P9_TA(2022)0247

Social Climate Fund ***I

Amendments adopted by the European Parliament on 22 June 2022 on the proposal for a regulation of the European Parliament and of the Council establishing a Social Climate Fund (COM(2021)0568 — C9-0324/2021 — 2021/0206(COD)) (1)

(Ordinary legislative procedure: first reading)

(2023/C 32/12)

Amendment 1

Proposal for a regulation

Recital 1

Text proposed by the Commission Amendment (1) The Union and its Member States are Parties to the Paris Agreement, which was signed in December 2015 under the United Nations Framework Convention on Climate Change (UNFCCC) (‘the Paris Agreement’) (28) and entered into force in November 2016. According to that Agreement, they are bound to limit the increase in the global average temperature well below 2 oC above pre-industrial levels and to pursue efforts to limit the temperature increase to 1,5 oC above pre-industrial levels. (1) The Union and its Member States are Parties to the Paris Agreement, which was signed in December 2015 under the United Nations Framework Convention on Climate Change (UNFCCC) (‘the Paris Agreement’) (28) and entered into force in November 2016. According to that Agreement, they are bound to limit the increase in the global average temperature well below 2 oC above pre-industrial levels and to pursue efforts to limit the temperature increase to 1,5 oC above pre-industrial levels. By adopting the Glasgow Climate Pact, the Parties to the Paris Agreement recognised that limiting the increase in the global average temperature to 1,5 oC above pre-industrial levels would significantly reduce the risks and impacts of climate change, and they committed to strengthening their 2030 targets by the end of 2022 to close the ambition gap, in line with the findings of the Intergovernmental Panel on Climate Change (IPCC). This should be done in a manner that is equitable and respects the principle of common but differentiated responsibilities and respective capabilities, in light of different national circumstances.

Amendment 2

Proposal for a regulation

Recital 2

Text proposed by the Commission Amendment (2) The Commission Communication The European Green Deal (29) sets out a new growth strategy that aims to transform the Union into a sustainable, fairer and more prosperous society, with a modern, resource-efficient and competitive economy, where there are no net emissions of greenhouse gases in 2050 and where economic growth is decoupled from resource use . The Commission proposes also to protect, conserve and enhance the Union's natural capital, and protect the health and well-being of citizens from environment-related risks and impacts. Finally, the Commission considers that this transition should be just and inclusive, leaving no one behind. (2) The Commission Communication The European Green Deal (29) sets out a new growth strategy that aims to transform the Union into a sustainable , equitable , fairer and more prosperous society, with a modern, resource-efficient and competitive economy, where there are no net emissions of greenhouse gases in 2050 at the latest . The Commission proposes also to restore, protect, conserve and enhance the Union's natural capital, and protect the health and well-being of citizens from environment-related risks and impacts. Finally, the Commission considers that this transition should be just and inclusive, leaving no one behind.

Amendment 3

Proposal for a regulation

Recital 3

Text proposed by the Commission Amendment (3) Regulation (EU) 2021/1119 of the European Parliament and of the Council (30) enshrines into law the target of economy-wide climate neutrality by 2050. That Regulation establishes a binding commitment on the part of the Union to reduce emissions. By 2030, the Union should reduce its greenhouse gas emission, after deduction of removals of greenhouse gas emissions, by at least 55 % compared to the level in 1990. All sectors of the economy should contribute to achieving that target. (3) Regulation (EU) 2021/1119 of the European Parliament and of the Council (30) enshrines into law the target of economy-wide climate neutrality by 2050 at the latest . That Regulation establishes a binding commitment on the part of the Union to reduce emissions. By 2030, the Union should reduce its greenhouse gas emission, after deduction of removals of greenhouse gas emissions, by at least 55 % compared to the level in 1990. All sectors of the economy should contribute to achieving that target.

Amendment 4

Proposal for a regulation

Recital 6

Text proposed by the Commission Amendment (6) The Porto Declaration of 8 May 2021 reaffirmed the European Council’s pledge to work towards a social Europe, and its determination to continue deepening the implementation of the European Pillar of Social Rights at EU and national level, with due regard for respective competences and the principles of subsidiarity and proportionality. (6) The European Pillar of Social Rights Action Plan (1a) highlights that social rights and the European social dimension need to be strengthened across all policies of the Union as enshrined in the Treaties, in particular Article 3 of the Treaty on European Union (TEU) and Article 9 of the Treaty on the Functioning of the European Union (TFEU). The Porto Declaration of 8 May 2021 reaffirmed the European Council’s pledge to work towards a social Europe ensuring a just transition , and its determination to continue deepening the concrete implementation of the European Pillar of Social Rights at EU and national level, with due regard for respective competences and the principles of subsidiarity and proportionality.

Amendment 5

Proposal for a regulation

Recital 6 a (new)

Text proposed by the Commission Amendment (6a) The Fund should only support activities and recipients that respect applicable Union and national law on social and labour rights concerning, inter alia, wages and working conditions, including collective agreements, and that promote sustainable and quality jobs.

Amendment 6

Proposal for a regulation

Recital 7

Text proposed by the Commission Amendment (7) In order to implement the commitments towards climate neutrality, the Union’s climate and energy legislation has been reviewed and amended in order to accelerate the greenhouse gas emissions reductions. (7) In order to implement the commitments towards climate neutrality, the Union’s climate and energy legislation has been reviewed and amended in order to accelerate the greenhouse gas emissions reductions. A just transition principled by the UN 2030 Agenda and by the European Pillar of Social Rights means eradicating energy and mobility poverty across the Union. To further this, a new Social Climate Fund should contribute to protecting and empowering the most vulnerable households. Particular attention is required to ensure that those households actually benefit from the implementation of various funding instruments, namely those instruments available to Member States and which include the Cohesion Funds, the Recovery and Resilience Facility, and revenues currently generated by the EU ETS. The funds available to Member States should be used to invest in the renovation of buildings, the creation of quality and safe green jobs, as well as the development of the necessary skills suitable to the green and digital transition, the decarbonisation of the transport sector, and in greater access to public, shared soft mobility.

Amendment 7

Proposal for a regulation

Recital 8

Text proposed by the Commission Amendment (8) Those amendments have differing economic and social impacts on the different sectors of the economy, on the citizens, and the Member States. In particular, the inclusion of greenhouse gas emissions from buildings and road transport into the scope of Directive 2003/87/EC of the European Parliament and the Council (31) should provide an additional economic incentive to invest into the reduction of fossil fuel consumption and thereby accelerate the reduction of greenhouse gas emissions. Combined with other measures, this should, in the medium to long term, reduce the costs for buildings and road transport , and provide new opportunities for job creation and investment . (8) Those amendments have differing economic and social impacts on the different sectors of the economy, on the citizens, and the Member States. In particular, any extension of the scope of Directive 2003/87/EC of the European Parliament and the Council (31) should provide an additional economic incentive to invest into the reduction of fossil fuel consumption and thereby accelerate the reduction of greenhouse gas emissions. Combined with other measures, this should, in the medium to long term, contribute to the eradication of energy and mobility poverty , and provide new opportunities for quality job creation and sustainable investments, fully aligned with the European Green Deal goals . The Commission should collect data on the social impact of the accompanying measures and how those measures affect different Member States, regions and vulnerable groups to ensure a preventive approach in order to reduce inequalities in access to sustainable and affordable energy and mobility. Particular attention should be paid to the most disadvantaged groups and to households in mobility or energy poverty, so that they benefit from the implementation of those funding instruments and no one is left behind.

Amendment 8

Proposal for a regulation

Recital 9

Text proposed by the Commission Amendment (9) However, resources are needed to finance those investments. In addition, before they have taken place, the cost supported by households and transport users for heating, cooling and cooking, as well as for road transport, is likely to increase as fuel suppliers subject to the obligations under the emission trading for buildings and road transport pass on costs on carbon to the consumers . (9) However, resources are needed to finance sufficient, stable and equitable investments. In addition, before they have taken place, the cost supported by households and transport users for heating, cooling and cooking, as well as for road transport is likely to increase , also, in light of the Russian war of aggression, taking into account the dependency of Member States on imported fossil fuels .

Amendment 9

Proposal for a regulation

Recital 9 a (new)

Text proposed by the Commission Amendment (9a) High fossil gas prices causing extreme price spikes in certain Member States in the 2021/2022 heating season, aggravated by import dependencies and geopolitical tensions, have exposed once more the Union’s dependency on imported fossil gas for its industries and households, especially felt by the poorest households. Investments in energy efficiency measures, as well as renewable energy based heating systems, including with electric heat pumps, heating and cooling at district level and participation in renewable energy communities, are hence the most cost-effective method of reducing import dependency and emissions while increasing Union resilience. Third party funding schemes are necessary, in particular for the poorest households, to ensure compliances with those principles.

Amendment 10

Proposal for a regulation

Recital 9 b (new)

Text proposed by the Commission Amendment (9b) As the transition to a cleaner Europe will have an economic and social impact that is difficult to assess ex-ante, additional investment and, thus, financial resources can be needed to achieve the commitment towards climate neutrality, while preserving the economic, social and territorial cohesion.

Amendment 11

Proposal for a regulation

Recital 9 c (new)

Text proposed by the Commission Amendment (9c) The costs passed on by fuel suppliers to final consumers can differ for each company, region or Member State. The Commission should therefore collect data on the share of costs absorbed by fuel suppliers and the share of costs passed on to final consumers and should annually report its findings to the European Parliament.

