EUROPEAN COMMISSION

Brussels, 1.6.2018

SWD(2018) 292 final

COMMISSION STAFF WORKING DOCUMENT

IMPACT ASSESSMENT

Accompanying the document

Proposal for a Regulation of the European Parliament and of the Council on the establishment of a Programme for the Environment and Climate Action (LIFE) and repealing Regulation (EU) No 1293/2013

{COM(2018) 385 final}
{SEC(2018) 275 final}
{SWD(2018) 293 final}

Table of contents

1.Introduction: Political and legal context

1.1.Scope and context

1.2.Lessons learned from the previous LIFE+ programme (2007-2013) and the current LIFE programme (2014-2020)

1.2.1.Consultation activities

2.The Objectives

2.1.Challenges for the LIFE programme for the next MFF

2.1.1.Key features of the current LIFE Programme

2.1.2.Key challenges and opportunities facing LIFE

2.1.3.Potential gaps and synergies with other EU programmes

2.2.Expected impacts of an unchanged LIFE programme (baseline)

2.3.Objectives of the LIFE programme post 2020

General and specific objectives for the future LIFE programme

Seizing opportunities for optimising the performance of the LIFE programme

3.Programme structure and priorities

3.1.Programme priorities

3.2.Critical mass

3.3.The EU added value of LIFE

3.4.Possible enhancements to the scope and structure of the future LIFE programme

3.4.1Extend the scope of the LIFE programme to include capacity-building projects related to clean energy by adding a sub-programme on Clean Energy Transition

3.4.2.Extend the scope of the LIFE programme to improve mainstreaming for nature and biodiversity

3.4.3.Extend eligibility of LIFE to the EU's Overseas Countries and Territories (OCTs) specifically for nature and biodiversity actions within the Environment sub-programme

3.5.Conclusions

4.Delivery mechanisms of the intended funding

4.1.Possible enhancements to funding mechanisms

4.1.1.Expand the scope and scale of Strategic Integrated Projects (SIPs)

4.1.2.Targeted support to upscale and replicate successful projects

4.1.3.Address the unbalanced participation of candidates from some Member States to LIFE calls for proposals through a reinforced network of LIFE contact points and targeted capacity-building actions

4.1.4.Increase the co-financing rate

4.1.5.Systematically define and develop synergies with other instruments

4.1.6.Financial Instruments delivered through a central fund.

4.1.7.Improving the strategic focus of the programme by simplifying the Regulation and the MAWP.

4.2.Conclusions

4.3.Programme management

4.3.1.Package of measure to reduce the administrative burden for the applicants/beneficiaries

4.3.2.Streamlined procedures for the implementation of the EU budget

5.How will performance be monitored and evaluated?

5.1.Lessons learned related to the existing monitoring and evaluation framework

5.2.Monitoring and evaluation framework for post 2020 indicators

5.2.1.How the outcomes and impact/catalytic role of the programme will be assessed

5.2.2.The timetable and the evaluations of the LIFE Programme 2021-2027

ANNEXES    47

Glossary

1.    Introduction: Political and legal context

1.1.    Scope and context

This impact assessment 1 accompanies the Commission proposal for the future LIFE Programme for the Environment and Climate Action 2021-2027 and satisfies the requirements of the Financial Regulation in respect of preparing an ex-ante evaluation.

All current and future EU generations are affected by environmental and climate problems, which impact on health, quality of life, and the availability and status of natural resources, implying social and economic costs. The EU is a global leader for environmental protection and climate action and - as confirmed in the President Juncker's 2017 State of the Union address 2 - wants to enhance this role 3 .

As highlighted in the Commission communication on the "Next steps for a sustainable European future" 4 , the 2030 Agenda on Sustainable Development and the 17 Sustainable Development Goals constitute an essential guiding principle and the contribution provided by the EU policies shall be assessed during the future EU multi-annual financial framework (MFF). The Commission communication on "A new, modern Multiannual Financial Framework for a European Union that delivers efficiently on its priorities post-2020 5 " acknowledges the citizens' expectations for their health, the environment and the climate. It identifies the European added value, enhanced performance, simplification and flexibility as the keys to a modern and effective EU budget.

At EU level, large investments in environmental and climate actions are primarily funded by major funding programmes (mainstreaming), in particular the cohesion funds, agriculture and rural development funds, maritime and fisheries funds, the research & innovation programme as well as external policy instruments.

The LIFE programme is the only EU fund entirely dedicated to environmental and climate objectives, addressed at present through two sub-programmes. With its modest budget (currently amounting to EUR 3.5 billion for the period 2014-2020 – 0.3% of the EU budget), it targets a niche between EU programmes supporting research and innovation on the one hand and EU programmes financing large-scale deployment of measures on the other hand (see Figure 1 below).

As Figure 1 illustrates, the first stage, research/innovation, involves primary research that enhances scientific knowledge and technical demonstration to prove viability of innovations. LIFE does not cover this area apart from small-scale research activities that support other objectives in projects. LIFE mainly finances actions that come under:

­the demonstration/best practice stage, including testing, demonstrating and piloting the effectiveness of new technologies, approaches or policies as methods for policy implementation. 

­the facilitating exploitation/upscaling/awareness stage to prepare the ground for the large-scale deployment of appropriate technical and policy-related solutions.

LIFE also contributes to the large-scale funding of green solutions, where access to funding constitutes the main barrier for the large-scale deployment of a technology, approach or policy, which has already proved to be effective. Its contribution is via two currently pilot financial instruments Private Finance for Energy Efficiency (PF4EE) and Natural Capital Finance Facility (NCFF), that only operate at a relatively small scale.

Figure 1. The coverage of LIFE and other major EU programmes and funds

Source: European Commission

While LIFE activities tackle certain problems directly on the ground, the programme's main impact is indirect through its catalytic role: the support for small-scale actions intended to initiate, expand or accelerate sustainable production, distribution and consumption practices by supporting:

­the development and exchange of best practice and knowledge;

­the building up of the capacities and speeding up the implementation of environmental and climate legislation and policies;

­stakeholders in testing small-scale technologies and solutions; and

­the mobilisation of funding from other sources.

On 2 May 2018, the European Commission adopted its proposals for a new Multiannual Financial Framework (MFF) for 2021-2027. Under these proposals , the LIFE programme will have a budget of EUR 5 450 million over this period.

This impact assessment report reflects the MFF proposals and focuses on the changes and policy choices which are specific to this instrument.

Among other things, it analyses the integration of part of the Intelligent Energy Europe (IEE) programme 6 into the future LIFE Programme as a separate window on ''Clean Energy Transition'' (see option 3.4.1 in chapter 3).

Moreover, it provides an assessment of the option for the establishment of dedicated envelopes for biodiversity and the management of the Natura 2000 network 7 .

