The Council adopted its position at first reading with a view to the adoption of a regulation of the European Parliament and of the Council establishing a Programme for the Environment and Climate Action (LIFE), and repealing Regulation (EU) No 1293/2013.

The proposed Regulation aims at establishing a programme for environment and climate action (LIFE) for the duration of the multiannual financial framework (MFF) 2021-2027.

Objective

The LIFE programme aims to contribute to the implementation, updating and development of EU environment and climate policies and legislation by co-financing projects with European added value.

Its main aim is to:

- contribute to the just transition towards a sustainable, circular, energy-efficient, renewable energy-based, climate-neutral and climate-resilient economy;

- protect, restore and improve the quality of the environment, including air, water and soil, and;

- halt and reverse the loss of biodiversity and combating the degradation of ecosystems, in particular by supporting the implementation and management of the Natura 2000 network so as to contribute to sustainable development.

Budget

The financial envelope for the implementation of the programme for the period 2021-2027 should be EUR 5 432 000 000 in current prices.

The indicative distribution of the amount is:

- EUR 3 488 000 000 for the field 'Environment', of which: (i) EUR 2 143 000 000 for the subprogramme 'Nature and Biodiversity', and (ii) EUR 1 345 000 000 for the subprogramme 'Circular Economy and Quality of Life';

- EUR 1 944 000 000 for the field 'Climate Action', of which: (i) EUR 947 000 000 for the subprogramme 'Climate Change Mitigation and Adaptation', and (ii) EUR 997 000 000 for the subprogramme 'Clean Energy Transition'.

At least 60% of the budgetary resources allocated to projects supported by action grants under the Environment area should be devoted to grants for projects supporting the Nature and Biodiversity sub-programme.

Climate mainstreaming and biodiversity ambition

The Council's position reflects the agreement of the European Council on the MFF to increase the target for budget wide climate related spending from 25% to at least 30%. 61% of the financial envelope of LIFE is expected to contribute to the achievement of that target

Accordingly, the LIFE Programme should contribute to mainstream biodiversity action in the Union policies and to the achievement of the overall ambition of providing 7.5% of annual spending under the MFF to biodiversity objectives in 2024 and 10% of annual spending under the MFF to biodiversity objectives in 2026 and 2027, while considering the existing overlaps between climate and biodiversity goals.

Implementation of funding

The Council's position provides that at least 85% of the LIFE budget should be allocated to grants to finance, inter alia, strategic nature conservation projects under the Nature and Biodiversity sub-programme, strategic integrated projects under the Circular Economy and Climate Action sub-programmes and technical assistance projects.

Co-financing rates for eligible actions should be a maximum of 60% of eligible costs and 75% for projects financed under the Nature and Biodiversity sub-programme which concern in particular priority habitats or species or bird species for which funding is considered a priority, where this is necessary to achieve the intended conservation objective.

Award criteria and geographical balance

The Council's position states that quality should be the general criterion for awarding projects under the LIFE programme and that the Commission should seek to ensure a real geographical coverage of the whole territory of the Union, based on the quality of the projects.

Funding should be provided for capacity building for activities by Member State authorities to improve effective participation in projects under the programme.

The maximum amount allocated to grants should be EUR 15 million, with maximum co-financing rates not exceeding 95% of eligible project costs.

Multi-annual work programmes

The Council position foresees that the first multi-annual work programme should run for four years and the second multi-annual work programme for three years.

The work programmes should be adopted by means of implementing acts and should include performance indicators for each sub-programme, as well as indicative timetables for calls for proposals, the selection procedure and award criteria for the submission of projects.

The Commission should ensure consultation of stakeholders during the preparation of the work programmes.

The European Parliament adopted by 578 votes to 39, with 34 abstentions, a legislative resolution on the proposal for a regulation of the European Parliament and of the Council establishing a Programme for the Environment and Climate Action (LIFE) and repealing Regulation (EU) No 1293/2013.

The European Parliament’s position adopted at first reading under the ordinary legislative procedure amended the Commission proposal as follows:

Objectives

The general objective of the LIFE Programme shall be to:

- contribute to the shift towards a sustainable, circular, energy-efficient, renewable energy-based, climate-neutral and -resilient economy;

- protect, restore and improve the quality of the environment, including the air, water and soil;

- halt and reverse biodiversity loss and to tackle the degradation of ecosystems, including through supporting the implementation and management of the Natura 2000 network.

