The European Parliament adopted a legislative resolution approving the Council position at first reading with a view to the adoption of a regulation of the European Parliament and of the Council establishing the Connecting Europe Facility and repealing Regulations (EU) No 1316/2013 and (EU) No 283/2014.

The proposed regulation establishes the Connecting Europe Facility (CEF) for the period of the Multiannual Financial Framework (MFF) 2021-2027. It sets out the objectives of the CEF and establishes its budget for the period 2021-2027, as well as the forms of EU funding and the rules for granting funding.

CEF’s objectives

The general objective of the CEF is to develop and modernise trans-European networks in the fields of transport, energy and digital technology and to facilitate cross-border cooperation in the field of renewable energy.

Budget

The financial envelope for the implementation of the CEF for the period from 1 January 2021 to 31 December 2027 is set at EUR 33 710 000 000 in current prices, broken down as follows: (a) EUR 25 807 000 000 for the transport sector; (b) EUR 5 838 000 000 for the energy sector; (c) EUR 2 065 000 000 for the digital sector.

The CEF will contribute 60% of its overall financial envelope to the climate objectives.

Transport sector

The CEF aims at contributing to the completion of the trans-European transport core network by 2030 and the comprehensive network by 2050. It should also support the modernisation of the TEN-T network, in particular the deployment of alternative fuels infrastructure and digitalisation of transport. In addition, civilian-military dual-use transport projects will be implemented through the CEF.

The actions eligible for funding are extended to a number of projects which will cover, inter alia, cross-border links and missing links listed in part III of the Annex, seaports and inland ports on the global network, as well as overseas countries and territories with a view to improving the connectivity of peripheral and isolated territories.

The Council's position maintains the principle of differentiating the co-financing rates between different types of actions with the objective to focus the CEF on the most crucial actions, especially on cross-border projects.

The maximum co-financing rates have been increased in support of a number of actions which aim in particular at integrated management structures, such as joint ventures, as well as synergies. These actions concern inter alia maritime, inland waterways and railway interoperability, while CEF will continue to focus on cross-border measures.

In addition, a specific amount from the CEF should be used for the completion of the missing major cross-border rail links between the cohesion countries to contribute to the functioning of the single market, and the rules for co-financing the transfer from the Cohesion Fund to the CEF should apply to this amount.

Energy sector

The focus is on contributing to the development of trans-European energy networks, further integration of the internal energy market and interoperability of networks across borders and sectors. The CEF will also facilitate cross-border cooperation in the field of renewable energy and enable decarbonisation through the integration of renewable energy sources.

A provision stipulates that, subject to market response, a maximum of 15% of the overall energy sector budget should be allocated to cross-border renewable energy projects, with the possibility of raising this ceiling to 20%.

Consistency with the energy efficiency first principle when defining award criteria and called for particular emphasis in the work programmes to actions aimed at further integrating the internal market for energy, ending energy isolation and eliminating electricity interconnection bottlenecks.

Digital sector

For digital, CEF aims at contributing to the deployment of safe and secure very high capacity digital networks and 5G systems and to the increased resilience and capacity of digital backbone networks in line with the European digital connectivity objectives.

The Council's position supports advanced connectivity for socio-economic drivers, but also aims to ensure comprehensive coverage around them, including households.

The regulation focuses on creating and, where it already exists, providing redundancy for the backbone infrastructure connecting the outermost regions, islands, overseas countries and territories, via the Member States’ territorial waters and exclusive economic zones.

A new cybersecurity clause provides that for all or some of the actions under the specific objectives set out for the digital sector, calls for proposals and calls for tenders can, for duly justified security reasons, be restricted to entities established, or deemed to be established, in Member States and directly or indirectly controlled by Member States, or by nationals of Member States.

The European Parliament adopted by 430 votes to 146, with 31 abstentions, a legislative resolution on the proposal for a regulation of the European Parliament and of the Council establishing the Connecting Europe Facility and repealing Regulations (EU) No 1316/2013 and (EU) No 283/2014.

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

Objective

The proposal aims to renew the Connecting Europe Facility for the period 2021-2027 in order to build, develop and modernise the trans-European networks in the fields of transport, energy and digital and to facilitate cross-border cooperation in the field of renewable energy.

