (+40 21) Managing Authority for Regional Operational Programme from the Ministry of Regional Development and Tourism Tel: (+40 37)

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