This year, the EU’s Modernisation Fund has disbursed a total of 4.11 billion euros in support of 61 projects in eight countries in Central and Eastern Europe (CEE), the European Commission announced last week.
The 4.11 billion euros was distributed to Croatia (119.8 million euros), Czechia (1.34 billion euros), Estonia (62.4 million euros), Hungary (74.3 million euros), Lithuania (85 million euros), Poland (643.2 million euros), Romania (1.39 billion euros) and Slovakia (399.5 million euros).
“The Modernisation Fund is a crucial element for a fair transition,” said the Executive Vice-President for the European Green Deal, Frans Timmermans. “We are investing some of the revenues from the EU emissions trading system in the modernisation of the energy system in those Member States where greater efforts in this regard are needed, and where GDP per capita is lower than elsewhere in the EU. Together with the EIB, we have already provided substantial funding this year and with the newly-strengthened EU ETS we will soon step up our support with a bigger investment in the future.”
The Modernisation Fund is currently in its second year of operation. In June, 2.4 billion euros was disbursed to support 45 investment proposals and this was complemented by a 1.71-billion-euro disbursement last week for 16 more investment proposals.
“We must urgently scale up investments to meet the 2030 climate and energy targets and lay the path for a carbon-neutral Europe,” commented European Investment Bank Vice-President, Ambroise Fayolle. “I welcome the more than 4 billion euros in financing from the Modernisation Fund in 2022 which shows its important role in the energy transition. As the EU climate bank, the EIB is working closely with the European Commission and EU countries by providing its expertise and services to help implement the Modernisation Fund. We stand ready to continue the excellent cooperation as the Modernisation Fund expands to more countries and increases in size.”
The 61 investment proposals funded by the Modernisation Fund focus on electricity generation from renewables, modernisation of energy networks and energy efficiency in the energy sector, in industry, in buildings and in transport and the replacement of coal generation with lower carbon intensity fuel.
The investment projects that received funding include:
- the production of electricity from renewable energy sources and battery storage to support electricity grid operation in Croatia;
- the modernisation of public lighting systems within municipalities, conversion of coal to biomass and gas in district heating and ETS installations and increase of energy efficiency in Czechia;
- low-emission energy-efficient public transport in Estonia;
- optimisation, digitalisation and automation of manufacturing processes to reduce electricity consumption and material use in Hungary;
- renovation of public buildings, increasing energy efficiency and development of renewable hydrogen production capacity in Lithuania;
- building heating plants based on renewable energy sources and improvement of energy efficiency in the industry in Poland;
- building 8 photovoltaic parks and two combined cycle gas turbine plants, replacing lignite with renewables and gas for power generation and modernisation of electricity networks in Romania;
- the rehabilitation and extension of district heating and cooling networks, and decarbonisation projects in the industrial sector in Slovakia.
The Modernisation Fund “aims to support ten EU countries with lower incomes in their transition to climate neutrality” and is funded by revenues from the auction of emission allowances from the recently-expanded EU’s Emissions Trading System (ETS). The extension of ETS will also increase the available funding from the Modernisation Fund.