In its second year of operation, the European “modernisation fund” has disbursed over €4 billion in support of 61 projects in eight beneficiary countries. During summer 2022, about €2.4 billion was already disbursed to support 45 investment proposals; it is now complemented by another €1.71 billion disbursement to support another 16 investment projects into sustainable energy issues.
Exactly 61 investment proposals were selected under the Modernisation Fund during 2022 focusing on electricity generation from renewables, modernisation of energy networks and the sector’s energy efficiency; as well as on energy transition in industrial sector, in construction and in transport through, e.g. replacement of coal generation with lower carbon intensity fuel.
These projects will help modernising energy system in the member states by e.g. generally reducing greenhouse gas emissions in industry, transport and agriculture, and by improving energy efficiency. Supporting these investments will help the member states to meet their 2030 climate and energy targets and accelerate the EU-wide green transition.
Examples in the Baltic States:
Disbursements were made this year to the following states:
= Estonia (€62.4 million) for low-emission energy-efficient public transport;
= Lithuania (€85 million) for renovation of public buildings, increasing energy efficiency and development of renewable hydrogen production capacity.
= Poland (€643.2 million) for building heating plants based on renewable energy sources and improvement of energy efficiency in industry.
In other EU states disbursements – both in millions and billions – were made to such states as: Croatia – €119.8 million, Czechia – €1.34 billion, Hungary – €74.3 million, Romania – €1.39 billion and Slovakia – €399.5 million.
On Modernisation Fund
The Modernisation Fund supports investments in the generation and use of energy from renewable sources, energy efficiency, energy storage, modernisation of energy networks, including district heating, pipelines and grids, and just transition in carbon-dependent regions.
In 2021, the Fund made available €898.43 million to eight beneficiary countries.
The Fund complements other European instruments such as cohesion policy and the Just Transition Fund; it mobilises significant resources, which can assist the EU states support investments in line with the REPowerEU Plan and “Fit-for-55” package.
The Fund operates under the responsibility of its beneficiary countries in close cooperation with the European Commission and the European Investment Bank.
For example, the EIB’s investment proposal assessment activities in the Modernisation Fund follow standard EIB financing and technical assistance operations to avoid any potential conflict of interest in carrying out the activities mandated in accordance with the ETS Directive and the Commission Implementing Regulation of 9 July 2020.
Frans Timmermans, Executive Vice-President for the European Green Deal (21.xii.2022) noted that the Modernisation Fund was a crucial element for a fair transition. The EU institutions are investing some of the revenues from the EU emissions trading system (EU ETS) in the modernisation of the energy system in the member states with a particular need for the energy transition and where GDP per capita is lower than in the EU average. Together with the EIB, the Fund has been already providing substantial funding during 2022; the newly-strengthened EU ETS will soon be supporting the states with a bigger investment in the future.
Ambroise Fayolle, European Investment Bank Vice-President acknowledged the need for both scaling up investments to meet the 2030 climate and energy targets and paving the way for a carbon neutral Europe. The EIB welcomes the over €4 billion in financing from the Modernisation Fund in 2022 which shows its important role for the energy transition. As the EU climate bank, the EIB is providing its expertise and services to help implement the European Modernisation Fund and continues expansion of support to more countries.
Besides, the Fund was involved indirectly in four new energy-gas interconnectors that have become operational during 2022: the so-called “Baltic Pipe”, the connection between Poland and Lithuania, the interconnector between Bulgaria and Greece, and the gas interconnector between Poland and Slovakia.
More information in the following Commission’s websites: = Adopted disbursement decisions; = Confirmations of priority investments; = Recommendations of the Modernisation Fund Investment Committee; = List of confirmed and recommended investment proposals; = Modernisation Fund website; = Delivering the European Green Deal