1.2.    Lessons learned from the previous LIFE+ programme (2007-2013) and the current LIFE programme (2014-2020) 

The final evaluation 8 of the LIFE+ Programme (2007-2013) concluded that the programme was successful in promoting the implementation of the EU’s environmental policy and legislation with significant EU added value. However, it also identified a number of shortcomings. The vast majority 9 of these were addressed by introducing changes to the design of the current LIFE Programme (2014-2020). For example, the need to ensure that the projects supported had sufficient strategic focus was addressed in the new programme by shifting from a pure bottom-up approach to a more flexible approach, with specific thematic priorities and project topics defined for the Environment sub-programme. Likewise, the need for further simplification in the application process and reporting obligations was addressed by introducing a two-step application procedure for the integrated projects, waiving the requirement to submit an external audit certificate and/or a VAT certificate and streamlining the system to enable applicants to submit their proposals electronically (e-proposal). Further details on these changes and their rationale are provided in Annex 3.

The effectiveness of these changes was explored in the recent mid-term evaluation of LIFE (MTE) 10 . While the evaluation was undertaken at an early stage of the programme implementation, when only the 2014 and 2015 projects had started, it confirmed that the programme is on track to be effective 11 , efficient and relevant and that it is providing a contribution to the Europe 2020 strategy. Furthermore, most stakeholders see LIFE as being a very important instrument for addressing environmental and climate priorities.

The lessons learned from the MTE and, where relevant, recommendations from other reviews of the LIFE programme, are summarised below. They concern three aspects: programme relevance, coherence and coverage; effectiveness and catalytic effect; and efficiency and simplification. Some of the conclusions have already been taken into account in the implementation of the current programme.

1. Relevance, coherence and coverage

·The LIFE programme and its general objectives are relevant and are targeting the EU’s existing environmental and climate policy priorities. Also, the six Priority Areas defined in the LIFE Regulation 12 are responding to the needs.

·Around 13% of the LIFE projects impact more than one thematic area 13 . These 'overlaps' are synergetic: taking into account the interdependence of natural resources, multipurpose projects are more effective. Their expected combined impact is rewarded with bonus points during the evaluation of proposals.

·The small budget, the breadth of policy objectives targeted and the new challenges imply that not all the thematic areas could be addressed adequately by the end of the programming period. A critical mass to trigger a change on all environmental and climate issues 14 would require a substantial increase of the budget.

·Reducing the thematic scope of the programme would have critical consequences in addressing one or more of the programme’s priorities (e.g. resource efficiency, the quality of water and air, greenhouse gas emissions reduction, marine conservation, etc.).

·Synergies have been found between the projects financed by LIFE grants and projects financed by grants from other EU programmes (e.g. demonstration projects under Horizon 2020), as the programmes, while having distinct goals and being different in size and nature have inter-related activities. In some areas (i.e. nature and biodiversity including marine ecosystems) the Programme plays a unique and essential role. Synergies and complementarities have been observed in particular with research and rural development programmes. Still, the systematic development of synergy mechanisms could offer space for improvement.

2. Effectiveness and catalytic effect

What the Programme is delivering:

·In general, the various types of grants (for standard projects, integrated projects, technical assistance for integrated projects, preparatory projects and NGO support) appear to be effective delivery mechanisms.

·The integrated projects, which coordinate the implementation of actions on a large territorial scale, have shown a significant potential to enhance the catalytic effect of LIFE 15 . LIFE financing of EUR 251.7 million to integrated projects under the present programme in the period 2014-2016 is expected to mobilise investments on environmental and climate action of about EUR 5.7 billion in total, thus for each LIFE euro spent a further 22 euros from other sources is expected to be used in a coordinated way for environment and climate objectives 16 .

·The pilot financial instrument for energy efficiency, Private Finance for Energy Efficiency instrument (PF4EE) is aimed at building up the capacity of financial institutions to develop and test specific loan products targeting private sector’s investments in energy efficiency measures. It has shown a good uptake and the possibility, after the pilot phase, to enable up-scaling of the piloted energy efficiency loans via relevant financial instruments mobilised by EU programmes, in particular under the future EU Invest Fund. The Committee of the Regions has called on the LIFE programme to achieve greater complementarity between PF4EE and other relevant financial instruments 17 .

·The pilot financial instrument for natural capital, Natural Capital Financing Facility (NCFF), provides loans, equity and guarantees to nature and climate adaptation measures that can generate revenues or save costs. It is intended to establish a pipeline of replicable, bankable operations that will serve as a "proof of concept" to demonstrate to potential investors the attractiveness of operations directly addressing biodiversity and climate adaptation objectives. It has registered a slow uptake because of the need to adapt banking practices for assessing the returns of such investments combined with the need to improve the quality of the project applications. Several adjustments have been made as a follow-up of the LIFE mid-term evaluation to increase the visibility of the instrument and to operationalise the technical assistance facility. The project pipeline has improved as a result. One of the recommendations still to be addressed is to complement this financial support with targeted grants (blending).

·Public procurement contracts are considered a valuable delivery mechanism for providing targeted support for the preparation of environmental and climate legislation and policies and their implementation/enforcement. They have an important catalytic effect.

What more could be done:

·More targeted steering of projects towards key priorities could enhance the focus and performance, in particular for the Environment sub-programme, where thematic priorities are defined in the Regulation for a period of seven years. This may pose a challenge for new priorities emerging during the seven-year programming period (such as have been in the current programming period the Circular Economy and the related sectors 18 , for example plastics), or other priorities which are not adequately targeted by projects (selected following a calls for proposals on the basis of a bottom-up approach).

·There is a low participation of beneficiaries from some Member States which risks weakening the catalytic effect of the programme (see Annex 8) 19 . The use of national allocations has proven not to be effective in targeting this problem: it resulted in a reduced participation from the countries which had participated more before without improving the participation of the others. It has been discontinued since 2018.The capacity-building grants introduced in 2014 seem to have mixed results but it is too early to reach any firm conclusion. New ways of mitigating an uneven participation of Member States should be sought.

·The greater the replication of project results, the greater the catalytic effect of LIFE. A 2016 report 20 on LIFE + projects observed that, although about three quarters of projects have good potential for replication, there is space for improvement in actual replication. The beneficiaries mention that the main barriers to replication are a lack of: financial means, decision makers’ interest and sense of urgency, specific information and communication of transferable solutions, and investment-planning capacity.

3. Efficiency and simplification

·The delegation of management from the Commission to the Executive Agency for Small and Medium-sized Enterprises ( EASME ) delivered cost savings and improved the efficiency of the programme, because it introduced economies of scale for implementing the large number of homogenous and standardised operations needed to manage grants.

·LIFE is relatively efficient compared to other EU programmes. It costs, in relative terms, significantly less to manage LIFE than other similar programmes (e.g. COSME 21 and Horizon 2020 22 ). The management practices characterised by the use of external support for project monitoring has resulted in a very high project success rate and a very low error rate 23 (0.25% in 2017 - the lowest across all the EU programmes). However, there might be a potential for further improving efficiency though adjustments of certain programme management aspects, such as the monitoring of projects.

·A potential risk of lacking continuity and loosing input from projects for policy-making and vice-versa due to the delegation of management from the Commission to EASME was mitigated by transferring key human resources from the Commission to EASME and by defining a strong policy-integration strategy.

·Beneficiaries find administrative burden too high. Thus, there is a need to simplify the application and reporting process. Some simplification measures have already been introduced and others are being tested.

