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Call key data
Mainstreaming sustainable energy investments in the financial sector
Funding Program
LIFE - sub-programme “Clean Energy Transition”
Call number
LIFE-2022-CET-MAINSTREAM
deadlines
Opening
17.05.2022
Deadline
16.11.2022 17:00
Funding rate
95 %
Call budget
€ 3,500,000.00
Link to the call
Link to the submission
Call content
short description
The topic aims to make investments in energy efficiency and small-scale renewable energy sources more attractive to private investors.
Call objectives
Significant investments need to be mobilised to achieve the ambition set by the European Green Deal and the objective to reduce EU dependence on fossil fuels imports set out in the REPowerEU plan. While significant public sector expenditure is allocated to leverage private finance for sustainable energy (e.g. through the InvestEU facility), many private investors still lack sufficient incentives and tools to overcome the perceived complexity and risks associated with this kind of projects. Sustainable energy investments, understood in this topic as investments in energy efficiency and small-scale renewable energy sources, need further de-risking and mainstreaming into the strategic and operational approaches of market actors, in particular private financial institutions.
The EU’s sustainable finance strategy aims to embed sustainability into investment processes. A proper implementation of the associated policies, in particular the EU taxonomy regulation, the proposal for a Corporate Sustainability Reporting Directive, the Banking Package 2021, the EU green bond standard and labels for retail investment products, requires market actors to change their practices. Sustainable energy interventions are often part of a broader investment, hence they are not always identified as sustainable assets, which reduces their visibility for investors.
In this context, adequate tools and methodologies are needed to attract private finance to sustainable energy investments, in particular in the energy efficiency segment. Some of these exist already and need to be fine-tuned and expanded. There is also a need to encourage investment alignment with and overachievement of the regulatory requirements and policies on sustainable finance, both on the supply and demand side of finance. Such alignment could in turn foster a massive upscale of retail investment in sustainable energy and via securitisation of sustainable energy assets access to the secondary market.
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Expected effects and impacts
Proposals should address one or several of the following areas of work, with a focus on sustainable energy investments (i.e. energy efficiency and/or small-scale renewables):
- Improving risk and sustainability assessment in the methods and tools of private investors by integrating the specificities of sustainable energy, including multiple benefits of energy efficiency. The focus can be at project level (e.g. creditworthiness analysis, quality standards, benchmarking data) or at portfolio level (e.g. internal ratings-based approaches, climate stress-testing, analysis of sustainable energy aspects of investment strategies, etc.).
- Labelling and certification schemes including methodologies and tools for benchmarking, tagging, monitoring of investment performance, and disclosure of investment data with a link to the EU sustainable finance legislation.
- Improving availability and interoperability for financial institutions of data collected e.g. from energy performance certificates, energy audits, smart meters, as well as energy and financial performance data of investment, connected wherever possible to the De-risking Energy Efficiency Platform (DEEP)[8].
- Development, evolution and/or distribution of financial products, including insurance, supporting the securitisation of sustainable energy assets with a particular focus on energy efficiency.
- Targeted support to sustainable energy finance related activities of regulatory bodies and supervisory authorities, in particular related to revised risk ratings and requirements for energy efficient assets.
- Accelerating implementation or overachievement of EU sustainable finance requirements and policies by private investors and/or companies, including support to project developers in order to better meet expectations of private investors (e.g. development of closer connections between technical standards and accounting and disclosure reporting).
- Develop standards to increase the volume of energy efficiency and sustainable energy investments in financial institutions assets and lending portfolio, in line with the EU’s sustainable finance strategy and the EU Taxonomy Regulation.
- Capacity building at all levels of the private finance value chain, in the form of exchanges of best practices, development of training programmes and/or evolution and/or rollout of existing training programmes.
The proposed actions should credibly engage with the relevant stakeholders in the private finance value chain, including institutional investors, but also retail banking branches, brokers, fund managers, investment advisers, insurers, etc., in order to ensure adoption of the results by market players. Proposals should demonstrate support of the targeted stakeholder groups and how they will be involved throughout the project.
The Commission considers that proposals requesting a contribution from the EU of up to EUR 1.5 million would allow the specific objectives to be addressed appropriately. Nonetheless, this does not preclude submission and selection of proposals requesting other amounts.
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Expected results
Proposals should result, depending on the scope of the activities, in enhanced capacity and appetite of private financial institutions to invest in energy efficiency and small-scale renewable energy sources; adoption of new approaches, tools, labels and certification schemes; enhanced access to data related to financial and energy performance; evolutions in the regulatory and supervisory frameworks; easier identification of the alignment of sustainable energy investments to the criteria of the EU taxonomy of sustainable activities.
Proposals should quantify their impacts using the indicators listed below, where relevant, as well as other project-specific performance indicators:
- Number of private finance stakeholders integrating the results of the project and related investment portfolios.
- Number of private finance stakeholders benefitting from enhanced capacity.
- Number of financial regulatory bodies and supervisory authorities benefitting from support on sustainable energy policies.
- Investments in sustainable energy triggered by the project (cumulative, in million Euro).
- Primary energy savings triggered by the project (in GWh/year).
- Renewable energy generation triggered by the project (in GWh/year).
The impacts of the proposals should be demonstrated during the project and within 5 years after the project lifetime.
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Eligibility Criteria
Regions / countries for funding
Albania (Shqipëria), Andorra, Faeroes (Føroyar / Færøerne), Iceland (Ísland), Israel (ישראל / إِسْرَائِيل), North Macedonia (Северна Македонија), Türkiye, Ukraine (Україна)
eligible entities
Education and training institution, International organization, Non-Profit Organisation (NPO) / Non-Governmental Organisation (NGO), Other, Private institution, incl. private company (private for profit), Public Body (national, regional and local; incl. EGTCs), Research Institution incl. University, Small and medium-sized enterprise (SME)
Mandatory partnership
Yes
Project Partnership
Proposals must be submitted by at least 3 applicants (beneficiaries; not affiliated entities) from 3 different eligible countries.
In order to be eligible, the applicants (beneficiaries and affiliated entities) must:
- be legal entities (public or private bodies)
- be established in one of the eligible countries, i.e.:
- EU Member States (including overseas countries and territories (OCTs))
- non-EU countries:
- please see the List of Participating Countries in LIFE for an up-to-date list of countries with which the association agreements have started to produce legal effects (either through provisional application or their entry into force).
- the coordinator must be established in an eligible country
Natural persons are NOT eligible (with the exception of self-employed persons, i.e. sole traders, where the company does not have legal personality separate from that of the natural person).
International organisations are eligible. The rules on eligible countries do not apply to them.
Additional information
Topics
UN Sustainable Development Goals (UN-SDGs)
Additional Information
Proposal page limits and layout:
Proposals must be complete and contain all the requested information and all required annexes and supporting documents:
- Application Form Part A — contains administrative information about the participants and the summarised budget for the project
- Application Form Part B — contains the technical description of the project
- Part C containing additional project data
- mandatory annexes and supporting documents:
- detailed budget table
- participant information
- optional annexes: letters of support
Page limit - Part B: 65 pages
Call documents
Call document LIFE-2022-CETCall document LIFE-2022-CET(1043kB)
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