Apr 17 2016

Baby-snatching

This article presents the views of stakeholders on the potential for aligning ETS Innovation Fund with other programmes, and their views on which part of the European Commission should be in charge of administering it.

Connie Hedegaard, the Commissioner responsible for NER300 in the second Barroso Commission, avoided any reference to the SET Plan in either of the two press conferences she gave (Dec 2012, July 2014) unveiling winning projects. This suggests she wanted it to be seen as an instrument that stood apart from the SET Plan, which was (and is) managed chiefly by DG Energy and DG Research & Innovation as a vehicle for coordinating energy research between stakeholders and public administrations, including the EC.

Eurelectric + 2 say, “The new NER400 mechanism needs to be much more aligned with the EU’s wider RD&D priorities for the energy sector and should be designed in such a way that it helps deliver these priorities alongside other key EU innovation funding mechanism such as the EU SET Plan [Editor’s note: which DECC also clocked] and Horizon2020. It should also be evaluated whether the integration of the new ETS Innovation Fund into existing funds (e.g. Horizon 2020, SET Plan etc.) at EU level would be appropriate. This could reduce the complexity when seeking funding for projects and enable a simpler bidding process.” The EC insisted that NER300 was not part of the EU’s Multiannual Financial Framework (7-year budget). Alstom wants a different approach with ETS Innovation Fund: “The Commission should in any case include funding for the EU Innovation Fund in its proposal for the next MFF (starting 2021) to be submitted at the [latest] on 1 January 2018.”

The same thought occurred to stakeholders from industry. CEFIC: “This fund should be also complementary and in full co-ordination with existing EU Research and Innovation programs, such as Horizon 2020, as well as the [Juncker] Investment Plan.” Fuels Europe and its member BP go one step further and call for the aggregation of ETS Innovation Fund with other funds “to minimise administration costs.” “In any case,” says ENAGAS, “it is essential to make sure that EU keeps an overall list of priorities when providing EU funds from NER300/400, Horizon 2020, CEF, or any other.”

The principle of “full coordination” applies within the Emissions Trading Scheme family of instruments, too, with Lewiatan, Bellona, Alstom and ZEP, saying “Member States […] should be given the possibility to combine the [Modernisation and NER400 Innovation] funds and use the revenues in the most efficient way.” This means, says Bellona, that the possibility should exist for funding from the two schemes to be cumulative.

One aspect of coordination is timing. Fuels Europe calls for the timetables of ETS Innovation Fund to be “shared with MSs as early as possible (so these can be accounted for in MSs support schemes).”

The possibility exists to look beyond R&D and climate policy to the approach taken for funding Trans-European Networks in Energy. E3G recommends “that different levels and forms of funding should be available, akin to the approach taken [for] PCIs.” Vattenfall also references these ‘Projects of Common Interest‘, which are energy-interconnection projects that, when approved by the EC, can benefit from a fast-track permitting regime or sometimes grants: “The guiding principles for granting support from the NER400 should be that the projects should be of common interest for the EU, preferably supporting more integration of the internal market.” CEPS notes that European State Aid law refers to another similar-sounding concept, the Important Project of Common European Interest. CEPS says that all ETS Innovation Fund projects should be recognised as IPCEIs, enabling them to quality for the ‘block exemption’ from State Aid rules.

Whose baby should it be?

Given the express desire of many stakeholders to see ETS Innovation Fund articulate with (and in a few cases, carry out the same work as) other instruments and strategies, it is no surprise that some want to see responsibility for ETS Innovation Fund taken away from DG CLIMA.

ZEP wants “The [eligibility] evaluation [to] be made by all relevant DGs.” CEEP: “[The] leading role (primary role) should be played by DG Grow with whom all projects should be co-ordinated in co-operation with DG Energy. The role of DG Clima should be secondary.”

DG CLIMA, for its part, has become somewhat more conscientious in name-checking the SET Plan since Connie Hedegaard’s speeches: references to it do appear in the ETS Innovation Fund Impact Assessment (SWD (2015) 135).