Proposal for a Regulation of the European Parliament and of the Council establishing a programme to aid economic recovery by granting Community financial assistance to projects in the field of energy
Date: 2009-01-28
Institutions: European Commission
Subjects: economic support, electrical energy, energy resources, gas, project of common interest

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COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 28.1.2009 
COM(2009) 35 final 

2009/0010 (COD) 

Proposal for a 

REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL 

establishing a programme to aid economic recovery by granting 
Community financial assistance to projects in the field of energy  

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EXPLANATORY MEMORANDUM 

1. 

CONTEXT OF THE PROPOSAL 

•  Grounds for and objectives of the proposal 

The proposal responds to the sharp downturn faced by the European economy in the wake of 
the  financial  crisis  and  to  shortcomings  in  the  Community's  security  of  energy  supply 
illustrated  by  the  gas  crisis.  It  implements  the  European  Economic  Recovery  Plan  (COM 
(2008) 800) endorsed by the European Council of 11-12 December 2008. Together with the 
proposals  in  the  area  of  broadband  and  rural  development,  it  specifically  responds  to  the 
request of the European Council to provide a detailed and balanced list of actions. 

•  General context 

The  financial  crisis  began  to  spread  to  the  real  economy  in  autumn  2008.  The  gas  crisis, 
involving lack of delivery to the Community of gas produced in Russia, emerged in December 
2008. The economic crisis and the gas crisis which has shown that energy interconnections in 
Europe  are  not  sufficient,  both  pose  structural  problems  for  the  European  economy  and  the 
welfare  of  Europe's  citizens.  A  comprehensive  Recovery  Plan  is  needed  and  is  being  put  in 
place;  this  proposal  for  a  financial  stimulus  to  key  parts  of  the energy  sector  is  an  essential 
element of the Plan. 

•  Existing provisions in the area of the proposal 

The energy infrastructure part of the Trans-European Networks programme aims to catalyse 
the  construction  of  cross-border  gas  and  electricity  interconnections;  that  is  also  the  aim  of 
one  of  the  three  sub-programmes  of  this  proposal.  The  list  of  projects  established  in  this 
Regulation  is  complementary  to  the  Guidelines  for  trans-European  energy  networks 
(European Parliament and Council Decision no. 1364/2006 of 6 September 2006).  

•  Consistency with the other policies and objectives of the Union 

The  proposal  aids  projects  in  the  field  of  energy  policy  as  a  key  part  of  the  EU's  wider 
objective of promoting economic progress and sustainable development. It is consistent with 
the objectives of EU energy policy as set out in the Second Strategic Energy Review, notably 
in increasing security of energy supply and reducing greenhouse gas emissions. 

The Commission has taken into account, when selecting the projects, multiple criteria that in 
particular refer to maturity of projects, coherent geographical distribution, European interest 
as  well  as  European  added  value  and  technological  progress.  All  of  these  criteria  are  in 
accordance with the energy policy developed by the EC during the past years as well as the 
actual  context  of  the  ongoing  financial  perspectives.  This  approach  will  most  likely  be 
supported in future financial perspectives. 

2. 

CONSULTATION OF INTERESTED PARTIES AND IMPACT ASSESSMENT 

•  Consultation of interested parties 

The  urgency  of  the  economic  crisis  calls  for  the  fastest  possible  action  to  send  a  signal  to 
investors. This means there has not been time for a consultation process. 

•  Collection and use of expertise 

External expertise was not used. 

•  Impact assessment 

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The  urgency  of  the  economic  crisis  calls  for  the  fastest  possible  action,  in  line  with  the 
conclusions of the European Council.  

This means there has not been time for an impact assessment. 

3. 

LEGAL ELEMENTS OF THE PROPOSAL 

•  Summary of the proposed action 

It  is  proposed  to  undertake  a  programme  of  investment  measures  during  2009  and  2010 
comprising sub-programmes in the following fields: 

- gas and electricity interconnection projects (financial envelope: EUR 1750 million); 

- offshore wind projects (EUR 500 million); 

- carbon capture and storage (EUR 1250 million). 

•  Legal basis 

The legal basis will be Article 156 of the Treaty for the sub-programme for gas and electricity 
interconnection projects, and Article 175 for the remainder of the action. 

•  Subsidiarity principle 

The  subsidiarity  principle  applies  insofar  as  the  proposal  does  not  fall  under  the  exclusive 
competence of the Community. 

The objectives of the proposal cannot be sufficiently achieved by the Member States for the 
following reason(s): 

–  A  coherent  and  effective  response  to  the  economic  crisis  requires  a  coordinated 
approach to investment at EU level, involving EU as well as national resources. 

–  Many  of  the  projects  identified  in  the  Regulation  are  of  transnational  character, 

notably in the offshore wind and interconnection sub-programmes.  

–  The encouragement of interconnection, renewable energy and carbon capture and 

storage has recently been confirmed as a common objective of the Union. 

–  All  the  sub-programmes,  and  notably  that  for  carbon  capture  and  storage,  are 

designed to maximise opportunities for replication across Member States. 

–  Action by Member States alone would prevent the achievement of a coordinated 
approach;  completion  of  projects  with  transnational  significance  is  essential  to 
meet the Union's objectives. 

Community  action  will  better  achieve  the  objectives  of  the  proposal  for  the  following 
reason(s): 

–  EU action will allow these objectives to be achieved. 

–  EU action is able to complement national action to attain the overall objectives of 
the Union, reflecting the transnational character of the economic crisis and of the 
challenge of energy security. 

–  The scope of the proposal is limited to such projects. 

The proposal therefore complies with the subsidiarity principle. 

•  Proportionality principle 

The proposal complies with the proportionality principle for the following reason(s): 

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–  Since  the  proposal  establishes  a  programme  for  financial  assistance  it  can  only 

take the form of a regulation. 

–  The financial burden is proportionate to the aim of introducing a major stimulus to 

the European economy and addressing the challenge of energy security. 

–  The  administrative  burden  is  minimised  by  the  choice  to  focus  on  a  few  large 

scale projects. 

•  Choice of instruments 

Proposed instruments: regulation. 

Other means would not be adequate for the following reason(s): 

–  Since  the  proposal  establishes  a  programme  for  financial  assistance  it  can  only 

take the form of a regulation. 

4. 

BUDGETARY IMPLICATION 

A  financial  envelope  of  €3,500  million  is  foreseen  in  total  for  the  three  sub-programmes, 
consisting of €1,500 million for 2009 and €2,000 million for 2010.  

The main volume of payments will be made between 2009 and 2012 with the last payments, 
notably for carbon capture and storage projects, foreseen for 2014/2015. 

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2009/0010 (COD) 

Proposal for a 

REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL 

establishing a programme to aid economic recovery by granting 
Community financial assistance to projects in the field of energy  

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Treaty establishing the European Community, and in particular Article 
156 and 175(1) thereof, 
Having regard to the proposal from the Commission1, 
Having regard to the opinion of the European Economic and Social Committee2, 
Having regard to the opinion of the Committee of the Regions3, 
Acting in accordance with the procedure laid down in Article 251 of the Treaty4, 

Whereas: 

(1) 

(2) 

(3) 

(4) 

The European economy is facing a sharp downturn resulting from the financial crisis. 

At  the  same  time  it  is  clear  that  the  long-term  strength  and  sustainability  of  the 
European economy depends on reshaping it to face the demands of energy security and 
the  need  to  reduce  greenhouse  gas  emissions.  Increasing  concerns  about  securing 
reliable gas supplies reinforce this conclusion. 

In  the  light  of  these  concerns,  the  European  Council  at  its  meeting  of  11  and  12 
December  20085  endorsed  the  European  Economic  Recovery  Plan6,  setting  out  how 
Member States and the European Union can coordinate their policies and provide new 
stimulus to the European economy, targeting that stimulus to the Community's long-
term objectives 

An  important  part  of  the  Recovery  Plan  was  the  proposal  to  increase  Community 
spending  in  defined  strategic  sectors,  addressing  lack  of  confidence  among  investors 
and  helping  develop  the  path  to  a  stronger  economy  for  the  future.  The  European 
Council  asked  the  Commission  to  present  a  list  of  concrete  projects,  taking  into 
account  an  adequate  geographical  balance,  to  reinforce  investments  for  the 
development of, in particular, infrastructure projects. 

(5) 

It is especially important to finance measures that rapidly address both the economic 
crisis and the Community's urgent energy needs. 

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3 
4 
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6 

OJ C , , p. .[must get complete references!] 
OJ C , , p. . 
OJ C , , p. . 
OJ C , , p. . 
The  conclusions  of  the  Presidency  of  the  European  Council  meeting  in  Brussels  on  11-12  December 
2008, 17271/08, point 9 
COM (2008) 800 

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(6) 

To have a tangible and substantial impact, this investment should be focussed on a few 
specific sectors. These should be sectors in which: 

(a) 

(b) 

the action will make a clear contribution to the objectives of security of energy 
supply and the reduction of greenhouse gas emissions;  

there exist large, mature projects capable of making efficient and effective use 
of  significant  amounts  of  financial  assistance  and  of  catalysing  significant 
amounts of investment from other sources, including the European Investment 
Bank; and 

(c) 

action at European level can add value.  