Amendment 12

Proposal for a regulation

Recital 9 d (new)

Text proposed by the Commission Amendment (9d) In the construction sector, a holistic reform of building structure would lead to less demand for energy, which would take into account in a more efficient way people at risk of exclusion, namely those who suffer most from energy poverty in the Union. It would also counter the trend of families moving between rural, peri-urban, urban areas and sparsely populated areas, thus preventing them from potentially incurring higher housing prices and preventing the consequent emission of greenhouse gas owing to increased use of private transport.

Amendment 13

Proposal for a regulation

Recital 10

Text proposed by the Commission Amendment (10) The increase in the price for fossil fuels may disproportionally affect vulnerable households, vulnerable micro-enterprises and vulnerable transport users who spend a larger part of their incomes on energy and transport, who, in certain regions, do not have access to alternative, affordable mobility and transport solutions and who may lack the financial capacity to invest into the reduction of fossil fuel consumption. (10) The transition toward climate neutrality, including by carbon pricing is expected to disproportionally affect vulnerable households, vulnerable micro-enterprises, and vulnerable transport users who spend a larger part of their incomes on energy and transport, who, in certain regions , including in rural, insular, mountainous, remote and less accessible areas or for less developed regions or territories, including less developed peri-urban areas , do not have access to alternative, affordable mobility and transport solutions and who may lack the financial capacity to invest into the reduction of fossil fuel consumption.

Amendment 14

Proposal for a regulation

Recital 11

Text proposed by the Commission Amendment (11) Therefore, a part of the revenues generated by the inclusion of building and road transport into the scope of Directive 2003/87/EC should be used to address the social impacts arising from that inclusion, for the transition to be just and inclusive, leaving no one behind. (11) Therefore, a part of the revenues generated by the inclusion of building and road transport into the scope of Directive 2003/87/EC should be used as an own resource to finance the Union budget as general income, in accordance with the legally binding Interinstitutional Agreement of 16 December 2020 (1a) (the ‘Interinstitutional Agreement’) that sets out a roadmap towards the introduction of new own resources, thereby providing the Union budget with the means of contributing to addressing the social impacts arising from that inclusion, for the transition to be just and inclusive, leaving no one behind. Under the Interinstitutional Agreement, a basket of new own resources is envisaged to be introduced by 1 January 2023. Green own resources are means of aligning the Union budget with the Union’s policy priorities, thus providing Union added value, and should be used to contribute to the climate mainstreaming objectives, the repayment of NextGenerationEU debts and the resilience of the Union budget as regards its functioning as a tool for investments and guarantees.

Amendment 15

Proposal for a regulation

Recital 11 a (new)

Text proposed by the Commission Amendment (11a) Further fiscal or stimulus measures may be necessary in order to support vulnerable households, vulnerable micro-enterprises, vulnerable small enterprises or vulnerable transport users.

Amendment 16

Proposal for a regulation

Recital 12

Text proposed by the Commission Amendment (12) This is even more relevant in view of the existing levels of energy poverty. Energy poverty is a situation in which households are unable to access essential energy services such as cooling, as temperatures rise, and heating . About 34 million Europeans reported an inability to keep their homes adequately warm in 2018, and 6,9 % of the Union population have said that they cannot afford to heat their home sufficiently in a 2019 EU-wide survey (32). Overall, the Energy Poverty Observatory estimates that more than 50 million households in the European Union experience energy poverty. Energy poverty is therefore a major challenge for the Union. While social tariffs or direct income support can provide immediate relief to households facing energy poverty, only targeted structural measures, in particular energy renovations, can provide lasting solutions. (12) This is even more relevant in view of the existing levels of energy poverty. Energy poverty is a situation in which households lack access to essential energy services that underpin a decent standard of living and health, including adequate warmth, cooling, lighting and energy to power appliances, and in the relevant existing social policy and other relevant policies, often as a result of facing a high share of energy expenditure as part of their disposable income due to a combination of factors, including low income, high-energy prices and low quality, poor performing housing stock . About 34 million Europeans reported an inability to keep their homes adequately warm in 2018, and 6,9 % of the Union population have said that they cannot afford to heat their home sufficiently in a 2019 EU-wide survey (32). Overall, the Energy Poverty Observatory estimates that more than 50 million households in the European Union experience energy poverty. Energy poverty is therefore a major challenge for the Union. Despite the importance of that challenge having been acknowledged at Union level for over a decade through various initiatives, legislation and guidelines, there is still no standard Union-level definition of energy poverty and only one third of Member States have put in place a national definition of energy poverty. As a result, no transparent and comparable data on energy poverty in the Union is available, limiting the capacity to effectively monitor and assess the level of energy poverty. Therefore, a Union-level definition should be established to effectively address energy poverty and measure progress across Member States. While social tariffs or direct income support can provide immediate relief to households facing energy poverty, only targeted structural measures, the application of the energy efficiency first principle, the installation of additional renewable energy sources, including through community-led projects, as well as information and awareness-raising measures targeted at the households in particular energy renovations contributions contributing to the renovation requirement established in Directive 2010/31/EU on the energy performance of buildings (recast) , can provide lasting solutions and effectively help combat energy poverty .

Amendment 17

Proposal for a regulation

Recital 12 a (new)

Text proposed by the Commission Amendment (12a) As regards the buildings sector, a holistic renovation of buildings, based on actions aimed at improving energy efficiency by focusing on all the elements that make up a building, would lead to a reduction in energy consumption for each household, and would be visible in term of the money saved and, as a result, would provide one means of combating energy poverty. The future revision of Directive 2010/31/EU of the European Parliament and of the Council would lay the foundations for those objectives to be achieved and should therefore be taken into account when implementing the Fund.

Amendment 18

Proposal for a regulation

Recital 12 b (new)

Text proposed by the Commission Amendment (12b) Particular attention needs to be paid to tenants in the private rental market. Those tenants include vulnerable households in energy poverty or households at risk of energy poverty, including lower middle-income ones, that are significantly affected by the price impacts of increased heating costs or by higher rental prices following renovation, but are not in a position to renovate the building they occupy. As part of their Social Climate Plans, Member States should therefore develop, in consultation with landlords, the private sector and relevant local authorities and civil society organisations, energy efficient, green social housing and specific measures and investments to support vulnerable tenants on the private rental market, for example by considering national schemes or voucher schemes aimed at housing tenants in the private rental sector, to make renovation measures and to contribute to the Union’s climate targets. As part of the biennial reporting and evaluation of the measures and investments implemented by Member States, the Commission should assess their impact and effectiveness to support vulnerable tenants in the private rental market. In the absence of positive results, that assessment should be accompanied by a Commission initiative, where appropriate, in consultation with Member States, representatives of the private rental market and relevant local authorities and civil society organisations, to address the situation of vulnerable tenants in the private rental market.

Amendment 19

Proposal for a regulation

Recital 12 c (new)

Text proposed by the Commission Amendment (12c) Mobility poverty has been underexposed and no clear definitions are available at Union or national level. However, it is a problem that is becoming more pressing to address as a result of the increasing phase-out requirements for combustion engine vehicles, high fuel prices, and high dependencies on transport availability, accessibility and costs to go to work or for daily mobility needs for those living in rural, insular, peripheral, mountainous, remote and less accessible regions or territories, including less developed peri-urban areas and the outermost regions.

Amendment 20

Proposal for a regulation

Recital 13

Text proposed by the Commission Amendment (13) A Social Climate (‘the Fund’) should therefore be established to provide funds to the Member States to support their policies to address the social impacts of the emissions trading for buildings and road transport on vulnerable households, vulnerable micro-enterprises and vulnerable transport users. This should be achieved notably through temporary income support and measures and investments intended to reduce reliance on fossil fuels through increased energy efficiency of buildings, decarbonisation of heating and cooling of buildings, including the integration of energy from renewable sources, and granting improved access to zero- and low-emission mobility and transport to the benefit of vulnerable households, vulnerable micro-enterprises and vulnerable transport users. (13) A Social Climate Fund (‘the Fund’) should therefore be established to provide funds to the Member States to support their policies to address the social impacts of the transition toward climate neutrality, including by carbon pricing, on vulnerable households, vulnerable micro-enterprises, and vulnerable transport users. This should be achieved notably through temporary income support and measures and investments intended to reduce reliance on fossil fuels through increased energy efficiency of buildings, decarbonisation of heating and cooling of buildings, including the integration of energy from renewable sources, and granting improved access to affordable and efficient zero- and low-emission mobility and transport to the benefit of vulnerable households, vulnerable micro-enterprises, and vulnerable transport users.

Amendment 21

Proposal for a regulation

Recital 13 a (new)

Text proposed by the Commission Amendment (13a) Since vulnerable households, vulnerable micro-enterprises and vulnerable transport users will require additional support with the green transition sufficient and proportionate financial assistance should be allocated to all Member States.