The Programme has the following specific objectives:

In the transport sector

- contribute to the development of projects of common interest relating to efficient, interconnected and multimodal networks and infrastructure for smart, interoperable, sustainable, inclusive, accessible, safe and secure mobility;

- adapt parts of the trans-European transport network for a dual use of the transport infrastructure in view of improving both civilian and military mobility.

In the energy sector

- contribute to the development of projects of common interest relating to further integration of an efficient and competitive internal energy market, interoperability of networks across borders and sectors, facilitating decarbonisation of the economy, promoting energy efficiency and ensuring security of supply, and to facilitate cross-border cooperation in the area of energy, including renewable energy.

In the digital sector

- contribute to the development of projects of common interest relating to the deployment of safe and secure very high capacity digital networks and 5G systems, to the increased resilience and capacity of digital backbone networks on EU territories by linking them to neighbouring territories, as well to the digitalization of transport and energy networks.

Budget

Parliament has proposed that the financial envelope for the implementation of the programme for the period 2021-2027 be set at EUR 43.85 billion , with the following indicative breakdown:

- EUR 33.51 billion at constant prices for transport projects, including: (i) EUR 17.74 billion from the European Strategic Investments cluster; (ii) EUR 10 billion transferred from the Cohesion Fund and (iii) EUR 5.76 billion from the Defence cluster;

- at least EUR 8.65 billion for energy network projects, of which 15%, subject to market uptake, for cross-border renewable energy projects. If the 15% threshold is reached, the Commission shall increase this amount to a maximum of 20%;

- EUR 2.66 billion for the development of digital networks.

Up to 1% of the financial envelope may be used for technical and administrative assistance for the implementation of the programme and sector-specific guidelines. The amount transferred from the Cohesion Fund shall not be used to finance intersectoral work programmes and joint financing operations.

Cross-border projects in the field of renewable energy

These projects were expected to contribute to decarbonisation, the completion of the internal energy market and the improvement of security of supply. They would be included in a cooperation agreement between at least two Member States or between at least one Member State and one or more third countries referred to in Directive (EU) 2018/2001. A transparent, comprehensive and complete cost-benefit analysis of the project would be mandatory for all funded projects.

Projects of common interest in the field of digital connectivity infrastructure

These projects are expected to make an important contribution to the Union's strategic connectivity objectives and/or provide the network infrastructure supporting the digital transformation of the economy and society as well as the European Digital Single Market.

Transport sector

Support would be given to actions relating to interconnected, interoperable and multimodal networks for the development of rail, road, inland waterway and maritime infrastructure. Actions in support of telematics application systems shall include: (i) for railways: ERTMS; (ii) for inland waterways: RIS; (iii) for road transport: ITS; (iv) for maritime transport: VTMIS and e-Maritime services; (v) for air transport: air traffic management systems, in particular those resulting from the SESAR system.

To meet the needs of remote, insular and outermost regions, co-financing rates up to a maximum of 70% may apply. Actions contributing to synergies between the transport, energy and digital sectors may benefit from a higher co-financing rate.

Work programmes

In order to provide transparency and predictability and to enhance the quality of the projects, the Commission shall adopt by 31 December 2020 the first multiannual work programmes that will include the timetable of the calls for proposals for the first three years of the programme, their topics and indicative budget as well as a prospective framework covering the entire programming period.

The European Parliament adopted by 434 votes to 134, with 37 abstentions, amendments to the proposal for a regulation of the European Parliament and of the Council establishing the Connecting Europe Facility and repealing Regulations (EU) No 1316/2013 and (EU) No 283/2014.

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

The main amendments adopted in plenary concern the following points:

Objectives

The proposed Regulation seeks to establish the Connecting Europe Facility (CEF 2.0) for the period 2021-2027 in order to build, develop and modernise the trans-European networks in the fields of transport, energy and digital and to facilitate cross-border cooperation in the field of renewable energy.

The objectives of the CEF aim to contribute to increasing European competitiveness, access to internal market, to smart, sustainable and inclusive growth, and to consolidate territorial, social and economic cohesion.

