BETA


2020/0100(COD) Public sector loan facility under the Just Transition Mechanism
Next event: Text adopted by Parliament, 1st reading/single reading 2021/06/24 more...

Progress: Awaiting Council's 1st reading position

RoleCommitteeRapporteurShadows
Joint Responsible Committee ['BUDG', 'ECON'] HAHN Henrike (icon: Verts/ALE Verts/ALE), VAN OVERTVELDT Johan (icon: ECR ECR) FERNANDES José Manuel (icon: EPP EPP), FITZGERALD Frances (icon: EPP EPP), BELKA Marek (icon: S&D S&D), HEINÄLUOMA Eero (icon: S&D S&D), ARMAND Clotilde (icon: Renew Renew), SØGAARD-LIDELL Linea (icon: Renew Renew), GEESE Alexandra (icon: Verts/ALE Verts/ALE), BECK Gunnar (icon: ID ID), LAPORTE Hélène (icon: ID ID), JURZYCA Eugen (icon: ECR ECR), GUSMÃO José (icon: GUE/NGL GUE/NGL), KOKKALIS Petros (icon: GUE/NGL GUE/NGL)
Committee Opinion TRAN
Committee Opinion REGI MAESTRE MARTÍN DE ALMAGRO Cristina (icon: S&D S&D) Krzysztof HETMAN (icon: PPE PPE), Bronis ROPĖ (icon: Verts/ALE Verts/ALE), Irène TOLLERET (icon: RE RE), Elżbieta KRUK (icon: ECR ECR)
Committee Opinion ITRE KLOC Izabela-Helena (icon: ECR ECR) Iskra MIHAYLOVA (icon: RE RE), Maria SPYRAKI (icon: PPE PPE), Paolo BORCHIA (icon: ID ID), Mikuláš PEKSA (icon: Verts/ALE Verts/ALE), Tsvetelina PENKOVA (icon: S&D S&D)
Committee Opinion ENVI CANFIN Pascal (icon: Renew Renew) Margrete AUKEN (icon: Verts/ALE Verts/ALE), Simona BONAFÈ (icon: S&D S&D), Alexandr VONDRA (icon: ECR ECR), Silvia MODIG (icon: GUE/NGL GUE/NGL), Lídia PEREIRA (icon: PPE PPE)
Committee Opinion EMPL
Lead committee dossier:
Legal Basis:
RoP 58, TFEU 175-p3, TFEU 322-p1

Events

2021/06/24
   EP - Text adopted by Parliament, 1st reading/single reading
Documents
2021/06/24
   EP - Debate in Parliament
2021/06/24
   EP - Decision by Parliament, 1st reading
Documents
2021/05/10
   EP - Approval in committee of the text agreed at 1st reading interinstitutional negotiations
Documents
2021/05/05
   CSL - Coreper letter confirming interinstitutional agreement
2020/11/04
   CofA - Court of Auditors: opinion, report
2020/10/21
   EP - Committee decision to enter into interinstitutional negotiations confirmed by plenary (Rule 71)
2020/10/19
   EP - Committee decision to enter into interinstitutional negotiations announced in plenary (Rule 71)
2020/10/16
   EP - Vote in committee, 1st reading
2020/10/16
   EP - Committee report tabled for plenary, 1st reading
Details

The Committee on Budgets and the Committee on Economic and Monetary Affairs jointly adopted the report by Johan VAN OVERTVELDT (ECR, BE) and Henrike HAHN (Greens/EFA, DE) the proposal for a regulation of the European Parliament and of the Council on the public sector loan facility under the Just Transition Mechanism.

The proposed Regulation seeks to provide for the ‘Public Sector Loan Facility’ under the Just Transition Mechanism to support public sector investments by combining grants financed from the Union budget with loans granted on preferential terms by financial partners such as the European Investment Bank (EIB).

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

Objectives

The proposed general objective of the Facility is to contribute to the Union’s policy objectives, in particular the new Union’s 2030 targets for climate and energy and the transition towards a climate-neutral economy in the Union by 2050 at the latest, in line with the Union’s commitments under the Paris Agreement and Union’s objectives and responding to the need to strengthen competitiveness and ensuring that the transition reduces inequalities, creates a net employment effect together with the European Pillar of Social Rights and the UN Sustainable Development Goals.

The Facility shall have the specific objective of increasing public sector investments, which address the development needs of regions identified in the territorial just transition plans, by facilitating the financing of projects that do not generate a sufficient stream of own revenues to cover investment costs within the meaning of the additionality principle.

Members included the definition of the ‘additionality principle’ to mean ‘ the support for projects that do not generate a sufficient stream of own revenues to cover investment costs and secure funding to the same extent or within the same timeframe without the element of grant support from the Union budget’.

