Regulation (EC) No 663/2009 of the European Parliament and of the Council of 13 July 2009 establishing a programme to aid economic recovery by granting Community financial assistance to projects in the field of energy

• CELEX: Regulation (EC) No 663/2009
• Articles: 30

Article 1 Subject matter

This Regulation establishes a financing instrument entitled the European Energy Programme for Recovery (the EEPR) for the development of projects in the field of energy in the Community which, by providing a financial stimulus, contribute to economic recovery, the security of energy supply and the reduction of greenhouse gas emissions.

This Regulation establishes sub-programmes to advance those objectives in the fields of:

(a)

gas and electricity infrastructures;

(b)

offshore wind energy; and

(c)

carbon capture and storage.

This Regulation identifies projects to be financed under each sub-programme and lays down criteria for identifying and implementing actions to realise these projects.

Article 2 Definitions

For the purposes of this Regulation, the following definitions shall apply:

(a)

‘carbon capture and storage’ means the capture of carbon dioxide (CO 2 ) from industrial installations, its transport to a storage site and its injection into a suitable underground geological formation for the purposes of permanent storage;

(b)

‘eligible costs’ has the same meaning as in Regulation (EC, Euratom) No 2342/2002;

(c)

‘gas and electricity infrastructures’ means:

(i)

all high-voltage lines, excluding those of distribution networks, and submarine links, provided that this infrastructure is used for interregional or international transmission or connection;

(ii)

high-pressure gas pipelines, excluding those of distribution networks;

(iii)

underground storage facilities connected to the high-pressure gas pipelines referred to in point (ii);

(iv)

reception, storage and regasification facilities for liquefied natural gas (LNG); and

(v)

any equipment or installations essential for the infrastructure referred to in points (i), (ii), (iii) or (iv) to operate properly, including protection, monitoring and control systems;

(d)

‘part of a project’ means any activity that is independent financially, technically or over time and which contributes to the completion of a project;

(e)

‘investment phase’ means the phase of a project during which construction takes place and capital costs are incurred;

(f)

‘offshore wind energy’ means the electric power generated from turbine engines powered by wind and situated in the sea, whether near or far from the shore;

(g)

‘planning phase’ means the phase of a project that precedes the investment phase, during which project implementation is prepared, and includes, where appropriate, feasibility assessment, preparatory and technical studies, obtaining licences and authorisations and incurring capital costs.

Article 3 Budget

1.   The financial envelope for the implementation of the EEPR for 2009 and 2010 shall be EUR 3 980 000 000, allocated as follows:

(a)

gas and electricity infrastructure projects: EUR 2 365 000 000;

(b)

offshore wind energy projects: EUR 565 000 000;

(c)

carbon capture and storage projects: EUR 1 050 000 000.

2.   Individual legal commitments implementing the budgetary commitments made in 2009 and 2010 shall be made by 31 December 2010.

Article 4 Objectives

The Community shall promote gas and electricity infrastructure projects having the highest Community added value and contributing to the following objectives:

(a)

security and diversification of sources of energy, routes and supplies;

(b)

the optimisation of the capacity of the energy network and the integration of the internal energy market, in particular concerning cross-border sections;

(c)

the development of the network to strengthen economic and social cohesion by reducing the isolation of the least favoured regions or islands of the Community;

(d)

the connection and integration of renewable energy resources; and

(e)

the safety, reliability and interoperability of interconnected energy networks, including the ability to use multidirectional gas flows where necessary.

Article 5 Priorities

The EEPR shall serve urgently to adapt and develop energy networks of particular importance to the Community in support of the operation of the internal energy market and, in particular, to increase interconnection capacity, security and diversification of supply and to overcome environmental, technical and financial obstacles. Special Community support is necessary to develop energy networks more intensively and to accelerate their construction, notably where the diversity of routes and sources of supply is low.

Article 6 Granting of Community financial assistance

1.   Financial assistance under the EEPR (EEPR assistance) for gas and electricity infrastructure projects shall be awarded for actions that implement the projects listed in Part A of the Annex or parts of such projects, and which contribute to the objectives laid down in Article 4.

