Modernisation Fund
Accelerating the transition to climate neutralityAbout
The Modernisation Fund is a programme from the European Union to support 13 Member States to meet energy targets by helping to modernise energy systems and improve energy efficiency.
Partners
The Modernisation Fund operates under the responsibility of the beneficiary Member States in close cooperation with the European Commission and the European Investment Bank.
What is targeted
The Modernisation Fund is a key part of the European Green Deal Investment Plan.
It will target investments in:
Renewable energy
Energy efficiency
Energy storage
Energy networks
Just transition in carbon-dependent regions
Which countries can benefit
Bulgaria
Croatia
Czech Republic
Estonia
Hungary
Latvia
Lithuania
Poland
Portugal
Romania
Slovakia
Slovenia
Conditions for financing
To obtain financing, the beneficiary Member State has to:
- demonstrate that the investment complies with the Modernisation Fund requirements set in the ETS Directive and the Implementing Regulation
- have sufficient funds available in the relevant category on its Modernisation Fund account
- provide evidence that the investment proposal is in line with the State aid rules
- demonstrate that the investment complies with “do no significant harm” principle (from 1 January 2025)
- confirm that the investment complies with any other applicable requirements of Union and national law
- confirm that there is no double funding of the same costs with another Union or national instrument
ensure that duration of the scheme does not exceed five years
Details on the eligibility criteria are described in the Assessment Guidance Document.
Types of investment
Priority investments that have to fall into at least one priority area as defined by the ETS Directive.
Non-priority investments that do not fall into a priority area but meet the Modernisation Fund objectives and demonstrate reduction of greenhouse emissions.
Type of support and synergies with other instruments
The support granted by Member States using the Modernisation Fund resources needs to be compliant with the State aid rules.
Co-financing from private and public entities is possible, as long as State aid rules are respected and the same costs are not already funded by another Union or national instrument (no double funding).
The Modernisation Fund complements other European and mobilises significant resources, which can help beneficiary Member States support investments in line with the REPowerEU Plan and the Fit For 55 package
In this context, Member States could draw on other national funds and/or European instruments, such as:
- InvestEU programme
- Connecting Europe Facility, including its energy projects (Projects of Common Interest)
- European structural and investment funds, including the Cohesion Fund and the European Regional Development Fund
- Just Transition Fund