Annexes to COM(2015)484 - Implementation of the European Energy Programme for Recovery and the European Energy Efficiency Fund - Main contents
Please note
This page contains a limited version of this dossier in the EU Monitor.
| dossier | COM(2015)484 - Implementation of the European Energy Programme for Recovery and the European Energy Efficiency Fund. |
|---|---|
| document | COM(2015)484  |
| date | October 8, 2015 |
For Cobra Cable, the grant agreement has been amended and the action extended to December 2017. The procurement of the converters and the cable was initiated and the contract should be awarded in November 2015. The Final Investment Decision will be taken in the second quarter of 2016 if all the relevant permits regarding the routing are secured and the contracts with suppliers for the cable and the converter stations fit into the budget of € 621 million. If these conditions are fulfilled, the cable should be operational two years later.
3. Carbon Capture and Storage
The EEPR sub-programme consisted of 6 projects and € 1 billion of support to aim at demonstrating the full carbon capture, transport and storage process.
One project has finished providing operational pilot plants for capture, transport and storage. Three projects have been terminated prematurely. Two projects are ongoing. € 426,982,066 have been paid to these projects.
Progress with CCS projects
The remaining two projects, ROAD (in the Netherlands) and Don Valley (in the UK), continue to experience significant difficulties in obtaining the necessary funding for both construction and operation.
The Don Valley project is progressing well as regards developing CO2 transport and storage infrastructure which would be used jointly with the NER300 co-funded White Rose project as well as other possible CCS projects in the Humber area. In contrast, the future of the CCS power plant is entirely dependent on obtaining operational support from the UK's Contract for Difference scheme. In August 2014 the UK Government published a policy scoping document outlining its next steps on CCS which include the development of a Contract for Difference scheme appropriate for CCS projects like Don Valley. The Commission will continue its discussions both with the project partners and with the UK government on timing and prospects for achieving a positive final investment decision. It will also discuss amending the grant agreement to take account of the delayed development of the CfD scheme and the planned new CO2 capture technology following the take-over of the project coordinator by a new investor in December 2014.
For the ROAD project, the low CO2 price resulted in a financing gap compared to initial calculations. The European Commission has invested considerable effort in trying to bring together relevant Member States, the industrial partners concerned and Norway in order to find a solution. The result was that the project was investigating an alternative storage solution which became available in the meantime and which would significantly reduce CO2 transport and storage costs due to its closer location to the shore. The Commission also received tangible expressions of interest to setting up an ERA-NET Cofund under Horizon 2020 to support the operation and make full use of the dissemination potential of what would be the first project in Europe demonstrating the application of post-combustion CCS technology to a commercial scale coal power plant. This would also mean the successful demonstration of technology capable of retrofitting existing coal power plants.
III. EUROPEAN ENERGY EFFICIENCY FUND (EEE F)
In December 2010, € 146.3 million from the European Energy Programme for Recovery (EEPR) were allocated to a financial facility for sustainable energy projects 6 . € 125 million were used as the EU contribution to the European Energy Efficiency Fund (EEE F), created in July 2011 and which has so far reached a total volume of € 265 million 7 , supported by a Technical Assistance grant facility with a budget of € 20 million and € 1.3 million for awareness-raising activities.
The EEEF provides tailored financing (both debt and equity instruments) for energy efficiency, renewable energy and clean urban transport projects. Beneficiaries are local or regional public authorities or private entities acting on their behalf.
1. progress to date
European Energy Efficiency Fund (EEE F)
In 2014, two new projects in France and in the Netherlands were signed. In France, it will provide € 5 million to a private company owned by the Rhône Alpes region to finance the refurbishment of public buildings (high schools, schools and gymnasiums), during their construction phase and to pave the way for raising further long term financing. The approach of this company is a good example of the aggregating mechanisms that are needed to upscale the size of investments in energy efficiency in Europe.
In the Netherlands, the City of Venlo signed a long-term financing contract for € 8.5 million to finance street lighting upgrades with the aim to equip a minimum of 16,000 lighting points with LED lights (73 % of the total lighting points of the city) and achieve more than 40 % in energy savings.