The sectors of gas and electricity interconnections; offshore wind energy; and carbon 
capture and storage fulfil these criteria. 

In  the  case  of  gas  and  electricity  interconnections,  the  challenges  have  developed  in 
the  course  of  the  last  years.  The  recent  gas  crises  (winters  2006  and  2009)  and  the 
increase  of  oil  prices  until  mid-2008  showed  how  much  Europe  was  vulnerable. 
Indigenous  energy  resources  –  gas  and  oil  –  are  decreasing  so  that  Europe  is 
increasingly  dependent  on  imports  for  its  energy  supply.  In  this  context,  energy 
infrastructure will play a crucial role.  

However, the current economic and financial crisis is affecting the implementation of 
energy  infrastructure  projects.  Some  important  projects  –  including  projects  of 
Community  interest  –  may  face  severe  delays  in  implementation  due  to  scarcity  of 
funds.  Urgent  action  to  support  investment  in  energy  interconnections  is  therefore 
appropriate.  Given  the  significant  time  necessary  to  plan  and  then  execute  such 
projects it is important that the Community invests in such infrastructure immediately 
so  that  it  may,  in  particular,  accelerate  the  development  of  projects  of  particular 
importance to security of energy supply within the  Community.  This will  be vital in 
ensuring  the  Community's  security  of  energy  supply  at  competitive  prices  when  the 
economy rebounds and global energy demand increases. 

(7) 

(8) 

(8 bis)  Among  the  energy  infrastructure  projects,  it  is  necessary  to  select  projects  that  are 
important  to  the  operation  of  the  internal  energy  market,  to  the  security  of  energy 
supply and which also contribute to the recovery of the economy. 

(9) 

In the cases of carbon capture and storage and offshore wind energy, this Regulation 
builds on the Strategic Energy Technology Plan for Europe7,  which  called  for a join 
and  strategic  plan  for  energy  research  and  innovation  efforts  in  alignment  with  EU 
energy  policy  goals,  while  committing  towards  the  establishment  of  six  European 
Industrial Initiatives, and in particular in these two areas. The European Council at its 
meeting on 16 October 20088 called on the Commission to significantly accelerate the 
implementation  of  the  Technology  Plan.  This  Programme  initiates  the  funding  for 
Carbon Capture and Storage and off-shore wind without prejudice to the future setting 
up of the six industrial initiatives on energy demonstration projects as outlined by the 
Strategic Energy Technology Plan for Europe. 

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8 

"A  European  strategic  energy  technology  plan  (SET  Plan)  -  Towards  a  low  carbon  future"  (COM 
(2007) 723)  
The conclusions of the Presidency of the European Council meeting in Brussels on 16 December 2008, 
[exact reference] 

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(10) 

(11) 

In order to have an immediate impact on the economic crisis, it is necessary for this 
Regulation to list the projects that may receive immediate financial assistance, subject 
to conformity with criteria that ensure efficiency and effectiveness and to the limits set 
by the financial envelope. 

In  the  case  of  gas  and  electricity  interconnection  projects,  this  list  is  established 
according to the project's contribution to the objectives of security and diversification 
of supply as identified in the recent 2nd Strategic Energy Review9 and endorsed by the 
European  Parliament  and  the  Council.10  Projects  are  selected  on  the  basis  that  they 
implement the priorities identified in that Review, have achieved a reasonable degree 
of maturity, and contribute to: 

(a)  Security and diversification of sources of energy and supplies; 

(b)  Optimisation of the capacity of the network and the integration of the internal 

energy market, in particular concerning cross-border section; 

(c)  Development  of  the  network  to  strengthen  economic  and  social  cohesion  by 
reducing  the  isolation  of  the  less-favoured  and  island  regions  of  the 
Community; 

(d)  Connection of renewable energy resources; and 

(e)  Safety, reliability and interoperability of interconnected networks. 

(f) 

Solidarity between Member States 

Realisation of these projects will require a commitment from national, regional and 
local authorities to accelerate administrative procedures and authorisations. For many 
projects, support will not be forthcoming within the timeframe set if this acceleration 
does not take place. 

In the case of offshore wind energy, the list contains projects that can be considered, 
on  the  basis  of  information  gathered  from  stakeholders  in  the  framework  of  the 
European Wind Energy Technology Platform, industrial sources and other sources, to 
be  approved  and  ready  for  implementation;  to  be  innovative,  while  building  on  well 
established concepts; to be capable of acceleration in response to a financial stimulus; 
to have a cross border significance; to be of a large scale; and be able to demonstrate 
how the results of technological advances will be disseminated effectively in the light 
of the objectives and structures endorsed by the Strategic Energy Technology Plan for 
Europe.  Financial  assistance  should  be  directed  towards  those  projects  that  are  in  a 
position to progress substantially with project development in 2009 and 2010. 

(12) 

(13) 

In the case of carbon capture and storage, this list should be established on the basis of 
information  gathered  from  stakeholders  in  the  framework  of  the  Fossil  Fuel  Forum, 
the Zero Emissions Fossil Fuel Power Plants Technology Platform and other sources. 
Financial assistance should be directed towards those projects that are in a position to 
progress substantially with project development in 2009 and 2010.  

(14)  Readiness  should  be  assessed  on  the  basis  of  the  existence  of  a  mature  and  feasible 
concept for the power plant, including its carbon capture component; the existence of a 
mature  and  feasible  concept  for  the  transport  and  storage  of  CO2;  and  articulated 
commitment  of  local  authorities  to  support  the  project.  Projects  will  also  need  to 

9 
10 

COM (2008) 781 
[references] 

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(15) 

demonstrate how the results of technological advances will be disseminated effectively 
and  how  they  will  accelerate  the  achievement  of  the  objectives  laid  down  in  the 
Strategic Energy Technology Plan for Europe.  

It will be necessary to select among the eligible projects. This selection should ensure, 
inter  alia,  that  no  more  than  one  carbon  capture  and  storage  project  is  supported  in 
each Member State, in order to ensure the investigation of a wide range of geological 
storage  conditions  and  to  support  the  objective  of  encouraging  economic  recovery 
across Europe.(16)  Community  funding  should  not  unduly  distort  competition  or 
the  functioning  of  the  internal  market,  having  regard  in  particular  the  rules  on  third 
party access and possible third party access exemptions. Any further national funds in 
addition to this Community funding will have to take into account State aid rules. 

Regardless  of  its  form,  the  Community  financial  assistance  should  be  granted  in 
accordance with the provisions of Council Regulation (EC, Euratom) No 1605/2002 of 
25  June  2002  on  the  Financial  Regulation  applicable  to  the  general  budget  of  the 
European Communities11 (the "Financial Regulation") and of Commission Regulation 
(EC, Euratom) No 2342/2002 of 23 December 2002 laying down detailed rules for the 
implementation of Council Regulation (EC, Euratom) No 1605/2002 on the Financial 
Regulation  applicable  to  the  general  budget  of  the  European  Communities12,  except 
where the provisions of the present Regulation explicitly depart from those rules. 

(17)  Due to the urgent need to address the economic crisis and the Community's pressing 
energy  needs  and  taking  into  account  the  level  of  detail  in  this  Regulation,  financial 
assistance may be granted, by derogation from Articles 75(2) and 110 of the Financial 
Regulation, without the previous adoption of a work programme or of another form of 
financing decision.  

(18)  Article  160a  of  the  Financial  Regulation  allows  for  the  possibility  to  again  make 
available  the  decommitted  commitment  appropriations  as  a  result  of  total  or  partial 
non-implementation  of  a  project  under  exceptional  circumstances.  However,  this 
provision  is  limited  to  research  projects.  In  order  to  ensure  that  the  budget  foreseen 
under this Regulation is well spent and contributes to its objectives, it is necessary to 
also allow for the possibility in the context of this Regulation. 

(19)  When actions financed under this Regulation are implemented, the financial interests 
of  the  Community  should  be  protected  by  the  application  of  preventive  measures 
against fraud, corruption and any other illegal activities, by effective checks and by the 
recovery  of  amounts  unduly  paid  and,  if  irregularities  are  detected,  by  effective, 
proportional  and  dissuasive  penalties,  in  accordance  with  Council  Regulation  (EC, 
Euratom)  No  2988/95  of  18  December  1995  on  the  protection  of  the  European 
Communities  financial  interests13,  Council  Regulation  (Euratom,  EC)  No  2185/96  of 
11 November 1996 concerning on-the-spot checks and inspections carried out by the 
Commission in order to protect the European Communities' financial interests against 
fraud  and  other  irregularities14  and  with  Regulation  (EC)  No  1073/1999  of  the 
European  Parliament  and  of  the  Council  of  25  May  1999  concerning  investigations 
conducted by the European Anti-Fraud Office (OLAF)15. 

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15 

OJ L 248, 16.9.2002, p. 1. 
OJ L 357, 31.12.2002, p. 1. 
OJ L 312, 23.12.1995, p. 1. 
OJ L 292, 15.11.1996, p. 2. 
OJ L 136, 31.5.1999, p. 1. 