2.   The Commission shall call for proposals to identify the actions referred to in paragraph 1 and shall assess the compliance of those proposals with the eligibility criteria laid down in Article 7 and the selection and award criteria laid down in Article 8.

3.   The Commission shall inform the beneficiaries of any EEPR assistance to be granted.

Article 7 Eligibility

1.   Proposals shall be eligible for EEPR assistance only if they implement the projects listed in Part A of the Annex, do not exceed the maximum amount of EERP assistance laid down therein and fulfil the selection and award criteria under Article 8.

2.   Proposals may be submitted:

(a)

by one or several Member States, acting jointly;

(b)

with the agreement of all Member States directly concerned by the project in question:

(i)

by one or several public or private undertakings or bodies acting jointly;

(ii)

by one or several international organisations acting jointly; or

(iii)

by a joint undertaking.

3.   Proposals submitted by natural persons shall not be eligible.

Article 8 Selection and award criteria

1.   In assessing the proposals received under the call for proposals referred to in Article 6(2), the Commission shall apply the following selection criteria:

(a)

the soundness and technical adequacy of the approach;

(b)

the soundness of the financial package for the full investment phase of the action.

2.   In assessing the proposals received under the call for proposals referred to in Article 6(2), the Commission shall apply the following award criteria:

(a)

maturity, defined as reaching the investment stage, and incurring substantial capital expenditure by the end of 2010;

(b)

the extent to which lack of access to finance is delaying the implementation of the action;

(c)

the extent to which EEPR assistance will stimulate public and private finance;

(d)

socioeconomic impacts;

(e)

environmental impacts;

(f)

the contribution to the continuity and interoperability of the energy network, and to the optimisation of its capacity;

(g)

the contribution to the improvement of service quality, safety and security;

(h)

the contribution to the creation of a well-integrated energy market.

Article 9 Funding conditions

1.   EEPR assistance shall contribute to project-related expenditure for the implementation of the project, incurred by the beneficiaries or by third parties responsible for the implementation of a project.

2.   EEPR assistance shall not exceed 50 % of the eligible costs.

Article 10 Instruments

1.   Following the call for proposals referred to in Article 6(2), the Commission, acting in accordance with the management procedure referred to in Article 26(2), shall select the proposals to receive EEPR assistance and determine the amount of EEPR assistance to be granted. The Commission shall specify the conditions and methods for the implementation of the proposals.

2.   EEPR assistance shall be granted on the basis of Commission decisions.

Article 11 Member States’ financial responsibilities

1.   Member States shall undertake the technical monitoring and financial control of projects in close cooperation with the Commission and shall certify the amount and the conformity with this Regulation of the expenditure incurred in respect of projects or parts of projects. Member States may request the participation of the Commission during on-the-spot checks.

2.   Member States shall inform the Commission of the measures taken under paragraph 1 and, in particular, shall supply a description of the control, management and monitoring systems established to ensure that projects are successfully completed.

Article 12 Granting of EEPR assistance

1.   EEPR assistance for offshore wind projects shall be awarded following a call for proposals limited to the actions that implement the projects listed in Part B of the Annex.

2.   The Commission shall call for proposals to identify the actions referred to in paragraph 1 and shall assess the compliance of these proposals with the eligibility criteria laid down in Article 13 and the selection and award criteria laid down in Article 14.

3.   The Commission shall inform the beneficiaries of any EEPR assistance to be granted.

Article 13 Eligibility

1.   Proposals shall be eligible for EEPR assistance only if they implement the projects listed in Part B of the Annex, do not exceed the maximum amount of EEPR assistance laid down therein and fulfil the selection and award criteria under Article 14. Those projects shall be led by a commercial undertaking.

2.   Proposals may be submitted by one or several undertakings, acting jointly.

3.   Proposals submitted by natural persons shall not be eligible.

Article 14 Selection and award criteria

1.   In assessing the proposals received under the call for proposals referred to in Article 12(1), the Commission shall apply the following selection criteria:

(a)

the soundness and technical adequacy of the approach;

(b)

the soundness of the financial package for the full investment phase of the project.

