Financing opportunities for Sustainable Energy & Climate Action Plans

In a series of four publications, the Covenant of Mayors - Europe Office guide you through the maze of funding and financing solutions for your local energy and climate actions.



Floriane Cappelletti

Publication date

October 2, 2020

Innovative Financing Schemes

In 2015, just before the COP21, City of Paris issued its very first set of green bonds worth €300 million. The system proved to be successful in raising the interest of investors. Two years later, the city issued a second set of climate bonds, for €320 million on the market. These were long-term bonds (17 years) at an interest rate of 1.43%. The reaction of the financial market players went beyond all expectations: in 3 days, a wide range of domestic and international investors offered €1.2 billion to the municipality.

Many of the Covenant of Mayors cities & towns have implemented innovative financing schemes to fund locally-owned projects in the framework of their Sustainable Energy and Climate Action Plans (SECAP). In the Innovative Financing Schemes booklet, you will learn how local and regional governments have been making use of green bonds, energy taxes, energy performance contracting, soft loans and third-party financing, engaged into local energy cooperatives…

Project Development Assistance

Girona Province’s Horizon 2020 Beenergi programme provides technical, financial and legal assistance to Covenant of Mayors signatories. The aim of the project is to mobilise investments in sustainable energy, promote energy efficiency in public lighting and in municipal buildings. The Beenergi programme promotes new organisational models through innovative funding systems and aims to simplify the legal and technical aspects of administrative procedures. One of the objectives of the programme is to increase the capacities of the key stakeholders (SMEs, public administration staff, financial entities) and the municipalities.

In the Project Development Assistance publication, cities and towns share their experience in the EU programmes Horizon 2020, ELENA and the eeef Technical Assistance Facility.

EU Funding Programme

About 80% of EU funding is granted through programmes managed in the EU countries themselves through structural funds. However, some funds are directly handled by the European Commission or dedicated agencies and secretariat, through calls for proposals which are part of dedicated funding programmes.

The EU Funding Programme leaflet guides you through the several programmes that are of interest for cities’ climate and energy actions (Horizon 2020, JPI Urban Europe, LIFE, URBACT and Urban Innovative Action), and provides you with tips for succesful applications.

Financial Institutions Instruments

In 2016, Portugal’s capital Lisbon became the first EU municipality to benefit directly from EU support under the Investment Plan for Europe. It is due to benefit from a €250 million European Investment Bank framework loan, supported by EFSI, to contribute to the urban regeneration of the city and to support its long-term growth and competitiveness. The project has a strong focus on social inclusion and it will also help Lisbon tackle climate change.

Since 2016, the EIB has also been part-financing a number of medium to large-scale investment schemes in the Polish city of Poznan related to urban transport, roads, education, social infrastructure and municipal services. The city’s tramway system has been modernised and more than 1,000 social housing units have been financed.

Learn how you can get financial support from the European Investment Bank, the European Strategic Investment Fund and national pomotional banks in the 4th booklet of the series, Financial Institutions Instruments.