Funding Proportion mis-stated in Award Decision

The EC has mis-stated the CCS:RES Funding Proportion in the first call Award Decision

Because there are no confirmed CCS projects in the first call of NER300, the RES:CCS ‘Funding Proportion’ is not “18% (CCS)/82% (RES)”, as stated in the Award Decision, but 0%(CCS)/100%(RES). The unofficial pre-18 Dec 2012 version of the Award Decision included ULCOS among the confirmed projects because it was not known at the time that it was written that it would be withdrawn. This led the EC to write, “On the basis of the confirmed funding requests, the funding proportion between the two groups was established as 18% (CCS)/82% (RES).” If the ‘confirmed funding requests’ are the basis on which the Funding Proportion should be calculated, then this line should have been updated with the 0%/100% ratio in the official version of the Award Decision. (This is not the only mistake in the document. The Dutch Woodspirit project is incorrectly denoted as ‘BIOd’. It is ‘BIOe’.)

The implication of a 0/100 Funding Proportion is that the entire NER300 first call pot of 1.5 bn € should go to RES projects. The EC’s position is that “the €275 million envisaged for CCS projects in the first call remains available to fund projects under the second phase of the NER300 programme”, but, given that there remain available RES proposals (i.e. proposals that have passed technical and financial due diligence and the EC’s competitiveness and eligibility checks), this looks untenable.

The NER300 Decision required that proposals be confirmed before they form part of the RES Group, which is the set of highest-ranked RES proposals. Appendix A9 of the Procedures Manual required the RES Group to be made up of 34 projects. To avoid requiring the Member States to confirm projects ranked very low, the EC took the step in Jul 2012 of identifying the top-ranked 34 projects, which if all confirmed, would make a complete RES Group. But the EC omitted to replenish the set as projects among the original 34 projects dropped out.

The likely outcome of a legal challenge, which might be mounted by projects that sense they narrowly missed out on millions of euros of funding, is that the EC would go back to those Member States with projects that would be next in line for funding, ask them to confirm them, then make an adjustment to the Award Decision awarding the remaining 300 M € to those projects. Simple and fair.

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