2.   In assessing the proposals received under the call for proposals referred to in Article 12(1), the Commission shall apply the following award criteria:

(a)

maturity, defined as reaching the investment stage, and incurring substantial capital expenditure by the end of 2010;

(b)

the extent to which lack of access to finance is delaying the implementation of the action;

(c)

the extent to which the project improves or increases the scale of installations and infrastructures that are already under construction, or are in the planning phase;

(d)

the extent to which the project includes the construction of full-size and industrial-scale installations and infrastructures, and addresses in particular the following matters:

(i)

the balancing of the variability of wind electricity through integrative systems;

(ii)

the existence of large-scale storage systems;

(iii)

the management of wind farms as virtual power plants (more than 1 GW);

(iv)

the existence of turbines placed further from the shore or in deeper waters (20 to 50 m) than is currently standard;

(v)

novel sub-structure designs; or

(vi)

processes for assembly, installation, operation and decommissioning and testing of these processes in life-size projects;

(e)

the innovative features of the project and the extent to which it will demonstrate the implementation of such features;

(f)

the impact of the project and its contribution to the Community’s offshore wind grid system, including its replication potential;

(g)

the commitment demonstrated by the beneficiaries to disseminate to other European operators the results of technological advances made by the project in a manner compatible with Community law and in particular with the objectives and structures outlined in the Strategic Energy Technology Plan for Europe.

Article 15 Funding conditions

1.   EEPR assistance shall contribute to project-related expenditure for the implementation of the project.

2.   EEPR assistance shall not exceed 50 % of the eligible costs.

Article 16 Instruments

1.   Following the call for proposals referred to in Article 12(1), the Commission, acting in accordance with the management procedure referred to in Article 26(2), shall select the proposals to receive EEPR assistance and determine the amount of funding to be granted. The Commission shall specify the conditions and methods for the implementation of the proposals.

2.   EEPR assistance shall be granted on the basis of grant agreements.

Article 17 Granting of EEPR assistance

1.   EEPR assistance for carbon capture and storage projects shall be awarded to actions that implement the projects listed in Part C of the Annex.

2.   The Commission shall call for proposals to identify the actions referred to in paragraph 1 of this Article and shall assess the compliance of the proposals with the eligibility criteria laid down in Article 18 and the selection and award criteria laid down in Article 19.

3.   If several proposals from projects located in the same Member State comply with the eligibility criteria laid down in Article 18 and the selection criteria laid down in Article 19(1), the Commission shall select for EEPR assistance, on the basis of the award criteria in Article 19(2), no more than one proposal per Member State among those proposals.

4.   The Commission shall inform the beneficiaries of any EEPR assistance to be granted.

Article 18 Eligibility

1.   Proposals shall be eligible for EEPR assistance only if they implement the projects listed in Part C of the Annex, fulfil the selection and award criteria under Article 19 and the following conditions:

(a)

the projects demonstrate that they have the ability to capture at least 80 % of CO 2 in industrial installations and to transport and geologically store this CO 2 safely underground;

(b)

in power installations, CO 2 capture is demonstrated on an installation of at least 250 MW electrical output or equivalent;

(c)

project promoters make a binding declaration that the generic knowledge generated by the demonstration plant will be made available to the wider industry and to the Commission to contribute to the Strategic Energy Technology Plan for Europe.

2.   Proposals shall be submitted by one or several undertakings, acting jointly.

3.   Proposals submitted by natural persons shall not be eligible.

Article 19 Selection and award criteria

1.   In assessing the proposals received under the call for proposals referred to in Article 17(2), the Commission shall apply the following selection criteria:

(a)

the soundness and technical adequacy of the approach;

(b)

maturity, defined as reaching the investment stage, which includes exploration and development of storage options, and incurring substantial investment-related expenditure for the project by the end of 2010;

(c)

the soundness of the financial package for the full investment phase of the project;

(d)

identification of all necessary permits required for construction and operation of the project at the proposed site(s) and the existence of a strategy to secure those permits.

