This is an HTML version of an attachment to the Freedom of Information request 'Meeting between DG ENER and European Engine Power Plants Association (EUGINE)'.




Ref. Ares(2020)6084012 - 29/10/2020

 
 
 
LINES TO TAKE 
 
  I recognise the role of gas in the EU economy, including in power production. 
Today gaseous energy consumption amounts to around 25% of the total EU 
energy consumption. Gaseous fuels, are a source of flexibility for the energy 
system increasingly based on intermittent RES generation and replacing more 
polluting fuels such as coal. Oil and oil products keep our transport running.   
  Engine power plants could play an important role in the decarbonisation of 
gases, in particular in replacing natural gas with biomethane, biogas and 
hydrogen. I understand this was also the message EUGINE gave when 
signing the “Bucharest Declaration” on "Sustainable and Smart Gas 
Infrastructure for Europe".  
  Indeed, to remain credible and maintain a role in the future, natural gas has to 
decarbonise and address urgently methane emissions across the life cycle. 
Reduction of methane emissions and a low-emission gas infrastructure is 
indispensable if gases in general want to remain part of the future energy mix 
  The Commission will deliver an integrated strategy to reduce methane 
emissions. This will not only cover the energy sector but also emissions from 
agriculture and waste. The strategy will focus on improved measurement, 
robust and transparent reporting and credible verification of methane 
emissions.  
  The upcoming Strategy for Energy System Integration (“smart sector 
integration” announced in the Commission Work Programme for June 2020) 
will outline a vision to create a smarter, more integrated and more optimised 
energy system, in which all sectors can fully contribute to decarbonisation.  
  Hydrogen is an important enabler of the transition to a carbon-neutral 
economy and can strongly contribute to the reshaping of the energy system in 
a way that ensures a more integrated and sustainable approach. We see a 
potentially important role for hydrogen to contribute to the energy system 
integration, through integrating larger shares of renewables in heavy-duty 
transport and carbon intensive industry, and providing a solution for large-
scale storage, among others. Clean Hydrogen will therefore be an important 
element of that strategy, but its key role and its wider scope may deserve a 
specific approach.  
  I am pleased to say that a specific hydrogen strategy is now envisaged to be 
linked to the Energy System Integration strategy, to underline how to upscale 
the demand and supply of renewable hydrogen, how to mobilise MSs, 
deployment and industry, how to advance the regulatory framework, how to 
strengthen the research agenda and how to positon internationally.  
 
MEETING EUGINE 

29 June 2020 11:30 
 

 
 
 
DEFENSIVE POINTS 
What  support  is  available  for  gas  projects  from  EU 
sources, including from the recovery package? 
 
  Gas infrastructure projects (e.g. transmission and 
distribution, district heating) are eligible under some EU 
budget programmes proposed within the Multiannual 
Financial Framework for 2021-2027. 
  This would include gas projects from the 4th list of 
Projects of Common Interest (PCI) that are to be 
supported under Connecting Europe Facility. 
  In addition gas infrastructure may be eligible in the 
following programmes that have been proposed by the 
Commission: InvestEU (e.g. transmission and distribution 
networks, district heating) and under the second pillar of 
Just Transition Mechanism (namely “Just transition 
scheme”
 – the same eligibility as in the InvestEU).   
  Under the recovery package, (which includes changes 
to InvestEU and the Just Transition Mechanism) the 
Commissioned proposed i.e. green transition as a priority 
horizontally through the programmes that may support 
energy-related investments.  
  In major grant/loan programme – Recovery and 
Resilience Facility – Commission proposed close 
alignment of future investment projects and reforms with 
the European Semester and the country specific 
recommendations, the National Energy and Climate Plans 
and the Just Transition Plans. All the projects that Member 
States are going to submit in their recovery and resilience 
MEETING EUGINE 

29 June 2020 11:30 
 

 
 
 
plans will be assessed against the background of their 
contribution to address challenges related to i.e. country 
specific recommendations and green transition. It 
considers also the assessment of gas related projects that 
Member States may include in the plans (e.g. networks, 
interconnectors, district heating). 
  [only if asked] The LIFE programme is not directly 
envisaged to support gas infrastructure project. However, 
if a gas related project contribute to energy efficiency and 
demonstrates the net positive effects on climate (net GHG 
emissions reduction), then some dedicated “enabling” 
activities like capacity building, awareness raising, 
investments mobilisation etc. might be funded.  
  [only if asked] In ERDF regulation: we have to wait for 
conclusion of negotiations between the Council and the 
European Parliament. The Council’s mandate envisages 
possibility of support for the replacement of coal-based 
heating systems by gas-based heating systems for climate 
mitigation purposes; investment in the distribution and 
transport of natural gas substituting coal. 
What about the EIB and the financing of gas? 
  EIB has played a key role in leveraging low carbon 
investments in the EU and beyond.  
  EU‘s climate and energy commitment needs is reflected in 
their new Energy Lending Policy, agreed in autumn last 
year. The EIB new Energy Lending Policy in relation to 
natural gas infrastructure investments will help the EIB 
fully align its activities with the climate ambition.  
  In general, this policy for gas excludes i.e. funding of new 
MEETING EUGINE 

29 June 2020 11:30 
 

 
 
 
traditional gas-fired power generation, and phases out 
new natural gas pipelines. (In certain cases it allows for 
CO2 abatement for instance or support for low-carbon 
gases, like biogas, synthetic gas and hydrogen). 
  There will be a limited transition period for the EIB to finish 
particular gas infrastructure projects that are under 
appraisal by the end of 2021. This would include a small 
number of gas projects from the 4th list of Projects of 
Common Interest (PCI), co-financed with the EU budget 
(e.g. the Connecting Europe Facility). Such projects need 
to be completed, in order to ensure security of supply and 
enhance competition. 
What  about  funding  of  funding  of  gas  projects  through 
CEF? 
  Electricity projects make up three thirds of the 4th PCI list 
mirroring the need to integrate a growing share of 
renewables to achieve carbon-neutrality. Most of the 32 
remaining gas projects (out of 149 in total) were selected 
because they address major security of supply challenges.  
  Any PCI can apply for funding from the Connecting 
Europe Facility. However, no project on the 4th PCI list will 
be automatically funded through CEF. Indeed, being on 
the PCI list is a precondition for CEF financing, however it 
is not a guarantee for funding.  
  The European Green Deal is clearly reflected in the 
objectives for the on-going CEF Energy call for proposals. 
The budget available under the call aims to maximise its 
added value towards decarbonisation.  
 
MEETING EUGINE 

29 June 2020 11:30 
 

 
 
 
  Each project proposed for funding will undergo a thorough 
external evaluation against the set TEN-E and CEF 
criteria. CEF funding is a last resort for a project in case 
no market based financing is possible.  
  The Commission does not decide alone on the funding of 
the projects, the Member States will need to approve the 
list of projects recommended for CEF funding.  
  The TEN-E review to be presented by the end of the year 
will be crucial in ensuring that our infrastructure policy fully 
supports the Green Deal, including through definition of 
future funding priorities under CEF. 
 
MEETING EUGINE 

29 June 2020 11:30