1.2.1.    Consultation activities

As part of the LIFE mid-term evaluation a wide range of consultation activities were conducted. They included a 12-week public consultation with more than 250 responses, six specific surveys with more than 200 responses, and over 150 interviews (and, where relevant, site visits) of key stakeholder groups, including project beneficiaries, project coordinators, external monitoring experts and financial instruments’ stakeholders.

The key messages from these consultation activities, described in more detail in Annex 2, are included in the lessons presented in the previous section and have been taken into account for the definition of the options.

Box 1: Summary of key messages from stakeholders consulted under the MTE of LIFE

Source:    Ecorys (2017) Support for an external and independent LIFE Mid Term Evaluation Report

For this impact assessment, it was not considered necessary to organise a new, broad public consultation. Still, further opinions on the LIFE mid-term evaluation results and the future of the LIFE Programme were received from environmental NGOs and some consultation activities to discuss the challenges and opportunities of the programme were undertaken with relevant stakeholders (see Annex 2).

These consultations confirmed the conclusions of the LIFE mid-term evaluation and provided new insights relating to the options for the new LIFE programme. A summary of these points is presented in the box below.

Box 2: Summary of key points from other stakeholders

2.    The Objectives

2.1.    Challenges for the LIFE programme for the next MFF

2.1.1.    Key features of the current LIFE Programme

The LIFE programme is directly managed by the European Commission ( DG Environment and DG Climate Action ), although the implementation of some components has been delegated to EASME. The European Investment Bank (EIB) manages the two financial instruments associated with the LIFE programme 2014-2020.

The budget for the current Environment sub-programme is EUR 2.59 billion and it targets the following Priority Areas: environment and resource efficiency; nature and biodiversity, including terrestrial and marine ecosystems; environment governance and information. The budget for the current Climate sub-programme is EUR 864 million and it targets the following Priority Areas: climate mitigation; climate adaptation and climate governance and information.

The setting of strategic priorities differs between the sub-programmes. The Environment sub-programme is quite prescriptive in the Regulation and the Multiannual Work Programmes (MAWP), whereas the Climate sub-programme enjoys a greater flexibility, allowing, in the yearly call for proposals, the identification of key priorities in line with the latest policy developments, e.g. the implementation of the 2015 Paris Agreement on Climate Change.

LIFE currently has three 24 main types of delivery mechanisms (Article 17). These are: grants (action and operating), financial instruments and public procurement contracts. An overview of the intervention logic and key features of the delivery mechanisms is set out in Annex 5. As mentioned in Section 1.2, the final evaluation of the LIFE+ Programme (2007-2013) identified several shortcomings, the vast majority of which have been addressed in the design of the current LIFE Programme (2014-2020). This includes changes to the action grants delivery mechanism.

The catalytic effect of the standard 'traditional' LIFE projects is to demonstrate suitable technologies or methodologies for implementation of EU environment and climate policy, which can subsequently be deployed at large scale, funded by other sources, including the main EU funds. The LIFE integrated projects and technical assistance projects are dedicated to facilitating the development, implementation and coordination of large-scale actions including by bringing together stakeholders and by using investment plans that mobilise funding from other sources. Likewise, the objective of the financial instruments currently being financed under LIFE is to test the possibility to improve the leveraging of funds for environmental and climate objectives. Similarly, support to the definition of policy and legislative targets, to the exchange of good practices, and to the EU role of global leader in international fora, financed through the LIFE procurement activities, further contributes to the catalytic effect of the programme.

Replication of results, including through promoting synergies with other EU programmes, increases the catalytic effect of LIFE and enhances the added value of EU spending overall. For this reason, LIFE projects are required to establish a replication plan (After LIFE plan). Furthermore, projects appearing to have a large replication potential are closely monitored and beneficiaries are advised about other funding instruments (e.g. the Horizon 2020 SME Instrument or regional development schemes) or private investors which might provide additional funding for up-scaling. Moreover, LIFE also magnifies the impacts of other EU programmes by taking forward their results, particularly through awarding bonus points for project applications that take up results from Horizon 2020 or previous research programmes.

It is challenging to determine the full impact of the LIFE programme because of its catalytic effect. The full effect of a LIFE project often materialises 5-7 years after the project has been completed, and may manifest itself in societal transformations that are hard to measure.

2.1.2.    Key challenges and opportunities facing LIFE

The key challenges and problems to be addressed by the future LIFE programme remain largely unchanged compared to the current programme, as illustrated in the needs analysis of Annex 4 and summarised below:

·The urgent need of transforming society to a clean, circular, energy-efficient, low-carbon and climate-resilient economy, with a high level of environmental protection and of halting and reversing biodiversity loss.

·Insufficient availability and use of efficient environmental, climate-friendly and low-carbon methods across different sectors.

·Insufficient knowledge, know-how and information.

·Insufficient levels of compliance with EU environmental and climate policy and legislation, and weak environmental and climate governance at all levels.

However, as highlighted by the World Economic Forum in its 2018 Report on Global Risks 25 the urgency of facing up to systemic challenges has intensified, in particular in the field of environmental degradation and climate change.

In order to adequately address these systemic problems and failures, both environmental and climate mainstreaming as well as targeted funding are needed. Furthermore, as mentioned in Annex 4, allocations to integrated projects should be scaled up by at least four-fold to achieve increased replication and large-scale deployment, particularly as regards mainstreaming of nature and biodiversity objectives into other financing programmes/instruments.

These challenges are developing rapidly over time, which accentuates the need for having a LIFE programme which is sufficiently flexible to target the evolving needs throughout the programming period as well as having a sufficient critical mass of finance to catalyse real societal transformation.

In designing the new LIFE Programme, there is a need to address the specific challenges mentioned in Section 1.2 above, as well as to address the cross-cutting objectives flexibility, focus on performance, coherence and synergies, simplification, which are mentioned in the Commission Communication on "A new, modern Multiannual Financial Framework for a European Union that delivers efficiently on its priorities post-2020 26 "..

2.1.3.    Potential gaps and synergies with other EU programmes

An analysis of potential gaps and synergies with other EU programmes is presented in Annex 6. In general, it confirms the conclusions from the LIFE mid-term evaluation that overlaps in financing stages related to implementation and development of environment and climate policy are synergetic. Nevertheless, if potential synergies could be exploited more systematically, this would enhance the performance of all the programmes. Moreover, considering the similar objective and stage in the shift to a greener Europe (see Figure 1) targeted by the LIFE Climate sub-programme and the IEE part of Horizon 2020, integrating the IEE programme into the future LIFE Programme could increase the coherence of the EU budget 27 .

At the same time the analysis shows some gaps related to the financing of specific environmental, climate and energy objectives, in particular regarding:

·Conservation of biodiversity and sustainable use of ecosystem services in the EU's Outermost Regions (ORs) and Overseas Countries and Territories (OCTs), which is presently supported through the BEST initiative 28 .

·Nature and biodiversity, where several evaluations and assessments (notably the mid-term review of the EU Biodiversity Strategy to 2020 and the Nature Fitness Check), and a recent study 29 highlighted the shortcomings of the current integration approach to nature and biodiversity financing.