Amendment 22

Proposal for a regulation

Recital 14

Text proposed by the Commission Amendment (14) For that purpose, each Member State should submit to the Commission a Social Climate Plan (‘the Plan’). Those Plans should pursue two objectives. Firstly, they should provide vulnerable households, vulnerable micro-enterprises and vulnerable transport users the necessary resources to finance and carry out investments in energy efficiency, decarbonisation of heating and cooling, in zero- and low-emission vehicles and mobility. Secondly, they should mitigate the impact of the increase in the cost of fossil fuels on the most vulnerable and thereby prevent energy and transport poverty during the transition period until such investments have been implemented. The Plans should have an investment component promoting the long-term solution of reduce fossil fuels reliance and could envisage other measures, including temporary direct income support to mitigate adverse income effects in the shorter term. (14) For that purpose, each Member State should submit to the Commission a Social Climate Plan (‘the Plan’). Those Plans should contribute to the implementation of the principles of the European Pillar of Social Rights and the achievement of the United Nations Sustainable Development Goals while ensuring that no-one is left behind as well as pursue two objectives. Firstly, they should together with the local and regional authorities, social partners and civil society, identify and map vulnerable households in energy or mobility poverty , vulnerable micro-enterprises and vulnerable transport users to be included as beneficiaries for the necessary resources to finance and carry out investments in energy efficiency, decarbonisation of heating and cooling, in zero- and low-emission vehicles and mobility . Member States should provide a detailed analysis, conducted together with the local and regional authorities, social partners and civil society, on the main causes of energy and mobility poverty in their respective territories. The Plans should also set targets and objectives to reduce the number of people in energy or mobility poverty, vulnerable households, vulnerable micro-enterprises, and vulnerable transport users. Secondly, they should mitigate the impact of the increase in the cost of fossil fuels on the most vulnerable and thereby prevent energy and mobility poverty during the transition period until such investments have been implemented. The Plans should have an investment component promoting the long-term solution of phasing out fossil fuels reliance complemented with temporary direct income support to mitigate adverse income effects in the shorter term. Those Plans should also ensure that actions which have already been implemented at national level will be taken into account.

Amendment 23

Proposal for a regulation

Recital 14 a (new)

Text proposed by the Commission Amendment (14a) Workers in the building and renovation sectors are particularly at risk of exposure to asbestos. Therefore, requirements for the mandatory asbestos screening, registering, and removal of asbestos and other dangerous substances are needed before any renovation works start. Energy renovations should be the opportunity to safely remove asbestos from buildings.

Amendment 24

Proposal for a regulation

Recital 14 b (new)

Text proposed by the Commission Amendment (14b) The Plans submitted by Member States should include measures to provide information support, capacity building and training necessary to implement the investments and measures intended to reduce reliance on fossil fuels through increased energy efficiency of buildings and increased access to renewable energy for heating and cooling of buildings, and grant improved access to sustainable mobility and transport services, including the necessary infrastructure and the deployment of charging stations for electric vehicles. The Plans should also address the lack of workforce needed for all stages of the green transition, in particular in jobs related to building renovation and the integration of energy from renewable sources as well as peer-to-peer and community work tackling energy poverty and mobility poverty.

Amendment 25

Proposal for a regulation

Recital 15

Text proposed by the Commission Amendment (15) Member States, in consultation with regional level authorities, are best placed to design and to implement Plans that are adapted and targeted to their local, regional and national circumstances as their existing policies in the relevant areas and planned use of other relevant EU funds. In that manner, the broad diversity of situations, the specific knowledge of local and regional governments, research and innovation and industrial relations and social dialogue structures, as well as national traditions, can best be respected and contribute to the effectiveness and efficiency of the overall support to the vulnerable. (15) Member States, with meaningful consultation of local and regional level authorities , economic and social partners and relevant civil society organisations , are best placed to design and to implement Plans that are adapted and targeted to their local, regional and national circumstances as their existing policies in the relevant areas and planned use of other relevant EU funds. In that manner, the broad diversity of situations, the specific knowledge of local and regional governments, economic and social partners, relevant civil society organisations and of research and innovation and industrial relations and social dialogue structures, as well as national traditions, can best be respected and contribute to the effectiveness and efficiency of the overall support to the vulnerable and to the scaling up of projects developed by local and regional authorities, social partners and socio-economic actors .

Amendment 26

Proposal for a regulation

Recital 15 a (new)

Text proposed by the Commission Amendment (15a) The Plans should be designed in a comprehensive manner, while at the same time preventing excessive administrative burdens. The Member States should be therefore required, when designing and implementing the Plans as described, to be comprehensive while avoiding any unnecessary complexity.

Amendment 27

Proposal for a regulation

Recital 16

Text proposed by the Commission Amendment (16) Ensuring that the measures and investments are particularly targeted towards energy poor or vulnerable households, vulnerable micro-enterprises and vulnerable transport users is key for a just transition towards climate neutrality. Support measures to promote reductions in greenhouse gas emissions should help Member States to address the social impacts arising from the emissions trading for the sectors of buildings and road transport . (16) Ensuring that the measures and investments are particularly targeted towards energy poor or vulnerable households, vulnerable micro-enterprises and vulnerable transport users is key for a just transition towards climate neutrality. Support measures to promote reductions in greenhouse gas emissions should help Member States to address the social impacts of the transition towards climate neutrality, including social impacts from carbon pricing .

Amendment 28

Proposal for a regulation

Recital 17

Text proposed by the Commission Amendment (17) Pending the impact of those investments on reducing costs and emissions, well targeted direct income support for the most vulnerable would help the just transition. Such support should be understood to be a temporary measure accompanying the decarbonisation of the housing and transport sectors. It would not be permanent as it does not address the root causes of energy and transport poverty. Such support should only concern direct impacts of the inclusion of building and road transport into the scope of Directive 2003/87/EC, not electricity or heating costs related to the inclusion of power and heat production in the scope of that Directive. Eligibility for such direct income support should be limited in time . (17) Direct income support when combined with long-lasting structural investment measures targeting the same beneficiaries, will contribute to the achievement of the objectives of the Fund. Pending the impact of those investments on reducing costs and emissions, well targeted direct income support for vulnerable households in energy poverty or mobility poverty would contribute to reduce energy and mobility costs and support the just transition while waiting for more structural investments to take place . Such support should be understood to be a temporary measure accompanying the decarbonisation of the housing and transport sectors. It would not be permanent as it does not address the root causes of energy and mobility poverty. Such direct income support should be limited to up to 40 % of the total estimated cost of each Plan for the period 2024-2027 and should be set for the 2028-2032 period in accordance with a country-by-country assessment by the Commission of the efficiency, added value, continued relevance and required level of direct income support in light of the progress and effect of the implementation of structural investments and measures, with a view to phasing out such support by the end of 2032 .

Amendment 29

Proposal for a regulation

Recital 17 a (new)

Text proposed by the Commission Amendment (17a) Vulnerable households, vulnerable transport users and vulnerable micro-enterprises should be informed about the existence of, and means to, benefit from support under the Fund. Targeted, accessible and affordable information, education, awareness and advice on cost-effective measures and investments and available support should therefore be provided.

Amendment 30

Proposal for a regulation

Recital 17 b (new)

Text proposed by the Commission Amendment (17b) The Fund should be consistent with the Union's obligation under the UN Convention on the Rights of Persons with Disabilities and should not support any measure or investment that contributes to segregation or to social exclusion.

Amendment 31

Proposal for a regulation

Recital 18

Text proposed by the Commission Amendment (18) Taking into account the importance of tackling climate change in line with Paris Agreement commitments, and the commitment to the United Nations Sustainable Development Goals, the actions under this Regulation should contribute to the achievement of the target that 30 % of all expenditure under the 2021-2027 multiannual financial framework should be spent on mainstreaming climate objectives and should contribute to the ambition of providing 10 % of annual spending to biodiversity objectives in 2026 and 2027, while considering the existing overlaps between climate and biodiversity goals. For this purpose, the methodology set out in Annex II of Regulation (EU) 2021/1060 of the European Parliament and of the Council (33) should be used to tag the expenditures of the Fund. The Fund should support activities that fully respect the climate and environmental standards and priorities of the Union and comply with the principle of ‘do no significant harm’ within the meaning of Article 17 of Regulation (EU) 2020/852 of the European Parliament and of the Council (34) . Only such measures and investments should be included in the Plans. Direct income support measures should as a rule be considered as having an insignificant foreseeable impact on environmental objectives, and as such be considered compliant with the principle of ‘do no significant harm’. The Commission intends to issue technical guidance to the Member States well ahead of the preparation of the Plans. The guidance will explain how the measures and investments must comply with the principle of ‘do no significant harm’ within the meaning of Article 17 of Regulation (EU) 2020/852. The Commission intends to present in 2021 a proposal for a Council Recommendation on how to address the social aspects of the green transition. (18) Taking into account the importance of tackling climate change in line with Paris Agreement commitments, the commitment to the European Pillar of Social Rights and the commitment to the United Nations Sustainable Development Goals, the actions under this Regulation should contribute to the achievement of the target that at least 30 % of the total amount of the Union budget under the 2021-2027 multiannual financial framework and the European Union Recovery instrument expenditure should be spent on mainstreaming climate objectives and should contribute to the ambition of providing 7,5 % of annual spending under the MFF to biodiversity objectives in 2024 and 10 % of annual spending to biodiversity objectives in 2026 and 2027, while considering the existing overlaps between climate and biodiversity goals. For this purpose, the methodology set out in Annex II of Regulation (EU) 2021/1060 of the European Parliament and of the Council (33) should be used to tag the expenditures of the Fund. The Fund should support activities that fully respect the technical screening criteria established by the Commission in accordance with Article 10(3) of Regulation (EU) 2020/852 of the European Parliament and of the Council (34). Only such measures and investments should be included in the Plans. Direct income support measures should as a rule be considered as having an insignificant foreseeable impact on environmental objectives, and as such be considered compliant with the principle of ‘do no significant harm’. The Commission presented in 2021 a proposal for a Council Recommendation on how to address the social aspects of the green transition.