2.   In assessing the proposals received under the call for proposals referred to in Article 17(2), the Commission shall apply the following award criteria:

(a)

the extent to which lack of access to finance is delaying the implementation of the action;

(b)

requested funding per tonne of CO 2 to be abated in the first five years of operation of the project;

(c)

the complexity of the project and level of innovation of the overall installation including other accompanying research activities and the commitment demonstrated by the beneficiaries to disseminate to other European operators the results of the technological advances made by the project in a manner compatible with Community law and in particular with the objectives and structures outlined in the Strategic Energy Technology Plan for Europe;

(d)

the soundness and adequacy of the management plan including, in relation to the scientific, engineering and technical information and data contained therein, demonstration of readiness of the proposed concept to achieve operation of the project by 31 December 2015.

Article 20 Funding conditions

1.   EEPR assistance shall contribute only to project-related expenditure for the implementation of the project which is attributable to carbon capture, transport and storage, taking account of possible operating benefits.

2.   EEPR assistance shall not exceed 80 % of total eligible investment costs.

Article 21 Instruments

1.   Following the call for proposals referred to in Article 17(2), the Commission, acting in accordance with the management procedure referred to in Article 26(2), shall select the proposals to receive EEPR assistance and determine the amount of EEPR assistance to be granted. The Commission shall specify the conditions and methods for the implementation of the proposals.

2.   EEPR assistance shall be granted on the basis of grant agreements.

Article 22 Other EEPR assistance and instruments

1.   A part of the Community assistance for the projects listed in the Annex may be granted through a contribution to an appropriate instrument under the resources of the European Investment Bank. That contribution shall not exceed EUR 500 000 000.

2.   The Community exposure to the loan guarantee instrument or other financing instrument, including management fees and other eligible costs, shall be limited to the amount of the Community contribution to that instrument and there shall be no further liability on the general budget of the European Union.

3.   The Commission, acting in accordance with the management procedure referred to in Article 26(2), shall decide on the amount of EEPR assistance to be granted to that instrument. The Commission and the European Investment Bank shall conclude a memorandum of understanding specifying the conditions and the methods for the implementation of that decision.

Article 23 Programming and implementing arrangements

1.   Calls for proposals shall be directly launched by the Commission on the basis of budgetary availabilities referred to in Article 3(1) and the eligibility, selection and award criteria set out in Chapter II.

2.   EEPR assistance shall cover only project-related expenditure incurred by the beneficiaries and, as regards projects under Article 9, also by third parties responsible for the implementation of a project. Expenditure may be eligible from the date referred to in Article 29.

3.   VAT shall not be an eligible cost, except for non-refundable VAT.

4.   Projects and actions financed under this Regulation shall be carried out in accordance with Community law and shall take into account any relevant Community policies, in particular those relating to competition including the applicable State aid rules, protection of the environment, health, sustainable development and public procurement.

Article 24 Member States’ general responsibilities

Within the sphere of their responsibility, Member States shall make every effort to implement the projects which receive EEPR assistance, notably through efficient administrative authorisation, licensing and certification procedures.

Article 25 Protection of the European Communities’ financial interests

1.   The Commission shall ensure that, when actions financed under this Regulation are implemented, the financial interests of the Community are protected by the application of preventive measures against fraud, corruption and any other illegal activities, by effective checks and by the recovery of amounts unduly paid and, if irregularities are detected, by effective, proportionate and dissuasive penalties, in accordance with Regulation (EC, Euratom) No 2988/95, Regulation (Euratom, EC) No 2185/96 and with Regulation (EC) No 1073/1999.

2.   For the Community actions financed under this Regulation, the notion of irregularity referred to in Article 1(2) of Regulation (EC, Euratom) No 2988/95 shall mean any infringement of a provision of Community law or any breach of a contractual obligation resulting from an act or omission by an economic operator, which has, or would have, the effect of prejudicing the general budget of the European Union or budgets managed by it, by an unjustified item of expenditure.