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(20)  Since  the  objectives  of  this  Regulation  to  aid  economic  recovery  within  the 
Community,  face  the  demands  of  energy  security  and  reduce  greenhouse  gas 
emissions  by  increasing  spending  in  defined  strategic  sectors  cannot  be  sufficiently 
achieved  by  the  Member  States,  and  can  therefore,  by  reason  of  the  scope  of  this 
Regulation  and  the  nature  of  the  sectors  and  projects  selected,  be  better  achieved  at 
Community  level,  the  Community  may  adopt  measures,  in  accordance  with  the 
principle  of subsidiarity  as  set  out  in  Article 5 of the Treaty.  In accordance with the 
principle  of  proportionality,  as  set  out  in  that  Article,  this  Regulation  does  not  go 
beyond what is necessary in order to achieve those objectives. 

(21)  Taking into account the nature of the issues in the sub-programmes, the Commission 
should be assisted by different committees for the selection of proposals retained for 
funding and the determination of the amount of funding to be granted under each sub-
programme.  

(22)  The measures necessary for the implementation of this Regulation should be adopted 
in accordance with Council Decision 1999/468/EC of 28 June 1999 laying down the 
procedures for the exercise of implementing powers conferred on the Commission.16 

(23)  Due to the urgent need to address the economic crisis and the Community's pressing 
energy needs, this Regulation should enter into force immediately after its publication, 

HAVE ADOPTED THIS REGULATION: 

16 

OJ L 184, 17.7.1999, p.23. 

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CHAPTER I 
INTRODUCTORY PROVISIONS 

Article 1 
Subject matter 

This  Regulation  establishes  a  financing  instrument,  the  European  Energy  Programme  for 
Recovery, hereinafter referred to as "the EEPR", for the development of projects in the field 
of  energy  in  the  Community  that  contribute  to  economic  recovery,  the  security  of  energy 
supply and the reduction of greenhouse gas emissions.  

It establishes sub-programmes to advance those objectives in the fields of: 

(a) 

(b) 

(c) 

gas and electricity interconnections; 

offshore wind energy; and 

carbon capture and storage.  

It  identifies  projects  to  be  financed  under  each  sub-programme  and  lays  down  criteria  for 
identifying and implementing actions to realise these projects. 

Article 2 
Definitions 

For the purposes of this Regulation, the following definitions shall apply: 

(a) 

(b) 

(c) 

"carbon  capture  and  storage"  shall  mean  a  means  of  mitigating  climate  change 
consisting  of  the  capture  of  carbon  dioxide  (CO2)  from  power  generating 
installations, its transport to a storage site and its injection into a suitable geological 
formation for the purposes of permanent storage; 

"eligible costs" shall have the same meaning as in Regulation (EC) No 2342/2002  

"gas and electricity interconnections" shall mean : 

(i) 

all high-voltage lines, excluding those of distribution networks, and submarine 
links, provided that this infrastructure is used for interregional or international 
transmission or connection; 

(ii) 

any  equipment  or  installations  essential  for  the  system  in  question  to  operate 
properly, including protection, monitoring and control systems; 

(iii)  high-pressure gas pipelines, excluding those of distribution networks;  

(iv)  underground  storage  facilities  connected  to  the  high-pressure  gas  pipelines 

referred to in point (iii); 

(v)  reception,  storage  and  regasification  facilities  for  liquefied  natural  gas  (LNG); 

and 

(vi)  any  equipment  or  installations  essential  for  the  system  in  question  to  operate 

properly, including protection, monitoring and control systems; 

(d) 

"part of a project" means any activity that is independent financially, technically or 
over time and which contributes to the completion of a project; 

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(e) 

(f) 

(g) 

"investment phase" shall mean the phase of a project during which construction takes 
place and capital costs are incurred; 

"offshore wind energy" shall mean the electric power generated from turbine engines 
powered by wind and that are situated in the sea - near or far from the shore; 

"planning  phase"  shall  mean  the  phase  of  a  project  that  precedes  the  investment 
phase,  during  which  project 
including,  where 
implementation 
appropriate,  feasibility  assessment,  preparatory  and  technical  studies  and  the 
obtaining of licences and authorisations. 

is  prepared, 

Article 3 
Budget 

1. 

The financial envelope for the implementation of the EEPR for 2009 and 2010 shall 
be EUR 3,500 million, allocated as follows: 

2. 

3. 

4. 

5. 

(a) 

gas and electricity interconnection projects: EUR 1,750 million; 

(b)  offshore wind energy projects: EUR 500 million; 

(c) 

projects for carbon capture and storage: EUR 1,250 million. 

The  commitment  appropriations  corresponding  to  the  amount  of  the  commitment 
decommitted  as  a  result  of  total  or  partial  non-implementation  of  the  projects  for 
which  they  were  earmarked  may,  exceptionally  and  in  duly  substantiated  cases,  be 
made available again in 2010 and 2011 where it is essential to achieve the objectives 
of the EEPR. 

For  the  purposes  of  paragraph  2,  the  Commission  shall,  at  the  beginning  of  each 
financial year, examine decommitments made during the previous financial year and 
assess,  in  the  light  of  the  requirements,  the  need  for  making  the  appropriations 
available  again.  On  the  basis  of  this  assessment,  the  Commission  may  submit 
appropriate  proposals  to  the  budgetary  authority,  by  15  February  of  each  financial 
year,  stating  for  each  budget  item  the  reasons  for  making  these  appropriations 
available again. 

The  budgetary  authority  shall  decide  on  the  Commission's  proposals  within  six 
weeks.  Where  no  decision  is  taken  within  this  time  limit,  the  proposals  shall  be 
deemed to be approved.  

Commitment  appropriations  made  available  again  shall  not  be  carried  over.  Legal 
commitments  relating  to  the  commitment  appropriations  which  have  been  made 
available again shall be concluded by 31 December of year n. At the end of year n, 
the unused balance of the commitment appropriations made available again shall be 
definitively decommitted by the authorising officer responsible. 

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CHAPTER II 
SUB-PROGRAMMES 

SECTION 1 
GAS AND ELECTRICITY INTERCONNECTION PROJECTS 

Article 4 
Objectives 

The Community shall promote gas and electricity interconnection projects having the highest 
Community added value and contributing to the following objectives: 

(a) 

(b) 

(c) 

(d) 

(e) 

security and diversification of sources of energy and supplies; 

optimisation of the capacity of the energy network and the integration of the internal 
energy market, in particular concerning cross-border section; 

development of the network to strengthen economic and social cohesion by reducing 
the isolation of the less-favoured and island regions of the Community; 

connection of renewable energy resources; and 

safety, reliability and interoperability of interconnected energy networks. 

Article 5 
Priorities 

The EEPR shall serve to urgently adapt and develop energy networks of particular importance 
to the Community in support of the operation of the internal energy market and, in particular, 
to solve the problems of bottlenecks, security and diversification of supply and to overcome 
environmental, technical and financial obstacles. Special Community support is necessary to 
develop  energy networks more intensively and to accelerate their construction. 

Article 6 
List of projects 

A list of projects corresponding to the priorities laid down in Article 5 is set out in the Annex, 
Part A. 

Article 7 
Granting of Community financial assistance  

1. 

2. 

Financial  assistance  under  the  EEPR  (hereinafter  referred  to  as  "EEPR  assistance") 
for  gas  and  electricity  interconnection  projects  shall  be  awarded  to  actions  that 
realise the projects in the Annex, Part A, or parts thereof. 

The  Commission  shall  call  for  proposals  to  identify  the  actions  referred  to  in 
paragraph  1  and  shall  assess  the  compliance  of  these  proposals  with  the  eligibility 
criteria  laid  down  in  Article  8  and  the  selection  and  award  criteria  laid  down  in 
Article 9. The Commission shall inform the beneficiaries of any EEPR assistance to 
be granted. 

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Article 8 
Eligibility 

1. 

Proposals shall be eligible for EEPR assistance only if they implement the projects 
listed  in  the  Annex,  Part  A  and  do  not  exceed  the  maximum  amount  of  EERP 
assistance laid down there. 

2. 

Proposals may be submitted: 

(a) 

by one or several Member States acting jointly; 

(b)  with the agreement of the Member State(s) directly concerned by the project in 
question,  by  one  or  several  public  or  private  undertakings  or  bodies  acting 
jointly; 

(c)  with the agreement of all Member States directly concerned by  the project in 
question, by one or several international organisations acting jointly; or 

(d)  with the agreement of all Member States directly concerned  by  the project in 

question, by a joint undertaking. 

3. 

Proposals submitted by natural persons shall not be eligible.  

1. 

2. 

Article 9 
Selection and award criteria 

In assessing the proposals received under the call for proposals referred to in Article 
7(2), the Commission shall apply the following selection criteria: 

(a) 

(b) 

the soundness and technical adequacy of the approach; 

the  soundness  of  the  financial  package  for  the  full  investment  phase  of  the 
action. 