Amendment 32

Proposal for a regulation

Recital 19

Text proposed by the Commission Amendment (19) Women are particularly affected by carbon pricing as they represent 85 % of single parent families. Single parent families have a particularly high risk of child poverty. Gender equality and equal opportunities for all, and the mainstreaming of those objectives, as well as questions of accessibility for persons with disabilities should be taken into account and promoted throughout the preparation and implementation of Plans to ensure no one is left behind. (19) Women are disproportionately affected by energy poverty and mobility poverty, in particular single mothers, who represent 85 % of single parent families , as well as single women, women with disabilities, or elderly women living alone. In addition, women have different and more complex mobility patterns . Single parent families with dependent children have a particularly high risk of child poverty. Gender equality and equal opportunities for all, and the mainstreaming of those objectives, as well as accessibility rights of persons with disabilities should be upheld and promoted throughout the preparation and implementation of Plans to ensure no one is left behind.

Amendment 33

Proposal for a regulation

Recital 19 a (new)

Text proposed by the Commission Amendment (19a) Renewable energy communities and citizen energy communities can help Member States to achieve the objectives of this Regulation via a bottom-up approach initiated by citizens, as those communities empower and engage consumers and enable certain groups of household customers, both living in urban and in rural, insular, mountainous, remote and less accessible areas or in less developed regions or territories, including less developed peri-urban areas, to participate in energy efficiency projects, support the use of renewable energy of households and at the same time contribute to fighting energy poverty. Member States should therefore promote the role of renewable energy communities and citizen energy communities and regard them as eligible beneficiaries of the Fund.

Amendment 34

Proposal for a regulation

Recital 20

Text proposed by the Commission Amendment (20) Member States should submit their Plans together with the update of their integrated national energy and climate plans in accordance with Article 14 of Regulation (EU) 2018/1999 of the European Parliament and of the Council (35). The Plans should include the measures to be financed, their estimated costs and the national contribution. They should also include key milestones and targets to assess the effective implementation of the measures. (20) Member States should submit their Plans together with the update of their integrated national energy and climate plans in accordance with Article 14 of Regulation (EU) 2018/1999 of the European Parliament and of the Council (35) and the European Code of Conduct on Partnership as set out in Regulation (EU) No 240/2014 (35a). The Plans should include the measures to be financed, their estimated costs and the national contribution. They should also include key milestones and targets to assess the effective implementation of the measures.

Amendment 35

Proposal for a regulation

Recital 20 a (new)

Text proposed by the Commission Amendment (20a) The execution of the measures included in the Plans will be reliant on an adequate level of workforce, including craftsmen as well as high-skilled green tech experts, applied scientists and innovators. Therefore, Member States should complement the Plans by making use of other relevant Union actions and programmes to provide for reskilling and upskilling of workers to establish better opportunities for specialised craftsmen and high-skilled experts, in particular in jobs related to building renovation, insulation and installation of heat pumps, and alternative fuel infrastructure deployment, such as the deployment of charging stations for electric vehicles.

Amendment 36

Proposal for a regulation

Recital 21

Text proposed by the Commission Amendment (21) The Fund and the Plans should be coherent with and framed by the reforms planned and the commitments made by the Member States under their updated integrated national energy and climate plans in accordance with Regulation (EU) 2018/1999, under Directive [yyyy/nnn] of the European Parliament and the Council [Proposal for recast of Directive 2012/27/EU on energy efficiency] (36), the European Pillar of Social Rights Action Plan (37), the European Social Fund Plus (ESF+) established by Regulation (EU) 2021/1057 of the European Parliament and of the Council (38), the Just Transition Plans pursuant to Regulation (EU) 2021/1056 of the European Parliament and of the Council (39) and the Member States long-term buildings renovation strategies pursuant to Directive 2010/31/EU of the European Parliament and of the Council (40). To ensure administrative efficiency, where applicable, the information included in the Plans should be consistent with the legislation and plans listed above. (21) The Fund and the Plans should be coherent with and framed by the reforms planned and the commitments made by the Member States under their updated integrated national energy and climate plans in accordance with Regulation (EU) 2018/1999, under Directive [yyyy/nnn] of the European Parliament and the Council [Proposal for recast of Directive 2012/27/EU on energy efficiency] (36), the European Pillar of Social Rights Action Plan (37), the European Social Fund Plus (ESF+) (38) , the Modernisation Fund, the cohesion policy operational programmes under Regulation (EU) 2021/1058, the Recovery and Resilience Plans in accordance with Regulation (EU) 2021/241 , the Just Transition Plans (39) and the Member States long-term buildings renovation strategies pursuant to Directive 2010/31/EU of the European Parliament and of the Council (40). To ensure administrative efficiency, where applicable, the information included in the Plans should be consistent with the legislation and plans listed above.

Amendment 37

Proposal for a regulation

Recital 21 a (new)

Text proposed by the Commission Amendment (21a) It is crucial to ensure that the Fund is consistent both with national energy and climate plans and with cohesion policy programmes with similar priorities, in order to prevent any overlap or duplication of efforts. Furthermore, there is a need for effective coordination and strategic programming in the Member States between the Fund, 2021-2027 cohesion policy and other Union funds, particularly the Just Transition Fund and the European Social Fund Plus.

Amendment 38

Proposal for a regulation

Recital 22

Text proposed by the Commission Amendment (22) The Union should support Member States with financial means to implement their Plans through the Social Climate Fund. Payments from the Social Climate Fund should be made conditional on achievement of the milestones and targets included in the Plans. This would allow efficiently taking into account national circumstances and priorities while simplifying financing and facilitating its integration with other national spending programmes while guaranteeing the impact and the integrity of EU spending. (22) The Union should support Member States with sufficient financial means proportionate to Member States, taking into account their respective geographic and demographic realities, along with technical support to implement their Plans through the Social Climate Fund. Specific individual attention should be given to the unique and specific challenges of rural, insular, peripheral, mountainous, remote and less accessible regions or territories, which face an amplified socio-economic impact of the climate transition. With a view to ensuring the effectiveness of measures and investments for those regions, a specific minimum financial allocation should be established for applicable regions. In order to ensure the most efficient use of Union funds, payments from the Social Climate Fund should be made conditional on the achievement of the milestones and targets included in the Plans and should be in accordance with the costs indicated for achieving those milestones and targets and should ensure that they do not prolong fossil fuel dependency and avoid carbon lock-in . This would allow efficiently taking into account national circumstances and priorities while simplifying financing and facilitating its integration with other national spending programmes while guaranteeing the impact and the integrity of EU spending.

Amendment 39

Proposal for a regulation

Recital 22 a (new)

Text proposed by the Commission Amendment (22a) The principle of unity of the Union budget, whereby all items of revenue and expenditure of the Union are shown in the budget, is a Treaty requirement under Article 310(1) TFEU. The Fund is therefore to be fully integrated into the Union budget in order to, inter alia, respect the Community method, respect parliamentary democratic accountability, oversight and control, ensure predictability of funding and multiannual programming, and safeguard transparency of the budgetary decisions taken at Union level.

Amendment 40

Proposal for a regulation

Recital 23

Text proposed by the Commission Amendment (23) The financial envelope of the Fund should, in principle, be commensurate to amounts corresponding to 25 % of the expected revenues from the inclusion of buildings and road transport into the scope of Directive 2003/87/EC in the period 2026 -2032. Pursuant to Council Decision (EU, Euratom) 2020/2053 (41), Member States should make those revenues available to the Union budget as own resources. Member States are to finance 50 % of the total costs of their Plan themselves. For this purpose, as well as for investment and measures to accelerate and alleviate the required transition for citizens negatively affected, Member States should inter alia use their expected revenues from emissions trading for buildings and road transport under Directive 2003/87/EC for that purpose. (23) The financial envelope of the Fund is set on the basis of an assessment of the estimated amount generated by allocating to the Union budget 25 % of the expected revenues linked to commercial road transport, commercial buildings and other fuels covered by Chapter IVa [ETS Directive] in the first period. That amount should be complemented by the revenues from the 150 million allowances auctioned in accordance with Article 30d(3) of Directive 2003/87/EC. Assuming a carbon price of 35 euros per tonne there would be an additional 5,25 billion euros available over the three year period. Together with the financial envelope this would amount to 16,39 billion euros for that period. A Commission proposal would be required to establish the amount for the Social Climate Fund for the second period 2028-2032, in light of the next MFF negotiations and any inclusion of the sectors of private buildings and private road transport into the scope of Directive 2003/87/EC by 1 January 2029 in accordance with Article [XX] of Directive 2003/87/EC. Consequently, the Fund could reach 72 billion euros over the whole period [date of entry into force] -2032. Pursuant to Council Decision (EU, Euratom) 2020/2053 (41), Member States should make those revenues available to the Union budget as own resources. Member States are to finance a significant share of the total costs of their Plans themselves , corresponding to at least 60 % for temporary direct income support and at least 50 % for targeted structural measures and investments. By way of derogation, it should be possible for the national co-financing share for targeted structural measures and investments to be limited to 40 % for Member States that are eligible for a top-up from the Modernisation Fund . For this purpose, as well as for investment and measures to accelerate and alleviate the required transition for citizens negatively affected, Member States should first use their expected revenues from emissions trading for buildings and road transport under Directive 2003/87/EC for that purpose. The financing of the Fund should not come at the expense of other Union programmes and policies.

