Fact Sheets on the European Union
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Financing the Trans-European Networks

This fact sheet explains how the EU finances the development of Trans-European Networks (TENs) – the large scale transport, energy and digital infrastructure networks that connect Member States. It describes the main funding instrument, the Connecting Europe Facility (CEF) and outlines how projects are selected and funded. It sets out the budget for 2021-2027 and gives details of the complementary funding sources: Structural Fund assistance, aid from the European Investment Bank and contributions from the private sector. It also explains Parliament’s role in shaping the priorities and overseeing TEN investments.

Legal basis

  • Article 171 of the Treaty on the Functioning of the European Union (TFEU), which stipulates that EU aid may be granted to projects of common interest that meet the requirements laid down in the guidelines.
  • The 2021 regulation establishing the Connecting Europe Facility (CEF-II) (Regulation (EU) 2021/1153).

Objectives

The general objectives of the Connecting Europe Facility (CEF) include building, developing, modernising and completing trans-European networks in the transport, energy and digital sectors (see fact sheet 3.5.1 on Trans-European Networks – guidelines) and facilitating cross-border cooperation in the field of renewable energy, taking into account long-term decarbonisation commitments and the goal of boosting the EU’s competitiveness. In line with the EU objective of mainstreaming climate actions, the CEF contributes 60% of its budget to climate objectives.

Funding and project selection

A. General conditions for project funding

Generally, EU funding has served as a catalyst for projects. Member States must raise most of the funding, except in the case of Cohesion Fund aid, where the EU has traditionally made a more substantial contribution.

The basic rules for funding trans-European networks were established in Council Regulation (EC) No 2236/95 of 18 September 1995, since superseded by a series of CEF regulations.

1. Type of EU aid

EU aid for projects can take one or more of the following forms:

  • co-financing of project-related studies and other technical support measures (up to 50%);
  • contributions towards fees for guarantees for loans from the European Investment Fund or other financial institutions;
  • interest subsidies for loans granted by the European Investment Bank (EIB) or other public or private financial bodies;
  • other financial instruments besides grants: equity and debt; loan guarantees and venture capital, and capacity building and risk sharing facilities;
  • direct grants for investments in duly justified cases.

2. Selection criteria for projects

The following project criteria have been progressively laid down.

  • EU aid to telecommunications and energy networks must not cause distortions of competition between businesses in the sector concerned.
  • Projects must help to achieve the networks’ objectives, as set out in the respective guidelines for the Trans-European Transport Network (TEN-T) (Regulation (EU) No 1315/2013) and the Trans-European Energy Network (TEN-E) (Regulation (EU) 2022/869).
  • Projects must be economically viable.
  • Projects must be mature and EU intervention must have a stimulatory effect.
  • There must be direct or indirect effects on the climate, the environment and employment, progressively including cost-benefit analyses, environmental impact analyses, the climate proofing of projects, etc.
  • The timing of different parts of the project must be coordinated, for example in the case of cross-border projects.
  • The financed projects have to comply with EU law and EU policies, in particular in relation to environmental protection, competition and the awarding of public contracts.
  • There must be competition between qualified tenderers and selection must be based on both cost and quality considerations.

B. Additional funding possibilities

1. EU Structural and Cohesion Funds

From 2014 to 2020, over EUR 6 billion from the European Regional Development Fund and EUR 25.95 billion from the Cohesion Fund were made available within Thematic Objective 7, ‘Promoting sustainable transport and improving network infrastructures’, to support a multimodal Single European Transport Area. Moreover, additional resources and instruments from the European Fund for Strategic Investments (now InvestEU), Horizon 2020 (now Horizon Europe), and the Recovery and Resilience Facility were put in place to foster investment opportunities in the TEN-T.

2. European Investment Bank aid

No territorial restrictions apply to EIB loans, as they are granted on the basis of banking criteria, which include the financial (ability to repay), technical and environmental feasibility of the project.

C. Adapting to new strategic priorities

1. Climate targets

Under the 2022 revised TEN-E regulation (Regulation EU) 2022/869), trans-European energy infrastructure has aligned with the EU’s 2030 targets for energy and climate and its objective of achieving climate neutrality by 2050. It has also helped ensure interconnections, energy security, market and system integration, competition that benefits all Member States, and affordable energy prices. The guidelines ended EU support for new natural gas and oil projects and mandated sustainability criteria for all projects of common interest (PCIs).

