The Board of Directors of the European Investment Bank (EIB) has approved an innovative financing mechanism worth €3 billion to accelerate the modernization of energy efficiency in low- and middle-income households and small businesses across Europe. Under the plan, developed in partnership with the European Commission, the allocated financing may be increased depending on market demand.
The mechanism will allow Member States that have transposed ETS2 to access financing by providing upfront funding under relevant programmes before the new system becomes operational in 2028 and starts generating revenues.
The upfront financing will stimulate investments in cleaner heating and cooling systems and contribute to reducing energy consumption in homes and buildings across the EU. It will ensure that the transition in the sectors covered by ETS2 is socially fair and economically efficient, while supporting the EU’s climate and energy objectives. Future investments will directly benefit low- and middle-income households by making clean solutions more affordable for citizens, in line with the objectives of the Social Climate Fund and the national Social Climate Plans.
The ETS2 upfront financing mechanism will also support measures to encourage a shift to public and shared transport, improve multimodality, and expand electromobility schemes. It will further help accelerate the deployment of zero-emission vehicles, electric bicycles, and the rollout of recharging and alternative refuelling infrastructure.
