A financing mechanism adopted by the European Commission to financially support new RES projects and facilitate synergies, at financial and technical levels, between EU member states is moving closer to actualization.
Late in 2020, the European Commission established a related platform and invited EU member states to express interest in the mechanism either as hosts or contributors.
According to the mechanism’s plan, contributing member states will be able to invest in RES projects in other countries. This prospect will enable contributors to become involved in projects offering greater financial returns, compared to those of domestic projects, and also invest through RES technologies that cannot be implemented at home. For example, landlocked countries will be able to invest in offshore wind farms and countries with minimal sunshine will be able to invest in solar farms.
On the other hand, member states hosting projects linked to the new mechanism stand to benefit from improved energy supply and security, grid upgrades, investments and job creation.
Also, RES output generated by projects linked to the new mechanism is planned to be equally divided by participating states, contributing to their respective energy and climate targets.
The European Commission is currently examining the prospect of also opening up this initiative to private-sector firms. Brussels, gauging the level of investment interest, has invited private-sector companies to express their interest in the mechanism by February 15.
The private sector is playing a crucial role in successfully promoting RES projects in the EU, Brussels pointed out in a statement.