2.2.    Expected impacts of an unchanged LIFE programme (baseline)

The continuation of the LIFE programme in its current format, and scale, in the next MFF would likely see a similar outcome as that described in the mid-term evaluation and in Annex 5. However, this would result in sub-optimal effectiveness in reaching the programme’s overall objectives, particularly when considering the emerging new challenges including for circular economy and the plastics strategy, as well as the needs for nature protection, including in the marine environment.

Thus, positive environmental impacts, highlighted by previous evaluations, would continue to be delivered in each of the programme’s thematic areas: air quality and emissions; biodiversity; climate change adaptation, climate change mitigation; environmental and health; nature; resource efficiency; waste and water.

While the programme would continue to act as a catalyst to promote changes in the development and implementation of environmental and climate policies, it is not expected to reach its full potential as a catalyst without seizing the opportunity to address the specific challenges mentioned in section 1.2 above, as well as the cross-cutting MMF objectives. In particular, some gaps would remain in the funding of certain environmental and climate challenges. Furthermore, the continuation of the programme in its current format would not ensure extensive coherence between the LIFE programme and other EU funds.

Without an increase in funding for certain environmental and climate challenges, the scale of action taken may be insufficient to address the associated problems sufficiently (see Annex 4). The funding of nature projects is one such example 30 . Likewise, there may be gaps in financial support for some of the new and increasingly urgent environmental and climate challenges.

Prioritisation between the various strands of LIFE is not possible because there is no hierarchy of objectives in environment and climate policy. Furthermore, multiple interlinked priorities are addressed by more than one strand of the programme, which makes prioritising one strand above another impossible. Thus, if the scope were broadened without an increase in budget, the funding available for all existing activities would have to be consistently decreased and the needs described in Annex 4 would not be adequately addressed.

The programme will continue to support existing, and promote new, jobs in environmental and climate fields as well as supporting the development of skills, knowledge, and innovation 31 . 2.3.    Objectives of the LIFE programme post 2020 

General and specific objectives for the future LIFE programme

On the basis of the key challenges to be addressed by the LIFE Programme, the general objective for the future LIFE Programme is:

Box 3: General objective of the LIFE Programme 2021-2027

The general objective of the next LIFE Programme has been simplified but not changed in substance compared to the current LIFE Programme, which has four general objectives. Furthermore, while a contribution towards a transition to clean energy is already covered by the current objectives, this transition is mentioned explicitly in the future objective in order to reflect the appropriateness of considering the activities discussed under Option 1 in Section 3.4.1.

In response to the general objective, the implementation of the Programme will be optimised in terms of coverage and delivery mechanisms (see Sections 3 and 4), by pursuing, in line with the cross-cutting objectives of the MFF, greater efficiency (simplification and flexibility), an improved coherence and better synergy with other programmes as well as increased effectiveness.

Although the new programme will not explicitly mention 'priority areas,' its actions will continue to address all topics covered by the current priority areas, as they are relevant according to the results of the mid-term evaluation. Moreover, to take into account the possible integration into LIFE of the transition to clean energy, an additional focus has been added on energy efficiency and renewable energy. As a result, the following specific objectives have been set as follows:

Box 4: Specific objectives of the LIFE Programme 2021-2027

The specific objectives are consistent with those established by the present LIFE Regulation, but they have been consolidated, giving more focus to replication and the triggering of large-scale deployment. This responds to the findings of the MTE. The present LIFE Regulation has several specific objectives for each of its six priority areas, which are partly repetitive.

Through these specific objectives, LIFE should continue to contribute to a societal transformation through its catalytic effect targeting the implementation of EU climate and environment policy goals, including compliance with the relevant EU acquis. The main source of EU finance for environmental, climate and energy action must continue to come from other EU programmes (mainstreaming).

Seizing opportunities for optimising the performance of the LIFE programme

To address the cross-cutting objectives of the future MFF and take advantage of the lessons learned, the new LIFE programme aims at achieving four operational goals, which are presented below together with the issues/opportunities to be addressed and the relevant parts of the programme – coverage, delivery mechanism, programme management – in which they will be addressed.

Box 5: Operational challenges and opportunities in line with the MMF cross-cutting objectives

3.    Programme structure and priorities

3.1.    Programme priorities

Fundamentally, the priorities of the LIFE programme 2021-2027 remain unchanged from the present programme, namely to support the development and implementation of the EU's environment and climate policy, through catalytic actions that improve compliance on the ground at all levels.

The operational challenges and the options to change the programme in order to address them are described in the box below.

Box 6: Operational challenges to the LIFE programme and corresponding options

As can be seen in their description in Annex 8, these options are not alternatives, but rather measures that are assessed individually and can function in synergy. In Annex 8, the effectiveness, efficiency and coherence of each one of these options has been analysed and some of them have been discarded. Many of the options can be implemented without a net increase to the budget; where additional budget would be required this is described in annex 8 and below.

Given the synergistic nature of the EU's environment and climate policies that underlie the LIFE programme and the fact that it is not appropriate to establish a hierarchy between the different environmental and climate policy areas, in case the budget is lowered, there will be a proportional reduction of the budget for the sub-programmes and thus a general reduction in funding for all activities covered by the LIFE programme.

3.2.    Critical mass

As described above, the programme's main impact arises from its catalytic actions to promote the substantial societal transformation required to achieve the full range of EU's environmental, climate and clean energy objectives.

Annex 4 describes the overall level of change required for each thematic area covered by the Programme, based on the scale of the problems to be addressed. Given that the role of LIFE is to catalyse change, in order to reach the overall goals, a critical mass is required not only in LIFE but also in other financing sources which are 'mobilised' by LIFE actions. Any reduction from the present levels of financing would spread the funding too thinly across different thematic areas, for the full catalytic effects to be realised.

Therefore, any expansion of thematic coverage or any new emerging priority will need to be accompanied by an adequate funding increase 32 or by the definition of negative or limited priorities. The concept of negative priorities is difficult to apply in the environmental and climate spheres there is a demonstrated interdependence among the different priorities (e.g. air, water, nature and biodiversity, resource efficiency, climate mitigation, etc..).

The specific unmet needs in the area of nature and biodiversity indicate that the critical mass needed, including to promote coordinated used of complementary funding sources, is significantly more than presently allocated.

Further elements on an appropriate level of support for the different priority areas, defining also the need for the Strategic Integrated Projects, are provided in Annex 4.

3.3.    The EU added value of LIFE

The EU added value of the LIFE Programme is recognised by almost all stakeholders and the general public. Its approach is unique as it is specialised in catalytic interventions primarily targeting issues concerning environmental protection and climate action. According to the MTE, LIFE is fulfilling its role as a catalyst by sharing best practices and supporting actions to accelerate change.

Highlighting its catalytic role, LIFE responds to cross-border environmental challenges, which a Member State is unlikely to address alone or which would risk leading to a duplication of efforts by Member States.

The programme's value added stems from its support to EU environmental and climate policy development, as well as its support to activities enhancing the ability to meet EU environmental and climate objectives across the EU. More homogenous implementation is achieved because LIFE represents an EU-level platform for sharing best practice and for the demonstration of more efficient solutions as well as by giving priority to projects that can be replicated at a wider scale in the EU 33 .

LIFE allows a better sharing of responsibility and promotes solidarity for the management/conservation of EU environmental assets, which are usually public goods, which are not evenly distributed across the EU. Their associated costs and benefits are not normally reflected in the market and, as a consequence, there is the need to ensure a sharing of associated burden.