Amendment 41

Proposal for a regulation

Recital 23 a (new)

Text proposed by the Commission Amendment (23a) In the event of a higher carbon price, additional allocations should be made available for the Fund so as to ensure that the available appropriations for the Social Climate Fund in the Union budget increase in alignment with the carbon price, in order to further support vulnerable households and transport users in the transition towards climate neutrality. Such annual reinforcements should be accommodated within the MFF by means of an automatic ‘carbon price fluctuation adjustment’ of the ceiling of Heading 3 and of the payment ceiling, the mechanism for which is to be provided for in Council Regulation (EU, Euratom) 2020/2093 pursuant to Article 312 TFEU.

Amendment 42

Proposal for a regulation

Recital 24

Text proposed by the Commission Amendment (24) The Fund should support measures that respect the principle of additionality of Union funding. The Fund should not be a substitute for recurring national expenditures , except in duly justified cases . (24) The Fund should support measures that respect the principle of additionality of Union funding. The Fund should not be a substitute for recurring national expenditures.

Amendment 43

Proposal for a regulation

Recital 25

Text proposed by the Commission Amendment (25) In order to ensure an efficient and coherent allocation of funds and to respect the principle of sound financial management, actions under this Regulation should be consistent with and be complementary to ongoing Union programmes, whilst avoiding double funding from the Fund and other Union programmes for the same expenditure. In particular, the Commission and the Member State should ensure, in all stages of the process, effective coordination in order to safeguard the consistency, coherence, complementarity and synergy among sources of funding. To that effect, Member States should be required to present the relevant information on existing or planned Union financing when submitting their plans to the Commission. Financial support under the Fund should be additional to the support provided under other Union programmes and instruments. Measures and investment financed under the Fund should be able to receive funding from other Union programmes and instruments provided that such support does not cover the same costs. (25) In order to ensure an efficient , transparent and coherent allocation of funds and to respect the principle of sound financial management, actions under this Regulation should be consistent with and be complementary to ongoing Union , national and, where appropriate, regional programmes , instruments and funds , whilst avoiding that the Fund substitutes other Union programmes , investments and funds for the same expenditure. In particular, the Commission and the Member State should ensure, in all stages of the process, effective coordination in order to safeguard the consistency, coherence, complementarity and synergy among sources of funding and promote evidence-based policy-making, social innovation in partnership with the social partners and public and private bodies . To that effect, Member States should be required to present the relevant information on existing or planned Union financing when submitting their plans to the Commission. Financial support under the Fund should be additional to the support provided under other Union programmes and instruments. Measures and investment financed under the Fund should be able to receive funding from other Union programmes and instruments provided that such support does not cover the same costs.

Amendment 44

Proposal for a regulation

Recital 25 a (new)

Text proposed by the Commission Amendment (25a) To ensure that support under the Plans can be effectively implemented from the initial years starting from … [the date of entry into force of the Social Climate Fund], it should be possible for an amount of up to 13 % of the financial contribution of Member States to be paid in the form of pre-financing by the Commission following a request by the Member State submitted together with the Social Climate Plan.

Amendment 45

Proposal for a regulation

Recital 27

Text proposed by the Commission Amendment (27) In order to ensure transparent rules for monitoring and evaluation, the power to adopt acts in accordance with Article 290 of the Treaty on the Functioning of the European Union should be delegated to the Commission in respect of setting the common indicators for reporting on the progress and for the purpose of monitoring and evaluation of the implementation of the Plans. It is of particular importance that the Commission carry out appropriate consultations during its preparatory work, including at expert level, and that those consultations be conducted in accordance with the principles laid down in the Interinstitutional Agreement on Better Law-Making of 13 April 2016 . In particular, to ensure equal participation in the preparation of delegated acts, the European Parliament and the Council receive all documents at the same time as Member States' experts, and their experts systematically have access to meetings of Commission expert groups dealing with the preparation of delegated acts. (27) In order to facilitate the preparation of the Social Climate Plans and to ensure transparent rules for monitoring and evaluation, the power to adopt acts in accordance with Article 290 of the Treaty on the Functioning of the European Union should be delegated to the Commission in respect of setting out the template based on which Member States are to prepare their Social Climate Plans and the common indicators for reporting on the progress and for the purpose of monitoring and evaluation of the implementation of the Plans. It is of particular importance that the Commission carry out appropriate consultations during its preparatory work, including at expert level, and that those consultations be conducted in accordance with the principles laid down in the European Code of Conduct on Partnerships . In particular, to ensure equal participation in the preparation of delegated acts, the European Parliament and the Council receive all documents at the same time as Member States' experts, and their experts systematically have access to meetings of Commission expert groups dealing with the preparation of delegated acts.

Amendment 46

Proposal for a regulation

Recital 28

Text proposed by the Commission Amendment (28) The implementation of the Fund should be carried out in line with the principle of sound financial management, including the effective prevention and prosecution of fraud, tax fraud, tax evasion, corruption and conflicts of interest. (28) The implementation of the Fund should be carried out in line with the principle of sound financial management, including the protection of the Union budget in the case of breaches of the principles of the rule of law, the effective prevention and prosecution of fraud, tax fraud, tax evasion, corruption and conflicts of interest.

Amendment 47

Proposal for a regulation

Recital 28 a (new)

Text proposed by the Commission Amendment (28a) The integration of the Fund into the Union budget provides strong safeguards as regards the Fund’s implementation, given the protection afforded both by Union financial legislation and the applicable sector-specific and financial rules in the event of irregularities or serious deficiencies in management and control systems and by the measures set out under Regulation (EU, Euratom) 2020/2092 of the European Parliament and of the Council (1a) for the protection of the Union budget in the event of breaches of the principles of the rule of law in Member States. The Commission should provide, to that effect, an effective and efficient internal control system and the recovery of amounts wrongly paid or incorrectly used and should take the necessary measures, which could include, among others, a suspension of payments, termination of the legal commitment within the meaning of the Regulation (EU, Euratom) 2018/1046 of the European Parliament and of the Council (1b) , a prohibition on entering into such legal commitments, or a suspension of the disbursement of instalments.

Amendment 48

Proposal for a regulation

Recital 29

Text proposed by the Commission Amendment (29) For the purpose of sound financial management, while respecting the performance-based nature of the Fund, specific rules should be laid down for budget commitments, payments, suspension, and recovery of funds as well as for the termination of agreements related to financial support. The Member States should take appropriate measures to ensure that the use of funds in relation to measures supported by the Fund complies with applicable Union and national law. Member States must ensure that such support is granted in compliance with the EU State aid rules, where applicable In particular, they should ensure that fraud, corruption and conflicts of interests are prevented, detected and corrected, and that double funding from the Fund and other Union programmes is avoided. Suspension and the termination of agreements related to financial support as well as reduction and recovery of the financial allocation should be possible when the Plan has not been implemented in a satisfactory manner by the Member State concerned, or in the case of serious irregularities, meaning fraud, corruption and conflicts of interest in relation to the measures supported by the Fund, or a serious breach of an obligation under the agreements related to financial support. Appropriate contradictory procedures should be established to ensure that the decision by the Commission in relation to suspension and recovery of amounts paid as well as the termination of agreements related to financial support respects the right of Member States to submit observations. (29) For the purpose of sound financial management, while respecting the performance-based nature of the Fund, specific rules should be laid down for budget commitments, payments, suspension, and recovery of funds as well as for the termination of agreements related to financial support. The Member States should take appropriate measures to ensure that the use of funds in relation to measures supported by the Fund complies with applicable Union and national law. Member States must ensure that such support is granted in compliance with the EU State aid rules, where applicable. In particular, they should ensure that fraud, corruption and conflicts of interests are prevented, detected and corrected, and that double funding from the Fund and other Union programmes is avoided. Suspension and the termination of agreements related to financial support as well as reduction and recovery of the financial allocation should be possible when the Plan has not been implemented in a satisfactory manner by the Member State concerned, or in the case of serious irregularities, meaning fraud, corruption and conflicts of interest in relation to the measures supported by the Fund, or a serious breach of an obligation under the agreements related to financial support. In the case of termination of an agreement related to financial support or the reduction and recovery of a financial allocation, these amounts should be proportionally allocated to the other Member States. Appropriate contradictory procedures should be established to ensure that the decision by the Commission in relation to suspension and recovery of amounts paid as well as the termination of agreements related to financial support respects the right of Member States to submit observations.

Amendment 49

Proposal for a regulation

Recital 29 a (new)

Text proposed by the Commission Amendment (29a) All Member States which benefit from the Social Climate Fund have an obligation to respect the fundamental values enshrined in Article 2 TEU. Respect for the rule of law is an essential precondition for compliance with the principles of sound financial management enshrined in Article 317 TFEU. The Commission should ensure the effective implementation of the horizontal rules for the protection of the Union budget in the case of breaches of the principles of the rule of law in the Member States in accordance with Regulation (EU, Euratom) 2020/2092 of the European Parliament and of the Council (1a) . Where it is established that breaches of the principles of the rule of law in a Member State affect or seriously risk affecting the sound financial management of the Social Climate Fund or the protection of the financial interests of the Union in a sufficiently direct way, the Commission should take the necessary measures, which may include, among others, a suspension of payments, termination of the legal commitment within the meaning of the Regulation (EU, Euratom) 2018/1046 of the European Parliament and of the Council (1b) , a prohibition on entering into such legal commitments, or a suspension of the disbursement of instalments. In such cases, the Commission should take all necessary steps to ensure that the intended beneficiaries of the Fund do not suffer, and continue to have access to Union assistance, if needed, with the Commission ensuring disbursement via local and regional authorities, non-governmental organisations, or other entities with a proven capacity to ensure the sound financial management of the Fund.

