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Cohesion Policy support for Sustainable Energy 2007-

2013Implementation overview

COCOF technical seminarBrussels

23 March 2011

Maud SKÄRINGEREuropean CommissionDirectorate-General for Regional Policy

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EnvironmentalRulebook

€54 bn

Low Carbon

Economy€48 bn

Eco-Innovation

€3 bn

= €105 billion 30% of Cohesion Policy funding

“Green economy” investments 2007-2013

Renewables €4.8 bilion

Energy Efficiency €4.4 billion

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Petroleum products2%

Natural gas6%

Electricity (TEN-E)3%Electricity

3%

Natural gas (TEN-E)3%

Wind7%

Solar 10%

Biomass17%

Hydroelectric, geothermal and other

10%

Energy efficiency, co-generation, energy

management39%

Cohesion Policy allocations to Energy

2007-2013 total = € 11 billion (3 % of total)

€ 9.2 billion EE & RES plus € 1.8 billion traditional energies & interconnectors.

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Cohesion Policy & Sustainable Energy 07-13

9%

12%

20%

13%

46%

Wind - € 787 M

Solar - € 1 B

Biomass - € 1,8 B

Hydroelectric,geothermal - € 1,1 B

Energy efficiency

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Allocations to Energy Sector as % of total allocations per MS

2007-2013

0%

1%

2%

3%

4%

5%

6%

7%

RES

EE

Traditional Energy

TEN-E

Source: Infoview 2009

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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

• Further regulatory amendment to facilitate the use of innovative financial instruments in this area (June 2010)

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Why focus on Sustainable Energy in Buildings?

• Building sector, a win-win-win opportunity:– Regional development / social cohesion / energy

savings• creating new and sustainable jobs;• building local and regional capacities;• creating local opportunities for R&D and innovation;• lowering energy consumption and improving security of

energy supply;• reducing energy costs and alleviating energy poverty;• improving the quality of residential / public /

commercial buildings,• reducing greenhouse gas emissions and improving the

local environment.

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Uptake 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,…?).

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Uptake of the regulatory amendments

• For MS known to be active in energy efficiency and renewable energies in housing, the overall net increase of allocations in the relevant categories, compared to the outset of the period, is – so far – around EUR 320 million.

• This is in addition to the allocations to energy efficiency or renewables in residential buildings already from the outset in EE and LV.

• This is also in addition to any reallocations to residential buildings from other types of investments within the energy efficiency or renewable categories.

• Cannot be concluded that the increase is linked to investments in energy efficiency and renewable energies in residential buildings only (but most likely mainly!).

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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.

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Strategic Report 2010Progress Energy priorities overall

Codes 33-43: € 11 billion available

Average project selection 13% = € 1,4 billion (by end September 2009)

Good progress – CZ, LT

0,00

0,50

1,00

1,50

2,00

2,50

PL IT CZ GR RO FR DE LT ES HU UK PT BG SK SI LV EE EU26

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

€ bn % project selected

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Strategic Report 2010Progress Sustainable Energy

priorities• Significant variations in the allocation rates in the

area of energy efficiency and renewable energies at Member State level in autumn 2009 (+/- 0-50 %).

• Also variations between the different categories of expenditure. The overall average situation was:– Renewable energies facing difficulties (10 %), in

particular wind energy (3 %);– Energy efficiency, co-generation and energy

management progressing better (20 %), but still delayed in relation to the overall Cohesion Policy average.

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Implementation delays and constraints

It appears that delays and shortcomings in implementation are especially linked to:

• The increase of allocations related to energy, mainly under the ERDF, since the previous period, 2000-2006, which has not always been accompanied by clear implementation strategies.

• Energy strategies and plans, in a number of MS, in need of revision or currently being revised. Therefore, lists of projects have been insufficient, and major projects announced have not been ready. This has often involved delays in preparing state aid approval.

• The priority given at EU level to energy issues not always reflected at local, regional and even national level.

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Implementation delays and constraints

• Apparent lack of flexibility in some administrations. This affects possible financial reallocations:– between implementing institutions (e.g. “pre-allocations”

made to a given level of institution – be it regional, provincial or municipal – unable to invest, while other levels of the public administration could indeed invest); or

– between categories of expenditure within the energy sector from less successful ones to the ones in high demand.

• As to renewables, success in the production of energy relies largely on having appropriate economic, fiscal and administrative framework conditions, e.g. sufficient feed-in tariffs.

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Implementation delays and constraints

• Lack of capacity reflected in different ways: – administrations are understaffed /

underskilled for the tasks attributed; – calls for proposals requiring energy audits

when sufficient auditors not available; – unfamiliarity in managing authorities with

financial engineering mechanisms;– complexity of permits systems;– inappropriate incentives;– unclear legislation and contractual

frameworks.

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More information

Cohesion Policy Project Examples:http://ec.europa.eu/regional_policy/projects/stories/index_en.cfm

Policy Learning Database:http://ec.europa.eu/regional_policy/cooperation/interregional/ecochange/

studies_en.cfm?nmenu=5

Regions for Economic Change Conference May 2010 Energy efficiency workshop (2A):

http://ec.europa.eu/regional_policy/conferences/sustainable-growth/programme_en.cfm?nmenu=4

List of Cohesion Policy funds Managing Authorities:http://ec.europa.eu/regional_policy/manage/authority/authority_en.cfm

Practical Guide to EU funding opportunities for Research and Innovation:

http://cordis.europa.eu/eu-funding-guide/home_en.html