According to the draft legislative act, the Programme has the following specific objectives:

In the transport sector :

- contribute to the development of projects of common interest relating to efficient, interconnected, interoperable and multimodal networks and infrastructure for smart, sustainable, inclusive, accessible, safe and secure mobility and European transport area;

- adapt the parts of the trans-European transport network suitable for military transport to dual (civilian and defence) mobility needs.

In the energy sector :

- contribute to the development of projects of common interest relating to further integration of an efficient and competitive internal energy market, interoperability of networks across borders and sectors, facilitating decarbonisation of the economy , and ensuring security of supply and EU energy independence, and to facilitate cross-border cooperation in the area of energy, including renewable energy, and to stimulate energy efficiency.

In the digital sector :

- contribute to the development of projects of common interest relating to the deployment of safe and secure very high capacity digital networks and 5G systems , to the increased resilience and capacity of digital backbone networks on EU territories by linking them to neighbouring territories, as well to the digitalisation of transport and energy network.

Budget

The proposed financial envelope for the implementation of the Programme for the period 2021-2027 is set at EUR 43.85 billion . The distribution of this amount shall be as follows:

EUR 33.51 billion in constant prices for transport projects of which: (i) EUR 17.74 from the European Strategic Investment cluster; (ii) EUR 10 billion transferred from the Cohesion Fund to be spent in line with this Regulation exclusively in Member States eligible for funding from the Cohesion Fund; (iii) EUR 5.76 billion from the heading Security and Defence from the MFF.

EUR 7.68 billion for energy network projects;

EUR 2.66 billion for digital network development.

The Programme shall:

- contribute to promoting territorial accessibility and connectivity in all regions of the Union , in particular in remote, outermost, island, peripheral, mountainous and cross-border regions, as well as in depopulated and scarcely populated areas;

- contribute to EU actions to combat climate change and support environmentally and socially sustainable projects;

- ensure transparency and citizen participation for important projects, in particular when projects affect the environment and human health.

Work programmes

Members proposed that the Commission must prepare, by the end of March 2021, a Framework Programme that will include the foreseen time table of the work programmes, calls, their topics and allocated financing and other necessary details necessary to provide transparency and predictability for all period of the Programme and to enhance the quality of the projects.

The Committee on Industry, Research and Energy and the Committee on Transport and Tourism adopted the joint report by Henna VIRKKUNEN (EP, FI), Marian-Jean MARINESCU (EPP, RO) and Pavel TELIČKA (ALDE, CZ) on the proposal for a regulation of the European Parliament and of the Council establishing the Connecting Europe Facility and repealing Regulations (EU) No 1316/2013 and (EU) No 283/2014.

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

Subject matter : the proposed Regulation seeks to establish the Connecting Europe Facility (CEF 2.0). It lays down the objectives of the Programme, the budget for the period 2021-2027, the forms of Union funding and the rules for providing such funding.

Objectives : the Programme has the general objective to build, develop and modernise the trans-European networks in the fields of transport, energy and digital and to facilitate cross-border cooperation in the field of renewable energy, in order to contribute to increasing European competitiveness, access to internal market, to smart, sustainable and inclusive growth, and to consolidate territorial, social and economic cohesion , contributing to the long-term decarbonisation commitments and with emphasis on synergies among transport, energy and digital sectors to the full.

The Programme has the following specific objectives:

In the transport sector :

contribute to the development of projects of common interest relating to efficient, interconnected, interoperable and multimodal networks and infrastructure for smart, sustainable, inclusive, accessible, safe and secure mobility and European transport area; adapt the parts of the trans-European transport network suitable for military transport to dual (civilian and defence) mobility needs.

In the energy sector :

contribute to the development of projects of common interest relating to further integration of an efficient and competitive internal energy market, interoperability of networks across borders and sectors, facilitating decarbonisation of the economy, and ensuring security of supply and EU energy independence, and to facilitate cross-border cooperation in the area of energy, including renewable energy, and to stimulate energy efficiency.

In the digital sector :

contribute to the development of projects of common interest relating to the deployment of safe and secure very high capacity digital networks and 5G systems , to the increased resilience and capacity of digital backbone networks on EU territories by linking them to neighbouring territories, as well to the digitalisation of transport and energy network.

