Socialist and Green members of the European Parliament face defeat in their efforts to ringfence up to €5 billion of Juncker Plan investor risk guarantees for energy efficiency projects.
On 14 April, the Parliament’s Industry, Research and Energy Committee will vote on the European Fund for Strategic Investments, the legislation implementing the Juncker Plan.
It is the only committee with a say on the article five of the bill, which can be changed to earmark cash for specific sectors. Other committees do have an influence on other parts of the bill.
Two separate amendments have been tabled to reserve money for energy efficiency, including one from the lead MEP on the bill, Belgian Socialist Kathleen Van Brempt.
But the European People’s Party (EPP), the European Conservatives and Reformists (ECR), and the Liberals (ALDE) won’t vote for the changes next Tuesday.
The investment plan will use €16 billion of EU money and €5 billion of funds from the European Investment Bank as risk guarantees. These guarantees should unlock up to €315 billion of private and public investment over the next three years, according to the European Commission.
The EPP, the largest group in the Parliament, argues that the market should determine which projects get finance from the flagship project. The Liberal ALDE group is against the ringfence. It believes ringfencing will be too narrow and not flexible enough.
The ECR, the third largest group after the Socialists & Democrats, are also opposed to earmarking the cash, meaning the amendments will struggle to get the majority support it needs.
Van Brempt, the bill’s rapporteur, has tabled an amendment to reserve €4 billion, or 20% of the funds, for efficiency projects such as building renovations.
“Energy efficiency is extremely important if we are going to solve our energy problems in the future,” she said. Energy efficiency can create local jobs, can deliver results quickly, increase energy security and help fight climate change, she added.
Four other MEPs are pushing for €5 billion to be set aside. They include Claude Turmes, a Green, Morten Helveg Pederson, a Danish Liberal, and Socialist Jeppe Kofod, also from Denmark.
The fourth MEP, Seán Kelly, of the EPP, put his name to the amendment. But EURACTIV understands the Irish MEP is considering withdrawing it under pressure from his group.
The EU Energy Union blueprint calls for energy efficiency to be given primary consideration in national policies. The Energy Union is a project to bolster the bloc’s resistance to shortages, given impetus by the Ukraine Crisis.
“Energy efficiency projects are often small ones, not able to compete with larger infrastructure-related ones to get funds,” said Turmes, who is from Luxembourg. “If we don’t ease their access to capital, the efficiency first concept will be turned into efficiency last”.
Groups will decide whether to hand their MEPs a free vote on the bill in meetings on Monday (13 April). EURACTIV understands ALDE and the EPP will likely insist on their party lines being followed.
Even if the amendments got the required support, they would also have to be agreed by the Council of Ministers. Both Council and Parliament must agree an identical text before it can become law.
Germany and France on 31 March called for the creation of a sub-fund for efficiency projects as part of the Juncker plan.
Commission Vice-President for Jobs, Growth, Investment and Competitiveness Jyrki Katainen is in charge of the plan. An EPP member, like Commission President Jean-Claude Juncker, Katainen told EURACTIV in March, that it would be the private sector that determined which projects get the money.
“Energy efficiency is one of the Commission’s key priorities,” Katainen said, “and that’s why I expect there will be energy efficiency projects. But it’s up to the private sector to apply or establish those projects.”
Commission Vice-President Maroš Šef?ovi?, in charge of Energy Union, said in March that part of the Juncker plan should go to energy efficiency in buildings. About 29% of the projects proposed by member states for package funding were for energy infrastructure, which was underinvested as a result of the crisis, he said.
He said, “Only 10% of our buildings are energy efficient so there is a huge opportunity for us to save, investors to invest, and for our apartment owners, households, and administrative bodies to save a lot of energy if we invest in the technology available on market.”
The Energy Efficiency Financial Institutions Group (EEFIG) is a platform involving the financial sector, policymakers, the International Energy Agency and other business and efficiency experts.
The group was set up by the Commission and the United Nations Environment Programme Finance Initiative. It warned that private investment in energy-efficient buildings renovation must increase five-fold by 2030.
The lack of public and private money for buildings, industry and SMEs, meant that EU countries risked missing efficiency targets for 2020 and beyond, the group’s report, Energy Efficiency – the first fuel for the EU Economy, said.
The EU has committed to cut its energy consumption by 20% by the end of the decade. The Commission had called for an efficiency goal of 30% by 2030. That was reduced to 27% across the EU.
The EU level target is not legally binding at the national level or EU level and will be reviewed in 2020 “having in mind” a 30% EU-level target, according to the deal struck by EU leaders at a summit last October.