LIFE focusses on relatively small-scale projects providing one-off investment needed in a specific area, eliminating initial barriers and testing new approaches which in turn catalyse broader actions and mainstreaming of environmental and climate policy into the major EU spending instruments.

Through strategic integrated projects, and the new strategic nature projects, the Programme will create synergies across EU and national funds which ease implementation of the relevant EU legislation.

Furthermore, LIFE finances those actions and measures that would otherwise be inadequately financed by Member States alone. Certain pieces of EU environmental legislation, such as the Habitats Directive and the National Emission Ceilings (NEC) directive, specifically acknowledge the need for EU finance to meet their objectives 34 .

3.4.    Possible enhancements to the scope and structure of the future LIFE programme 

The internal structure and scope of the present LIFE instrument is generally considered sufficiently fit-for-purpose albeit there is room for broadening its scope and size, and reflecting the possible expanded scope in the area of transition to clean energy (see section 3.4.1) and nature (see section 3.4.2) through dedicated sub-programmes. Indeed, as described in Annex 6, there are potential gaps in meeting the needs for environment and climate finance in the various EU instruments as well as opportunities to enhance synergies between them.

To address these challenges and better meet the related operational goal of avoiding gaps and ensuring coherence with other EU programmes, several options relating to potential changes in the scope and structure of the LIFE programme were identified and then screened in terms of effectiveness, efficiency and coherence. Annex 8, section 1 presents the relevant options and the results of the screening. The most promising options are summarised in Box7 below. They are further analysed in sections 3 and 4.

Box 7: Options retained after initial screening

In accordance with the methodology described in annex 7, the impacts of the options are considered taking into account environmental, social and economic factors, however only those impacts which differ from the status quo are mentioned. In practice, and in view of the fact that the options were conceived with the purpose of improving the effectiveness of the LIFE programme to meet its environment and climate policy goals, most of the observed net impacts concern environmental factors.

3.4.1    Extend the scope of the LIFE programme to include capacity-building projects related to clean energy by adding a sub-programme on Clean Energy Transition

This option is introduced to respond to the operational challenge to increase coherence between EU instruments and further develop synergies between the funded actions.

This option would involve extending the scope of projects supported through LIFE to include the capacity-building activities of the Intelligent Energy Europe Programmes (IEE) 35 , along with the necessary funding. Focusing on energy efficiency and small-scale renewables that contribute to climate mitigation, the relevant activities would be funded under a new Clean Energy Transition sub-programme.

Their objective is to enable socio-economic transformation for transition to clean energy in Europe, especially with those regions, sectors and actors who need to catch up (e.g. cities, coal and carbon-intensive regions in transition, islands). The transition to clean energy is an essential contribution to the mitigation of climate change with co-benefits for the environment and in line with the LIFE framework. These activities address the different elements of the market environment by developing and spreading best practice in policy implementation, mobilising investments, improving skills, creating favourable market conditions for technology deployment and providing support to socio-economic transformation and addressing vulnerabilities.

Lessons learnt:

The evaluation of IEE and the integration in Horizon 2020 under the Societal Challenge 3, did not reveal major weaknesses and confirmed the effectiveness of the funded actions. The integration of the Clean Energy Transition sub-programme in LIFE is expected to lead to improvements and address the shortcomings of the current approach as presented in Annex 9, section 9.3. The main shortcoming, which will be addressed, is the different focus of the R&I framework programme which does not specifically aim at supporting capacity building activities.

The integration of IEE III into Horizon 2020, with different objectives, clients and funding logic, has proved to be difficult and the current proposal is to continue these activities under a better suited framework. The inclusion of IEE-like actions under the R&I programme followed the logic of installing a comprehensive programme covering all steps from basic research to market uptake and deployment. However, in the report on the first results of Horizon 2020 on energy efficiency 36 the evaluators point out that mainly large consortia are funded, too little support is given for the applicants and that the impact on national policies could be improved. Also, higher barriers to participation in Horizon 2020 than in IEE actions are mentioned (see Annex 9 9.2.2. Lessons learnt from the current MFF for the details).

Conclusions for the next MFF:

1.    The Horizon Europe programme does not specifically cover 'capacity building' activities in its scope

The R&I programme objective is to fund excellent research and innovation, supporting pioneers who will show the way. But the EU has also the responsibility to help laggards and followers 'catching up' by building the capacity in order to quickly narrow the gap. There is also a need to address specific barriers hampering the wide uptake of the existing clean energy solutions. For the massive market roll-out, 'expected impact' and 'quality of implementation' criteria should outweigh the criterion of 'scientific excellence', which has less of relevance for capacity building.

Based on this conclusion the unsuitability of the R&I framework for capacity building is confirmed in the R&I FP proposal for the next MFF, where the clear demarcation is made in the Horizon Europe Impact Assessment between a 'first-of-the-kind market uptake of innovation' and 'capacity building for a large-scale market uptake'.

As stated in the Horizon Europe impact assessment improving market uptake of innovative solutions is a broad concept encompassing various activities, which help R&I -driven innovation to succeed on the market and create new value for market players and consumers/citizens alike. However, market uptake goes beyond research and innovation. Therefore, activities under the Framework Programme alone cannot suffice to incentivise broad market uptake and dissemination of innovative solutions. Other EU programmes need to also play a key role (see Horizon Europe Impact Assessment Annex 7 on Synergies).

2. Bringing the clean energy capacity building and deployment activities under the LIFE programme will increase the coherence of the European funding landscape

As research and innovation activities would rest with Horizon Europe, the clear distinction between excellent research and innovation, including market uptake of first of a kind innovations, on the one side and supporting the catching-up and rolling-out processes by capacity building, removing barriers and shaping market on the other side leads to improving the coherence of EU funding landscape. This coherence would allow the Clean Energy Transition sub-programme to tailor its interventions more closely to the often limited capacity of catch-up actors and territories and lower the barriers for participation in the programme (see Annex 9 for a comprehensive review of barriers to energy efficiency uptake).

3. LIFE provides the best suitable framework and the potential for synergies while the differences in the implementation know-how will be mutually enriching when integrating the Clean Energy Transition sub-programme.

a.Programme coherence and avoidance of overlaps:

LIFE provides a suitable regulatory environment, taking into account its intervention logic, legal base and delivery mechanisms aiming to implement EU environment and climate policy. The LIFE programme offers the possibility to host the clean energy capacity building that contributes to climate mitigation in a clearly structured but at the same time flexible framework. Installing the Clean Energy Transition sub-programme in LIFE would ensure that potential theoretical overlaps between LIFE and the present IEE III are avoided (see annex 6 for a discussion) and that gaps between the two programmes are filled.

b.Synergies and multiplier effects:

Joining forces would enable synergy effects, which can be triggered by the projects implemented under the common framework (tackling energy efficiency, greenhouse gas emissions and local air pollutants at the same time). Such a synergetic action between the projects and the underlying policies is already observed 37 , like in the case of the Covenant of Mayors initiative, and it will be further strengthened 38 . There is also a potential for exploiting synergies between actions supporting capacity building for clean energy transition on the one hand and strategic LIFE integrated projects focusing on implementing climate mitigation plans at a larger scale. These synergies could be more easily exploited if these actions were funded under the same programme (see also Appendix 3 to Annex 9, summarising some examples of the existing synergies in the projects and initiatives for environment, climate and clean energy).

c.Further development of the implementation know-how:

The clean energy transition enabling actions funded under IEE and its continuation in Horizon 2020 have developed their own implementation intelligence, know-how and close interactions with policy-making, which are exemplary across all the centrally-managed EU funding activities. This precious experience needs to be preserved, while the implementation modalities and instruments available in LIFE are definitely worth exploring. This justifies the integration of Clean Energy Transition as a separate sub-programme, which would allow differences in implementation approaches and facilitate clear communication to the stakeholders.

