Barroso’s stimulus plan revamped at Nabucco’s expense

gas_pipeline_workers.jpg

A Commission plan to spend five billion euro on clean energy and broadband Internet infrastructure projects has been redrafted. According to the new version, seen by EURACTIV, a number of countries will obtain more funding, at the expense of the EU’s flagship Nabucco pipeline project.

Although a Commission spokesperson strongly denied its existence, EURACTIV has obtained the revised version of the five billion “smart projects” plan. The document clearly shows that a number of countries will receive more funding than initially planned, whereas less will be allocated to the Nabucco project. 

€250m had been earmarked for Nabucco in the initial proposal. That amount was not meant to fund the construction of the gas pipeline itself, but represented a risk-sharing facility to help secure loans from banks at better conditions than those offered on the market. 

The sum allocated to Nabucco has now been downsized to €200 million, while several countries will receive more financial support than initially planned. Bulgaria and Greece will get €40m instead of €20m for the Haskovo-Komotini gas interconnection, while an expansion of gas storage capacity in the Czech Republic will get €35m instead of €25m. 

Infrastructure to allow reverse gas flows in the event of disruptions in 12 EU countries will receive 75 million euro instead of 20. Moreover, France is given more money (150 rather than 100 million) to reinforce its network as part of an Africa-Spain-France axis, and a France-Belgium connection will obtain €200m instead of €100m, as initially planned. 

A number of new projects will also see the light of day: Slovakia-Poland, Hungary-Croatia and Bulgaria-Romania gas interconnections, each worth €20m. The GALSI gas pipeline between Algeria and Italy will now receive €100m. 

In total, gas interconnectors will benefit to the tune of €1,360bn, instead of €1,025bn. Electricity interconnectors also gain an additional €10m, for a Malta-Italy electricity interconnection, with offshore wind projects receiving an additional €5m, for the North Sea grid. 

However, CCS (carbon capture and storage; see EURACTIV LinksDossier) projects will be depleted by €100m, obtaining €1,150bn instead of €1,250bn, the draft shows. 

In total, the new financial rescue blueprint provides €3,750bn for energy projects, compared to €3.5bn in the earlier version. 

The difference between the new version and the original proposal is expected to be bridged using €500 million originally earmarked for tackling new agricultural challenges, such as climate change, renewable energy, water management and restructuring the dairy sector. This sum will now stand at €250m. Plans to commit €1bn to bringing broadband in rural areas remain unchanged. 

The Commission would not comment in detail, with a spokesperson saying only that negotiations are still ongoing. A representative of the Czech EU Presidency described the EU executive’s proposals as “old already”, but recognised that the new paper is the version under discussion at present. 

The package will be further discussed among ambassadors on Thursday (12 March), ahead of the General Affairs Council on 16-17 March and the spring EU summit (19-20 March). 

The next obstacle for Barroso could well be the European Parliament, which will be called upon to give its final green light to the Commission’s plan after member states have approved it, probably during the spring EU summit. 

On 28 January, the European Commission proposed to reallocate five billion euro of unspent 2008 EU agricultural funding, mostly to support clean coal projects, offshore wind farms and the deployment of broadband Internet connections in rural areas (EURACTIV 29/01/09). 

Under the plans, a total of €3.5 billion will be devoted to clean energy projects, while €1 billion will support broadband Internet. A further €500 million is earmarked for tackling new agricultural challenges, such as climate change, renewable energy, water management and restructuring the dairy sector. 

But many EU countries have attacked the Commission's proposals, for a variety of reasons. Some Western countries complained that projects for "smart cities" have been dropped, while Bulgaria, the country worst hit by the recent gas crisis, found its own modest allocation "abnormal" (EURACTIV 04/02/09). 

Besides other problems, there are still doubts as to where the money will come from. The Commission was embarrassed by a Council legal service decision to issue an opinion excluding the possibility of retroactively revising the 2008 allocations. 

Subscribe to our newsletters

Subscribe

Want to know what's going on in the EU Capitals daily? Subscribe now to our new 9am newsletter.