The criteria that big infrastructure projects must meet to get “EU” status, and EU project bonds to finance them, are the key proposals in a resolution, passed by Parliament on Tuesday, on Energy infrastructure priorities for 2020 and beyond.
The non-legislative resolution, drafted by Francisco Sosa Wagner (NI, ES), approved with 590 votes in favour, 43 against and 12 abstentions, responds to the European Commission’s November 2010 communication on policies and priorities for connecting energy networks and completing the EU energy market.
Projects of European interest
MEPs acknowledged that infrastructure project planning and development is mainly a task for the market, but they acknowledged that EU also has a role to play, especially in projects that are of European interest. They set out a list of criteria for selecting priority projects that “meet pressing European needs”, including connecting energy islands with the rest of the grid, reducing network losses and single supplier dependency and integrating renewable energy sources into the network.
All projects with added value for the EU should be supported, even smaller ones, says the text. (Para 86). Parliament welcomed the Commission proposal that a national “one-stop shop” be created for each project of European interest and called for more coordination by the Commission of cross-border projects.
EU project bonds
On financing issue, MEPs reiterated that a properly-functioning market should provide a large share of infrastructure investment. However, when “the market alone cannot cover the investments needed”, EU funding may be required for projects that are not “commercially viable” but are very important for achieving EU energy policy objectives. For example, projects that fail to attract private investors but are needed to interconnect EU electricity and gas grids in isolated regions should receive EU funding, they say.
MEPs therefore encourage proposals to develop innovative financing instruments and back the idea of issuing “common European project bonds” to finance EU’s major infrastructure needs. These bonds would secure the necessary investment, and at the same time help create a climate of confidence for private investors.