Implementation knowledge cross-fertilization would be facilitated by the fact that both LIFE and IEE activities in Horizon 2020 are implemented by EASME and the frequent interactions and common initiatives (e.g. common projects feedback workshops) are already in place between the units implementing both programmes.

d.Simplification potential:

The evaluation of IEE type of actions under Horizon 2020 39 suggests that there is a clear potential for simplifying the presently complex application procedures. The review showed that the Horizon 2020 framework favours bigger projects and large consortia, putting forward resource-intensive research and innovation efforts. This crowds out smaller participants and projects. In consequence there is not only a need for simplified administration on the side of the Commission, but also the need to guarantee simple and open access to the programmes for the potential beneficiaries, especially catching-up actors with limited capacities (see Annex 9.3.3. Simplification efforts for details).

Assessment of the integration option:

The Horizon 2020 sustainable energy capacity building projects are currently managed by EASME and currently sit within the Horizon 2020 budget programme with an allocation ~€135 million per year 40 . A planned expansion of the allocated annual budget for these projects to ~€171 million could include the policy support and capacity building for renewables Particular focus is given to capacity building related to the implementation of the climate and energy package in the Member States, as a key enabler for acceleration of the technological, financial and social transformation.

This option would extend the current thematic coverage of LIFE to explicitly include capacity building for policy implementation and investment mobilisation for the uptake of existing technologies related to: energy efficiency and small-scale, distributed renewable energy 41 sources for climate mitigation. The option will not include projects on biofuels.

The option would not require any change to the current management modes, delivery mechanism and type of projects financed under LIFE.

Table 3.1: Assessment of option 1

3.4.2.    Extend the scope of the LIFE programme to improve mainstreaming for nature and biodiversity

This option, as the one to finance large scale deployment activities for nature and biodiversity which was discarded during the preliminary screening (see Annex 8) 44 , intends to address, at least partially, the unmet needs in the area of nature and biodiversity.

Under this option, LIFE would include a specific sub-programme for 'nature and biodiversity' covering both the terrestrial and marine environment. This 'nature and biodiversity' sub-programme would consist of a reinforced centrally managed component funding actions similar to those presently implementing the Nature and Biodiversity priority area of LIFE through 'traditional' standard action projects, as well as funding a new type of dedicated strategic nature projects.

The strategic nature projects (SNPs) would reinforce the implementation of Union nature and biodiversity objectives through mainstreaming these objectives into other policies and funding instruments. These projects will support the implementation of programmes of action for each Member State, including the coordination of finance available for large-scale nature and biodiversity actions, with a particular focus on the Natura 2000 network and the implementation of the prioritised action frameworks established pursuant to the Habitats Directive 45 .

This option does not change the objectives of LIFE, nor does it significantly alter the structure of delivery mechanisms of the Programme. This option would be complemented by actions, particularly under the European Agricultural Fund for Rural Development (which presently provides 75% of EU funding for nature), the European Regional Development Fund/Cohesion Fund and the European Maritime and Fishery Fund, that target direct investments in nature conservation and biodiversity or that contribute indirectly to protecting nature and biodiversity. The effectiveness of this approach is therefore dependent on adequate allocation of funding under these other instruments.

Table 3.2: Assessment of option 2

3.4.3.    Extend eligibility of LIFE to the EU's Overseas Countries and Territories (OCTs) specifically for nature and biodiversity actions within the Environment sub-programme 

This option would involve a change in the Article 6 provision of the LIFE Regulation, allowing the eligibility of projects on nature and biodiversity in OCTs countries under the same conditions as the ones in the EU.

The BEST scheme 47 has addressed a gap related to the financing for biodiversity in the Outermost Regions (ORs) and in the OCTs. It has allowed substantial synergies and its financing should be continued.

In the absence of a specific legal basis, the financing of this scheme is decided each year by the Budgetary Authority: in 2018 a preparatory action has been financed. According to the Financial Regulation, a preparatory action is designed to prepare a proposal for the adoption of future actions and cannot be renewed for more than 3 consecutive years. There is therefore the need to provide a (more) stable financing framework for the continuation of BEST in the next MFF.

The external development instrument, the regional funds or the LIFE Programme could constitute such framework. However, given the need to include both ORs and OCTs, the eligibility rules of the concerned programme, whatever it will be, would need to be changed. Taking into account the type of actions (small-scale grants) and the specific sector (biodiversity), the LIFE Programme seems to be the most suitable framework, subject to additional funding being made available.

This option would allow the continuation of the financing of the BEST scheme under LIFE under its Nature and Biodiversity sub-programme.

Table 3.3: Assessment of option 3

3.5.    Conclusions

The LIFE programme has a very high EU added value and its scope and structure are generally suitable to its objectives. This section presents three possible extensions to the current scope of the LIFE programme.

The option to extend the scope to include the energy efficiency and renewable energy actions presently financed under Horizon 2020 is clearly desirable and should be implemented as a priority, provided the new LIFE Programme is equipped with the necessary funding.

The option to extend LIFE to further support the mainstreaming of nature and biodiversity objectives is a highly viable alternative for better financing of nature. In line with the Commission communication on the post 2020 financial framework 48 ,., this would improve coherence in the overall structuring of the EU budget by facilitating an improved mainstreaming approach.

The integration of the BEST initiative for OCTs (and ORs) is a smaller extension to the programme, which also shows an overall positive impact. Unless either an external instrument or the European Regional Development Fund can finance the entirety of the BEST initiative, it should be incorporated into LIFE, to the extent that the capacity of LIFE to address other priority objectives is not weakened.

4.    Delivery mechanisms of the intended funding

The present LIFE instrument comprises a variety of delivery mechanisms including several types of standard action grants, strategic integrated projects, technical assistance to develop integrated projects, preparatory projects, operational grants for NGOs, two financial instruments, capacity-building projects for certain Member States and procurement. As mentioned in Section 1.2, these mechanisms (also described further in Annex 5) have been assessed as generally effective and efficient in delivering the objectives of the LIFE programme. It is therefore not appropriate to substantially modify the delivery mechanisms or management model of the programme. Elements such as the NGO operational grants will be continued in their present format 49 . However, this section explores some possible options for further improving the effectiveness and efficiency of the LIFE programme.

As in Chapter 3, these options are not alternatives, but rather complementary measures that are assessed individually and could be applied in synergy. In accordance with the methodology described in Annex 7, only those impacts which differ from the status quo are mentioned and most of the observed net impacts concern environmental factors in view of the inherent nature of the options.

