Municipalities, local authorities and local public entities aggregating municipalities/local authorities play a key role in Europe’s transition towards sustainable energy. They have tremendous potential to build comprehensive sustainable energy investment programmes and can encourage the pooling of smaller projects into larger investment portfolios to mobilise the significant financial resources required for the energy transition.
Although the potential is immense, there are fundamental barriers for sustainable energy investments, such as:
the lack of financial and legal capacity of municipalities/ local authorities to transform their long-term energy and climate strategies into appropriate investment concepts;
the lack of aggregation of fragmented smaller projects and thus lack of attractiveness of those for the financial sector.
In many cases, municipalities/ local authorities lack resources and internal capacities to develop credible, robust and sufficiently mature investment concepts that can mobilise financing for the realisation of their sustainable energy projects. These concepts are, however, essential for addressing potential investors and accessing different sources of funding.
In this context, the European City Facility (EUCF), continued under the LIFE Programme of the European Union, provides tailor-made, rapid and simplified financial support (grants of EUR 60,000) and capacity building services to municipalities, local authorities, their groupings and local public entities aggregating municipalities/local authorities in Europe in order to enable them to develop sound investment concepts andmobilise finance in the field of sustainable energy.
The investment concepts developed by EUCF beneficiaries will represent an important step towards a fully-fledged business and financial plan and in this way facilitate the subsequent mobilisation of investments in energy efficiency and renewable energy. Sources of funding for the investment projects may vary, coming from the private sector, but also from other EU-funded instruments such as the European Fund for Strategic Investments (EFSI), the European Structural and Investment Funds (ESIF), various Project Development Assistance (PDA) facilities, such as the European Local Energy Assistance (ELENA) facility of the European Investment Bank (EIB), or other different national and local investment platforms.
The overarching objective of the EUCF is to provide financial and technical support to municipalities/local authorities, their groupings and local public entities aggregating municipalities/local authorities in order to accelerate the implementation of their ambitious sustainable energy and climate plans. Building on the success and the lessons learned in the first four calls for applications, the EUCF aims for an appropriate follow-up and upscale of its support, by continuing to be relevant to municipalities, local authorities and local public entities in structuring and increasing the maturity of their investment projects and supporting the European goals of increasing investments in sustainable energy.
The specific objectives of the EUCF include:
Municipalities and local authorities, groupings of municipalities/local authorities as well as local public entities aggregating municipalities/local authorities located entirely in the European Union Member States (EU-27), in Iceland or Ukraine are eligible to apply to receive EUCF support.
Municipalities/local authorities, groupings of municipalities/local authorities, and local public entities aggregating municipalities/local authorities are able to benefit only once from the EUCF support. Thus, beneficiaries from previous EUCF calls are not able to participate again in the calls for applications.
Successful applicants receive financial support in the form of a EUR 60,000 grant for the development of the investment concept.
The EUCF provides municipalities/local authorities, their groupings and local public entities aggregating municipalities/local authorities with different types of technical support activities along their journey within the EUCF:
The EUR 60,000 grant is provided to EUCF beneficiaries to support the activities necessary for the development of their investment concepts. The grant amount can be used for in-house staff - if internal capacities are sufficient - or for external experts, sub-contractors and other positions that are necessary for the investment concept development. Among the activities that can be funded are feasibility studies, engineering analyses, legal analyses, social studies, market studies, financial analyses, energy audits and further supporting tasks.
The EUCF provides support for investment projects within the field of sustainable energy, including all investments on the energy demand side, which contribute to the improvement of energy performance and the achievement of energy savings. Among the investment sectors targeted by the EUCF are public buildings (including social-rental and public housing), private residential and non-residential buildings, building integrated renewables, district heating and cooling networks, sustainable urban mobility, innovative energy infrastructure, renewable energy production infrastructure and public lighting. Nevertheless, it is also possible to implement projects in further sectors, as long as they are in the field of sustainable energy. Given the high relevance of energy efficiency for achieving the goals of European climate and energy policy, applications focused on the generation of energy savings are appreciated in the EUCF evaluation.
The EUCF is aligned with the European Commission’s European Green Deal, 2030 climate & energy framework, 2050 long-term strategy and the EIB’s energy lending policy. Thus, the EUCF has a clear position not to support investments in energy projects reliant on unabated fossil fuels, such as the production of oil and natural gas, traditional gas infrastructure, power generation technologies resulting in GHG emissions above 250 gCO2 per kWh of electricity generated, and large-scale heat production infrastructure based on unabated oil, natural gas, coal or peat.
Yes, the beneficiaries selected for EUCF support in previous calls are listed per country in the EUCF website, including a brief description of their investment projects. As the investment concepts developed by EUCF beneficiaries include sensitive and confidential information, these cannot be shared as reference to other beneficiaries by the EUCF.
1. Pre-application phase
At the beginning of the EUCF journey, potential applicants can receive information about the scope and the benefits of the EUCF by visiting the EUCF website, attending promotional events at EU and national level and participating in the EUCF webinars and info sessions.
2. Application phase
The EUCF application process comprises of two steps: i) the eligibility check and ii) the full application. The eligibility check is a simple, automated questionnaire, which can be answered online by the applicant on the EUCF website. To be eligible, applicants must be able to answer YES to all five questions of the eligibility check. Eligible applicants can register in the EUCF website user zone, where they can complete the application form and upload supporting documents. Applications can be submitted until the closing of the respective call and are then evaluated by a dedicated team. Successful applicants are selected and move to the next phase and become EUCF beneficiaries, while unsuccessful applications are redirected to the EUCF Helpdesk for support.
3. Grant Agreement phase
Successful applicants conclude Grant Agreements to benefit from the EUCF support. The Grant Agreement establishes the terms and conditions for EUCF support as well as the rights and obligations of both parties. 65% of the lump sum will be disbursed once the Grant Agreement enters into force; 35% of the lump sum after positive validation of the submitted investment concept.
4. Development of the investment concept
EUCF Beneficiaries must develop their investments concepts over a period of up to twelve months, during which the EUCF provides support through the technical and financial expertise from Country Experts and the EUCF team, standard tools and documents and capacity building events in different geographical regions on the topic.
5. Implementation of the investment concept
After the finalisation of the investment concepts, these are validated by a dedicated evaluation team. If the IC meets the validation criteria, the IC is positively validated and the beneficiary receives the remaining 35% of the total grant amount. Beneficiaries may then proceed with the successful implementation of their investment concepts. The EUCF accompanies the process by organising matchmaking and other capacity building events as well as by monitoring the IC implementation for a 2-year period. Validated ICs are uploaded into the EUCF brokering display window and presented to potential investors.