From its creation to 31st December 2014, the Fund has signed contracts with nine projects for € 115 million, which have generated € 216 million of final investments. In addition, € 70 million have been allocated to 3 projects 8 .
A project assessment and reporting framework on CO2 equivalent and primary energy savings has been developed. As of the end of 2014, EEE F investments have achieved savings of 96 000 tons of CO2, comparable to the annual CO2 equivalent emissions of 12 000 European citizens.
Technical Assistance facility
In 2014, an additional € 5,5 million were allocated to seven local authorities 9 to finance their project development activities. This should leverage investments of € 127million, 23 times higher than the initial outlay.
In total, the Technical Assistance facility funded by the Commission will have supported the structuring of 16 projects for a total amount of € 17 million 10 . Several factors can explain the reasons for small amounts of unallocated funds. First, the projects identified in the ramp-up phase of the Fund had a higher advancement stage/maturity level and therefore did not need technical assistance. Moreover, the experience of the Technical assistance facility has shown that financing energy efficiency projects faces many challenges, such as a lower level of preparation of requests than initially estimated at the inception of the fund (few of the technical assistance requests received were ready for submission), changes in projects following political changes in governments, or necessary adaptations after the first set of feasibility studies.
Awareness Raising Activities
The European PPP Expertise Centre (EPEC) 11 has finalised the awareness raising campaign focusing on 3 aspects: supporting the development of Energy Performance Contracting in the Member States, encouraging the optimal use of Structural and Cohesion Funds for energy efficiency and renewable energy and spreading information on recent policy changes and priorities for the Multiannual Financial Framework 2014-2020 (MFF). Based on the preparation of various fact sheets and country strategies, tailored workshops and follow-up activities were organised in various Member States.
Main Conclusions & outlook
The EEE F will seek to increase its geographical coverage, in particular in Central and Eastern Europe, to accommodate the various needs of European local and regional public authorities.
By now, the Fund has progressively established a solid track record of profitable investments and will actively look for additional senior investors to leverage the EU contribution further.
IV. overall conclusions
The EEPR has delivered good results. The majority of projects have been completed, particularly regarding gas and electricity infrastructures. The Commission has taken the decision to terminate projects where appropriate and maintains a strict control on project implementation and monitoring.
The Off-Shore Wind solution has proven to be more complex than expected and a lot of technological knowledge has been gained over the five years. The same applies to CCS projects where additionally problems with finding the necessary complementary funding delay progress or stopped projects.
The EEEF has also been successful: a commercial fund was established that will continue to grow, providing financing solutions and generating profits covering administrative expenses, shareholders’ dividend and repayment of establishment costs.
(1)
REPORT 2014 adopted on 28 October 2014, COM(2014)669
(2)
Regulation (EU) No 347/2013 of the European Parliament and of the Council of 17 April 2013 on guidelines for trans-European energy infrastructure , OJ L115 of 25.04.2013, p.39.
(3)
Regulation (EU) No 1316/2013 of the European Parliament and of the Council of 11 December 2013 establishing the Connecting Europe Facility, OJ L 348 of 20.12.2013, p. 129.
(4)
After redeploying €2.8 billion from the Connecting Europe facility for the EFSI fund
(5)
After redeployement from CEF energy (€5,85 billion) allocated to the EFSI fund
(6)
Regulation (EU) No 1233/2010 of the European Parliament and of the Council of 15 December 2010 amending Regulation (EC) NO 663/2009 establishing a programme to aid economic recovery by granting Community financial assistance to projects in the field of energy.
(7)
Additional investments to those of the European Commission have been made by: the European Investment Bank EUR 75 million, Cassa Depositi e Prestiti SpA (CDP) EUR 60 million and the Investment Manager Deutsche Bank (DB) EUR 5 million.
(8)
One of the projects to which financing had been allocated in March 2014 did not proceed.
(9)
In the Netherlands, Belgium, Ireland, Portugal.
(10)
Support from the Technical assistance facility has been allocated to four other projects.
(11)
The European PPP Expertise Centre (EPEC) is a joint initiative of the EIB, the European Commission and EU Member States and candidate countries. EPEC helps strengthen the capacity of its public sector members to enter into Public Private Partnership (PPP) transactions. http://www.eib.org/epec/ .