Amendment 50

Proposal for a regulation

Recital 30 a (new)

Text proposed by the Commission Amendment (30a) Respect for fundamental rights and compliance with the Charter of Fundamental Rights of the European Union, should be ensured throughout the preparation, evaluation, implementation and monitoring of eligible projects under the Fund. The Fund should contribute to eliminating inequalities, promoting gender equality and integrating the gender perspective, as well as combating discrimination based on sex, racial or ethnic origin, religion or belief, disability, age or sexual orientation as set out in Article 2 of the TEU, Article 10 TFEU and Article 21 of the Charter of Fundamental Rights of the European Union.

Amendment 51

Proposal for a regulation

Article 1 — paragraph 3

Text proposed by the Commission Amendment The measures and investments supported by the Fund shall benefit households, micro-enterprises and transport users, which are vulnerable and particularly affected by the inclusion of greenhouse gas emissions from buildings and road transport into the scope of Directive 2003/87/EC , especially households in energy poverty and citizens without public transport alternative to individual cars ( in remote and rural areas). The measures and investments supported by the Fund shall benefit households, micro-enterprises, and transport users, which are vulnerable and particularly affected by the impact of the transition towards climate neutrality, including by carbon pricing , especially households in energy poverty and citizens in mobility poverty, paying special attention to those living in rural, insular, peripheral, mountainous, remote and less accessible areas or less developed regions or territories, including less developed peri-urban areas, the outermost regions, and carbon-intensive regions with high unemployment .

Amendment 52

Proposal for a regulation

Article 1 — paragraph 4

Text proposed by the Commission Amendment The general objective of the Fund is to contribute to the transition towards climate neutrality by addressing the social impacts of the inclusion of greenhouse gas emissions from buildings and road transport into the scope of Directive 2003/87/EC. The specific objective of the Fund is to support vulnerable households, vulnerable micro-enterprises and vulnerable transport users through temporary direct income support and through measures and investments intended to increase energy efficiency of buildings, decarbonisation of heating and cooling of buildings, including the integration of energy from renewable sources, and granting improved access to zero- and low-emission mobility and transport. The general objective of the Fund is to contribute to a socially fair transition towards climate neutrality that leaves no one behind, in particular by addressing the social impacts of the inclusion of greenhouse gas emissions from buildings and road transport into the scope of Directive 2003/87/EC. The specific objective of the Fund is to support vulnerable households, vulnerable micro-enterprises, and vulnerable transport users , especially those in energy poverty or mobility poverty through temporary direct income support and through measures and investments intended to increase energy efficiency of buildings, decarbonisation of heating and cooling of buildings, including the integration and storage of energy from renewable sources, and granting improved access to efficient and affordable mobility and transport in accordance with Article 6, with the objective to phase out gradually and not prolong fossil fuel dependency and avoid carbon lock-in .

Amendment 53

Proposal for a regulation

Article 2 — paragraph 1 — point 1

Text proposed by the Commission Amendment (1) ‘building renovation’ means all kinds of energy-related building renovation, including the insulation of the building envelope, that is to say walls, roof, floor, the replacement of windows, the replacement of heating, cooling and cooking appliances, and the installation of on-site production of energy from renewable sources; (1) ‘building renovation’ means any kind of energy-related building renovation and accompanying safety measures , including by contributing to the renovation requirements established in Directive …/… [on the energy performance of buildings (recast) [2021/0426(COD)], aimed to reduce the building’s energy consumption, including: the insulation of the building envelope, that is to say walls, roof, floor, the replacement of windows ; passive ventilation; the installation of heat pumps and cooling systems; the replacement of heating, cooling and cooking appliances ; the upgrade of electrical installations and the installation of on-site production of energy from renewable sources , heat recuperation systems or the connection to nearby systems using energy and storage from renewable sources ;

Amendment 54

Proposal for a regulation

Article 2 — paragraph 1 — point 2

Text proposed by the Commission Amendment (2) ‘energy poverty’ means energy poverty as defined in point [(49)] of Article 2 of Directive (EU) [yyyy/nnn] of the of the European Parliament and of the Council (50); (2) ‘energy poverty’ means poverty affecting households in the lowest income deciles, including lower middle-income ones that have a significant share of energy expenditure to disposable income, including as a result of low-quality housing, arrears on utility bills due to financial difficulties, or limited access to essential and affordable energy services that underpin a decent standard of living and health, including adequate warmth, cooling, lighting and energy to power appliances ;

Amendment 55

Proposal for a regulation

Article 2 — paragraph 1 — point 2 a (new)

Text proposed by the Commission Amendment (2a) ‘mobility poverty’ means poverty affecting households in the lowest deciles, including lower middle-incomes ones, that have a high share of mobility expenditure to disposable income or a limited access to affordable public or alternative modes of transport required to meet essential socio-economic needs, with a particular focus on households in rural, insular, peripheral, mountainous, remote and less accessible areas or less developed regions or territories, including less developed peri-urban areas and the outermost regions, caused by one or a combination of the following factors that depend on national or local specificities: low income, high fuel expenditures, the phase-out of internal combustion engine cars, high costs or lack of affordable or available public or alternative modes of transport;

Amendment 56

Proposal for a regulation

Article 2 — paragraph 1 — point 11

Text proposed by the Commission Amendment (11) ‘vulnerable households’ means households in energy poverty or households, including lower middle-income ones, that are significantly affected by the price impacts of the inclusion of buildings into the scope of Directive 2003/87/EC and lack the means to renovate the building they occupy; (11) ‘vulnerable households’ means households in or at risk of energy poverty or households in the lowest income deciles , including lower middle-income ones, that are significantly affected by the impact of the transition towards climate neutrality, including by carbon pricing, and lack the means to renovate the building they occupy;

Amendment 57

Proposal for a regulation

Article 2 — paragraph 1 — point 12

Text proposed by the Commission Amendment (12) ‘vulnerable micro-enterprises’ means micro-enterprises that are significantly affected by the price impacts of the inclusion of buildings into the scope of Directive 2003/87/EC and lack the means to renovate the building they occupy; (12) ‘vulnerable micro-enterprises’ means micro-enterprises that are significantly affected by the price impacts of the inclusion of greenhouse gas emissions from buildings and road transport into the scope of Directive 2003/87/EC , as part of the just transition towards climate neutrality, leaving no one behind, and lack the means to renovate the building they occupy or upgrade road vehicles on which they rely in the course of business ;

Amendment 58

Proposal for a regulation

Article 2 — paragraph 1 — point 13

Text proposed by the Commission Amendment (13) ‘vulnerable transport users’ means transport users, including from lower middle-income households, that are significantly affected by the price impacts of the inclusion of road transport into the scope of Directive 2003/87/EC and lack the means to purchase zero- and low-emission vehicles or to switch to alternative sustainable modes of transport , including public transport, particularly in rural and remote areas . (13) ‘vulnerable transport users’ means transport users, including from lower middle-income households in the lowest income deciles, including lower middle-income ones , that are at risk of mobility poverty and significantly affected by the impact of the transition towards climate neutrality , including by carbon pricing .

Amendment 59

Proposal for a regulation

Article 3 — paragraph 1

Text proposed by the Commission Amendment 1. Each Member State shall submit to the Commission a Social Climate Plan (‘the Plan’) together with the update to the integrated national energy and climate plan referred to in Article 14(2) of Regulation (EU) 2018/1999 in accordance with the procedure and timeline laid down in that Article. The Plan shall contain a coherent set of measures and investments to address the impact of carbon pricing on vulnerable households, vulnerable micro-enterprises and vulnerable transport users in order to ensure affordable heating, cooling and mobility while accompanying and accelerating necessary measures to meet the climate targets of the Union. 1. Each Member State shall submit to the Commission a Social Climate Plan (‘the Plan’) together with the update to the integrated national energy and climate plan referred to in Article 14(2) of Regulation (EU) 2018/1999 in accordance with the procedure and timeline laid down in that Article and following a meaningful consultation of local and regional level authorities, economic and social partners and relevant civil society organisations . The Plan shall contain a coherent set of measures and investments to address energy and mobility poverty, in particular the impact of the transition towards climate neutrality, including the impact of carbon pricing on vulnerable households, vulnerable micro-enterprises, and vulnerable transport users in order to ensure affordable and sustainable heating, cooling and mobility while accompanying and accelerating necessary measures to meet the climate targets of the Union.

Amendment 60

Proposal for a regulation

Article 3 — paragraph 2

Text proposed by the Commission Amendment 2. The Plan may include national measures providing temporary direct income support to vulnerable households and households that are vulnerable transport users to reduce the impact of the increase in the price of fossil fuels resulting from the inclusion of buildings and road transport into the scope of Directive 2003/87/EC . 2. The Plan may include national or, where applicable, regional measures providing temporary direct income support to vulnerable households and households that are vulnerable transport users to reduce the impact of the increase in the price of fossil fuels resulting from the transition towards climate neutrality, including by carbon pricing .