In assessing the proposals received under the call for proposals referred to in Article 
7(2), the Commission shall apply the following award criteria: 

(a)  maturity, in relation in particular to the ability to start work early and commit 

funds by the end of 2010; 

(b) 

the  extent  to  which  lack  of  access  to  finance  is  holding  back  the 
implementation of the action; 

(c) 

the extent to which EEPR assistance will stimulate public and private finance; 

(d) 

socio-economic impacts; 

(e) 

(f) 

environmental impacts; 

the contribution to the continuity and interoperability of the energy network, as 
well as to the optimisation of its capacity  

(g) 

the contribution to the improvement of service quality, safety and security; 

(h)  Member  States'  demonstrated  commitment  to  taking  the  project  forward, 
notably in relation to the procedures and processes referred to in Article 12(2). 

EN 

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1. 

2. 

1. 

Article 10 
Funding conditions 

EEPR  assistance  shall  cover  only  project-related  expenditure  incurred  by  the 
beneficiaries or by third parties responsible for the implementation of a project. 

EEPR assistance shall not exceed 50% of the eligible costs.  

Article 11 
Instruments 

Following the call for proposals referred to in Article 7(2), the Commission, acting in 
accordance with the procedure referred to in Article 27(2), shall select the proposals 
to  receive  EEPR  assistance  and  determine  the  amount  of  EEPR  assistance  to  be 
granted.  The  Commission  shall  specify  the  conditions  and  methods  for  their 
implementation. 

2. 

EEPR assistance shall be granted on the basis of Commission decisions. 

1. 

2. 

1. 

2. 

Article 12 
Member States' financial responsibilities 

Member  States  shall  undertake  the  technical  monitoring  and  financial  control  of 
projects in close cooperation with the Commission and shall certify the amount and 
the conformity with this  Regulation of the expenditure incurred in respect of projects 
or parts of projects. Member States may request the participation of the Commission 
during on-the-spot checks. 

Member States shall inform the Commission of the measures taken under paragraph 
1  and,  in  particular,  shall  supply  a  description  of  the  control,  management  and 
monitoring  systems  established  to  ensure  that  projects  are  successfully  completed 
and that related expenditure is legal and regular. 

SECTION 2 
OFFSHORE WIND PROJECTS 

Article 13 
Granting of EEPR assistance 

EEPR  assistance  for  offshore  wind  projects  shall  be  awarded  following  a  call  for 
proposals limited to the actions that realise the projects listed in the Annex, Part B.  

The  Commission  shall  call  for  proposals  to  carry  out  the  actions  referred  to  in 
paragraph  1 and shall  assess the compliance of these proposals  with  the  eligibility 
criteria  laid  down  in  Article  14  and  the  selection  and  award  criteria  laid  down  in 
Article 15. 

3. 

The Commission shall inform the beneficiaries of any EEPR assistance to be granted.  

Article 14 
Eligibility 

1. 

Proposals shall be eligible for EEPR assistance only if they implement the projects 
listed in the Annex, Part B, do not exceed the maximum amounts of EEPR assistance 
laid down there and fulfil the following conditions: 

EN 

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(a) 

the project timetable shall include substantial capital expenditure in 2009 and 
2010;  

(b) 

the project shall be led by a commercial undertaking. 

Proposals may be submitted by one or several undertakings, acting jointly.  

Proposals submitted by natural persons shall not be eligible. 

Article 15 
Selection and award criteria  

In assessing the proposals received under the call for proposals referred to in Article 
13(1), the Commission shall apply the following selection criteria: 

2. 

3. 

1. 

(a) 

(b) 

the soundness and technical adequacy of the approach; 

the  soundness  of  the  financial  package  for  the  full  investment  phase  of  the 
project. 

2. 

In assessing the proposals received under the call for proposals referred to in Article 
13(1), the Commission shall apply the following award criteria: 

(a) 

(b) 

the extent to which the project improves or increases the scale of installations 
and  infrastructures  that  are  already  under  construction,  or  are  in  the  planning 
phase;  

the  extent  to  which  the  project  includes  the  construction  of  full-size  and 
industrial-scale  installations  and  infrastructures,  and  the  extent  to  which  it 
addresses in particular: 

(i) 

balancing the variability of wind electricity through integrative systems; 

(ii) 

large-scale storage systems; 

(iii)  management of wind farms as virtual power plants (more than 1 GW); 

(iv) 

turbines placed further from the shore or in deeper waters (20 to 50 m) 
than is currently standard; 

(v)  novel sub-structure designs; or 

(c) 

(d) 

(e) 

(vi)  processes for assembly, installation, operation and decommissioning and 

testing of these processes in life-size projects. 

the  innovative  features  of  the  project  and  the  extent  to  which  it  will 
demonstrate the implementation of such features; 

the impact of the project and its contribution to the Community's offshore wind 
grid system, including its replication potential. 

the  commitment  demonstrated  by  the  beneficiaries  to  diffuse  the  results  of 
technological  advances  made  by  the  project  to  other  European  operators  in  a 
manner compatible with Community law and in particular with the objectives 
and structures outlined in the Strategic Energy Technology Plan for Europe. 

EN 

15 

   EN 

 
1. 

2. 

1. 

Article 16 
Funding conditions  

EEPR  assistance  shall  contribute  to  the  costs  associated  with  the  construction  and 
establishment of projects. 

EEPR  assistance  shall  not  exceed  50%  of  the  costs  referred  to  in  paragraph  1.  The 
eventual  cumulation  of  Community  and  national  funding  shall  not  lead  to 
overcompensation. 

Article 17 
Instruments 

Following the call for proposals referred to in Article 13(1), the Commission, acting 
in  accordance  with  the  procedure  referred  to  in  Article  27(2),  shall  select  the 
proposals  to  receive  EEPR  assistance  and  determine  the  amount  of  funding  to  be 
granted.  The  Commission  shall  specify  the  conditions  and  methods  for  their 
implementation. 

2. 

EEPR assistance shall be granted on the basis of grant agreements.  

SECTION 3 
CARBON CAPTURE AND STORAGE 

Article 18 
Granting of EEPR assistance  

1. 

2. 

3. 

4. 

5. 

1. 

EEPR assistance for carbon capture and storage projects shall be awarded to actions 
that realise the projects in the Annex, Part C. 

The  Commission  shall  call  for  proposals  to  carry  out  the  actions  referred  to  in 
paragraph  1  and  shall  assess  the  compliance  of  the  proposals  with  the  eligibility 
criteria  laid  down  in  Article  19  and  the  selection  and  award  criteria  laid  down  in 
Article 20.  

If several proposals from projects located in the same Member State comply with the 
eligibility  criteria  laid  down  in  Article  19  and  the  selection  criteria  laid  down  in 
Article 20(1), the Commission shall select for EEPR assistance, on the basis of the 
award criteria in Article 20(2), no more than one proposal per Member State among 
those proposals.  

EEPR  assistance  shall  be  granted  to  no  more  than  5  projects.  Funding  shall  not 
exceed EUR 250 million per project. 

The Commission shall inform the beneficiaries of any EEPR assistance to be granted. 

Article 19 
Eligibility 

Proposals shall  be eligible for EEPR assistance only if they implement the projects 
listed in the Annex, Part C and fulfil the following conditions: 

(a) 

projects shall demonstrate that they have the ability to capture at least 85% of 
CO2 in power generating installations that will have at least 300 MW electrical 
output or equivalent and the ability to transport and geologically store this CO2 
safely underground; 

EN 

16 

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2. 

3. 

1. 

(b) 

(c) 

the project timetable shall include substantial capital expenditure in 2009 and 
2010. 

project promoters shall make a binding declaration that the generic knowledge 
generated  by  the  demonstration  plant  will  be  made  available  to  the  wider 
industry  and  to  contribute  to  the  Strategic  Energy  Technology  Plan  for 
Europe17. 

Proposals shall be submitted by one or several undertakings, acting jointly.  

Proposals submitted by natural persons shall not be eligible.  

Article 20 
Selection and award criteria 

In assessing the proposals received under the call for proposals referred to in Article 
18(2), the Commission shall apply the following selection criteria: 

(a) 

(b) 

(c) 

the soundness and technical adequacy of the approach; 

the  soundness  of  the  financial  package  for  the  full  investment  phase  of  the 
project; 

identification of,  all necessary permits required for construction and operation 
of  the  project  at  the  proposed  site(s)  and  having  a  strategy  to  secure  those 
permits. 

2. 

In assessing the proposals received under the call for proposals referred to in Article 
18(2), the Commission shall apply the following award criteria: 

(a) 

(b) 

(d) 

requested  funding  per  tonne  of  CO2  to  be  abated  in  the  first  5  years  of 
operation (weighting of 40%);  

complexity  of  the  project  and  level  of  innovation  of  the  overall  installation 
including  other  accompanying  research  activities  as  well  as  the  commitment 
demonstrated  by  the  beneficiaries  to  diffuse  the  results  of  the  technological 
advances made by the project to other European operators in compatibility with 
Community law and in particular with the objectives and structures outlined in 
the Strategic Energy Technology Plan for Europe (weighting of 40%); 

soundness  and adequacy  of the management plan including, in relation to the 
scientific,  engineering,  and  technical  information  and  data  that  it  contains, 
documenting  readiness  of  the  proposed  concept  to  achieve  operation  of  the 
project by 31 December  2015 (weighting of 20%). 

