Illustration Funding Instruments

Covenant Signatories Signatories Signatories represent cities, with different size from small villages to major metropolitan areas such as London or Paris, that have signed the Covenant of Mayors on a voluntary manner and are committed to implement sustainable energy policies to meet and exceed the EU 20% CO2 reduction objective through increased energy efficiency and development of renewable energy sources. , voluntarily committed to meet and exceed the EU target of 20% CO2 emissions reduction by 2020, are on the lookout for funding opportunities crucial to develop their Sustainable Energy Action Plans Sustainable Energy Action Plans A Sustainable Energy Action Plan (SEAP) is the key document in which the Covenant signatory outlines how it intends to reach its CO2 reduction target by 2020. It defines the activities and measures set up to achieve the targets, together with time frames and assigned responsibilities. Covenant signatories are free to choose the format of their SEAP, as long as it is in line with the general principles set out in the Covenant SEAP guidelines. and finance the actions featured in it.

This section presents a non-exhaustive list of financial programmes and initiatives available to Covenant Signatories Signatories Signatories represent cities, with different size from small villages to major metropolitan areas such as London or Paris, that have signed the Covenant of Mayors on a voluntary manner and are committed to implement sustainable energy policies to meet and exceed the EU 20% CO2 reduction objective through increased energy efficiency and development of renewable energy sources. .

INNOVATIVE FINANCING SCHEMES

Numerous sources of financing are available at local, regional and national levels, including from:

  • Local authorities’ own resources
  • Local partners’ resources
  • Municipal and regional subsidies
  • Public-Private Partnerships

To find out how fellow Covenant Signatories Signatories Signatories represent cities, with different size from small villages to major metropolitan areas such as London or Paris, that have signed the Covenant of Mayors on a voluntary manner and are committed to implement sustainable energy policies to meet and exceed the EU 20% CO2 reduction objective through increased energy efficiency and development of renewable energy sources. are tapping into these and other resources, read the collection of case studies listed in the Covenant Thematic Leaflet on financing.

PDF - 4.1 Mb
Thematic leaflet n°3: "Inspirational Financing Schemes: Food for Thought for Covenant Signatories"
This Thematic Leaflet seeks to provide an overview of the different funding opportunities available to Covenant Signatories at the local, regional, national and European level.
Document available in:
български (bg), čeština(cs), dansk (da), Deutsch (de), eesti (et), ελληνικά (el), español (es), français (fr), Gaeilge (ga), italiano (it), lietuvių (lt), latviešu (lv), magyar (hu), Malti (mt), Nederlands (nl), polski (pl), português (pt), română (ro), slovenčina (sk), slovenščina (sl), suomi (fi), svenska (sv)

