Member states have yet to tap into EU support fund for decarbonising buildings and transport
Tagesspiegel Background
Not a single EU country has requested funding from the European Investment Bank (EIB) to spur investments to decarbonise the buildings and transport sectors five months after the launch of a 3-billion euro initiative, reported news service Tagesspiegel Background.
“The EIB has not yet received any requests for funding,” an EIB spokesperson told Tagesspiegel.
The so-called frontloading facility will advance revenues from the new Emissions Trading System (ETS 2) that now also covers emissions in the buildings and transport sectors, set to become fully operational only in 2028. The EIB funding allows countries to pre-finance investment programmes before the new system kicks off and revenues start flowing. It is supposed to mainly drive investments in cleaner heating and cooling and reduce energy demand in homes and buildings in the EU, said the EIB.
The price on emissions from fossil fuels that people use to heat their homes or drive their cars is a key instrument for reaching EU climate targets. The new ETS 2, which is expected to boost the shift to low-emissions technologies like EVs or heat pumps, is set to become fully operational across the EU at the beginning of 2028. However, opposition to the system has increased in recent months, as policymakers worry about public backlash if prices rise significantly amid an already challenging economic environment. To alleviate worries, the European Commission agreed several measures to guarantee a smoother start to the ETS 2, including the EIB initiative.
“The EIB stands ready to bring forward future revenue from emissions trading and to provide funding to member states to accelerate investments that reduce energy costs for households and small businesses,” the EIB spokesperson said.
Loans from the facility are limited to EU countries that have already transposed the European ETS-2 Directive into national law, which by now covers the majority of countries, including for example Germany and Italy. However, countries like France and Poland have delayed implementation, worrying about rising living costs and public protests, according to Tagesspiegel.
German think tank Zukunft KlimaSozial criticised the delayed use of the EIB funding. “This means that an opportunity for early investment in social support measures is being missed,” researcher Marie-Louise Zeller said. The think tank analysed the so-called Social Climate Plans of EU countries, which outline support for vulnerable households during the energy transition. It said that the plans drafted so far provide crucial impetus for a just transition towards climate neutrality.