Article 21 
Funding conditions  

EEPR assistance shall contribute to the cost of those elements of the investment phase of the 
project  that  are  only  attributable  to  carbon  capture  and  storage,  taking  account  of  possible 
operating benefits. It shall not exceed 80% of total eligible investment costs.  

COM (2007) 723. 

EN 

17 

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Article 22 
Instruments 

1. 

Following the call for proposals referred to in Article 18(2), the Commission, acting 
in accordance with the procedure referred to in Article 28(2), shall 
the 
proposals to receive EEPR assistance and  determine the amount of EEPR assistance 
to  be  granted.  The  Commission  shall  specify  the  conditions  and  methods  for  the 
implementation of the proposals. 

select 

2. 

EEPR assistance shall be granted on the basis of grant agreements. 

EN 

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CHAPTER III 
COMMON PROVISIONS 

Article 23 
Other EEPR assistance and instruments 

1. 

2. 

1. 

2. 

3. 

4. 

A  part  of  the  Community  assistance  for  the  projects  listed  in  the  Annex  may  be 
implemented through a contribution to an appropriate instrument under the resources 
of  the  European  Investment  Bank.  That  contribution  shall  not  exceed  EUR  500 
million.  
The  Community  exposure  to  the  loan  guarantee  instrument  or  other  financing 
instrument,  including  management  fees  and  other  eligible  costs,  shall  be  limited  to 
the amount of the Community contribution to that instrument and there shall be no 
further liability on the general budget of the European Union. 

3. 
The Commission, acting in accordance with the procedure referred to in Article 
28(2),  shall  decide  on  the  amount  of  EEPR  assistance  to  be  granted  to  this 
instrument.  The  Commission  and  the  European  Investment  Bank  shall  establish  a 
memorandum  of  understanding  specifying  the  conditions  and  the  methods  for  the 
implementation of that decision. 

Article 24 
Programming and implementing modalities 

By way of derogation from Article 75(2) and Article 110 of the Financial Regulation, 
calls  for  proposals  shall  be  directly  launched  by  the  Commission  on  the  basis  of 
budgetary availabilities referred to in Article 3(1) of this Regulation and on the basis 
of  the  eligibility,  selection  and  award  criteria  as  set  out  in  Chapter  II  of  this 
Regulation. 

EEPR  assistance  shall  cover  only  project-related  expenditure  incurred  by  the 
beneficiaries  responsible  for  the  implementation  of  a  project.  Expenditure  may  be 
eligible as from the date referred to in Article 31.  

VAT shall not be an eligible cost, except for non-refundable VAT. 

Projects and actions financed under this Regulation shall be carried out in conformity 
with Community law and shall take into account any relevant Community policies, in 
particular  those  relating  to  competition  including  the  applicable  state  aid  rules,  the 
the  environment,  health,  sustainable  development  and  public 
protection  of 
procurement. 

Article 25 
Reserve 

Up to 0.1% of the budget provided for in this Regulation shall be set aside for implementation 
and evaluation by the Commission. 

Article 26 
Member States' general responsibilities 

1. 

Within the sphere of their responsibility, the Member States shall make every effort 
to implement the projects which receive EEPR assistance . They shall, in particular, 

EN 

19 

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2. 

1. 

2. 

3. 

make  every  effort  to  expedite  the  administrative  procedures  and  authorisation, 
licensing and certification procedures to be fulfilled by the projects' promoters.  

Member  States  shall  inform  the  Commission  by  31  March  of  each  year  of  the 
measures taken under paragraph 1 during the previous year.  

Article 27 
Protection of the European Communities' financial interests 

The Commission shall ensure that, when actions financed under this Regulation are 
implemented,  the  financial  interests  of  the  Community  are  protected  by  the 
application  of  preventive  measures  against  fraud,  corruption  and  any  other  illegal 
activities,  by  effective  checks  and  by  the  recovery  of  amounts  unduly  paid  and,  if 
irregularities  are  detected,  by  effective,  proportional  and  dissuasive  penalties,  in 
accordance  with  Council  Regulation  (EC,  Euratom)  No  2988/95 
,  Council 
Regulation (Euratom, EC) No 2185/96 and  with Regulation (EC) No 1073/1999 of 
the European Parliament and of the Council  

For the Community actions financed under this Regulation, the notion of irregularity 
referred to in Article 1(2) of Regulation (EC, Euratom) No 2988/95 shall mean any 
infringement  of  a  provision  of  Community  law  or  any  breach  of  a  contractual 
obligation resulting from an act or omission by an economic operator, which has, or 
would  have,  the  effect  of  prejudicing  the  general  budget  of  the  European  Union  or 
budgets managed by it, by an unjustified item of expenditure. 

All  implementing  measures  resulting  from  this  Regulation  shall  provide,  in 
particular,  for  supervision  and  financial  control  by  the  Commission  or  any 
representative authorised by it, and by audits by the European Court of Auditors, if 
necessary on-the-spot audits. 

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CHAPTER IV 

IMPLEMENTINGAND FINAL PROVISIONS 

Article 28 
Committees 

1. 

The Commission shall be assisted by the following committees. 

(a) 

(b) 

(c) 

for  projects  for  carbon  capture  and  storage,  the  committee  established  by 
Article 8 of Council Decision 2006/971/EC18; 

for offshore wind projects, the committee established by Article 8 of  Decision 
2006/971/EC; 

for  gas  and  electricity  interconnection  projects,  the  committee  established  by 
Article 15 of Regulation (EC) 680/2007 of the European Parliament and of the 
Council. 

2. 

Where reference is made to this  Article,  Articles 4  and 7 of  Decision 1999/468/EC 
shall apply, having regard to the provisions of Article 8 thereof.  

The  period  laid  down  in  Article  4(3)  of  Decision  1999/468/EC  shall  be  set  at  one 
month.  

Article 29 
Evaluation 

1. 

2. 

3. 

The  Commission  shall  carry  out  an  evaluation  of  the  EEPR  in  order  to  assess  its 
contribution  to  the  objectives  of  Community  energy  policy  and  the  effective  use 
made of the appropriations. 

The  Commission  may  request  a  beneficiary  Member  State  to  provide  a  specific 
evaluation  of  projects  financed  under  Chapter  II  Section  1  of  this  Regulation  or, 
where  appropriate,  to  supply  it  with  the  information  and  assistance  required  to 
undertake an evaluation of such projects. 

The Commission shall present to the European Parliament, the Council, the European 
Economic  and  Social  Committee  and  the  Committee  of  the  Regions  an  evaluation 
report on the results achieved by the EEPR. 

Article 30 
Information to, the European Parliament and the Council 

The  Commission  shall  monitor  the  implementation  of  this  Regulation.  Each  year,  when  it 
presents the preliminary draft budget, it shall present a report to the European Parliament and 
to the Council on the implementation of the Programme.  

Article 31 
Entry into force 

This  Regulation  shall  enter  into  force  on  the  day  following  that  of  its  publication  in  the 
Official Journal of the European Union. 

18 

OJ L 162 of 22.6.2007 

EN 

21 

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This Regulation shall be binding in its entirety and directly applicable in all Member States. 

Done at Brussels,  

For the European Parliament 
The President 

For the Council 
The President 

EN 

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A. 

1. 

INTERCONNECTORS 

Gas interconnectors 

Project 

Southern Gas Corridor 

NABUCCO19 

ITGI – Poseidon 

Baltic interconnection 

Skanled 

LNG network 

ANNEX  
Eligible projects 

Location 
supported 

of 

projects 

Envisaged 
Community 
contribution 

(€ million) 

Austria,  Hungary,  Bulgaria, 
Germany, Romania 

Italy, Greece  

Poland, Denmark, Sweden 

Liquefied  Natural  Gas  terminal  at  Polish  coast  at 
port of Świnoujście  

Poland 

Central and South East Europe 

Slovakia-Hungary Interconnector 

Slovakia-Hungary 

(Velky Krtis – Balassaqyarmat) 

Gas  transmission  system  in  Slovenia  between  the 
Austrian Border to Ljubljana (excluding the section 
Rogatec-Kidričevo)  

Slovenia 

Interconnection Bulgaria-Greece 

(Haskovo-Komotini) 

Romania-Hungary gas interconnector 

Expansion  of  Gas  Storage  Capacity  in  the  Czech 
hub 

Bulgaria, Greece 

Romania, Hungary 
Czech Republic 

Infrastructure and equipment to permit west-east gas 
flow in the event of short term supply disruption 

All Member States 

250

100

150

80

25

40

20

30

25

20

19 

This support may be channelled alongside European Investment Bank support 

EN 

23 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                 
Mediterreanean 

Reinforcement  of  FR  gas  network  on  the  Africa-
Spain-France axis 

France 

North Sea area 

Germany-Belgium-United Kingdom pipeline 

Belgium 

France-Belgium connection 

France, Belgium 

150

35

100

1025

TOTAL 

2. 