Amendment 61

Proposal for a regulation

Article 3 — paragraph 3 — introductory part

Text proposed by the Commission Amendment 3. The Plan shall include national projects to: 3. The Plan shall include national , regional or local projects to:

Amendment 62

Proposal for a regulation

Article 3 — paragraph 3 — point a

Text proposed by the Commission Amendment (a) finance measures and investments to increase energy efficiency of buildings, to implement energy efficiency improvement measures, to carry out building renovation, and to decarbonise heating and cooling of buildings, including the integration of energy production from renewable energy sources; (a) finance measures and investments to increase energy efficiency of buildings, to implement energy efficiency improvement measures, to carry out building renovation and accompanying safety measures, where appropriate in combination with improvements in line with fire and seismic safety standards , and to decarbonise heating and cooling of buildings, including the integration of energy production and storage of energy from renewable sources in accordance with Article 6 ;

Amendment 63

Proposal for a regulation

Article 3 — paragraph 3 — point b

Text proposed by the Commission Amendment (b) finance measures and investments to increase the uptake of zero- and low-emission mobility and transport. (b) finance measures and investments to increase the uptake of mobility and transport , including by directing measures and investments towards a modal shift from private to public, shared and active mobility, in accordance with Article 6 .

Amendment 64

Proposal for a regulation

Article 4 — paragraph 1 — point -a (new)

Text proposed by the Commission Amendment (-a) detailed quantitative information on energy and mobility poverty concerning the following: (i) the definition, in exact terms, of energy and mobility poverty applied at national level, on the basis of the definitions set out in Article 2; (ii) a mapping of the number of vulnerable households, vulnerable micro-enterprises, and vulnerable transport users identified at the start of the Plan, on the basis of the definitions set out in Article 2, to identify the potential beneficiaries of the Plan; (iii) national targets and objectives to reduce the number of vulnerable households, vulnerable micro-enterprises, and vulnerable transport users over the duration of the Plan;

Amendment 65

Proposal for a regulation

Article 4 — paragraph 1 — point a

Text proposed by the Commission Amendment (a) concrete measures and investments in accordance with Article 3 to reduce the effects referred to in point (c) of this paragraph together with an explanation of how they would contribute effectively to the achievement of the objectives set out in Article 1 within the overall setting of a Member State’s relevant policies; (a) concrete measures and investments in accordance with Articles 3 and 6 to address the effects referred to in point (c) of this paragraph together with an explanation of how they would contribute effectively to the achievement of the objectives set out in Article 1 within the overall setting of a Member State’s relevant policies;

Amendment 66

Proposal for a regulation

Article 4 — paragraph 1 — point b a (new)

Text proposed by the Commission Amendment (ba) the coherence and mutual reinforcement of the accompanying measures to reduce the effects referred to in point (c);

Amendment 67

Proposal for a regulation

Article 4 — paragraph 1 — point c

Text proposed by the Commission Amendment (c) an estimate of the likely effects of that increase in prices on households, and in particular on incidence of energy poverty , on micro-enterprises and on transport users, comprising in particular an estimate and the identification of vulnerable households, vulnerable micro-enterprises and vulnerable transport users; these impacts are to be analysed with a sufficient level of regional disaggregation, taking into account elements such as access to public transport and basic services and identifying the areas mostly affected, particularly territories which are remote and rural ; (c) an estimate of the likely effects of a price increase on energy poverty and mobility poverty, on vulnerable households, vulnerable micro-enterprises, and vulnerable transport users; these impacts are to be analysed with a sufficient level of regional disaggregation taking into account national specificities and elements such as access to public transport and basic services and identifying the areas mostly affected, particularly territories which are rural, insular, peripheral, mountainous, remote and less accessible areas or less developed regions or territories, including less developed peri-urban areas and the outermost regions which will need particular attention and support for the transition towards climate neutrality ;

Amendment 68

Proposal for a regulation

Article 4 — paragraph 1 — point d

Text proposed by the Commission Amendment (d) where the Plan provides for measures referred to in Article 3(2), the criteria for the identification of eligible final recipients, the indication of the envisaged time limit for the measures in question and their justification on the basis of a quantitative estimate and a qualitative explanation of how the measures in the Plan are expected to reduce energy and transport poverty and the vulnerability of households, micro-enterprises and transport users to an increase of road transport and heating fuel prices; (d) where the Plan provides for measures referred to in Article 3(2), the criteria for the identification of eligible final recipients, the indication of the envisaged time limit for the measures in question and their justification on the basis of a quantitative estimate and a qualitative explanation of how the measures in the Plan are expected to reduce energy and mobility poverty and the vulnerability of households, micro-enterprises and transport users to an increase of road transport and heating fuel prices; as well as a justification on how those measures complement existing activities of Member States to that effect;

Amendment 69

Proposal for a regulation

Article 4 — paragraph 1 — point e

Text proposed by the Commission Amendment (e) envisaged milestones, targets and an indicative timetable for the implementation of the measures and investments to be completed by 31 July 2032; (e) envisaged milestones, targets and an indicative timetable for the implementation of the measures and investments to be completed by each biennial integrated national energy and climate progress report pursuant to Article 23 and by 31 July 2032;

Amendment 70

Proposal for a regulation

Article 4 — paragraph 1 — point e a (new)

Text proposed by the Commission Amendment (ea) an indicative timetable, where applicable, for the support for vehicles in accordance with Article 6(2), point (d);

Amendment 71

Proposal for a regulation

Article 4 — paragraph 1 — point e b (new)

Text proposed by the Commission Amendment (eb) how the measures and investments, where relevant, promote sustainable and quality jobs;

Amendment 72

Proposal for a regulation

Article 4 — paragraph 1 — point i

Text proposed by the Commission Amendment (i) the arrangements for the effective monitoring and implementation of the Plan by the Member State concerned, in particular of the proposed milestones and targets, including indicators for the implementation of measures and investments, which, where relevant, shall be those available with the Statistical office of the European Union European Statistical Office and the European Energy Poverty Observatory as identified by Commission Recommendation (EU) 2020/1563 (54) on energy poverty; (i) the arrangements for the effective monitoring and implementation of the Plan by the Member State concerned , to be undertaken in close consultation with local and regional level authorities, economic and social partners and relevant civil society organisations in accordance with national law and practices , in particular of the proposed milestones and targets, including indicators for the implementation of measures and investments, which, where relevant, shall be those available with the Statistical office of the European Union European Statistical Office and the European Energy Poverty Observatory as identified by Commission Recommendation (EU) 2020/1563 (54) on energy poverty;

Amendment 73

Proposal for a regulation

Article 4 — paragraph 1 — point j

Text proposed by the Commission Amendment (j) for the preparation and, where available, for the implementation of the Plan, a summary of the consultation process, conducted in accordance with Article 10 of Regulation (EU) 2018/1999 and with the national legal framework, of local and regional authorities, social partners, civil society organisations, youth organisations and other relevant stakeholders, and how the input of the stakeholders is reflected in the Plan; (j) for the preparation and, where available, for the implementation of the Plan, a summary of the consultation process, conducted in accordance with Article 10 of Regulation (EU) 2018/1999 and Article 8 of Regulation (EU) 2021/1060 and with the national legal framework, of local and regional authorities, social partners, civil society organisations, youth organisations and other relevant stakeholders, and how the input of the stakeholders is reflected in the Plan as well as their specific roles on the design, implementation and monitoring ;

Amendment 74

Proposal for a regulation

Article 4 — paragraph 1 — point k a (new)

Text proposed by the Commission Amendment (ka) the proportion of the Fund set aside for community-led local climate transition projects.

Amendment 75

Proposal for a regulation

Article 4 — paragraph 2 a (new)

Text proposed by the Commission Amendment 2a. The Commission is empowered to adopt, within … [insert date three months from the entry into force of this Regulation], a delegated act in accordance with Article 25 to supplement this Regulation by setting out a template based on which Member States are to prepare their Plan.

Amendment 76

Proposal for a regulation

Article 5 — paragraph 2 — introductory part

Text proposed by the Commission Amendment 2. Payment of support shall be conditional upon achieving the milestones and targets for measures and investments set out in the Plans. Those milestones and targets shall be compatible with the Union’s climate targets and cover in particular: 2. Payment of support shall be made in accordance with the costs indicated to achieve the milestones and targets for measures and investments set out in the Plans in accordance with Article 6 . Those milestones and targets shall be compatible with the Union’s climate targets , in line with the principles of the European Pillar of Social Rights, and cover in particular:

Amendment 77

Proposal for a regulation

Article 5 — paragraph 2 — point b

Text proposed by the Commission Amendment (b) building renovation; (b) building renovation , including by contributing to the achievement of the renovation requirements established in Directive …/… [on the energy performance of buildings (recast) [2021/0426(COD)] ;

Amendment 78

Proposal for a regulation

Article 5 — paragraph 2 — point c

Text proposed by the Commission Amendment (c) zero- and low-emission mobility and transport; (c) mobility and transport in accordance with Article 6 ;

Amendment 79

Proposal for a regulation

Article 5 — paragraph 2 — point d

Text proposed by the Commission Amendment (d) greenhouse gas emissions reductions; (d) greenhouse gas emissions reductions , with the objective to phase out gradually and not prolong fossil fuel dependency and avoid carbon lock-in, relating to measures and investments in accordance with Article 6 ;

Amendment 80

Proposal for a regulation

Article 5 — paragraph 2 — point e

Text proposed by the Commission Amendment (e) reductions in the number of vulnerable households, especially households in energy poverty, of vulnerable micro-enterprises and of vulnerable transport users, including in rural and remote areas. (e) reductions in the number of vulnerable households, i.e. households in or at risk of energy poverty, of vulnerable micro-enterprises and of vulnerable transport users, including in rural , insular, peripheral, mountainous, remote and less accessible areas or less developed regions or territories, including less developed peri-urban areas and the outermost regions which will need particular attention and support for the transition towards climate neutrality;

Amendment 81

Proposal for a regulation

Article 5 — paragraph 2 — point e a (new)

Text proposed by the Commission Amendment (ea) contribution to, where relevant, sustainable and quality jobs.

