These days, numerous commentators are warning that the financial crisis is threatening decades of European integration. With an overdue initiative for a new infrastructure network, the European commission is trying to get back in the driver seat of the debate on Europea’s future to 2020 and beyond. The prospects are not so bad. The proposal of an infrastructure package presented on 19 October comprises guidelines for key sectors such as transport, energy and innovative communications technologies (ICT.) Moreover, it also includes a new budgetary instrument, the so-called Connecting Europe Facility, to enable the EU to implement its “Europe 2020 Strategy”.

“Connecting Europe”, as the Commission labels this initiative, should be funded with €50 billion from the EU's 2014-2020 budget. In order to attract private money, the Commission proposes the introduction of project bonds as a new category of securities to attract the investment in infrastructure projects that would otherwise not be feasible. "The Connecting Europe Facility and the Project Bond Initiative are a perfect demonstration of the value added that Europe can provide. […] We are closing the missing links in Europe's infrastructure networks that otherwise would not be built,” outlined José Manuel Barroso, European Commission president. In a pilot phase from 2012-2013, the initiative will start with a contribution of €230 million from the EU budget aimed at mobilizing private investment of up to €4.5 billion.

With about €9 billion used to meet the 2020 energy and climate objectives, in principle, the initiative can help to foster the low carbon energy transformation needed. It aims at building a new momentum of energy solidarity between Member States by completing the internal energy market, linking isolated regions to the European network and assisting renewables to develop and compete with traditional energy sources. Among the priority projects in the renewable section are the Northern Seas offshore grid to integrate electricity generated in the North Sea, the Baltic Sea and neighbouring waters, as well as north-south electricity interconnections in western and central and southern Europe.

However, the guidelines for the energy sector do not only identify trans-European priority corridors for renewable energies, but also include gas and oil as part of the CO2 transport infrastructure. Environmental groups already questioned the risk-sharing approach related to the carbon capture storage technology. In addition, the concept of project bonds is subject to hotly contested debates. It remains to be seen to what extent next steps by the EU will help to provide new perspectives for European solidarity. (Dennis Taenzler)

For the full report on “Connecting Europe”, please see here.

For the guidelines on energy, please see http://ec.europa.eu/energy/infrastructure/strategy/doc/com_2011_0658.pdf

Published in: ECC-Newsletter, 5/2011