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No new fossil fuel projects will receive funding from the Connecting Europe Facility

15 December 2021

The Council presidency and the European Parliament’s negotiators reached a provisional political agreement on the revision of the Trans-European Networks for Energy (TEN-E) Regulation. The new rules for TEN-E will support the EU’s climate objectives and the Green Deal. The agreement found in trialogue negotiations is pending endorsement by member states.

Jernej Vrtovec, Slovenian Minister of Infrastructure, explained: “The agreement reached today makes sure that in the future, no new fossil fuel projects will receive funding from the Connecting Europe Facility. Today’s deal makes sure we will invest in a green and climate-neutral future that guarantees efficiency, competitiveness and security of supply, while leaving no one behind.”

The Council’s and Parliament’s negotiators agreed among other things to:

  • end support for new natural gas and oil projects and introduce mandatory sustainability criteria for all projects
  • simplify and accelerate permitting and authorization procedures, notably by creating a unique point of contact per project for permitting and authorization
  • allow during a transitional period until 31 December 2029, for dedicated hydrogen assets converted from natural gas to be used to transport or store a pre-defined blend of hydrogen with natural gas or biomethane. Eligibility for EU financial assistance for such projects will end on 31 December 2027
  • allow for projects no longer on the list of projects of common interest, but for which an application file has been accepted for examination by the competent authority, to maintain their rights and obligations in terms of faster permitting
  • in the case of Cyprus and Malta, that are still not interconnected to the trans-European gas network, allow for one interconnection per Member State under development or planning that has been granted the Project of Common Interest status and is necessary to secure permanent interconnection of Cyprus and Malta to the trans-European gas network
  • add an explicit reference to article 136 of the EU financial regulation that enumerates the situations where a person or entity shall be excluded from being selected for receiving EU financing, such as fraud, corruption or conduct related to criminal organizations
  •  include in the scope of the Regulation certain types of electrolysis that account for at least 50 MW capacity, provided by a single electrolyze or by a set of electrolyzers that form a single, coordinated project and that contribute to sustainability. Electrolyzers will not be eligible for financing
  • emphasize the role of energy from renewable sources regarding all assets, including smart gas grids
  • create a possibility for non-binding cooperation in the field of offshore grid planning
  • strengthen the governance process for TEN-E with a stronger role for relevant stakeholders
  • include in the scope of the Regulation projects of mutual interest, where they are sustainable and demonstrate benefits at EU-level

The revised Regulation will continue to ensure that new projects respond to market integration, competitiveness and security of supply objectives. It will continue to support projects that connect regions currently isolated from European energy markets, that strengthen existing cross-border interconnections and that promote cooperation with countries outside of the EU.

This September, the European Commission launched a new call for proposals for key cross-border EU energy infrastructure projectsincluded on the 4th Union list of Projects of Common Interest (PCIs), to be co-financed through grants worth 785 million EUR from the EU budget. This is the first call for PCIs under the new Connecting Europe Facility (CEF) rules, the European support programme for trans-European infrastructure.  In November, European Commission approved Romania’s first cross-border smart grid project, developed in partnership by Delgaz Grid SA, the electricity and natural gas distribution company, part of the E.ON group, with CNTEE Transelectrica SA, the operator national transmission system, and MAVIR, the Hungarian transmission operator.

The text of the provisional political agreement will be available soon.

The provisional political agreement is subject to approval by the committee of permanent representatives in the Council, before going through the formal steps of the adoption procedure. The provisional agreement was reached by the Council’s Slovenian Presidency and the European Parliament’s representatives, based on mandates from their respective institutions.

The European Commission presented its proposal on a revised TEN-E on 15 December 2020. The revision of the TEN-E Regulation identifies 11 priority corridors and 3 priority thematic areas to develop and interconnect. It updates the infrastructure categories eligible for support with an emphasis on decarbonization and adds a new focus on offshore electricity grids, hydrogen infrastructure and smart grids. This will be done mostly through projects of common interest (PCIs) that are eligible for financing from the Connecting Europe Facility for 2021-2027.

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