2. Geopolitical events

Following Russia’s invasion of Ukraine in 2022 the Commission presented the REPowerEU Plan with the double aim of tackling the climate crisis and ending the EU’s dependence on Russian fossil fuels. The plan contained additional gas infrastructure investments, estimated at around EUR 10 billion, to complement the existing list of PCIs. In addition, a faster roll-out of electricity PCIs was considered essential to adapt the power grid to future needs and will be supported through the CEF

On 27 July 2022, the Commission presented an amended proposal for the TEN-T guidelines to reflect the changed geopolitical context, including an extension of four European Transport Corridors to Ukraine and Moldova. Parliament adopted the 2024 revised TEN-T regulation on 24 April 2024, and it came into force in the summer of 2024.

Current financial framework (2021-2027)

The Commission put forward its proposal for the EU’s 2021-2027 long-term budget in 2018. This was followed by legislative proposals for 37 sectoral programmes. In addition to the EU Structural and Cohesion Funds, the Horizon Europe and InvestEU funds provided complementary funding for TENs, including research and innovation in the areas of clean energy, transport and digital technologies.

In response to the unprecedented crisis caused by COVID-19, on 27 May 2020, the Commission proposed the temporary recovery instrument NextGenerationEU, with a budget of EUR 750 billion, as well as targeted reinforcements to the 2021-2027 EU budget. EU Heads of State or Government reached a political agreement in July 2020, and Parliament and the Council endorsed it in November 2020.

Connecting Europe Facility (CEF)

The Connecting Europe Facility (CEF) has been the central financial framework for TEN infrastructure since December 2013.

A. General objectives

The CEF aims:

  • to build, develop, modernise and complete trans-European networks in the transport, energy and digital sectors and to facilitate cross-border cooperation in the field of renewable energy, taking into account the long-term decarbonisation commitments and the goals of increasing European competitiveness;
  • to achieve smart, sustainable and inclusive growth;
  • to promote territorial, social and economic cohesion;
  • to enhance access to and the integration of the internal market, with an emphasis on facilitating synergies between the transport, energy and digital sectors.

1. In the transport sector, support is reserved for projects of common interest aimed at:

  • fostering efficient, interconnected and multimodal networks and infrastructure for smart, interoperable, sustainable, inclusive, accessible, safe and secure mobility, in accordance with the TEN-T guidelines;
  • adapting parts of the TEN-T for the dual use of transport infrastructure with a view to improving both civilian and military mobility.

For example, the CEF aims to accelerate the completion of both layers of the TEN-T and the deployment of European traffic management systems, such as the European Railway Traffic Management System and Single European Sky ATM Research project, and to support the transition towards smart, sustainable, inclusive, safe and secure mobility by introducing a European network of charging infrastructure for alternative fuels.

2. In the energy sector, support aims to:

  • contribute to the further integration of an efficient and competitive internal energy market and to the interoperability of networks across borders and sectors, facilitating the decarbonisation of the economy, promoting energy efficiency and ensuring security of supply;
  • facilitate cross-border cooperation in the area of energy, including renewable energy.

3. In the digital sector, the CEF supports:

  • the deployment of and access to safe and secure, very high capacity networks, including 5G systems, the reinforcement of digital backbone networks on EU territories by linking them to neighbouring territories, and the digitalisation of transport and energy networks.

B. CEF budget 2021-2027 (CEF-II)

The Commission announced a proposal for the CEF-II programme in 2018, then adjusted it in 2020 in response to the COVID-19 pandemic. In March 2021, Council and Parliament negotiators reached a provisional agreement to divide the funding as follows:

  • transport sector: EUR 25.81 billion, including EUR 11.29 billion for countries that benefit from the Cohesion Fund and EUR 1.69 billion for actions relating to military mobility;
  • energy sector: EUR 5.84 billion;
  • digital sector: EUR 2.06 billion.

The Council arrived at a common position on 16 June 2021 and Parliament agreed to the regulation establishing the Connecting Europe Facility at second reading on 7 July 2021.

In June 2023, the EU formalised the association of Ukraine with the CEF, enabling Ukrainian projects to be submitted for EU funding in the transport, energy and digital sectors.

The proposal provided that the new CEF will also support civilian/military dual-use transport infrastructure to adapt Europe’s transport networks to military requirements and improve military mobility in the EU. Following this, the Commission adopted an Action Plan on Military Mobility 2.0 in November 2022 to ensure better-connected and more secure military mobility. In 2025, the EU built on this with a broader package of measures under the same policy framework.