3.   All implementing measures resulting from this Regulation shall provide, in particular, for supervision and financial control by the Commission or any representative authorised by it, and by audits by the European Court of Auditors, including, if necessary, on-the-spot audits.

Article 26 Committees

1.   The Commission shall be assisted by the following committees:

(a)

for gas and electricity infrastructure projects, the committee established by Article 15 of Regulation (EC) No 680/2007 of the European Parliament and of the Council of 20 June 2007 laying down general rules for the granting of Community financial aid in the field of the trans-European transport and energy networks  ( 9 ) ;

(b)

for offshore wind projects, the committee established by Article 8 of Council Decision 2006/971/EC of 19 December 2006 concerning the Specific Programme Cooperation implementing the Seventh Framework Programme of the European Community for research, technological development and demonstration activities (2007 to 2013)  ( 10 ) ;

(c)

for carbon capture and storage projects, the committee established by Article 8 of Decision 2006/971/EC.

2.   Where reference is made to this paragraph, Articles 4 and 7 of Decision 1999/468/EC shall apply, having regard to the provisions of Article 8 thereof.

The period laid down in Article 4(3) of Decision 1999/468/EC shall be set at one month.

Article 27 Evaluation

1.   The Commission shall carry out an evaluation of the EEPR by 31 December 2011 in order to assess its contribution to the effective use made of the appropriations.

2.   The Commission may request a beneficiary Member State to provide a specific evaluation of projects financed under Section 1 of Chapter II of this Regulation or, where appropriate, to supply it with the information and assistance required to undertake an evaluation of such projects.

3.   The Commission shall present to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions an evaluation report on the results achieved by the EEPR.

Article 28 Information to the European Parliament and to the Council

The Commission shall monitor the implementation of this Regulation. It shall, each year, on presentation of the preliminary draft budget, present a report to the European Parliament and to the Council on the implementation of the EEPR.

If the report identifies serious risks in implementing the priority projects, the Commission shall recommend measures to offset those risks, and shall, where appropriate and consistent with the Recovery Plan, make additional proposals for such projects.

Article 29 Entry into force

This Regulation shall enter into force on the day following its publication in the Official Journal of the European Union .

Schedules & Appendices

ANNEX

ANNEX

ELIGIBLE PROJECTS

A.    Gas and Electricity infrastructure projects

1.    Gas interconnectors

Project

Location of projects supported

Envisaged Community contribution

(EUR million)

Southern Gas Corridor

NABUCCO

Austria, Hungary, Bulgaria, Germany, Romania

200

ITGI – Poseidon

Italy, Greece

100

Baltic interconnection

Skanled/Baltic pipe

Poland, Denmark, Sweden

150

LNG network

Liquefied Natural Gas terminal at Polish coast at port of Świnoujście

Poland

80

Central and South East Europe

Slovakia-Hungary Interconnector (Veľký Krtíš - Vecsés)

Slovakia, Hungary

30

Gas transmission system in Slovenia between the Austrian Border to Ljubljana (excluding the section Rogatec-Kidričevo)

Slovenia

40

Interconnection Bulgaria-Greece (Stara Zagora — Dimitrovgrad-Komotini)

Bulgaria, Greece

45

Romania-Hungary gas interconnector

Romania, Hungary

30

Expansion of Gas Storage Capacity in the Czech hub

Czech Republic

35

Infrastructure and equipment to permit reverse gas flow in the event of short term supply disruption

Austria, Bulgaria, Czech Republic, Estonia, Greece, Hungary, Latvia, Lithuania, Poland, Portugal, Romania, Slovakia

80

Slovakia-Poland interconnection

Slovakia, Poland

20

Hungary-Croatia interconnection

Hungary

20

Bulgaria-Romania interconnection

Bulgaria, Romania

10

Mediterranean

Reinforcement of FR gas network on the Africa-Spain-France axis

France

200

GALSI (Gazoduc Algérie-Italie)