Amendment 82

Proposal for a regulation

Article 5 — paragraph 3

Text proposed by the Commission Amendment 3. The Fund shall only support measures and investments respecting the principle of ‘do no significant harm’ referred to in Article 17 of Regulation (EU) 2020/852 . 3. The Fund shall only support measures and investments that are consistent with the technical criteria established in the framework of Regulation (EU) 2020/852 and respecting the principle of ‘do no significant harm’ referred to in Article 17 of that Regulation. Recipients of the Fund shall respect applicable Union and national law on social and labour rights .

Amendment 83

Proposal for a regulation

Article 6 — paragraph 1

Text proposed by the Commission Amendment 1. Member States may include the costs of measures providing temporary direct income support to vulnerable households and vulnerable households that are transport users to absorb the increase in road transport and heating fuel prices. Such support shall decrease over time and be limited to the direct impact of the emission trading for buildings and road transport . Eligibility for such direct income support shall cease within the time limits identified under Article 4(1) point (d) . 1. Member States may include the costs of measures providing temporary direct income support , including the reduction of electricity taxes and fees, as a transitional measure to vulnerable households and vulnerable transport users affected by energy poverty or mobility poverty, to absorb the increase in road transport and heating fuel prices. Such support shall constitute intermediary support to those vulnerable households, decreasing over time , subject to the implementation of structural measures or investments with long-lasting impacts to effectively lift those beneficiaries out of energy and mobility poverty . Such support shall be limited to a maximum of 40 % of the total estimated cost of each Plan for the period 2024-2027 and shall be set for the period 2028-2032 in accordance with the assessment by the Commission made in accordance with Article 24(3), with a view to phasing out such support by the end of 2032 .

Amendment 84

Proposal for a regulation

Article 6 — paragraph 2 — introductory part

Text proposed by the Commission Amendment 2. Member States may include the costs of the following measures and investments in the estimated total costs of the Plans, provided they principally benefit vulnerable households, vulnerable micro-enterprises or vulnerable transport users and intend to: 2. Member States may include the costs of the following measures and investments with lasting impacts in the estimated total costs of the Plans, provided they principally benefit vulnerable households, vulnerable micro-enterprises, or vulnerable transport users and intend to:

Amendment 85

Proposal for a regulation

Article 6 — paragraph 2 — point a

Text proposed by the Commission Amendment (a) support building renovations, especially for those occupying worst-performing buildings, including in the form of financial support or fiscal incentives such as deductibility of renovation costs from the rent, independently of the ownership of the buildings concerned; (a) support quality, cost- and energy efficient building renovations, especially to contribute to the achievement of the renovation requirements established in Directive …/… [on the energy performance of buildings (recast) [2021/0426(COD)]] and for those occupying worst-performing buildings , with a special attention to tenants and social housing , including in the form of financial support or fiscal incentives such as deductibility of renovation costs from the rent or specific support for the renovation of social housing in order to facilitate access to affordable energy-efficient housing independently of the ownership of the buildings concerned;

Amendment 86

Proposal for a regulation

Article 6 — paragraph 2 — point a a (new)

Text proposed by the Commission Amendment (aa) ensure access to affordable energy-efficient housing, including by providing sufficient energy-efficient and affordable housing stock, including social housing;

Amendment 87

Proposal for a regulation

Article 6 — paragraph 2 — point b

Text proposed by the Commission Amendment (b) contribute to the decarbonisation, including the electrification, of heating and cooling of, and cooking in, buildings and the integration of energy from renewable sources that contribute to the achievements of energy savings; (b) contribute to the cost-efficient decarbonisation, including the electrification, of heating and cooling of, and cooking in, buildings by ensuring access to affordable and energy-efficient systems, and the integration and storage of energy from renewable sources , including through citizen energy communities and peer-to-peer energy sharing, to power any residual demand, smart internal electricity installations or cover connection costs to smart grids and any other measures that contribute unequivocally to the achievements of energy savings as well as connection to district heating networks, such as vouchers, subsidies or zero-interest loans to invest in products and services to increase the energy performance of buildings or to integrate renewable energy sources in buildings ;

Amendment 88

Proposal for a regulation

Article 6 — paragraph 2 — point b a (new)

Text proposed by the Commission Amendment (ba) provide targeted, accessible and affordable information, education, awareness and advice on cost-effective measures and investments and available support for building renovations and energy efficiency, as well as sustainable and affordable mobility and transport alternatives, including through energy audits of buildings, tailored energy consultations or tailored mobility management services;

Amendment 89

Proposal for a regulation

Article 6 — paragraph 2 — point c

Text proposed by the Commission Amendment (c) support public and private entities in developing and providing affordable energy efficiency renovation solutions and appropriate funding instruments in line with the social goals of the Fund; (c) support public and private entities , including social-housing providers, in particular public-private cooperation, in developing and providing safe and affordable energy efficiency renovation solutions and appropriate funding instruments in line with the social goals of the Fund , including smart-grid solutions ;

Amendment 90

Proposal for a regulation

Article 6 — paragraph 2 — point d

Text proposed by the Commission Amendment (d) provide access to zero- and low-emission vehicles and bikes , including financial support or fiscal incentives for their purchase as well as for appropriate public and private infrastructure, including for recharging and refuelling; for support concerning low-emission vehicles, a timetable for gradually reducing the support shall be provided ; (d) provide financial support or fiscal incentives to improve access to zero- emission vehicles, while maintaining technological neutrality, and to bicycles, including incentivising access to, and the further development of, the second-hand zero-emission vehicles market , including financial support or fiscal incentives for their purchase, for appropriate public and private infrastructure, including for recharging and refuelling for support concerning the purchase of zero-emission vehicles; the support shall be limited to vehicles which are available at or below the average market price for such vehicles in a Member State in a given year; measures to support low-emission vehicles shall be primarily considered only where access to zero-emission mobility is not yet feasible , in particular for rural, remote and less accessible areas. Member States shall provide a timetable for gradually reducing the support , in accordance with the technical criteria established by the Commission under Commission Delegated Regulation (EU) 2021/2139 ;

Amendment 91

Proposal for a regulation

Article 6 — paragraph 2 — point e

Text proposed by the Commission Amendment (e) grant free access to public transport or adapted tariffs for access to public transport, as well as fostering sustainable mobility on demand and shared mobility services; (e) incentivise the use of affordable and accessible zero- and low-emission public transport, as well as supporting private and public entities, including cooperatives, in developing and providing sustainable mobility on demand, shared mobility services and attractive active mobility options, especially in rural, insular, mountainous, remote and less accessible areas, in less developed regions or territories, including less developed peri-urban areas and the outermost regions ;

Amendment 92

Proposal for a regulation

Article 6 — paragraph 2 a (new)

Text proposed by the Commission Amendment 2a. Member States shall promote, where relevant, sustainable and quality jobs when implementing the measures and investments in accordance with paragraph 2.

Amendment 93

Proposal for a regulation

Article 6 — paragraph 2 b (new)

Text proposed by the Commission Amendment 2b. By 31 July 2023, the Commission shall provide guidance on cost-effective measures and investments in the context of paragraph 2. By 31 July 2026 and every two years thereafter, the Commission shall evaluate the cost-effectiveness of the measures and investments implemented by the Member States as part of their Plans on the basis of the biennial integrated national energy and climate progress report pursuant to Article 23. The Commission shall report on best practices and shall adjust the guidance accordingly.

Amendment 94

Proposal for a regulation

Article 7 — paragraph 1 — introductory part

Text proposed by the Commission Amendment 1. The Fund shall not support, and the estimated total costs of Plans shall not include measures in the form of direct income support pursuant to Article 3(2) of this Regulation for households already benefiting: 1. The Fund shall not replace measures in the form of direct income support pursuant to Article 3(2) of this Regulation to the extent that those are additional and complementary to the support provided for households already benefiting:

Amendment 95

Proposal for a regulation

Article 7 — paragraph 1 — point a

Text proposed by the Commission Amendment (a) from public intervention in the price level of the fuels covered by Chapter IVa of Directive 2003/87/EC ; (a) from public intervention in the price level of the fuels used for combustion in the heating and cooling of buildings or road transport ;

Amendment 96

Proposal for a regulation

Article 7 — paragraph 2

Text proposed by the Commission Amendment 2. Where it is proven by the Member State concerned in its Plan that the public interventions referred to in paragraph 1 do not fully off-set the price increase resulting from the inclusion of the sectors of buildings and road transport into the scope of Directive 2003/87/EC , direct income support may be included in the estimated total costs in the limits of the price increase not fully off-set. 2. Where it is proven by the Member State concerned in its Plan that the public interventions referred to in paragraph 1 do not fully off-set the price increase, direct income support may be included in the estimated total costs in the limits of the price increase not fully off-set.

Amendment 97

Proposal for a regulation

Article 8 — paragraph 1

Text proposed by the Commission Amendment Member States may include into the estimated total costs financial support provided to public or private entities other than vulnerable households, vulnerable micro-enterprises and vulnerable transport uses, if those entities carry out measures and investments ultimately benefitting vulnerable households, vulnerable micro-enterprises and vulnerable transport users. Member States may include into the estimated total costs financial support provided to public or private entities , strictly excluding financial intermediaries, other than vulnerable households, vulnerable micro-enterprises and vulnerable transport users in energy poverty or mobility poverty , if those entities carry out measures and investments on their behalf and which ultimately directly benefit those vulnerable households, vulnerable