The Modernisation Fund must follow the objectives of the national energy markets

The Modernisation Fund must follow the objectives of the national energy markets

On May the 4th, 2016, CEEP’s CEO spoke at a hearing at the European Parliament, which was devoted to the revision of the 2003/87/EC directive. Mr. Bodio stressed that the new proposal regarding the directive may not change the formula of the Modernisation Fund, by reducing the role of Member States, when it comes to investment decisions in the energy sector.

The aim of the works, which are now taking place in the European Commission, is to make the ETS system compliant with the European Council’s conclusions. In October, 2014, heads of governments reached an agreement in relation to the climate and energy policy framework post-2030. The CEO of CEEP reminded the audience at the European Parliament that part of the compromise was the establishment of the Modernisation Fund for those Member States, where GDP per capita does not exceed 60% of the EU average.

“The Fund was to be managed by the Beneficiary States, with an advisory – and not decisive – role of the European Investment Bank (EIB). Yet, what we now see on the table goes in a totally opposite direction, with the role of Beneficiary States strictly limited, when compared to the original agreement,” Mr. Bodio stressed.

The current proposal from the European Commission provides the EIB and Non-Beneficiary Member States with a decisive role concerning the selection of specific investment projects. This could lead to the blocking of financial support for modern energy technologies, whose only ‘fault’ is making use of coal.

According to CEEP’s CEO, “the selection of investment projects should be carried out, taking into account the specificity of the energy mix in each Member State, with due respect for the Lisbon Treaty. Therefore, when it comes to investment decisions, the Modernisation Fund should be managed independently by each Beneficiary State.” The way Mr. Bodio presented it in the European Parliament, there is no need for additional administrative structures and bodies, in order to effectively manage the Fund.

Mr. Bodio declared that CEEP, alongside other industry organisations, is committed to working out a formula for the Modernisation Fund, that would guarantee its full transparency. “We believe that the Fund’s management procedures should resemble those, which proved effective when it comes to the EU’s structural and investment funds. That means that each Member State should have dedicated funds to be spent on a specific purpose,” he explained.

In conclusion, Mr. Bodio stated that CEEP is ready to support all Member States in their efforts to modernise their energy systems and increase energy efficiency, in accordance with the needs of individual nations participating in the European Community.