USEFUL PUBLICATIONS

DocumentAuthorDate
"Enabling synergies between European Structural and Investment Funds, Horizon 2020 and other research, innovation and competitiveness-related Union programmes" European Commission European Commission The European Commission is the executive body of the European Union. The body is responsible for proposing legislation, implementing decisions, upholding the Union’s treaties and the general day-to-day running of the Union. With the Covenant of Mayors initiative, the European Commission - DG Energy endorses and supports the efforts deployed by local authorities in the implementation of sustainable energy policies. ’s Directorate-General for Regional Policy 2014
"Energy Efficiency – the first fuel for the EU Economy : How to drive new finance for energy efficiency investments" Energy Efficiency Financial Institutions Group (EEFIG) 2014
"Technical guidance: Financing the energy renovation of buildings with Cohesion Policy funding" European Commission European Commission The European Commission is the executive body of the European Union. The body is responsible for proposing legislation, implementing decisions, upholding the Union’s treaties and the general day-to-day running of the Union. With the Covenant of Mayors initiative, the European Commission - DG Energy endorses and supports the efforts deployed by local authorities in the implementation of sustainable energy policies. ’s Directorate-General for Energy 2014
"Financing energy efficiency: Forging the link between financing and project implementation" European Commission European Commission The European Commission is the executive body of the European Union. The body is responsible for proposing legislation, implementing decisions, upholding the Union’s treaties and the general day-to-day running of the Union. With the Covenant of Mayors initiative, the European Commission - DG Energy endorses and supports the efforts deployed by local authorities in the implementation of sustainable energy policies. ’s Joint Research Centre Joint Research Centre The Joint Research Centre (JRC) is the scientific and technical arm of the European Commission. It works in close co-operation with the CoMO to provide signatories with clear technical guidelines and templates in order to assist delivery of their Covenant of Mayors commitments as well as to monitor implementation and results.
Website of the JRC: http://ec.europa.eu/dgs/jrc/
May 2010
FRESH - Financial simulation tool ICE 2013
FRESH - Financial simulation tool > Introduction to use ICE 2013
Bioenergy Promotion 2 - From strategies to activities Latvian Environmental Investment Fund 2014
Interim report on the pilot phase of the Europe 2020 project bond initiative European Commission European Commission The European Commission is the executive body of the European Union. The body is responsible for proposing legislation, implementing decisions, upholding the Union’s treaties and the general day-to-day running of the Union. With the Covenant of Mayors initiative, the European Commission - DG Energy endorses and supports the efforts deployed by local authorities in the implementation of sustainable energy policies. 2013
PR - Hera launches the first Italian green bond Hera Group June 2014
Using EU funding mechanism for Smart Cities European Commission European Commission The European Commission is the executive body of the European Union. The body is responsible for proposing legislation, implementing decisions, upholding the Union’s treaties and the general day-to-day running of the Union. With the Covenant of Mayors initiative, the European Commission - DG Energy endorses and supports the efforts deployed by local authorities in the implementation of sustainable energy policies. November 2013
India - Manual for the Development of Municipal Energy Efficiency Projects International Finance Cooperation 2008
Training course on energy efficiency in SMEs ENGINE 2010
Guidelines - Developing and Implementing a Sustainable Urban Mobility Plan Rupprecht Consult September 2011
Final ADVANCE Audit Scheme and Guidelines (Auditing and certification scheme to increase the quality of sustainable urban mobility plans in cities) Traject November 2013
The new LIFE financial instruments European Commission European Commission The European Commission is the executive body of the European Union. The body is responsible for proposing legislation, implementing decisions, upholding the Union’s treaties and the general day-to-day running of the Union. With the Covenant of Mayors initiative, the European Commission - DG Energy endorses and supports the efforts deployed by local authorities in the implementation of sustainable energy policies. 2014
Closing the circle: funding schemes for energy efficiency investments in 2014-2020 European Investment Bank 2014

EUROPEAN FUNDS MANAGED AT NATIONAL AND REGIONAL LEVEL

Structural Funds & Cohesion Fund

The European Cohesion Policy is divided into three main funding instruments:

  • The European Regional Development Fund (ERDF)
  • The European Social Fund (ESF)
  • The Cohesion Fund (CF)

More info: “Cohesion policy: Strategic Report 2010 on the implementation of the programmes 2007-2013” (in all EU languages)

European Regional Development Fund (ERDF) for energy efficiency improvements and use of renewable energy in existing housing

Additional information

Communication of the European Commission European Commission The European Commission is the executive body of the European Union. The body is responsible for proposing legislation, implementing decisions, upholding the Union’s treaties and the general day-to-day running of the Union. With the Covenant of Mayors initiative, the European Commission - DG Energy endorses and supports the efforts deployed by local authorities in the implementation of sustainable energy policies. Regional policy contributing to sustainable growth in Europe

JESSICA technical assistance

JESSICA – Joint European Support for Sustainable Investment in City Areas - is an initiative developed by the European Commission European Commission The European Commission is the executive body of the European Union. The body is responsible for proposing legislation, implementing decisions, upholding the Union’s treaties and the general day-to-day running of the Union. With the Covenant of Mayors initiative, the European Commission - DG Energy endorses and supports the efforts deployed by local authorities in the implementation of sustainable energy policies. and the European Investment Bank, in collaboration with the Council of Europe Development Bank.

Under new procedures, Member States or regions are being given the option of using the structural funds to make repayable investments in projects forming part of an integrated plan for sustainable urban development. These investments, which may take the form of equity, loans and/or guarantees, are delivered to projects via Urban Development Funds and, if required, Holding Funds.