Electricity interconnectors 

Project 

Baltic interconnection 

Estlink-2 

Interconnection  Sweden-  Baltic  States, 
strengthening of the grid in Baltic States 

Central and South East Europe 

Location 
supported 

of 

projects 

Envisaged 
Community 
contribution 

(EUR 
million) 

Estonia, Finland 

and 

Sweden, Latvia, Lithuania 

100 

175 

Halle/Saale – Schweinfurt 

Germany 

50 

Mediterreanean 

Portugal-Spain interconnection reinforcement 

Portugal 

Interconnection France-Spain (Baixas – Sta Llogaia) 

France, Spain 

New  380  kV  AC  submarine  cable  between  Sicily- 
Continental Italy (Sorgente – Rizziconi) 

Italy 

North Sea area 

Interconnection Republic of Ireland – Wales 

Ireland, UK 

TOTAL 

30 

150 

100 

100 

705 

EN 

24 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
3. Small island projects 

Small isolated island initiatives  

Cyprus, Malta 

20

EN 

25 

   EN 

 
B. 

OFFSHORE WIND PROJECTS  

Project 

Capacity  Location 

of 
projects supported 

1) Grid integration of offshore wind energy 

1.1.Baltic I and II - Kriegers Flak I, II, 
III  

1.5 GW 

Denmark,  Sweden, 
Germany, Poland 

Building  on  projects  under  development. 
Financing  aimed  at  ensuring  extra  cost 
for  securing  a 
interconnection 
joint 
solution. 

1.2. North sea grid 

1 GW 

Modular  development  of  offshore  grid, 
demonstration  of  virtual  offshore  power 
plant 

United  Kingdom, 
Netherlands, 
The 
Ireland, 
Germany, 
Denmark, 

Envisaged 

Community  

contribution  

(EUR 
million) 

150

150

2) New turbines, structures and components, optimisation of manufacturing capacities  

2.1 Alpha Ventus/Bard Offshore 1  

0.5 GW 

Germany, Poland  

150

Building  on  projects  presently  under 
development. New generation of 6-7 MW 
size  turbines  and  innovative  structures, 
situated  far  from  shore  (up  to  100km)  in 
deeper waters (up to 40 m).  

2.2  Aberdeen  offshore  wind 
(European testing centre) 

farm 

0.25 GW  UK 

40

Building  on  project  presently  under 
-Testing  of  multi-MW 
development 
turbines.  Development  of 
innovative 
structures  and  substructures  including 
optimisation  of  manufacturing  capacities 
of  offshore  wind  energy  production 
equipment.  An 
in  size  of 
increase 
100MW can be envisaged. 

EN 

26 

   EN 

 
 
 
2.3 Thornton Bank  

90MW  

Belgium 

10

from 

Building  on  project  presently  under 
the 
Learning 
development. 
Downvind  project  (co  financed  through 
FP6);  Upscaling 
the  Downvind 
installations turbines (5 MW size) in deep 
waters  (  up  to  30  m)  with  low  visual 
impact (up to 30 km). 

TOTAL 

500

EN 

27 

   EN 

 
 
 
 
C. 

CARBON CAPTURE AND STORAGE PROJECTS 

Project Name/ 

Envisaged 

Fuel 

Capacity 

Location 

Community  

contribution 

(EUR 
million) 

Capture 
Technique  

Storage Concept 

Huerth 

Germany 

250

Coal 

450 MW 

IGCC 

Saline Aquifer 

Jaenschwalde 

Coal 

500 MW 

Oxyfuel 

Oil/Gas fields 

Eemshaven 

Netherlands 

250

Coal 

1200 MW 

IGCC 

Oil/Gas fields 

Rotterdam 

Rotterdam 

Coal 

1080 MW  

PC 

Oil/Gas fields 

Coal 

 800 MW 

PC 

Oil/Gas fields 

Belchatow 

Poland 

250 Coal 

858 MW 

PC  

Saline Aquifer 

Compostilla 
(León) 

(with 

Spain 
{Portugal) 

250 Coal 

500 MW 

Oxyfuel 

Saline Aquifer 

Kingsnorth 

UK 

250

Coal 

800 MW 

PC 

Oil/Gas fields 

Longannet 

Tilbury 

Hatfield  

(Yorkshire) 

TOTAL 1 250 

Coal 

3390 MW 

PC 

Saline Aquifer 

Coal 

1600 MW 

PC 

Oil/Gas fields 

Coal 

900 MW 

IGCC 

Oil/Gas fields 

EN 

28 

   EN 

 
 
 
 
 
 
 
 
 
 
 
LEGISLATIVE FINANCIAL STATEMENT 

This document is intended to accompany and complement the Explanatory Memorandum. As such, 
when  completing  this  Legislative  Financial  Statement,  and  without  prejudice  to  its  legibility,  an 
attempt should be made to avoid repeating information contained in the Explanatory Memorandum. 
Before  filling  in  this  template,  please  refer  to  the  specific  Guidelines  that  have  been  drafted  to 
provide guidance and clarification for the items below. 

1. 

NAME OF THE PROPOSAL: 

Regulation  of  the  European  Parliament  and  of  the  Council  establishing  the  programme  for  the 
granting of Community financial assistance to energy projects to aid economic recovery. 

2. 

ABM / ABB FRAMEWORK 

Policy Area(s) concerned and associated Activity/Activities: 

06: Energy and transport 
06 09: Energy projects to aid economic recovery  

3. 

3.1. 

BUDGET LINES 

Budget  lines  (operational  lines  and  related  technical  and  administrative  assistance 
lines (ex- B.A lines)) including headings : 

06 09 01: Energy projects to aid economic recovery: energy networks 
06 09 02: Energy projects to aid economic recovery: carbon capture and storage 
06 09 03: Energy projects to aid economic recovery: European offshore wind grid system 
06  01  04  13:  Energy  projects  to  aid  economic  recovery:  Expenditure  on  administrative 
management 

3.2. 

Duration of the action and of the financial impact: 

Start: 2009  end: 2010 

3.3. 

Budgetary characteristics (add rows if necessary) : 

Budget line 

Type of 
expenditure 

New 

EFTA 
contribution 

Contributions 
from applicant 
countries 

Heading in 
financial 
perspective 

06 09 01 

06 09 02 

06 09 03 

Non-
comp 

Non-
comp 

Non-
comp 

Diff 

YES 

Diff 

YES 

Diff 

YES 

06 01 04 13  Non-
comp 

Non Diff 

YES 

NO 

NO 

NO 

NO 

NO 

NO 

NO 

NO 

1a 

1a 

1a 

1a 

EN 

29 

   EN 

4. 

SUMMARY OF RESOURCES 

4.1. 

Financial Resources 

4.1.1. 

Summary of commitment appropriations (CA) and payment appropriations (PA) 

EUR million (to 3 decimal places) 

Expenditure type 

Section 
no. 

Operational expenditure 

Commitment 
Appropriations (CA) 

8.1 

Payment  Appropriations 
(PA) 

A 

B 

2009 

2010 

2011 

2012 

2013 

2014 

2015 

1498,8 

1998,8 

Total 

3497,6 

75 

1012 

750 

1024 

362 

212 

62,6 

3497,6 

Administrative expenditure within reference amount 

Technical 
& 
administrative  assistance 
(NDA) 

8.2.4 

C 

1,2 

1,2 

TTOOTTAALL  RREEFFEERREENNCCEE  AAMMOOUUNNTT  

a+c 

1500 

2000 

Commitment 
Appropriations 

Payment 
Appropriations 

2,4 

3500 

b+c 

76,2 

1013,2 

750 

1024 

362 

212 

62,6 

3500 

Administrative expenditure not included in reference amount 

Human 
associated 
(NDA) 

resources 

and 
expenditure 

Administrative  costs,  other 
than  human  resources  and 
not 
associated 
included in reference amount 
(NDA) 

costs, 

8.2.5 

D 

1,014 

2,2 

2,2 

2,2 

2,2 

2,2 

2,2 

14,214 

8.2.6 

E 

0,468 

0,468 

0,610 

0,610 

0,610 

0,510 

0,510 

3,786 

Total indicative financial cost of intervention 

TOTAL  CA 
cost 
Resources 

of 

TOTAL  PA 
cost 
Resources 

of 

including 
Human 

including 
Human 

a+c
+d+
e 

b+c
+d+
e 

1501,5 

2002,7 

2,81 

2;81 

2,81 

2,71 

2,71 

3518 

77,682 

1015,9 

752,81 

1026,8 

364,81 

214,71 

65,31 

3518 

EN 

30 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  
  
  
  
  
  
  
  
 
 
 
 
 
 
 
 
 
 
 
 
Co-financing details 

If the proposal involves co-financing by Member States, or other bodies (please specify which), an 
estimate of the level of this co-financing should be indicated in the table below (additional lines may 
be added if different bodies are foreseen for the provision of the co-financing): 

EUR million (to 3 decimal places) 

n + 1 

n + 2 

n + 3 

n + 4 

Year 
n 

n  +  5 
and 
later 

Total 

Co-financing body 

TOTAL CA including co-
financing 

f 

a+c
+d+
e+f 

4.1.2.  Compatibility with Financial Programming 

(cid:133) 

(cid:133) 

x 

Proposal is compatible with existing financial programming. 

Proposal  will  entail  reprogramming  of  the  relevant  heading  in  the  financial 
perspective. 