C. CEF budget 2028-2034 (CEF-III)

On 16 July 2025, the Commission issued a proposal to establish the Connecting Europe Facility for the period 2028-2034. It includes a budget of EUR 81.4 billion for the CEF to fund trans-European transport and energy infrastructure, covering projects such as military mobility and renewable energy.

In transport, CEF supports the completion of the TEN-T, targeting the core network by 2030 and the extended core network by 2040. Flagship projects include Rail Baltica, the Brenner Base Tunnel, the Seine–Escaut inland waterway, the Brno–Bratislava and Thessaloniki–Bucharest links, and hinterland connections for TEN-T ports.

CEF also promotes interoperable, safe, and smart mobility on TEN-T, financing systems such as the European Rail Traffic Management System, the River Information Services for inland waterways, and links with the Galileo, EGNOS and IRIS satellite systems. It also invests in cross-border connections with non-EU countries. For instance, CEF funds are being used to improve links to Ukraine and Moldova to strengthen the ‘Solidarity Lanes’ – the connections that support bilateral trade with Ukraine and give it access to international markets and global supply chains – such as by helping to prepare for the alignment of rail gauges with EU standards.

In line with the revised TEN-E Regulation, the CEF energy window for 2028-2034 is expected to strengthen its support for cross-border PCIs in areas such as hydrogen and CO₂ transport networks, offshore electricity grids for offshore wind, and, where eligible, cross-border electricity storage and other smart grid infrastructure. New fossil gas and oil projects would no longer be supported.

Military mobility is another priority, with four multimodal corridors identified for urgent investment. Planned works include widening rail tunnels, strengthening road and rail bridges, and expanding port and airport terminals to enable rapid movement of troops and equipment.

Role of the European Parliament

A. Advocating for greener transport

In support of the TENs, Parliament has consistently called for the funding of more environmentally friendly modes of transport to be prioritised, with the allocation of over 50% of infrastructure funding to rail projects (including combined transport) and a ceiling of 25% for road projects. Furthermore, Parliament has emphasised the need for the Commission to ensure the coordination and coherence of projects financed by contributions from the EU budget, the EIB, the Cohesion Fund, the European Regional Development Fund or other EU financing instruments.

B. Aligning TEN-E infrastructure with climate targets

C. Oversight and accountability

When taking decisions on the yearly EU budgets, Parliament has paid attention to the appropriations allocated to both the CEF and Horizon programmes. In response to the Commission’s 2018 proposal on the post-2020 CEF, the Committee on Transport and Tourism and the Committee on Industry, Research and Energy prepared a joint draft report, which noted the lack of ambition of CEF allocations for transport and highlighted the investment needs of the sector, in addition to the benefits that improved connectivity could deliver for the EU. It emphasised the need to further simplify the rules of the CEF and the importance of coherence between the various EU funds supporting projects in the transport, energy and digital sectors. The rapporteurs pointed out the need to reinforce parliamentary scrutiny of the priorities of the CEF and to improve how it is monitored. The joint report included an increase of around 20% in the budget allocated to transport projects. The envisaged increase in the CEF budget could not, however, be accommodated in the underlying multiannual budget for the period 2021-2027.

In July 2020, a Parliament resolution on the conclusions of the extraordinary European Council meeting of July 2020 welcomed the deal on measures in response to the COVID-19 pandemic as a positive step, but expressed regret about cuts to the grant component of the recovery fund, among other things.

Parliament is currently reviewing the Commission’s proposal for the 2028-2034 multiannual financial framework, which puts forward increased investment in TEN-E and TEN-T through the new CEF, and the introduction of dual-use civilian/military transport projects to enable seamless military mobility throughout the EU.

D. Role of the Committee on Transport and Tourism and Committee on Industry, Research and Energy

The Committee on Transport and Tourism and the Committee on Industry, Research and Energy serve as the institutional pillars of the European Parliament’s legislative oversight for the TENs. Under a joint committee procedure (Rule 55), both committees co-examine CEF proposals. The Committee on Transport and Tourism focuses on the transport window, ensuring funds are directed toward completing the TEN-T core network by 2030, with a focus on missing cross-border links and military mobility. Meanwhile, the Committee on Industry, Research and Energy oversees the energy and digital allocations. ITRE’s role is also critical in financing PCIs under the TEN-E framework.

This fact sheet is jointly prepared by the European Parliament’s Policy Departments on Transport, Employment and Social Affairs, and on Transformation, Innovation and Health. For more information on these topics, please see the websites of the Committee on Transport and Tourism and of the Committee on Industry, Research and Energy.

 

Marianne Simonne Eva MAQUET / Maja STRNAD MESKO