The LIFE programme is the only programme dedicated specifically to environment and climate action, and therefore plays a crucial role in supporting the implementation of Union legislation and policies in those areas. Parliament considered that the LIFE Programme should contribute to mainstream climate actions and to the achievement of an overall target of at least 25 % of the EU budget expenditures supporting climate objectives over the MFF 2021-2027 period, and an annual target of 30 % as soon as possible and at the latest by 2027.

Budget

Parliament proposed that the financial envelope for the implementation of the programme for the period 2021-2027 should be set at EUR 6.44 billion at constant 2018 prices , i.e. EUR 7.27 billion at current prices (compared to EUR 5.45 billion at current prices in the Commission's proposal).

The indicative breakdown of this amount shall be as follows:

- Environment: EUR 4.71 billion at 2018 prices, of which: (i) EUR 2.82 billion for the Nature and Biodiversity sub-programme and (ii) EUR 1.88 billion for the Circular Economy and Quality of Life sub-programme;

- Climate Action area: EUR 1.95 billion of which: (i) EUR 950 million for the sub-programme 'Climate change mitigation and adaptation' and (ii) EUR 1 billion for the sub-programme 'Transition to clean energy'.

At least 60 % of the budgetary resources allocated to projects supported by action grants under the 'Environment' domain shall be devoted to grants awarded for projects supporting the 'Nature and Biodiversity' sub-programme.

Projects under the new Clean Energy Transition sub-programme shall focus on capacity building and the dissemination of knowledge, skills and innovative solutions to achieve the objectives of EU legislation and policy on the transition to renewable energy and improving energy efficiency.

The LIFE Programme may finance technical and administrative assistance activities by the Commission for the implementation of the LIFE Programme, such as preparatory, monitoring, control, audit and evaluation activities including corporate information technology systems and network activities supporting the LIFE Programme’s National Contact Points, including training, mutual learning activities and events to share experience.

Implementation and forms of Union funding

At least 85% of the LIFE programme budget shall be allocated to grants for projects financed by other forms of financing and financial instruments in the context of mixed financing operations.

The co-financing rates for certain strategic nature protection projects, certain integrated strategic projects, technical assistance projects and standard action projects would be a maximum of 60 % of the eligible costs and 75 % in the case of projects financed under the Nature and Biodiversity sub-programme which concern in particular priority habitats or species or bird species for which funding is considered a priority, where this is necessary to achieve the desired conservation objective.

The evaluation of projects and the award process in the LIFE programme shall be governed by the quality criterion while seeking to ensure effective geographical coverage across the Union, including by supporting Member States to increase the quality of projects through capacity building.

Technical assistance projects concerning the activities of Member States' authorities should improve effective participation in the LIFE programme, support the activities of Member States with a low effective participation rate and improve the services of the National Contact Points in the Union as well as the overall quality of the proposals submitted.

Award criteria

The Commission shall set out award criteria in the multiannual work programme referred to in Article 17 and the calls for proposals taking into account the following principles:

- projects financed by the LIFE Programme shall be of Union interest and shall promote the use of green public procurement;

- projects shall ensure a cost-effective approach and be technically and financially coherent;

- projects with the highest potential of being replicated and taken-up by the public or private sector or of mobilising the largest investments or financial resources (catalytic potential) shall benefit from a bonus in their evaluation.

The European Parliament adopted by 580 votes to 41, with 45 abstentions, amendments to the proposal for a regulation of the European Parliament and of the Council establishing a Programme for the Environment and Climate Action (LIFE) and repealing Regulation (EU) No 1293/2013.

The matter was referred back to the committee for interinstitutional negotiations.

The main amendments adopted in plenary concerned the following issues:

Objective : the proposed Regulation aims to establish a Programme for the Environment and Climate Action (LIFE) , covering the period from 1 January 2021 to 31 December 2027.

Parliament Members stressed that LIFE is the only programme specifically dedicated to the environment and climate and as such it plays a crucial role in supporting the implementation of EU legislation in these areas. It shall contribute to mainstream climate actions and to the achievement of an overall target of at least 25% of the EU budget expenditures supporting climate objectives over the MFF 2021-2027 period, and an annual target of 30 % as soon as possible and at the latest by 2027.

The general objective of the Programme is to:

contribute to the shift towards a clean, circular, energy-efficient, net-zero emission and climate-resilient economy; protect and improve the quality of the environment; halt and reverse biodiversity loss and the degradation of ecosystems, thereby contributing to sustainable development.