Italy

120

Gas Interconnection Western Axis Larrau Branch

Spain

45

North Sea area

Germany-Belgium-United Kingdom pipeline

Belgium

35

France-Belgium connection

France, Belgium

200

TOTAL

1 440

2.    Electricity interconnectors

Project

Location of projects supported

Envisaged Community contribution

(EUR million)

Baltic interconnection

Estlink-2

Estonia, Finland

100

Interconnection Sweden-Baltic States, and strengthening of the grid in Baltic States

Sweden, Latvia, Lithuania

175

Central and South East Europe

Halle/Saale – Schweinfurt

Germany

100

Wien-Győr

Austria, Hungary

20

Mediterranean

Portugal-Spain interconnection reinforcement

Portugal

50

Interconnection France-Spain (Baixas - Sta Llogaia)

France, Spain

225

New 380 kV AC submarine cable between Sicily – Continental Italy (Sorgente – Rizziconi)

Italy

110

North Sea area

500 MW Ireland/Wales interconnector (Meath-Deeside)

Ireland, United Kingdom

110

Electricity interconnection Malta-Italy

Malta/Italy

20

TOTAL

910

3.    Small island projects

Small isolated island initiatives

Cyprus

10

Malta

5

TOTAL

15

B.    Offshore wind projects

Project

Capacity

Location of projects supported

Envisaged Community contribution

(EUR million)

1.    Grid integration of offshore wind energy

1.1.

Baltic – Kriegers Flak I, II, III

Building on projects under development. Financing aimed at ensuring extra cost for securing a joint interconnection solution.

1,5 GW

Denmark, Sweden, Germany, Poland

150

1.2.

North sea grid

Modular development of offshore grid, demonstration of virtual offshore power plant and integration in the existing onshore grid system.

1 GW

United Kingdom, Netherlands, Germany, Ireland, Denmark, Belgium, France, Luxembourg

165

2.    New turbines, structures and components, optimisation of manufacturing capacities

2.1.

Borkum West II – Bard 1 – Nordsee Ost – Global Tech I

New generation of multi-megawatt size turbines (5-7 MW) and innovative structures, situated far from shore (up to 100 km) in deeper waters (up to 40 m).

1,6 GW

Germany

200

2.2.

Aberdeen offshore wind farm (European testing centre)

Building on project presently under development – testing of multi-MW turbines. Development of innovative structures and substructures including optimisation of manufacturing capacities of offshore wind energy production equipment. An increase in size of 100 MW can be envisaged.

0,25 GW

United Kingdom

40

2.3.

Thornton Bank

Building on project presently under development. Learning from the Downvind project (cofinanced through FP6). Upscaling the Downvind installations turbines (5 MW size) in deep waters (up to 30 m) with low visual impact (up to 30 km).

90 MW

Belgium

10

TOTAL

565

C.    Carbon capture and storage projects

Project Name/Location

Envisaged Community contribution

(EUR million)

Fuel

Capacity

Capture Technique

Storage Concept

Huerth

Germany

180

Coal

450 MW

IGCC

Saline Aquifer

Jaenschwalde

Coal

500 MW

Oxyfuel

Oil/Gas fields

Eemshaven

Netherlands

180

Coal

1 200 MW

IGCC

Oil/Gas fields

Rotterdam

Coal

1 080 MW

PC

Oil/Gas fields

Rotterdam

Coal

800 MW

PC

Oil/Gas fields

Bełchatów

Poland

180

Coal

858 MW

PC

Saline Aquifer

Compostilla

(León)

Spain

180

Coal

500 MW

Oxyfuel

Saline Aquifer

Kingsnorth

United Kingdom

180

Coal

800 MW

PC

Oil/Gas fields

Longannet

Coal

3 390 MW

PC

Saline Aquifer

Tilbury

Coal

1 600 MW

PC

Oil/Gas fields

Hatfield

(Yorkshire)

Coal

900 MW

IGCC

Oil/Gas fields

Porto Tolle

Italy

100

Coal

660 MW

PC

Industrial carbon capture project

Florange

France

50

Transport of CO 2 from industrial installation (steel plant) to underground storage (saline aquifer)

TOTAL

1 050