Presentation to the Greens/EFA Climate Core Group Conference, 28 September, 2016, European Parliament, Brussels

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European Structural and Investment Funds’
Contribution to Climate Action
in Eastern Europe
Céline Charveriat
Executive Director, Institute for European Environmental Policy
European Parliament, Brussels
28 September 2016

2. www.ieep.eu @IEEP_eu
Where we come from: useful facts from 2007-2013
• A glass 95% empty?:
‒ €50 billion was spent on climate change
under the 2007-2013 EU MFF or a meagre
5% of EU funds (IEEP).
‒ Around 19% of CP funding in the EU was
allocated to investments that contributed
to declining sustainability in the period
2007-2012 (IEEP).

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Where we come from: major effectiveness issues
• The risk of relabelling i.e. projects don’t
change in substance, they are simply
relabelled
• The challenge of demonstrating impact: the
inability to evaluate whether projects lead
to a reduction in carbon emission
• The risk of a mitigation-adaptation
imbalance, while climate change impacts
are increasing in severity and frequency in
Europe
• The coherence gap: undermining
objectives with the rest of project funding
going to “carbon bombs”
• The challenge of optimal additionality i.e.
ensuring EU funds finance public or PPP
projects that would otherwise not have
taken place
• The challenge of cost-effectiveness i.e.
wasting scarce public funds on projects
that deliver very little impact while missing
on other opportunities with much greater
potential.

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Where we come from: example of effectiveness of
ERDF/cohesion funds in public and residential buildings
• Total ERDF/CF allocations to “energy
efficiency, co-generation and energy
management”= EUR 6.1 bn or 2%
• About half of this was allocated to
energy efficiency in public and
residential buildings (EUR 3.4 bn)
• 90% of the funds were non-repayable
grants
• Role of ERDF/CF was 50% of the total
public funding with major variations
between countries.
Evidence of impact: Mixed evidence, studied
programs achieved 62% of energy reduction
but only 23% of emission reduction targets.
Evidence of cost-effectiveness: no discernible
correlation between level of funding and
results in terms of energy reductions and
GHGs
Evidence of integration with wider national
strategy: very little
Highly variable quality and comparability of
data

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Case studies of particular projects—showing huge
disparity among achievements (2007-2013)
• Lithuanian Promotion of cohesion
programme
• 864 public buildings modernised (101%
of target)
• 69% increase in energy efficiency in
multi-apartment buildings covered by
the program—although for a
significantly lower number of buildings
than planned
• Polish infrastructure and Environment
Programme
• Energy efficiency funding mostly
allocated to public buildings
• 413 public buildings modernised
• Result indicator target values were not
achieved
• Negligible impact in terms of overall
energy savings and CO2 emissions

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The key questions for 2014-2020: is there evidence of:
• Increased volume of spending on climate action?
• Increased effectiveness of spending on climate action?
• Increased coherence of overall spending?

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2014-2020: the promise of a
major increase in overall
volume of spending
• Effective 20% mainstreaming of
the budget would translate into
Eur. 188 bn for climate action
which is almost four times as
much as climate action during
the previous MFF, with ESIF
providing 90bn as a contribution
• Effective implementation of Art.
8 of CPR=greater alignment of EU
funding to Sustainable devt.

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Evidence to date
• If current trends continue:
• 18.9% of the total EU budget will
have gone to climate action by
2020 i.e. Eur. 200 bn or 30bn a
year (EC, 2016).
• For ESIF: 25.2% of total support
to climate action i.e. over Eur. 100
bn or 14 bn a year (COWI, 2016)
• For CP: around 15% i.e. Eur. 56 bn
or 8 bn a year (EC, 2016)

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And most CEE countries seem to be overshooting the
climate action mainstreaming target
0
5
10
15
20
25
30
RO LT CZ HU LV SK EE HR PL
Climate action as share of ESIFs, CEE
countries (%)

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Scratching below the surface: The example of the
European Agricultural Fund for Rural Development (1)
• High ambition:
‒ A minimum of 30% from the EARDF must be spent on climate mitigation and adaptation (as well
as environmental issues).
• Impressive headline figure suggesting a significant over-achievement:
‒ 57.1 % of European Agricultural Fund for Rural Development (EAFRD) earmarked for climate
action (2014-2020) i.e. 56 bn (or a share of 12% of total climate action under ESIF)

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The example of EAFRD (2): the case of CEE countries
0
10
20
30
40
50
60
70
80
PL LT EE RO HR LV HU SK CZ
Share of climate action in EAFRD funds in CEE countries (%)

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The example of EAFRD (3)
• Lower level of specificity in the marker
system compared with ERDF (only 10
categories versus 34)
• Only 7.68% of the total RDP budgets
(EAFRD + national co-financing) for
climate action defined by “promoting
resource efficiency and transition to a
low carbon economy”
• The bulk of allocations have climate
change only as a secondary objective
• 75% of the allocations is under the
objective of restoring, preserving and
enhancing ecosystems related to
agriculture and forestry-some of which
can be beneficial or detrimental to
mitigation
• Lack of description of specific climate
action measures within programs
• Very low targets set by MS in terms of
outcomes
• Mitigation vs. adaptation confusion?

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Sources
• EC. Commission Staff working document.
Mid-term Review of MFF. 14.2016
• COWI. 2016. Mainstreaming of climate
action into ESI funds
• Ramboll, IEEP. 2015. Energy efficiency in
public and residential buildings, ex-post
evaluation of ERDF and CF.
• IEEP. 2014. Mainstreaming climate
objectives in EU Cohesion Policy - a
guidance briefing.
• IEEP. 2001. Cohesion Policy and
Sustainable Development, A report for DG
Regio
• IEEP. 2012. Criteria for maximizing
European added value of EU budget:
the case of climate change
• IEEP. 2012. Walking the talk-practical
options for making the 2014-2020 EU
MFF deliver on climate change.
• Ecorys, LEI and IEEP, forthcoming,
Mapping and analysis of the
implementation of the CAP, DG
Agriculture and Rural Development.