Budget

Members proposed that, without prejudice to additional resources allocated in the Union budget for the period 2021-2027, the grant component of support provided under this Facility, including the advisory support for the preparation, development, and implementation of projects, shall be financed from resources from the Union budget for an amount of EUR 1 760 000 000 in current prices.

Higher amounts of technical and administrative assistance may be made available upon request to beneficiaries who have lower administrative capacities in terms of technological equipment, staff and infrastructure.

In order to pursue the achievement of specific objectives, in particular through advisory support and implementation, the committee proposed an amount of EUR 50 000 000 for these activities.

Access to the resources

Access to the Facility shall be conditional on the adoption of a national objective towards the achievement of climate neutrality by 2050. For those Member States, which have not yet committed to a national target for climate neutrality, only 50 % of their national allocation shall be released, while the remaining 50 % shall be made available once they have adopted that target.

Non-eligible projects

The report stressed that the Facility shall not support activities which would hamper the development and deployment of low carbon alternatives or which lead in the long run to a lock-in of carbon-intensive assets and that would undermine the achievement of the Union’s climate and environment objectives. Two years after the entry into force of this Facility, the Commission shall review the eligibility conditions in order to assess their impact on environmental objectives.

As part of that review, the Commission shall assess whether the conditions need to be updated to appropriately apply the 'do no harm principle' and take the necessary action.

Selection of finance partners other than the EIB

The Commission shall adopt delegated acts in respect of establishing work programmes, setting out the details of eligibility conditions and selection procedures for finance partners other than EIB. The eligibility conditions for the finance partners other than the EIB shall reflect the objectives of the Facility.

Monitoring and reportin g

The Commission shall report annually on the implementation of the Facility. That report shall provide information on the results and impact of the Facility with respect to its objectives and performance indicators, in particular its contribution to addressing the transition needs and to the Union sustainability objectives including its impact on climate, the environment, the social dimension and gender equality.

Evaluation

Evaluations on the implementation of the Facility and its capacity to reach the objectives shall be carried out in a sufficiently timely manner to feed into the decision-making process. The interim evaluation of the Facility shall be performed by1 January 2024. At the end of the implementation period and no later than 31 December 2031, the Commission shall submit to the European Parliament and to the Council an independent final evaluation report on the results and long-term impact of the Facility.

Documents
2020/10/16
   EP - Committee decision to open interinstitutional negotiations with report adopted in committee
2020/10/05
   EP - Committee opinion
Documents
2020/10/02
   EP - Committee opinion
Documents
2020/10/01
   EP - Committee opinion
Documents
2020/07/27
   PT_PARLIAMENT - Contribution
Documents
2020/07/24
   EP - Committee draft report
Documents
2020/07/23
   EP - Referral to joint committee announced in Parliament
2020/07/22
   EP - HAHN Henrike (Verts/ALE) appointed as rapporteur in ['BUDG', 'ECON']
2020/07/22
   EP - VAN OVERTVELDT Johan (ECR) appointed as rapporteur in ['BUDG', 'ECON']
2020/07/10
   EP - KLOC Izabela-Helena (ECR) appointed as rapporteur in ITRE
2020/07/06
   RO_SENATE - Contribution
Documents
2020/07/06
   ES_PARLIAMENT - Contribution
Documents
2020/06/17
   EP - Committee referral announced in Parliament, 1st reading
2020/06/10
   EP - CANFIN Pascal (Renew) appointed as rapporteur in ENVI
2020/06/09
   EP - MAESTRE MARTÍN DE ALMAGRO Cristina (S&D) appointed as rapporteur in REGI
2020/05/28
   EC - Legislative proposal
Details

PURPOSE: to provide for the public sector loan facility under the Just Transition Mechanism to support public investment in the territories most negatively affected by the climate transition.

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 on an equal footing with the Council.

BACKGROUND: in order to help the most vulnerable regions to cope with the socio-economic effects of transition, the Commission proposed in January 2020 to establish a Just Transition Mechanism, amounting to EUR 100 billion and based on three pillars:

- A Just Transition Fund ,

- a dedicated just transition scheme under InvestEU and

- a public sector loan facility.

In line with the objective to achieve EU climate-neutrality by 2050 in an effective and fair manner, the European Green Deal announced a Just Transition Mechanism to provide means for facing the climate challenge while leaving no one behind.

In view of the coronavirus crisis, the European Commission wishes to strengthen the Just Transition Mechanism as part of its response to the crisis and in its new proposal for the next Multiannual Financial Framework (MFF) for the period 2021-2027.

The present proposal of the European Commission addresses the third pillar of the Just Transition Facility, namely the Public Sector Loan Facility to support public sector entities in their investments.

CONTENT: the proposed Regulation provides for the ‘Public Sector Loan Facility’ to support public sector investments by combining grants financed from the Union budget with loans granted on preferential terms by financial partners such as the European Investment Bank (EIB).