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JASPERS technical assistance

JASPERS - Joint Assistance to Support Projects in European Regions - assists the 12 Central and Eastern EU Member States in the preparation of major projects to be submitted for grant financing under the Structural and Cohesion Funds. The aim is to increase the quantity and quality of projects to be sent for approval to the services of the Commission. JASPERS’ assistance, which is provided free of charge, is geared towards accelerating the absorption of the available funds.

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Cooperation programme INTERREG IV A

The programme supports cross-border cooperation along all interior borders of the EU. The aim is to enhance the exchange of experiences between the European regions and find joint solutions on problems encountered. The main idea is to prevent the "re-inventing of wheel" and replicate faster successful policies and strategies implemented elsewhere. The added value of such projects is sometimes intangible – improved knowledge, capacities, contacts, and new experiences, sometimes pilot actions and hard investments are financed.

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Cooperation programmes INTERREG IV B

Pilot projects, investment preparation and light investments are allowed within this type of cooperation.

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EUROPEAN FUNDS MANAGED CENTRALLY BY THE EUROPEAN COMMISSION European Commission The European Commission is the executive body of the European Union. The body is responsible for proposing legislation, implementing decisions, upholding the Union’s treaties and the general day-to-day running of the Union. With the Covenant of Mayors initiative, the European Commission - DG Energy endorses and supports the efforts deployed by local authorities in the implementation of sustainable energy policies.

Cooperation programmes INTERREG IV C & URBACT

Interregional cooperation (INTERREG IV C): Projects are strictly focused on the exchange of experiences and some light pilot initiatives - testing methodologies and tools. Investment activities are not supported.

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URBACT: European exchange and learning programme for cities promoting sustainable urban development. Cities work together to develop solutions to major urban challenges, reaffirming the key role they play in facing increasingly complex societal changes.

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Horizon 2020

The Horizon 2020 programme was launched in 2014 as a successor to Intelligent Energy-Europe.

Horizon 2020 is the financial instrument implementing the Innovation Union, a Europe 2020 flagship initiative aimed at securing Europe’s global competitiveness.

Horizon 2020, the European Commission European Commission The European Commission is the executive body of the European Union. The body is responsible for proposing legislation, implementing decisions, upholding the Union’s treaties and the general day-to-day running of the Union. With the Covenant of Mayors initiative, the European Commission - DG Energy endorses and supports the efforts deployed by local authorities in the implementation of sustainable energy policies. ’s €80 billion research and innovation programme will focus on excellent science, industrial leadership and tackling societal challenges. There are a number of calls offering funding to help public authorities carry out sustainable energy policies.

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Calls for application 2014

ELENA facility

ELENA – European Local Energy Assistance – is a facility that provides grants for technical assistance. The wide range of measures eligible for such financial support include: feasibility & market studies; structuring of investment programmes; business plans; energy audits; preparation of tendering procedures & contractual arrangements and allocation of investment programme management to newly recruited staff. The aim is to bundle dispersed local projects into systemic investments and make them bankable.

The actions featured in the municipalities’ action plans Action plans A Sustainable Energy Action Plan (SEAP) is the key document in which the Covenant signatory outlines how it intends to reach its CO2 reduction target by 2020. It defines the activities and measures set up to achieve the targets, together with time frames and assigned responsibilities. Covenant signatories are free to choose the format of their SEAP, as long as it is in line with the general principles set out in the Covenant SEAP guidelines. and investment programmes must be financed through other means, such as loans, ESCOs or structural funds.

ELENA is financed through the European Intelligent Energy-Europe programme with an annual budget of €15 million.

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ELENA-KfW

This new technical assistance facility has been launched by the European Commission European Commission The European Commission is the executive body of the European Union. The body is responsible for proposing legislation, implementing decisions, upholding the Union’s treaties and the general day-to-day running of the Union. With the Covenant of Mayors initiative, the European Commission - DG Energy endorses and supports the efforts deployed by local authorities in the implementation of sustainable energy policies. in cooperation with the German group KfW. It supports medium-sized investment projects of less than €50 million with a focus on carbon crediting.