Budget : the proposed financial envelope for the implementation of the Programme for the period 2021-2027 is set at EUR 43.85 billion . The distribution of this amount shall be as follows:

EUR 33.51 billion for transport projects; EUR 7.68 billion for energy network projects; EUR 2.66 billion for digital network development.

Work programmes : Members proposed that the Commission must present a Framework Programme for the entire MFF period, including a timetable for work programs and calls for proposals, to provide predictability and transparency and allow EU Member States to prepare mature project proposals.

PURPOSE: to renew the Connecting Europe Facility 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 European Union needs modern and efficient infrastructures that contribute to the interconnection and integration of the Union and all its regions in the transport, telecommunications and energy sectors . Trans-European networks and cross-border cooperation are not only essential for the functioning of the single market, but also strategic for the achievement of energy unification, the completion of the digital single market and the development of sustainable modes of transport.

Since 2014, the Connecting Europe Facility (CEF) has supported investments in the trans-European infrastructure (TEN) in transport, energy and the digital sector.

Building on the positive results of the implementation of the CEF in the period 2014-2020, the Commission proposes to extend the CEF programme beyond 2020 with a view to accelerating investment in the field of trans-European networks and to leverage funding from both the public and the private sectors.

For the period 2021-2027, the Commission proposes to enhance the environmental dimension of the CEF, by setting the target of 60% of its envelope to climate objectives , in line with the Union's commitments to implement the Paris Agreement, and the commitment to the United Nations Sustainable Development Goals.

CONTENT: the proposed Regulation - presented for a Union of 27 Member States - seeks to establish the Connecting Europe Facility . It lays down the objectives of the Programme, the budget for the period 2021-2027, the forms of Union funding and the rules for providing such funding.

The new programme shall aim to develop and modernise the trans-European networks in the fields of transport, energy and digital and to facilitate cross-border cooperation in the field of renewable energy, taking into account the long-term decarbonisation commitments and with emphasis on synergies among sectors.

(1) Transport sector : the facility shall contribute to the completion of both layers of the trans-European transport network: the TEN-T core network by 2030 and the TEN-T comprehensive network by 2050. It is estimated that the completion of the TEN-T core network by 2030 will generate 7.5 million job-years between 2017 and 2030 and an additional GDP increase of 1.6 % in the Union in 2030. It shall also support the deployment of European traffic management systems for all traffic modes , in particular for air transport and railways, and helps the EU transition towards smart, sustainable, inclusive, safe and secure mobility (for example by establishing a European network of charging infrastructure for alternative fuels). Part of the budget would be reserved for Member States eligible for the Cohesion Fund .

With a view to adapting the European transport network to military requirements and improving military mobility in the EU, the mechanism shall support dual-use civil and military transport infrastructure.

(2) Energy sector : emphasis shall be placed on:

completing the trans-European energy networks through the development of projects of common interest relating to further integration of the internal energy market and interoperability of networks across borders and sectors; security of supply inter alia through the smartening and digitalisation of the infrastructure; cooperation between Member States on cross-border renewable energy projects to promote strategic uptake of marketable renewable energy technologies.

(3) Digital sector : the CEF shall support European households’ access to very high capacity networks. In addition, it shall ensure that all main socio-economic drivers such as schools, hospitals, transport hubs, main providers of public services and digitally intensive enterprises have access to future-oriented broadband connections (1 Gbit/second) by 2025. It contributes to the overall connectivity of the European territories, including that of the outermost regions, to the Internet.

Actions in support of the deployment of backbone electronic communications networks, including submarine cables connecting European territories to third countries on other continents or connecting European islands or overseas territories to the mainland, shall be eligible.

The strategic objectives of the programme shall also be implemented through financial instruments and budgetary guarantees under the opportunities offered by the InvestEU Fund . Programme actions shall be used to address market failures or investment deficits without duplicating efforts and shall have a clear European added value.

Proposed budget : in line with the Commission proposal for the post 2020 multiannual financial framework, the Connecting Europe Facility shall be allocated EUR 42.265 billion in current prices for the period 2021-2027:

Transport : EUR 30.615 billion, of which: (i) general envelope: EUR 12.830 billion; (ii) contribution from the Cohesion Fund: EUR 11.285 billion; (iii) support for military mobility: EUR 6.5 billion. Energy : EUR 8.65 billion; Digital : EUR 3 billion.