On-bill schemes to support Member States in implementing their Recovery and Resilience plans
NextGenerationEU, a temporary recovery instrument proposed by the European Commission in 2020, was established to tackle the severe effects of the COVID-19 crisis by offering Member States €750 billion of aid to boost the recovery of the EU economy in a sustainable way. The Recovery and Resilience Facility (RRF), one of the NextGenerationEU cornerstones, supports investments by making €672.5 billion of loans and grants available to Member States. To apply for funds offered by the RRF, Member States must prepare and submit their recovery and resilience plans (RRPs) to the European Commission.
While preparing their RRPs, Member States should be ready to demonstrate their commitment to a green transition as one of the pillars of the Annual Sustainable Growth Strategy 2021. Commitment to the green transition principle requires countries to accelerate the reduction of greenhouse gas emissions through fast deployment of renewable energy and increased energy efficiency of buildings. In addition, each RRP should use at least 37% of its expenditures for covering climate investments and reforms. The strategy also states that by means of job creation, savings on energy bills and reduced energy poverty, building renovation is expected to be an indispensable support to the economic recovery.
Soon after they become officially approved, RRPs will be converted to legally binding acts that will fall under the competence and responsibility of national governments in each Member State. National governments will then have the important task of mobilising the funds provided by the RRF and investing in accordance with the submitted plans.In its recovery and resilience plans guideline, the European Commission identified renovation as one of the priority areas, and on-bill schemes as an important measure that could be promoted in these plans.
The new RenOnBill paper explores some of the critical challenges utilities may face when preparing for and utilising on-bill schemes and proposes actions national and/or local governments in EU Member States may take to mobilise utility companies to adopt on-bill schemes as a strong support to the implementation of national recovery and resilience plans.On-bill schemes are a useful tool and concept that can help Member States roll out impactful renovation programmes. This is especially relevant as the implementation phase of the RRPs starts, and where a strong focus on building renovation means that readyto-use and effective instruments should be accessible to national authorities as well as stakeholders. On-bill schemes can help in that process, but for that to happen, governments need to enable their adoption by utilities. This paper has suggested three areas of work which would truly leverage the recovery funds in favour of renovating the building stock in Europe:
- Empowering building owners
- Setting up national/municipal guarantee funds
- Increasing competences of small utilities