To this end, the Programme shall:

promote innovative techniques and approaches for reaching the objectives of the Union legislation and policy on environment and climate action, including the transition to clean, renewable energy and increased energy efficiency; contribute to the knowledge base, effective management and application of best practice, in relation to nature and biodiversity, including through the support of the Natura 2000 network; support the implementation of General Union Environment Action Programmes and improve environmental and climate governance at all levels, including by enhancing capacities of public and private actors and the involvement of civil society.

Budget : the financial envelope for the implementation of the Programme for the period 2021-2027 shall be EUR 6.44 billion in 2018 prices (EUR 7.27 billion in current prices) as opposed to EUR 5.45 billion in current prices proposed by the Commission).

The indicative distribution of the amount shall be:

Environment: EUR 4.71 billion at 2018 prices , of which: (i) EUR 2.82 billion for the Nature and Biodiversity sub-programme and (ii) EUR 1.88 billion for the Circular Economy and Quality of Life sub-programme; Climate Action area: EUR 1.95 billion of which: (i) EUR 950 million for the sub-programme 'Climate change mitigation and adaptation' and (ii) EUR 1 billion for the sub-programme 'Clean energy transition'.

Synergies : LIFE shall facilitate integration, particularly in major EU funding programmes. Since environmental and climate requirements shall be integrated into the definition and implementation of all EU policies and actions, Members stressed the need to promote synergies and complementarity with other EU funding programmes , in particular by facilitating: (i) the funding of activities that complement strategic integrated projects and strategic nature projects; (ii) the uptake and replication of solutions developed under the Programme.

Implementation : the Commission shall ensure that implementation is easy to understand, and should promote genuine simplification for project developers. Projects with the highest potential of being replicated and taken-up by the public or private sector or of mobilising the largest investments or financial resources (catalytic potential) shall benefit from a bonus in their evaluation.

The just transition should be achieved in consultation and dialogue with social partners and the regions and communities affected . These should also be included to the extent possible in the development and implementation of projects.

In addition, the Programme shall involve all stakeholders and sectors involved in a clean energy transition, such as the building sector, industry, transport and agriculture.

The Committee on the Environment, Public Health and Food Safety adopted the report by Gerben-Jan GERBRANDY (ALDE, NL) on the proposal for a regulation of the European Parliament and of the Council establishing a Programme for the Environment and Climate Action (LIFE) and repealing Regulation (EU) No 1293/2013.

The committee recommended that the European Parliament's position adopted at first reading under the ordinary legislative procedure should amend the Commission's proposal as follows.

Objective : the proposed Regulation aims to establish a Programme for the Environment and Climate Action (LIFE), covering the period from 1 January 2021 to 31 December 2027.

Members stressed that LIFE is the only programme specifically dedicated to the environment and climate and as such it plays a crucial role in supporting the implementation of EU legislation in these areas. It shall contribute to mainstream climate actions and to the achievement of an overall target of at least 25% of the EU budget expenditures supporting climate objectives over the MFF 2021-2027 period, and an annual target of 30 % as soon as possible and at the latest by 2027.

The general objective of the Programme is to:

· contribute to the shift towards a clean, circular, energy-efficient, net-zero emission and climate-resilient economy;

· protect and improve the quality of the environment;

· halt and reverse biodiversity loss and the degradation of ecosystems, thereby contributing to sustainable development.

To this end, the Programme shall:

· promote innovative techniques and approaches for reaching the objectives of the Union legislation and policy on environment and climate action, including the transition to clean, renewable energy and increased energy efficiency;

· contribute to the knowledge base, effective management and application of best practice, in relation to nature and biodiversity, including through the support of the Natura 2000 network;

· support the implementation of General Union Environment Action Programmes and improve environmental and climate governance at all levels, including by enhancing capacities of public and private actors and the involvement of civil society.

Budget : the financial envelope for the implementation of the Programme for the period 2021-2027 shall be EUR 6.44 billion in 2018 prices (EUR 7.27 billion in current prices) as opposed to EUR 5.45 billion in current prices proposed by the Commission).

The indicative distribution of the amount shall be:

Environment : EUR 4.71 billion at 2018 prices , of which: (i) EUR 2.82 billion for the Nature and Biodiversity sub-programme and (ii) EUR 1.88 billion for the Circular Economy and Quality of Life sub-programme;

Climate Action area : EUR 1.95 billion of which: (i) EUR 950 million for the sub-programme 'Climate change mitigation and adaptation' and (ii) EUR 1 billion for the sub-programme 'Clean energy transition'.