Proposal  may  require  application  of  the  provisions  of  the  Interinstitutional 
Agreement20 (i.e. flexibility instrument or revision of the financial perspective). 

4.1.3.  Financial impact on Revenue 

x 

(cid:133) 

Proposal has no financial implications on revenue 

Proposal has financial impact – the effect on revenue is as follows: 

NB:  All  details  and  observations  relating  to  the  method  of  calculating  the  effect  on 
revenue should be shown in a separate annex. 

EUR million (to one decimal place) 

Budget line 

Revenue 

Prior to
action 
[Year 
n-1] 

Situation following action 

[Yea
r n] 

[n+1] [n+2] [n+3

] 

[n+4]  [n+5]

21

a) Revenue in absolute terms 

b) Change in revenue 

 ∆ 

20 

21 

See  points  19  and  21  to  23  of  the  Interinstitutional  agreement  on  budgetary  discipline  and  sound  financial 
management of 17 May 2007, OJ C139, 14.6.2006, p.1. 
Additional columns should be added if necessary i.e. if the duration of the action exceeds 6 years 

EN 

31 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                 
(Please  specify  each  revenue  budget  line  involved,  adding  the  appropriate  number  of 
rows to the table if there is an effect on more than one budget line.) 

4.2. 

Human Resources FTE (including officials, temporary and external staff) – see detail 
under point 8.2.1. 

Annual requirements 

2009 

2010 

2011 

2012 

2013 

2014 
and 
later 

number 
Total 
human resources 

of 

10 

22 

22 

22 

22 

22 

5. 

CHARACTERISTICS AND OBJECTIVES 

Details  of  the  context  of  the  proposal  are  required  in  the  Explanatory  Memorandum.  This 
section  of  the  Legislative  Financial  Statement  should  include  the  following  specific 
complementary information: 

5.1. 

Need to be met in the short or long term 

The  proposal  responds  to  the  sharp  downturn  faced  by  the  European  economy  in  the  wake  of  the 
financial crisis and to the winter's gas crisis. It implements the European Economic Recovery Plan 
(COM (2008) 800 endorsed by the European Council of 11-12 December 2008. 

The financial crisis began to spread to the real economy in autumn 2008. The gas crisis, involving 
lack  of  delivery  to  the  Community  of  gas  produced  in  Russia,  emerged  in  December  2008.  The 
economic  crisis  and  the  gas  crisis  both  pose  structural  problems  for  the  European  economy.  A 
comprehensive  Recovery  Plan  is  needed  and  is  being  put  in  place;  this  proposal  for  a  financial 
stimulus to key parts of the energy sector is an essential element of the Plan. 

The Commission has already tabled a proposal to revise the Multiannual Financial Framework 2007-
2013  to  make  available  additional  funds  under  heading  1A  whilst  respecting  the  total  amounts 
agreed in the Interinstitutional Agreement on budgetary discipline and sound financial management 
of  17  May  200622  In  the  light  of  first  discussions  with  the  budgetary  authority,  it  now  proposes  a 
transfer  of  resources  not  required  under  the  ceiling  of  heading  2  in  respect  of  the  year  2008  to 
heading 1A to fund the EUR 3.5 billion proposed for energy projects (EUR 1.5 billion in 2009 and 
EUR 2.0 billion in 2010)..  

- In order to make an immediate contribution to addressing the economic crisis, it is necessary for 
projects to receive approval as soon as possible. 

-  It  is  therefore  necessary  for  this  regulation  already  to  list  the  projects  that  may  receive  support, 
subject to conformity with criteria to ensure efficiency and effectiveness and subject to the limit set 
by the financial envelope. 

22 

COM(2008) 859 of 10.12.2008 

EN 

32 

   EN 

 
 
 
 
 
 
 
 
 
                                                 
- In the case of carbon capture and storage, this list should be established on the basis of information 
gathered in the framework of the Fossil Fuel Working Group, the Zero Emissions Fossil Fuel Power 
Plants  Technology  Platform  and  other  sources.  Within  this  list,  financial  assistance  should  be 
directed towards those projects that are ready to start project development in 2009/2010, while those 
that  are  not  should  constitute  a  reserve  list.  Readiness  should  be  assessed  on  the  basis  of  the 
existence of a mature and feasible concept for the power plant, including its capture component; the 
existence  of  a  mature  and  feasible  concept  for  the  transport  and  storage  of  CO2;  and  articulated 
commitment of  local authorities to support the project. In order to ensure the maximum chance of 
accelerated project development, resources of maximum €250 million should be made available for 
each  project.  To  achieve  this,  it  will  be  necessary  to  make  a  selection  among  the  projects  that  are 
ready  to  start  project  development  in  2009/2010.  This  selection  should  ensure,  inter  alia,  that  no 
more than one project is supported in each Member State, in order to ensure the investigation of a 
wide range of geological storage conditions and to support the objective of encouraging  economic 
recovery across Europe. 

In the case of offshore wind, this list should contain only projects that are ready for implementation; 
capable  of  acceleration  in  response  to  a  financial  stimulus;  of  cross-border  significance;  and  of  a 
large scale. 

In the case of gas and electricity interconnection projects, this list should be established on the basis 
of  project  maturity  of  the  project  and  projects'  contribution  to  the  objectives  of  security  and 
diversification of supply as identified in the recent 2nd Strategic Energy Review and endorsed by the 
European Parliament and the Council. 

5.2. 

Value-added  of  Community  involvement  and  coherence  of  the  proposal  with  other 
financial instruments and possible synergy 

Energy has become one of the key concerns for Europe. In December, the European Union took a set 
of key decisions to address the future of energy in Europe. To drive an energy sector able to make 
cuts in greenhouse gas emissions. To make renewable energy a major part of Europe's energy mix. 
And to contain Europe's demand for energy by realising the gains of energy efficiency. 

These changes need a major commitment and major investment. But the economic downturn risks 
delaying this investment unless additional action is taken now. The credit crunch is having a direct 
impact  on  the  speed  with  which  Europe  is  making  the  changes  required.  The  risk  is  a  loss  of 
momentum  and  technological  edge,  and  delay  today  meaning  higher  costs  later.  That  is  why  the 
Economic Recovery Plan put particular emphasis on the need for "smart investment", a stimulus to 
the economy targeted on clear strategic objectives. 

To  have  a  tangible  and  substantial  impact,  this  investment  should  be  focussed  on  a  few  specific 
sectors.  These  should  be  sectors  in  which  action  at  European  level  can  add  value;  in  which  there 
exist  large,  mature  projects  capable  of  absorbing  significant  amounts  of  financial  assistance;  and 
whose development will make a clear contribution to the objectives of security of energy supply and 
the reduction of greenhouse gas emissions. The sectors of carbon capture and storage; offshore wind; 
gas and electricity interconnections; and energy efficient cities fulfil these criteria. 

In  the  cases  of  carbon  capture  and  storage  and  offshore  wind,  this  builds  on  the  Strategic  Energy 
Technology Plan for Europe, which called for the establishment of European Industrial Initiatives in 
these  areas.  The  European  Council  of  16  October  2008  called  on  the  Commission  to  significantly 
accelerate the implementation of the Technology Plan. 

EN 

33 

   EN 

In  the  case  of  gas  and  electricity  interconnections,  the  energy  challenges  have  developed  in  the 
course of the last years. The recent gas crises (winters 2006 and 2009) and the increase of oil prices 
until mid-2008 showed how much Europe was vulnerable. Indigenous energy resources – gas and oil 
– are decreasing so that Europe is more and more depending on imports for its energy supply. In this 
context, energy infrastructure will play a crucial role. However, the current economic and financial 
crisis  is  affecting  the  implementation  of  energy  infrastructure  projects.  Some  important  projects  – 
including projects of European interest – may face severe delays in implementation due to scarcity 
of  funds.  Urgent  action  to  support  investment  in  energy  interconnections  is  therefore  appropriate. 
Given the significant time necessary to plan and then execute such projects it is important that the 
Community now invests in such infrastructure in particular to accelerate the development of projects 
of particular importance to the EU's energy security. This will be vital for the EU to be in a better 
position  to  secure  its  energy  security  when  the  economy  does  rebound  and  global  energy  demand 
picks up. 

5.3. 

Objectives, expected results and related indicators of the proposal in the context of the 
ABM framework 

(a) 

(b) 

(c) 

contributing to the EU's climate change objectives by taking a tangible step towards 
the  European  Council  objective  of  developing  up  to  12  demonstration  plants  for 
sustainable  fossil  fuel  technologies  by  2015  in  order  to  make  carbon  capture  and 
storage a commercially viable technology by 2020; 

establishing a modern and fully integrated European offshore wind grid system, which 
substantially  reinforces  the  contribution  of  wind  power  to  the  EU  renewable  energy 
target and strengthens the EU industrial leadership in the field of wind power; 

adapting  and  developing  the  energy  networks  in  support  of  the  operation  of  the 
internal energy market and, in particular, solving the problems of bottlenecks, security 
and diversification of supply and to overcome environmental, technical and financial 
obstacles. 