The public sector loan facility of the present proposal constitutes the third pillar of the Just Transition Mechanism. It will support public investments, through preferential lending conditions. These investments will benefit the territories most negatively affected by the climate transition as identified in the territorial just transition plans for the purposes of the Just Transition Fund.

The grant component of the Facility shall be implemented directly by the European Commission while the EIB shall implement the loan component.

Objectives

Under the Just Transition Facility, the Public Sector Loan Facility shall benefit, in each Member State, the territories most affected by the transition to a carbon-neutral European Union, as identified in the territorial Just Transition Plans of the Just Transition Fund.

All investments under the Just Transition Mechanism, including the public sector loan facility, shall be implemented based on territorial just transition plans.

In order to ensure an effective implementation of the Facility, the proposed Regulation provides for the provision of advisory support for the preparation, development, and implementation of projects. Only projects that do not generate sufficient stream of own revenues and that would not be financed on commercial terms without the element of grant support may be eligible.

Investments

In order to enhance the economic diversification of territories impacted by the transition, the Facility should cover a wide range of investments. They may cover:

- energy and transport infrastructure,

- district heating networks,

- green mobility,

- smart waste management,

- clean energy and energy efficiency measures including renovations and conversions of buildings,

- support to transition to a circular economy,

- land restoration and decontamination,

- up- and re-skilling, training and social infrastructure, including social housing.

Proposed budget

The total budget proposed for the grant component of the facility is EUR 1.525 billion. It is envisaged to finance this amount mainly :

- with assigned revenue EUR 1.275 billion and;

- partly with appropriations programmed under the Multiannual Financial Framework (MFF) 2021- 2027 for EUR 250 million.

EUR 1 billion of the assigned revenue foreseen would stem from the estimated surpluses of the provisioning of the European Fund for Strategic Investments (EFSI) after its constitution phase, ending in 2022.

From the financial envelope for the grant component, up to EUR 25 million from assigned revenues will be allocated to advisory services to support the preparation and implementation of eligible projects.

2020/05/28
   EC - Document attached to the procedure

Documents

Activities

AmendmentsDossier
115 2020/0100(COD)
2020/09/01 REGI 115 amendments...
source: 655.979

History

(these mark the time of scraping, not the official date of the change)

