Press release
Regional development funding for energy efficiency investment in housing
Regional policy - 10-03-2009 - 09:11
Committees
Committees
All EU Member States and regions would be able to get EU regional development funding for energy-efficiency and renewable energy investments in housing, under rule changes approved by the Regional Development Committee on 9 March and scheduled for a plenary vote at the start of April.
The rule changes would mean European Regional Development Fund (ERDF) money could co-fund national, regional or local authority schemes to install e.g. double glazing, wall insulation or solar panels in housing, or to replace old boilers with more energy efficiency ones, in all Member States. The ERDF currently funds such schemes only in the new (EU-12) Member States, and only in common parts of a building (or the entire building, if it's social housing), in deprived urban areas.
All Member States eligible
Broadening eligibility to the "old" Member States was the key aim of a May 2007 European Parliament resolution on housing and regional policy, but it took the "impetus" of the financial crisis to get it introduced throughout the EU. It is expected to help create jobs in the building trade, and, by reducing energy consumption, help to slow the rate of climate change. The changes do not increase funding or affect the Community budget, but they do enable Member States to shift their priorities in order to finance measures in this field.
The key legislative change needed - an amendment to ERDF Regulation 1080/2006 Article 7 ("Eligibility of Expenditure") was backed in a co-decision report by Emmanouil Angelakas, (EPP-ED, Greece), which the committee adopted with 36 votes in favour and one abstention.
The 4% ceiling
In each Member State, spending on energy efficiency improvements and the on the use of renewable energy in housing would be eligible for ERDF support, up to a ceiling of 4% of the Member State's total ERDF allocation.
New (EU-12) Member States will still be able to fund other types of housing expenditure under the existing ERDF rules (up to a maximum of 3% of the ERDF allocation to the relevant operational programmes or 2% of the total national ERDF allocation). Total spending on housing in the new Member States, under various rules, could reach 6% of their total ERDF allocation.
From "low income households" to "social cohesion"
However, the categories of housing eligible under national rules would be decided by each Member State, "in order to support social cohesion". (The measure was first intended to apply only to "low-income households", but this caused problems because "low income" definitions differ from one Member State to the next). The decision as to whether or not to support energy investments in buildings, in accordance with national rules, remains an exclusive competence of Member States.
New costs covered
Another amendment makes three new types of costs eligible for ERDF grants: indirect costs (up to 20% of the direct costs of an operation), lump sums (up to €50,000) and flat-rate costs, calculated using standard national scales. This change is meant to simplify the declaration of expenditure, and enable public authorities to prepare projects and measures faster and more efficiently. To ensure certainty as to the law, these new types of costs would be deemed eligible for ERDF funding with effect from 1 August 2006, when Regulation 1080/2006 entered into force.
Climate change
Buildings account for about 40% of final energy demand, and an estimated 40% of greenhouse gas emissions, in the EU. The Commission estimates that cost-effective energy savings in the building sector could reach 28% by 2020 (in turn reducing the EU's total final energy consumption by about 11% - COM (2006) 545 (19.10.2006).
Procedure: co-decision, first reading Committee vote: 36 in favour, none against, one abstention - Plenary: April I
09/03/2009
Committee on Regional Development
In the chair : Gerardo GALEOTE (EPP-ED, ES)
In the chair : Gerardo GALEOTE (EPP-ED, ES)
REF.: 20090309IPR51306