4.1.    Possible enhancements to funding mechanisms

As previous sections of this report indicate, several challenges and opportunities have been identified in relation to LIFE's present funding mechanisms. In particular, operational challenges have been established as the basis for further optimisation in view of evolving policy needs to improve the performance and catalytic role of LIFE, and to improve the strategic focus of LIFE.

Options for addressing these operational challenges and improving simplification are presented and screened in Annex 8. An overview of the options assessed is also presented in Box 6 above. The most promising options are further considered below. In terms of project management arrangements, the present model is considered to be the best option. Some measures related to the reduction of the administrative burden are included in Annex 9.

4.1.1.    Expand the scope and scale of Strategic Integrated Projects (SIPs)

This option is meant to improve the performance and catalytic role of LIFE. The proposed option is an expansion in both the scope and scale of the integrated projects which will be called strategic integrated projects (SIPs) in the post-2020 programming period. The SIPs are designed to support Member State implementation of key environmental or climate plans and strategies, so are focussed on practical support to policy implementation. Since the concept of integrated projects is proving effective during the present programme, it should be reinforced through both:

­an increase in the SIPs targeting the presently eligible plans (air, water, nature, waste, climate mitigation and climate adaptation) 50 . As regards waste, SIPs would be eligible for both waste management plans and, as a new feature, for waste prevention programmes, in coherence with the overall aim of transitioning towards a circular economy and

­an increase in the scope of the SIPs under the Environment sub-programme (to include also plans for national emissions ceilings, noise, marine environment and nitrates in accordance with the relevant legislation and policies). SIPs related to the marine environment could be developed through LIFE and EMFF funding.

While the funds allocated for integrated projects in the current programming period have been at a level appropriate to piloting the concept, this level does not allow full realisation of the potential of the mechanism as a tool for improving compliance with key climate and environment policies and legislation, and would need to be increased.

This would imply an overall funding increase in the LIFE budget so as to ensure continued availability of funding also for other project types.

Specifically in order to respond to the considerable needs for financing in the area of nature including the marine environment, identified in the Nature Fitness check, and in order to ensure that LIFE can play the necessary role in coordinating actions related to nature and biodiversity under the mainstream EU funds, the number of strategic projects for nature (SNPs) should be significantly increased and their focus on mainstreaming should be reinforced (see section 3.4.4). Further information about the critical mass required for SIPs can be found in the relevant section of annex 4.

Table 4.1: Assessment of option 4

4.1.2.    Targeted support to upscale and replicate successful projects

This is a second option aimed at improving the performance and catalytic role of LIFE. LIFE would provide targeted support to facilitate the upscaling and replication of successful LIFE project results. It would therefore increase overall performance by enhancing the impacts of the projects supported by the programme, and focussing the effort on those projects with the greatest potential impact.

This would include a range of mechanisms such as follow-up technical assistance grants to provide coaching and finance to develop upscaling and/or replication plans and undertake centralised measures to diffuse project results to relevant stakeholders. These technical assistance will be small in size and would not require additional budget overall for the LIFE programme.

Targeted support could help to facilitate access to technical assistance/grants, e.g. following the successful example of the ELENA facility, or blending or pilot financial instruments under the centrally managed EU Invest Fund, as a means of enhancing sustainability and dissemination of project results.

In such option, the overall existing focus on follow-up plans during project duration would remain and use as a reference for identification of the more promising projects. It would be complemented by additional targeted support actions.

This approach will be coordinated with policy initiatives, taking into account and building on existing dissemination activities (databases of measures, Country Dialogues, Commission-led networks such as the Covenant of Mayors for Energy and Climate, expert groups, conferences, etc.). It will thus strengthen the link between LIFE and policy development.

Table 4.2: Assessment of option 5

4.1.3.    Address the unbalanced participation of candidates from some Member States to LIFE calls for proposals through a reinforced network of LIFE contact points and targeted capacity-building actions

This option is aimed at improving the performance and catalytic role of LIFE, notably through enhancing participation from different Member States.

Taking into account the experience of the current national capacity building projects, the capacity of the LIFE contact points will be enhanced through the financing of networking activities. Specifically, it will improve performance by focussing on those approaches that have been most effective under the current programme at building the capacity of national contact points to support the preparation of high quality proposals. The funding for the network would be managed centrally by the European Commission or EASME, and participation would be open to all Member States. The funding would be used to target the specific capacity building needs of the National Contact Points (NCPs), including through mutual learning. It would also include a component targeting barriers to participation specifically in Member States with a low absorption rate. This evolution is in line with suggestions already made by several NCP which have tried to initiate such cooperation in the framework of the preparation of the Multi Annual Work Programme 2018-2020. It would still lead to specific target actions similar to the existing capacity building projects. In turn, the increased capacity of the national contact point will enhance their role in supporting project applicants, leading to both an increase in participation rates from selected Member States, as well as high quality proposals.

These activities will be supported using the budget that is currently allocated to capacity building projects under the current programme.

Table 4.3: Assessment of option 6

4.1.4.    Increase the co-financing rate

This is the fourth option for responding to the operational goal to improve the performance and catalytic role of LIFE, notably through enhancing participation for beneficiaries in different Member States 51 . The maximum EU co-financing rates that are included in the LIFE Regulation would be increased and therefore project beneficiaries would be required to provide less co-financing. It will therefore improve performance by removing one of the barriers to applicants.

Additional budget would need to be made available to allow for an increase in co-financing rates whilst maintaining the same number of projects to be supported.

Table 4.4: Assessment of option 7

4.1.5.    Systematically define and develop synergies with other instruments

This option also responds to the operational goal to improve the performance and catalytic role of LIFE.

It would complement the present practice of giving preferential treatment in standard LIFE project applications to projects which build on the result of relevant EU research projects (Horizon 2020 or previous programmes) 52 . The preference could be extended to results from other programmes that develop small-scale pilots, such as Interreg. 

More systematic mechanisms would be developed to operationalise synergies with other EU programmes that can support sustainability, upscaling and replication of relevant LIFE results. One main area of potential developing of synergies is with the European Institute of Innovation and Technology (EIT) European Innovation Council (EIC) that might support the up-scaling of innovations but also support the objectives of LIFE with targeted activities like the ‘EIC challenges’ (innovation prizes). This would include the possibility to scale up the best close-to-market LIFE projects’ results, by channelling them towards the EIC mechanisms.

Moreover, according to the results of the mid-term evaluation, the development of more systematic synergies through specific mechanisms would be beneficial with the European Regional Development Fund (ERDF, including the European Territorial Cooperation goal), the Cohesion Fund (CF), the European Agricultural Fund for Rural Development (EAFRD) and the European Maritime and Fisheries Funds (EMFF), which can support the large-scale implementation of project results.

This option would not require any specific modifications to the LIFE legal base, but would require more coordination and control at the level of programming and implementation among the concerned DGs and Agencies 53 . No additional budget will be required to implement this option.

Table 4.5: Assessment of option 8

Such an evolution will require some effort to define and operationalise the mechanisms but is feasible as long as the legal bases do not prevent such mechanisms.