5.4.  Method of Implementation (indicative) 
Show below the method(s)23 chosen for the implementation of the action. 

X Centralised Management 

X  Directly by the Commission 

Indirectly by delegation to: 

Executive Agencies 

Bodies  set  up  by  the  Communities  as  referred  to  in  art.  185  of  the 

Financial Regulation 

National public-sector bodies/bodies with public-service mission 

Shared or decentralised management 

23 

If more than one method is indicated please provide additional details in the "Relevant comments" section of 
this point 

EN 

34 

   EN 

                                                 
With Member states 

With Third countries 

Joint management with international organisations (please specify) 

6. 

MONITORING AND EVALUATION 

6.1.  Monitoring system 

The granting of subsidies to these types of action will be based on the standard subvention contract 
of the European Communities. The various monitoring, information and auditing provisions of this 
contract will fully apply. 

In  particular  for  interconnection  projects,  the  Member  States  shall  undertake  the  technical 
monitoring  and  financial  control  of  projects  in  close  cooperation  with  the  Commission  and  shall 
certify  the  reality  and  the  conformity  of  the  expenditure  incurred  in  respect  of  projects  or  parts  of 
projects.  The  Member  States  may  request  the  participation  of  the  Commission  during  on-the-spot 
checks. 

The  Member  States  shall  inform  the  Commission  of  the  measures  taken  to  expedite  the 
administrative procedures  and  authorisation, licensing and certification processes to be fulfilled by 
promoters of the interconnection projects and, in particular, shall supply a description of the control, 
management and monitoring systems set up to ensure that projects are successfully completed 

6.2. 

Evaluation 

6.2.1.  Measures taken following an intermediate/ex-post evaluation (lessons learned from similar 

experiences in the past) 

The  Commission  shall  carry  out  an  evaluation  of  the  Programme  in  order  to  assess  its 
contribution  to  the  objectives  of  Community  energy  policy  and  the  effective  use  made  of 
the appropriations. 

The Commission may request a beneficiary Member State to provide a specific evaluation 
of projects financed under Chapter 2 Section 3 of this Regulation or, where appropriate, to 
supply  it  with  the  information  and  assistance  required  to  undertake  an  evaluation  of  such 
projects. 

The  Commission  shall  present  to  the  European  Parliament,  the  Council,  the  European 
Economic and Social Committee and the Committee of the Regions an evaluation report on 
the results achieved by the Programme. 

6.2.2.  Terms and frequency of future evaluation 

Not applicable 

7. 

ANTI-FRAUD MEASURES  

•  As  the  contracts  for  all  actions  envisaged  will  be  standard  subvention  contracts,  the 

generally applicable anti-fraud measures will apply. 

•  Output will be clearly visible and measurable in all types of action. The types of subsidy 
will  be  straightforward:  expenditure  in  investment,  and  costs  arising  from  operations. 

EN 

35 

   EN 

These  items  can  be  verified  in  details,  and  there  is  enough  material  and  knowledge 
through projects to make an informed assessment of the dangers of fraud. 

•  On the spot visits will be possible on all projects.  

•  Depending on the complexity of the projects, specific monitoring tasks can be entrusted 

to specialised staff or outside consultants. .  

EN 

36 

   EN 

8. 

DETAILS OF RESOURCES 

8.1. 

8.1.  Objectives of the proposal in terms of their financial cost 

Type 
of 
output 

Av. 
cost 

2009 

2010 

2011 

2012 

2013 

2014 

TOTAL 

No. 
outputs 

Total 
cost 

No. 
outputs 

Total 
cost 

No. 
outputs 

Total 
cost 

No. 
outputs 

Total 
cost 

No. 
outputs 

Total 
cost 

No. 
outputs 

Total 
cost 

No. 
outputs 

Total 
cost 

Commitment appropriations in EUR million (to 3 decimal places) 

of 

(Headings 
Objectives, 
actions 
and 
outputs  should  be 
provided) 

OPERATIONAL 
OBJECTIVE 

No.1  24 projects for 
carbon  capture  and 
storage 

No.2 offshore wind 
projects 

and 

gas 

No.3 
electricity 
interconnection 
projects 

3 

3 

8 

535 

4 

714,2 

213,8 

3 

285,4 

750 

12 

999,2 

1249,2 

499,2 

1749,2 

3497,6 

TOTAL COST 

14 

1498,8 

19 

1998,8 

24 

As described under Section 5.3 

EN 

37 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                 
8.2. 

Administrative Expenditure 

8.2.1.  Number and type of human resources 

Types of 
post 

Staff to be assigned to management of the action using existing and/or additional 
resources (number of posts/FTEs) 

2009 

2010 

2011 

2012 

2013 

2014 

12 

3 

12 

3 

12 

3 

12 

3 

12 

3 

7 

7 

7 

7 

7 

A*/AD 

B*, 
C*/AST 

6 

1 

Officials 
or 
temporary 
staff25 
(XX 01 
01) 

Staff  financed26  by 
art. XX 01 02 

3 

staff27 
Other 
financed  by  art.  XX 
01 04/05 

TOTAL 

10 

22 

22 

22 

22 

22 

8.2.2.  Description of tasks deriving from the action 

– 

– 

– 

– 

– 

– 

Programme definition and coordination 

Financial management of the projects 

Monitoring of the projects 

Representing the Commission in the Programme Committee and the submission to it 
of measures to be taken where there is a comitology procedure 

Undertaking inter-service consultations within the Commission 

Strategic evaluations  

8.2.3. 

Sources of human resources (statutory) 

The needs for human and administrative resources shall be covered within the allocation that 
can be granted to the managing DG in the framework of the annual allocation procedure in the 
light of budgetary constraints.  

25 
26 
27 

Cost of which is NOT covered by the reference amount 
Cost of which is NOT covered by the reference amount 
Cost of which is included within the reference amount 

EN 

38 

   EN 

 
 
 
 
 
 
 
 
 
 
 
                                                 
8.2.4.  Other Administrative expenditure included in reference amount 

EUR million (to 3 decimal places) 

Budget line 

(number and heading) 

2009 

2010  2011  2012  2013 

Year 2014 

and later 

TOTAL 

Technical 

1 
and 
assistance (including related staff costs) 

administrative 

Other 

technical 

and 

administrative 

assistance 

- intra muros  

- extra muros (IT maintanence) 

1,2 

1,2 

Total  Technical  and  administrative 
assistance 

1,2 

1,2 

2,4 

2,4 

8.2.5.  Financial cost of human resources and associated costs not included in the reference 

amount 

EUR million (to 3 decimal places) 

Type of human resources 

2009 

2010 

2011 

2012 

2013 

2014  

and later 

Officials and temporary staff (XX 01 
01) 

Staff  financed  by  Art  XX  01  02 
(auxiliary, END, contract staff, etc.) 

(specify budget line) 

Total cost of Human Resources 
and associated costs (NOT in 
reference amount) 

1,014 

2,2 

2,2 

2,2 

2,2 

2,2 

1,014 

2,2 

2,2 

2,2 

2,2 

2,2 

Calculation– Officials and Temporary agents 

Reference should be made to Point 8.2.1, if applicable 

Year 2009 and later: 7 officials (122.000 €/official/year)  and 3 external staff: 2 GFIV (62.500 
€/year), 1 GFII (34.500 €/year) 

Year  2010  and  later:  15  officials  (122.000  €/official/year)  and  7  external  staff:4  GFIV 
(62.500 €/year), 2 GFII (34.500 €/year) and 1 SNE's (51.000 €/year) 

The needs for human and administrative resources shall be covered within the allocation that 
can be granted to the managing DG in the framework of the annual allocation procedure in the 
light of budgetary constraints 

EN 

39 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
8.2.6 Other administrative expenditure not included in reference amount 

EUR million (to 3 decimal places) 

2009 

2010 

2011 

2012 

2013 

2014 

and 
later 

TOTAL 

XX 01 02 11 01 – Missions 

0,300 

0,300 

0,300 

0,300 

0,300 

0,200 

1,7 

XX 01 02 11 02 – Meetings & Conferences 

XX 01 02 11 03 – Committees28  

0,108 

0,108 

0,216 

XX 01 02 11 04 – Studies & consultations 

0,25 

0,25 

0,25 

0,25 

1 

XX 01 02 11 05 - Information systems 

0,06 

0,06 

0,06 

0,06 

0,06 

0,06 

0,36 

 2 

Total 

Other  Management 

Expenditure (XX 01 02 11) 

3 

Other 

expenditure 

administrative 
including reference to budget line) 

nature 

of 

an 
(specify 

Total Administrative expenditure, other 
than human resources and associated 
costs (NOT included in reference 
amount) 

0,468 

0,468 

0,610 

0,610 

0,610 

0,510 

3,276 

Calculation - Other administrative expenditure not included in reference amount 

Missions : 100.000 € by type of projects 

One committee a year by topics = 4*27*1000 €=108.000 € 

Monitoring consultancy as from 2011 : 250.000 €/year 

0,5 FTE (consultancy) for monitoring system : 60.000 €/year 

The  needs  for  administrative  resources  shall  be  covered  within  the  allocation  that  can  be 
granted to the managing DG in the framework of the annual allocation procedure in the light 
of budgetary constraints.  

28 

Coordination group and (comitology) committee foreseen in the draft legislation 

EN 

40 

   EN