Financing LNG Investments in Energy and
Transport
Dr. Panayotis Zacharioudakis
Managing Director – Ocean Finance Ltd.
Round table on Transport and
Energy Connections
29 March 2017, Athens
2016 CEF Transport Program
New Technologies and Innovation
• Decarbonisation of transport, energy efficiency.
• Projects should be deployed on the core
network corridors.
• Budget: EUR 80 million (General Envelope) &
EUR 59.5 million (Cohesion Envelope)
• Co-Funding rate: 50% for studies with pilot
deployment, 20% for works, 85% for Cohesion
countries(Studies & Works).
Motorways of the Sea (MoS)
• Alternative clean fuels infrastructure (e.g.
Scrubbers only for shortsea outside SECA).
• New maritime links.
• Budget: EUR 40 million (General Envelope) &
EUR 20 million (Cohesion Envelope)
• Co-Funding rate: 30% for infrastructure works
and, 50% for pilot actions, up to 85% for all type
of projects in Cohesion countries.
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Urban Nodes of the Core Network
• Nodes of 9 Core Network Corridors.
• Directive 2014/94/EU on the deployment
of alternative fuels infrastructure.
• Works , studies and/or deployments of
pilot actions.
• Budget: EUR 40 million (General
Envelope) & EUR 20 million (Cohesion
Envelope).
• Co-Funding rate: 20% for works and 50%
for studies (General Envelope), 85% for
Cohesion Envelope.
2017 CEF Transport Blending Call (1/2)
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€1 billion of funding available for PCI projects.
Maximizes the leverage of private involvement and capital.
Open to all EU Member States.
At least one EU Member State for decarbonisation of all transport modes along the TENT Core Network Corridors and nodes.
Indicative Call Timeline
Evaluation:
Call opening:
July to November 2017
8 February 2017
December 2017 to March 2018
14 July 2017
European Commission
Decision on selected
projects:
30 November 2017
January 2018
Deadline for Submission:
May 2018
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Signature of grant
agreements:
January 2018
May 2018
2017 CEF Transport Blending Call (2/2)
New Technologies and Innovation 2017
• Only works for the roll-out of the innovative
solution, e.g. along and entire corridor.
• Combination of grant and loan.
• More flexibility on eligible costs funding.
• At least a significant part of a Core Network
Corridor.
• Budget: EUR 140 million (General Envelope).
• Co-Funding rate: 20% of the eligible costs.
Motorways of the sea 2017 (MoS)
• Development of MoS Links: at least 1 Core
Port, 1 Comprehensive Port and 1 Maritime
operator on the link concerned.
• Only WORKS ELIGIBLE - Studies & Pilot
Actions not supported under the blending
call.
• Budget: EUR 40 million (General Envelope)
• Co-Funding rate: 30% for infrastructure
works and facilities.
Inland waterways and inland ports 2017
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Access and connections (connections
to waterways, access to inland ports
and connections between inland
ports).
Basic infrastructure.
Fixed infrastructure to supply
alternative energy .
Waterside terminals infrastructure
Maximum EU contribution rates: 20%
for inland ports & 20% for inland
waterways.
2016 CEF Energy Program
• Aims at ending energy isolation, eliminating
energy bottlenecks, and completing of the
internal energy market.
• By the end of 2016, 75 actions for a total
amount of EUR 1.2 billion.
• Implementation of 66 Projects of Common
Interest (PCI).
• 35 in electricity & 31 in gas.
• Financial support is provided to 51 different
beneficiaries from 23 EU Member States and
2 third countries.
• Studies/works: 50% of eligible costs & up to
75% for actions with a high degree of regional
or EU-wide security of supply.
• 2017 CEF Energy call is planned for later this
spring.
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2016 CEF Synergy Call
• First CEF Synergy Call - actions
between transport and energy
sector (& cyber-security).
• Overlap TEN – T and TEN – E:
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TEN – T: entire
comprehensive network
(emphasis on core transport
network corridors).
TEN – E: only on location of
one of the 195 (Energy) –
PCIs.
• Type of actions:
•
•
Studies without pilot
deployment.
Studies with pilot
deployment (= real – life
trials).
• One or more Member States.
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Budget
Co-Funding rate
EUR 40 million
(General Envelope)
60% of the eligible costs for both
sectors
European Fund for Strategic Investment (EFSI)
• Additional investment of at least
EUR 315 billion over a three year
period.
• Supports bankable projects.
• No geographical or sectoral
allocation.
• Provides risk financing instruments
via EIB (no grants).
• EUR 500 billion in additional
investments by 2020.
EFSI Transport, as of 31 January 2017
34 transport operations approved
Triggering > EUR 14 billion in related
investment
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Green Shipping Financing Tool (GSFT)
• The GSFT instrument would allow financing of new investments and
conversion of existing fleets.
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Public Private Partnerships (PPPs)
• Common practice for
financing transport projects.
• Public party bears assets
ownership.
• Procurement method for
large infrastructure projects.
• Improve the quality of
expenditure and ensure
effective use of EU funds.
• EU funds make PPP projects
more affordable for the
procuring authority and/or
user and improve the
bankability of PPP projects.
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Improve
delivery of
projects
Improve risk
sharing and
Boost
sustainability
PPPs Benefits
Spread the cost
of financing
over the
lifetime of the
asset
Better Value
for money
from
infrastructure
Ocean Finance has played a major role in the
business development of LNG use in energy and
transport by,
Setting up industrial projects.
Analysing the required LNG
infrastructure per case.
Undertaking extended focused
studies in both sectors in order to
mature the projects.
Facilitating of projects
implementation.
Providing supportive measures for
solutions to the financial obstacles
in transport and energy sector.
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• COSTA I - CO2 & Ship transport
emissions abatement by LNG
Project: LNG Masterplan for Med,
Black Sea and Atlantic.
• COSTA II EAST Global plan for LNG
infrastructure development /
Poseidon Med Project: Conceptual
Studies for East Med.
• POSEIDON-MED II Global plan for
LNG infrastructure development
Project: Detailed Studies and
works.
• Proposal CYnergy Establishment
of a Natural Gas supply system on
the island of Cyprus (Under
Evaluation): Studies for Cyprus –
Project of Common Interest (PCI):
Removing bottlenecks to end
island gas isolation.
Recommendations
• Transport and Energy dedicated
budget increase within the context
of CEF Synergy.
• Shipping sector is expected to be a
heavy LNG user – more favorable
terms are required for increasing
investments.
• Shipping sector investments should
be equally treated as roads and rails
investments by CEF Transport.
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Dr. Panayotis Zacharioudakis
Managing Director
Ocean Finance Ltd.
[email protected]
Telephone: 215 5002901