Synergies : LIFE shall facilitate integration, particularly in major EU funding programmes. Since environmental and climate requirements shall be integrated into the definition and implementation of all EU policies and actions, Members stressed the need to promote synergies and complementarity with other EU funding programmes , in particular by facilitating: (i) the funding of activities that complement strategic integrated projects and strategic nature projects; (ii) the uptake and replication of solutions developed under the Programme.

The Commission and Member States shall take steps to prevent administrative overlap and burden on project beneficiaries, arising from reporting obligations from different financial instruments.

In addition, the Programme shall involve all stakeholders and sectors involved in a clean energy transition, such as the building sector, industry, transport and agriculture.

PURPOSE: to establish a programme for the environment and climate action (LIFE) for the period 2021-2027.

PROPOSED ACT: Regulation of the European Parliament and of the Council.

ROLE OF THE EUROPEAN PARLIAMENT: the European Parliament decides in accordance with the ordinary legislative procedure and on an equal footing with the Council.

BACKGROUND: the EU is a global leader in environmental protection and climate action. The Commission considers the shift towards a clean, energy-efficient, low-carbon and climate-resilient economy to be a priority .

The programme for the environment and climate action (LIFE), established by Regulation (EU) No 1293/2013 for the period 2014 to 2020, is the latest in a series of Union programmes over 25 years which support the implementation of environmental and climate legislation and policy priorities.

Through its catalytic role, the programme supports small scale actions intended to initiate, expand or promote sustainable production, distribution and consumption practices, as well as to protect natural heritage.

The Commission considers that this approach should be continued in the multiannual financial framework for the period 2021-2027 . An enhanced LIFE programme would play an important role in developing climate action and clean energy investments across Europe. It would also help the EU meet its climate objectives and commitments under the Paris Agreement and the UN’s sustainable development goals.

The Commission proposal for the 2021-2027 multiannual financial framework set a more ambitious goal for climate mainstreaming across all EU programmes, with an overall target of 25% of EU expenditure contributing to climate objectives.

CONTENT: the proposed Regulation - presented for a Union of 27 Member States – seeks to establish the environment and climate action programme (LIFE) . It lays down the objectives of the programme, the budget for the period 2021-2027, as well as the forms of Union funding and the rules for providing such funding.

Programme objectives : the proposed programme aims to achieve the Union’s objectives as set out in international environmental, climate and clean energy legislation, policy, plans and commitments. Its overall objective is to contribute to the shift towards:

a clean, circular, energy-efficient, low-carbon and climate-resilient economy, including a transition to clean energy; protecting and improving the quality of the environment; halting and reversing biodiversity loss, including in marine ecosystems, so as to contribute to sustainable development.

In particular, the new LIFE programme shall:

mobilise investment and support energy efficiency activities, particularly in European regions lagging behind in the shift towards clean energy; support projects promoting best practice in relation to nature protection and biodiversity , as well as ‘strategic nature protection projects’ for all Member States, including measures to protect the marine environment; contribute to the transition to a circular economy model through financial support targeting a variety of actors (businesses, public authorities and consumers), in particular by applying, developing, and replicating best technology, practices and solutions tailored to specific local, regional or national contexts, including through integrated approaches for the implementation of waste management and prevention plans; support the other aspects of the Union's environment policy, such as the protection and improvement of air and water quality in the EU, implementing the 2030 climate and energy policy framework and meeting the Union’s commitments under the Paris Agreement. Actions taken under the programme are expected to contribute 61 % of the overall financial envelope of the programme to climate objectives.

The Commission proposes to simplify the programme management procedures and allow for a wider geographical access. Synergies would be developed with the European Regional Development Fund, the European Social Fund, the Cohesion Fund, the European Agricultural Fund for Rural Development and the European Maritime and Fisheries Fund, Horizon Europe, the Connecting Europe Facility and InvestEU.

Proposed budget : EUR 5.45 billion in current prices for the period 2021-2027. The indicative breakdown of this amount is as follows:

Environment : EUR 3.5 billion of which: (i) EUR 2.15 billion for the Nature and Biodiversity sub-programme; (ii) EUR 1.35 billion for the Circular Economy and Quality of Life sub-programme; Climate action : EUR 1.95 billion of which: (i) EUR 950 million for the sub-programme Climate change mitigation and adaptation; (ii) EUR 1 billion for the sub-programme clean energy transition.