Amended legislation on the European Energy Recovery Plan (EERP) will channel the unspent money into a new fund, to finance projects such as:
- renovations of public and private buildings to improve energy efficiency or switching to renewable energy;
- the construction of renewables-based heat-and-power installations, with distribution networks, and their integration into electricity grids;
- clean urban public transport solutions, particularly electric and hydrogen vehicles;
- local infrastructure, including efficient street lighting, electricity storage, smart metering and smart grids.
The fund will focus chiefly on helping local and regional authorities to pay for such projects, which must be economically and financially viable, so as to refund the investment in due course.
Contributions from the fund could take the form of loans, guarantees, equity or other financial products. Up to 15% of the funding may be used to provide technical assistance to public authorities to help set up the projects. Geographical balance is to be an important criterion in the selection of projects.