EE Finances » Financing Energy Efficiency » Transnational EE financing strategy » Assessment of existing financing models and their deployment » Assessment of European Funds and Operational Programmes

Assessment of European Funds and Operational Programmes

Features favourable for municipalities

Features NOT favourable for municipalities

  • OP Funds can provide a large portion of the costs for large investments like perennial projects or projects with high investment sums.

  • The relevant OPs are accessible financial sources for municipal energy investments when planned developments meet the programme indicators (e.g. saved energy in kWh, reduction of COeq in tones, etc.) and respect the limits set by the calls (e.g. price limit of PV panels in HUF/kW)

  • Big subsidy rates which in some cases can go up to 80 % of the total investment or even up to 100 % in case of project development assistance.

  • No debt service costs

  • For many fund programmes certain special criteria have to be fulfilled by an investment to be eligible which excludes many projects. (E.g. LED adaptions are funded for investments in municipal commercial enterprises but not in school and office buildings.)

  • Reporting procedures are often very complicated and requirements hard to fulfil for municipalities which follow own regulations.

  • Even if funds are granted by the federal or provincial state, pre-financing and financing of the co-payment can be difficult and there might be a need to get a commercial loan to bridge the period until the fund redistributes money.

  • There is no absolute certainty that a funding will be granted therefore realization may depend completely on funding approval.

  • This method is not favourable for municipalities if they do not implement the planned investments and fail to meet the pre-set indicators the grants must be returned

Types of EE projects or EE services suitable to be financed this way

  • Energy efficiency investments of municipality buildings and deployment of decentralized solutions of energy generation based on renewable energy sources and solutions of effectively operating the municipality buildings (heat insulations, solar panels, photovoltaic panels, upgrading of lightning infrastructure, ventilation of buildings, doors and windows, etc.), with related planning, project management and public procurement activities. Elaborating SECAPs is often supported, too.

  • Major or capital projects, such as low-energy schools or kindergartens, new technology parks, energy renovation of buildings, cultural heritage buildings renovation, e-mobility projects, infrastructural projects – smart city etc.



Recommendations for deployment

  • Seek assistance from energy agencies and other information centres to find a suitable and available funding programme.

  • Develop competent staff resources to handle application and reporting procedures.

  • To support the EPBD, the Union’s European Structural and Investment Funds (ESIFs) and the European Fund for Strategic Investments (EFSI) have sought to improve the availability of finance for energy efficiency investments.

  • It is considered very useful to collaborate with the structures created specifically by the EU Commission for assistance in the use of European funds, such as fi-compass (https://www.fi-compass.eu/)

  • The case study on effects of subsidies as well as loans is the part of the BOOSTEE- CE Transnational Methodological Framework



Examples

  • European funds and national operational programmes are widely utilised in Croatia, Poland, Slovenia, the Czech Republic and Hungary which has a considerable effect on the whole financing of the EE projects. Undisputable advantage of these funds is the financial stability, certainty and relatively short payback period. There are numerous EU financing Programmes, each of them having different requirements and eligibility conditions. Therefore, the crucial activity for deployment of this financial model is to have well organized teams that are capable of developing and implementing quality infrastructure project or business plans which will be financed with EU funds. Experience and skills are required in order to meet strict rules of such Programmes.

  • In Italy the Structural Funds (ESIF) already used in the 2014-2020 programming will be confirmed in the next programming period and developed by seeking the most effective combination to exploit other available European funds (in particular EFSI funds) and to attract private capital and increase consequently the leverage effect.

  • Upon the experience from Austrian partners European funds should be employed more. Therefore, skills of staff and information exchange between different responsibilities should be improved.

  • The case study from the Zlín Region is available on the OnePlace Platform related to the influence of OP involvement in public sector EE projects.