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  • The Committee on Budgets and the Committee on Economic and Monetary Affairs jointly adopted the report by Johan VAN OVERTVELDT (ECR, BE) and Henrike HAHN (Greens/EFA, DE) the proposal for a regulation of the European Parliament and of the Council on the public sector loan facility under the Just Transition Mechanism.
  • The proposed Regulation seeks to provide for the ‘Public Sector Loan Facility’ under the Just Transition Mechanism to support public sector investments by combining grants financed from the Union budget with loans granted on preferential terms by financial partners such as the European Investment Bank (EIB).
  • The committee recommended that the European Parliament’s position adopted at first reading under the ordinary legislative procedure should amend the Commission proposal as follows.
  • Objectives
  • The proposed general objective of the Facility is to contribute to the Union’s policy objectives, in particular the new Union’s 2030 targets for climate and energy and the transition towards a climate-neutral economy in the Union by 2050 at the latest, in line with the Union’s commitments under the Paris Agreement and Union’s objectives and responding to the need to strengthen competitiveness and ensuring that the transition reduces inequalities, creates a net employment effect together with the European Pillar of Social Rights and the UN Sustainable Development Goals.
  • The Facility shall have the specific objective of increasing public sector investments, which address the development needs of regions identified in the territorial just transition plans, by facilitating the financing of projects that do not generate a sufficient stream of own revenues to cover investment costs within the meaning of the additionality principle.
  • Members included the definition of the ‘additionality principle’ to mean ‘ the support for projects that do not generate a sufficient stream of own revenues to cover investment costs and secure funding to the same extent or within the same timeframe without the element of grant support from the Union budget’.
  • Budget
  • Members proposed that, without prejudice to additional resources allocated in the Union budget for the period 2021-2027, the grant component of support provided under this Facility, including the advisory support for the preparation, development, and implementation of projects, shall be financed from resources from the Union budget for an amount of EUR 1 760 000 000 in current prices.
  • Higher amounts of technical and administrative assistance may be made available upon request to beneficiaries who have lower administrative capacities in terms of technological equipment, staff and infrastructure.
  • In order to pursue the achievement of specific objectives, in particular through advisory support and implementation, the committee proposed an amount of EUR 50 000 000 for these activities.
  • Access to the resources
  • Access to the Facility shall be conditional on the adoption of a national objective towards the achievement of climate neutrality by 2050. For those Member States, which have not yet committed to a national target for climate neutrality, only 50 % of their national allocation shall be released, while the remaining 50 % shall be made available once they have adopted that target.
  • Non-eligible projects
  • The report stressed that the Facility shall not support activities which would hamper the development and deployment of low carbon alternatives or which lead in the long run to a lock-in of carbon-intensive assets and that would undermine the achievement of the Union’s climate and environment objectives. Two years after the entry into force of this Facility, the Commission shall review the eligibility conditions in order to assess their impact on environmental objectives.
  • As part of that review, the Commission shall assess whether the conditions need to be updated to appropriately apply the 'do no harm principle' and take the necessary action.
  • Selection of finance partners other than the EIB
  • The Commission shall adopt delegated acts in respect of establishing work programmes, setting out the details of eligibility conditions and selection procedures for finance partners other than EIB. The eligibility conditions for the finance partners other than the EIB shall reflect the objectives of the Facility.
  • Monitoring and reportin g
  • The Commission shall report annually on the implementation of the Facility. That report shall provide information on the results and impact of the Facility with respect to its objectives and performance indicators, in particular its contribution to addressing the transition needs and to the Union sustainability objectives including its impact on climate, the environment, the social dimension and gender equality.
  • Evaluation
  • Evaluations on the implementation of the Facility and its capacity to reach the objectives shall be carried out in a sufficiently timely manner to feed into the decision-making process. The interim evaluation of the Facility shall be performed by1 January 2024. At the end of the implementation period and no later than 31 December 2031, the Commission shall submit to the European Parliament and to the Council an independent final evaluation report on the results and long-term impact of the Facility.
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  • PURPOSE: to provide for the public sector loan facility under the Just Transition Mechanism to support public investment in the territories most negatively affected by the climate transition.
  • 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 on an equal footing with the Council.
  • BACKGROUND: in order to help the most vulnerable regions to cope with the socio-economic effects of transition, the Commission proposed in January 2020 to establish a Just Transition Mechanism, amounting to EUR 100 billion and based on three pillars:
  • - A Just Transition Fund ,
  • - a dedicated just transition scheme under InvestEU and
  • - a public sector loan facility.
  • In line with the objective to achieve EU climate-neutrality by 2050 in an effective and fair manner, the European Green Deal announced a Just Transition Mechanism to provide means for facing the climate challenge while leaving no one behind.
  • In view of the coronavirus crisis, the European Commission wishes to strengthen the Just Transition Mechanism as part of its response to the crisis and in its new proposal for the next Multiannual Financial Framework (MFF) for the period 2021-2027.
  • The present proposal of the European Commission addresses the third pillar of the Just Transition Facility, namely the Public Sector Loan Facility to support public sector entities in their investments.
  • CONTENT: the proposed Regulation provides for the ‘Public Sector Loan Facility’ to support public sector investments by combining grants financed from the Union budget with loans granted on preferential terms by financial partners such as the European Investment Bank (EIB).
  • The public sector loan facility of the present proposal constitutes the third pillar of the Just Transition Mechanism. It will support public investments, through preferential lending conditions. These investments will benefit the territories most negatively affected by the climate transition as identified in the territorial just transition plans for the purposes of the Just Transition Fund.
  • The grant component of the Facility shall be implemented directly by the European Commission while the EIB shall implement the loan component.
  • Objectives
  • Under the Just Transition Facility, the Public Sector Loan Facility shall benefit, in each Member State, the territories most affected by the transition to a carbon-neutral European Union, as identified in the territorial Just Transition Plans of the Just Transition Fund.
  • All investments under the Just Transition Mechanism, including the public sector loan facility, shall be implemented based on territorial just transition plans.
  • In order to ensure an effective implementation of the Facility, the proposed Regulation provides for the provision of advisory support for the preparation, development, and implementation of projects. Only projects that do not generate sufficient stream of own revenues and that would not be financed on commercial terms without the element of grant support may be eligible.
  • Investments
  • In order to enhance the economic diversification of territories impacted by the transition, the Facility should cover a wide range of investments. They may cover:
  • - energy and transport infrastructure,
  • - district heating networks,
  • - green mobility,
  • - smart waste management,
  • - clean energy and energy efficiency measures including renovations and conversions of buildings,
  • - support to transition to a circular economy,
  • - land restoration and decontamination,
  • - up- and re-skilling, training and social infrastructure, including social housing.
  • Proposed budget
  • The total budget proposed for the grant component of the facility is EUR 1.525 billion. It is envisaged to finance this amount mainly :
  • - with assigned revenue EUR 1.275 billion and;
  • - partly with appropriations programmed under the Multiannual Financial Framework (MFF) 2021- 2027 for EUR 250 million.
  • EUR 1 billion of the assigned revenue foreseen would stem from the estimated surpluses of the provisioning of the European Fund for Strategic Investments (EFSI) after its constitution phase, ending in 2022.
  • From the financial envelope for the grant component, up to EUR 25 million from assigned revenues will be allocated to advisory services to support the preparation and implementation of eligible projects.