ELENA-CEB

Developed by the European Commission European Commission The European Commission is the executive body of the European Union. The body is responsible for proposing legislation, implementing decisions, upholding the Union’s treaties and the general day-to-day running of the Union. With the Covenant of Mayors initiative, the European Commission - DG Energy endorses and supports the efforts deployed by local authorities in the implementation of sustainable energy policies. in partnership with the Council of Europe Development Bank, ELENA-CEB will provide technical assistance for the development of investment projects targeting social housing.

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EBRD-ELENA

The EBRD-ELENA facility supports the preparation and mobilisation of financing for sustainable energy investments by local and regional authorities and other public bodies.

The facility will cover up to 90% of the total technical cooperation (TC) costs necessary to prepare and implement sustainable energy investments in the municipal sector, including feasibility and market studies, identification and preparation of eligible projects, business planning, energy audits, implementation and verification of projects, establishment of a project implementation units, preparation of tender documentation and launching of the tender process.

The facility supports five types of EBRD-backed energy efficiency investment projects:

  • municipal building projects,
  • district heating projects,
  • urban transport projects,
  • local infrastructure projects,
  • and utilities infrastructure.

The eligible countries are: Bulgaria, Croatia, Estonia, FYR Macedonia, Hungary, Latvia, Lithuania, Poland, Romania, Slovakia and Slovenia.

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Feel free to contact the EBRD for further information.

Smart Cities & Communities

Covenant Signatories Signatories Signatories represent cities, with different size from small villages to major metropolitan areas such as London or Paris, that have signed the Covenant of Mayors on a voluntary manner and are committed to implement sustainable energy policies to meet and exceed the EU 20% CO2 reduction objective through increased energy efficiency and development of renewable energy sources. having taken a political commitment to mitigate climate change and developed a holistic sustainable energy action plan Sustainable Energy Action Plan A Sustainable Energy Action Plan (SEAP) is the key document in which the Covenant signatory outlines how it intends to reach its CO2 reduction target by 2020. It defines the activities and measures set up to achieve the targets, together with time frames and assigned responsibilities. Covenant signatories are free to choose the format of their SEAP, as long as it is in line with the general principles set out in the Covenant SEAP guidelines. for their territories can also benefit from the technology component of Europe’s energy policy. The Smart Cities initiative will support a limited number of larger technology-focused projects of cities and regions featuring pioneering measures in sustainable use and production of energy as well as in mobility.

It will draw upon the other Strategic Energy Technology Plan (SET-Plan) initiatives, in particular the Solar Europe Initiative and European Electricity Grid Initiative, as well as on the EU public-private partnership for Buildings and Green Cars, established under the European Economic Plan for Recovery.

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European Energy Efficiency Facility

A new European investment fund for sustainable energy projects is to be launched in 2011. This fund will use the unspent €146 million from the European Economic Recovery Programme, supplemented by co-funding from the European Investment Bank, in order to provide equity, guarantees and debt products for public authorities and entities acting on their behalf. The fund will focus on investments in buildings, local energy infrastructure, distributed renewable installations and urban mobility.

Municipal Finance Facility

The Municipal Finance Facility is an initiative of the European Commission European Commission The European Commission is the executive body of the European Union. The body is responsible for proposing legislation, implementing decisions, upholding the Union’s treaties and the general day-to-day running of the Union. With the Covenant of Mayors initiative, the European Commission - DG Energy endorses and supports the efforts deployed by local authorities in the implementation of sustainable energy policies. and the European Bank for Reconstruction and Development (EBRD) to develop and stimulate commercial bank lending to small and medium-sized municipalities and their utility companies in the EU countries who joined the EU in 2004 (Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Slovak Republic and Slovenia with Bulgaria and Romania). The facility combines EBRD finance in the form of long-term loans and/or risk sharing.

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Sustainable Energy Initiative

The European Bank for Reconstruction and Development (EBRD) supports municipal sustainable energy projects in the countries of its operation.

The areas of intervention (e.g. municipal energy infrastructure, transport, carbon market, etc.) target municipalities, local banks, Small and Medium Enterprises and other local actors.

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With the political support of the European Commission - DG Energy With the political support of the European Commission - DG Energy. Website coordinated by the Covenant of Mayors Office.
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