Connecting Europe Facility Stphane Ouaki Head of Unit

Connecting Europe Facility Stéphane Ouaki Head of Unit Connecting Europe – Infrastructure Investment Strategies DG MOVE Transport

Connecting Europe Facility One instrument – three sectors Financing framework 2014 -2020 Sectoral policy frameworks The "European Infrastructure Package" (European Commission proposal, October 2011) Transport (setting priorities for 2020, 2030, 2050)

CEF: new funding framework • Stronger concentration of financial support on EU addedvalue projects • Exploitation of cross-sectoral synergies • Higher emphasis on the use of innovative financial instruments Transport

Main results of negotiations: budget • Total CEF budget: € 33. 3 bn • € 26. 25 billion for TEN-T (-40% vs EC) • European Council agreement 7 -8 February 2013 • EP resolution backed the agreement. Vote on the MFF Regulation end expected to be positive. • € 14. 9 bn available to all Member States • € 11. 3 bn to be transferred from the Cohesion Fund • To be allocated exclusively to projects in Cohesion Fund eligible Member States • € 5. 9 bn for energy • € 1. 15 bn for ICT Transport

CEF: Centralised management of grants • Project selection and resources allocation • by Commission with the help of an EA • Same criteria for project proposals coming from all Member States • Quality, maturity, EU added value, socio-eco and environmental impacts Concentration on projects with high EU added value • cross-border missing links, boosting multimodality, ensuring interoperability of networks across borders and modes • Increased efficiency of EU budget spending • Competition between proposals, "use-it-or-lose-it" principle Transport

The Connecting Europe Facility: eligibility • 80 – 85 % of available budget for pre -identified projects listed in Annex 1 • 4 horizontal priorities (including ERTMS) • 9 core network corridors • and other important crossborder and bottleneck sections • delegated act foreseen to amend list • 15 – 20 % for other projects of the core and comprehensive networks and for financial instruments Transport

TEN-T Corridors Baltic-Adriatic North Sea - Baltic Mediterranean Orient/East Med Scandinavian-Mediterranean Rhine-Alpine Atlantic North Sea - Mediterranean Rhine-Danube 22 Transport

Co-funding rates Transport

Centralised management of grants Work programmes Multiannual & annual (COM) Calls for projects Info Days (EA + COM) Application Paperless via TENtec; EA support Selection External evaluation (experts + EA) Internal Evaluation (COM) Funding Decisions For selected projects (COM) Monitoring of project implementation EA + COM ("Use it or lose it") € 11. 3 billion from the Cohesion Fund Exclusively dedicated work programmes and calls Transport

Delivering TEN-T grants 19 Transport

2014 Work programmes and calls - main features • Size of the calls will be evaluated on the basis of MS project pipelines In cooperation with MS authorities and DG REGIO, especially for Cohesion MS • 1 MAP for the € 11. 3 bn (Cohesion MS) End March - beginning April 2014, then Spring 2015, then • 1 MAP & 1 AP for the 28 EU MS Total budget for CEF (without the transfer from Cohesion Fund): ~€ 14. 9 bn in current prices • No plan to have an AP for the € 11. 3 bn All key projects on the Core Network are included in the Annex, covered by the MAP Transport

Following Work programmes and calls • Next MAP and specific call in Spring 2015 • Last MAP under national allocations in Autumn 2016 Even if funding decisions are adopted only in 2017, national allocations will apply • Possibility of Annual Work programmes under the € 11. 3 bn in 2015 and 2016 For projects of the Core Network not covered by the Annex Will depend on discussions with MS regarding their project pipeline Transport

CEF - Financial instruments 2 types: • Equity (Marguerite) • Risk-sharing instruments to provide loans and/or guarantees (such as LGTT or Project Bonds) • Combination of innovative financial instruments (e. g. Project bonds) and EU direct support (i. e. grants) to optimise the impact of financing • Possibility to top up the CEF financial instruments: MS (directly or through Structural Funds), other EU funds and/or investors • Possibility to use the Risk Sharing Finance Facility (RSFF) and its successor under Horizon 2020. Dedicated instrument to finance projects with high technological or innovation risk. • Possibility of specific model for ERTMS or SESAR • Specific Technical support from the EIB or external consultants can be financed through CEF support actions. Transport

THANK YOU FOR YOUR ATTENTION! Stéphane. ouaki@ec. europa. eu 31 Transport

Project bonds: how does it work? ➢ Project Company will divide its debt into two layers: Project Bonds Target rating minimum A- Bond Issue and underwriting Project Bond Investor SPV Project Costs ➢ A (smaller) Subordinated tranche, which would be underwritten by the Commission and the EIB, in a funded (loan) or unfunded (guarantee) form. EIB Sub-debt Equity & Quasiequity ➢ A Senior tranche, which will be issued as Project Bonds and placed with institutional investors (insurance companies, pension funds, etc. ) up to 20% of total Bond issue A mechanism to “credit enhance” senior debt and thus attract capital market investors ➢ Subordinated debt maximum 20% of total debt ➢ EIB and EU to receive a fee and/or credit margin European Investment Bank