The European Union provides funding to become independent of Russian energy

The agreement facilitates a “fundamental reform” of the EU’s energy sector, according to Czech Finance Minister Zbenik Stanjora.

The countries agreed to add 20 billion euros, about NOK 208 billion, in grants on top of the remaining funds in the EU’s joint coronavirus fund.

Dubbed REPowerEU, the European Commission’s plan aims primarily to diversify EU gas purchases, accelerate plans to roll out renewable energy and reduce gas consumption where possible.

In May, the Commission presented plans to raise up to 300 billion euros in loans and grants to boost investment in renewable energy, in response to higher energy prices in the European Union since Russia’s invasion of Ukraine.

The proposal states that a large part of the pot, up to 225 billion euros, will be money left in the Corona Fund. Traders agree that this money can be used for energy projects.

Among the things that were in dispute was where the 20 billion grants should come from. In the end, the parties agreed that 60 percent of the grants would be funded through the European Union’s Innovation Fund.

The remainder will come from selling more emissions allowances through the EU’s allowance system (ETS).

Projects in renewable energy and energy efficiency will be the main beneficiaries of the funds, but also some projects in fossil fuels, including liquefied natural gas (LNG) and oil, may receive support if completed by 2026.