Commission finds 3.5 bn EUR for energy technology
Keen to show that it, likenational governments, could react quickly to the economic downturn with afiscal stimulus package, the Commission proposed diverting 4 bn EUR of spendingfrom the 2009 and 2010 EU budget to energy technology in November last year. Originally, it had proposed only funding gas and electricityinterconnections. But, following discussions with the Council in thelast few weeks, the plans changed. 4 bn EUR has become 3.5 bn EUR, and of this, half will go on electricity and gas interconnections with the rest beingspent on offshore wind energy and carbon capture and storage.
A new instrument, the‘European Energy Programme for Recovery’ (EEPR) will be created to disburse thismoney, with its own rules. Only the projects listed here will be eligible for funding. Consortia wanting to undertake these projects mustrespond to a call for proposals. For offshore wind projects, the rules are:
The proposals must relate directly to the listed projectsThe EEPR will cover 50% of the “costs associated with the constructionand establishment” of the listed projects, up to stipulated maxima that varyfrom 10 M EUR (applying knowledge from the ‘Downvind’ project to the ThorntonBank offshore project) to 150 M EUR (expanding the offshore power grid)The proposals can be submitted by just one undertaking. In any case,they must be led by a ‘commercial undertaking’
CCS and wind werechosen because they were thought to have well-developed plans for using the moneyin the short term. Also, days before the European Economy Recovery Plan waspublished, the Commission had brought out a Communicationon offshore wind, and the CCS community had succeeded in a campaign to subsidisethe cost of applying its technology to coal power plants using free allowancesfrom the New Entrants’ Reserve of Phase 3 of the Emissions Trading Scheme.
It is proposed that the EEPR cover 80% of the investment costs of technologyfor capturing and storing carbon dioxide. If instead 50% of the costs werecovered (like the EEPR proposes for wind and interconnector projects), thenabout 470 M EUR could be freed up for financing renewable energy technologiesbesides offshore wind.
The Regulation containing full details of the functioning of the EEPR is downloadable here.
