Municipalities and local authorities play a key role in a sustainable European energy transition. They have a tremendous potential to build comprehensive sustainable energy investment programs (i.e. investments in energy efficiency and renewable energy). They also play a key role in pooling smaller projects into larger investment portfolios and in mobilising the significant financial resources required for the energy transition.
Although the potential is immense, there are fundamental obstacles. In many cases, there is a lack of credible, robust and sufficiently mature investment concepts (including a detailed description of the planned investment project and of the promoter(s) and local stakeholders, a legal analysis, an economic and financial analysis and the investment roadmap). However, such investment concepts are an initial prerequisite for access to different sources of funding.
In this context, a new pan-European City Facility is set up under the Horizon 2020 Framework Programme for Research and Innovation of the European Union: tailor-made, rapid and simplified financial support (in the form of EUR 60,000 lump sums) and related services will be provided to some 200 cities and municipalities to enable them to develop relevant investment concepts.
The Facility addresses two fundamental barriers for sustainable energy investments:
• Limited financial and legal capacity of local authorities to transform their long-term energy and climate strategies (e.g. SEAPs, SECAPs etc.) into appropriate investment concepts.
• Lack of aggregation of fragmented smaller projects (for example in the building sector) and thus lack of attractiveness for the financial sector.
The resulting investment concepts will represent an initial step towards a fully-fledged business and financial plan and – in this way - facilitate the subsequent mobilization of (local) investment in energy efficiency and renewable energy. Sources of funding may come from the private sector, but also from other EU-funded instruments such as the European Fund for Strategic Investments, the European Structural and Investment Funds, various Project Development Assistance facilities, such as the ELENA facility of the European Investment Bank, or various national investment platforms.
The vision of the EUCF is one where European cities have their say on how the EUCF financial and technical support will be used to meet their needs and help them overcome the barriers they face in financing and implementing their ambitious energy and climate strategies.
We would like to encourage cities to be as bold as possible in addressing the fundamental changes that are needed to accelerate the energy transition.
The EUCF is governed by the Strategic Board (Board), operated by the Core Management Team (CMT) and advised by the Investment Advisors. These bodies have clearly assigned responsibilities that guarantee strategic steering of the initiative (assuring that cities have a say on how the financial support will best meet their financial needs), independent and transparent selection process and support for EUCF beneficiaries as well as the relevance of the investment concepts for investors and financiers. Moreover, Country Experts are appointed for each EU Member State and act as a ‘prolonged arm’ of the CMT to support the EUCF applicants and beneficiaries at local level and in their national language.