4.1.6.    Financial Instruments delivered through a central fund.

This is the sixth and final option considered to respond to the operational goal to improve the performance and catalytic role of LIFE. At present the LIFE Programme operates two small-scale pilot financial instruments 54 . After the pilot phase, thus in the next MFF, such instruments could be upscaled and delivered through a central funding instrument (InvestEU Fund) to allow synergy and economies of scale. This up-scaling would require additional budget.

As described in Annex 6 the EU employs a large and increasing number of FIs, several of which could support projects of a similar nature to those targeted by LIFE’s FIs (i.e. PF4EE and NCFF). PF4EE’s design features specify the nature of support it offers, it helps intermediary banks in Member States to develop and offer specific loan programmes for energy efficiency projects and supports projects that help achieve the national energy efficiency action plan objectives, plus Member State energy efficiency programme objectives. It offers a combination of an EC guarantee, an EIB loan and a technical assistance facility. This combination distinguishes it from the majority of other instruments that can finance energy efficiency projects, although none of the elements are unique. Some potential overlap with EBRD and ERDF loans was highlighted in the Mid-term evaluation of LIFE, there are also other FIs that could support energy efficiency projects (including the EFSI). However, due to the vast investment needs in energy and climate projects that are necessary to achieve the EU’s 2030 objectives, and the relatively small scale of PF4EE the risk of FIs seeking to support energy efficiency projects crowding each other out appears minimal.

The NCFF provides €10 million of technical assistance and €50 million guarantee to support EIB investments of up to €125 million that are intended to contribute to the EU’s biodiversity and climate adaptation objectives, financing projects that generate a revenue stream from natural capital. This is a new approach and thus no other European FI offers a competing service.

For the future, the creation of the InvestEU Fund as Union-wide investment instrument, providing an EU guarantee with a view to mobilising public and private financing to support various political priorities represents a great opportunity for new synergies. This instrument will be the single entry point for 360-degree project development assistance for project promoters.

The suggested structure of this InvestEU Fund includes the following four windows: Social, skills, and human capital; SMEs; Research and Innovation; Infrastructure and Climate. The InvestEU Fund is expected to play an important role with financial instruments for market related action, in particular by supporting a thematic investment platform for research and innovation in the Blue Economy.

Besides the existing financial instruments, the opportunity to finance technical assistance and/or blending mechanisms, recommended in the LIFE mid-term evaluation, would be explored.

Table 4.6: Assessment of option 9

4.1.7.    Improving the strategic focus of the programme by simplifying the Regulation and the MAWP.

This option responds to the operational goal to improve the strategic focus of LIFE, specifically including the possibility to target specific new and key policy priorities, in line with the cross-cutting objectives of the MFF to pursue budget flexibility and simplification.

It involves the removal of:

­The current list of thematic priorities and related activities under the Environment sub-programme from the LIFE Regulation. The thematic priorities could be included in the MAWP.

­The ceilings related to various delivery mechanisms or thematic areas, beyond the earmarking by sub-programmes, for biodiversity and for project types.

This option would allow for further earmarking within the MAWP and/or in yearly calls for proposals, to target key and emerging priorities including circular economy and plastics waste. No additional budget will be required to implement this option.

Table 4.7: Assessment of option 10

4.2.    Conclusions

Most elements of the present LIFE delivery model can be considered to be fully functional at present and do not need any modification.

Concerning the operational goal to improve the performance and catalytic role of LIFE, two options were explored in relation to improving the accessibility of LIFE for applicants from all EU Member States. The option to provide centralised support to the entire NCP network instead of the present national capacity building projects (for only certain MSs) is assessed positively. The option of increasing co-financing rates would need to be further considered once the overall shape and budget of the LIFE programme for the next MFF will be decided and basing on the demand over time. It is important that the legal base does not prejudge this issue in line with the existing template.

Several other complementary options were considered to improve the performance and catalytic role of the Programme. Among them, the extension of the SIPs is considered to be the most powerful mechanism based on the pilot experience of integrated projects in the present LIFE programme.

The options to enhance replication and to increase both the flexibility of the programme and the possibility to target key and emerging issues through simplifying the Regulation and the MAWP have no serious negative implications, so should both be introduced. Concerning financial instruments, it would beneficial to upscale the current LIFE pilot instruments under InvestEU in the next MFF (2021-2027).

The options that are not depending on additional budgets should be implemented in any event. If the budget is specifically increased to include Clean Energy Transition and/or to include a sub-programme for Nature, these options (option 1 and 2) should be included in the structure of the Life Programme. If the LIFE budget is expanded in general, the options 3, 4 and 5 could be implemented.

4.3.    Programme management

The MTE concluded that current management arrangements of the programme were efficient and effective. The same conclusion was made with respect to the monitoring and evaluation arrangement of the current programme. Nevertheless, some further options were considered as part of the Impact Assessment to explore whether further improvements could be made to the programme management and monitoring and evaluation processes.

4.3.1.    Package of measure to reduce the administrative burden for the applicants/beneficiaries

This combination of measures is proposed in order to respond to the operational goal of introducing simplification measures, where possible. This package includes changing some of the processes and systems that are used in the programme management, including:

·Taking into account the experience of the ongoing pilot, consider further waiving the requirement to submit a complete proposal at the start of the application process by expanding the use of a two-step award procedure for standard projects. This has already been applied for integrated projects and is being piloted for some traditional projects. It would reduce administrative burden for applicants.

·Adapting reporting requirements in proportion to the length and complexity of projects and the value of the grant.

·Simplifying the indicators database, based on project focus.

·Use of Simplified Cost Options, payments based on output, limitation of eligible costs for grants.

·Use of cascading grants with limited reporting, with the involvement of the monitoring team

·Simplification of the application process, including rationalised forms and supporting documents

The detailed assessment of the impact of these measures in comparison to the business as usual scenario showed the following:

Table 4.8: Assessment of measures to reduce the burden for applicants/beneficiaries

4.3.2.    Streamlined procedures for the implementation of the EU budget

These measures respond to the operational goal to introduce simplification measures, where possible, and to increase efficiency in the implementation of the programme.

They include:

­the mention in the Regulation of selected organisations, which regularly receives grants without a call for proposals according to Art.190 of the RAP (e.g. because they have a de facto monopoly or the specific administrative power required for the implementation of projects with special characteristics) so that grants can be awarded directly without the need of an exceptional procedure. This will be restricted to a few organisations, such as the IMPEL network and the network of National Contact Points.

­the reduction of the multiple budget lines linked to the LIFE Programme and used for internal management to one operational line per parent DG while going on with the current system for tracking the funds per priority area.

The assessment of these measures in relation to their economic, environmental and social impacts in comparison to the business as usual scenario showed the following:

Table 4.9: Assessment of measures to make easier the budget implementation

5.    How will performance be monitored and evaluated?

The general and specific objectives proposed in Section 2.3 place greater emphasis on the catalytic role of LIFE and its contribution to supporting societal transformation through replication and the triggering of large-scale deployment rather than focusing on outputs at project level. Moreover the transition to clean energy has been added. Thus, while performance should still be measured at project level (building on the current monitoring and evaluation framework), additional performance criteria have been identified to strengthen the monitoring and evaluation of LIFE’s catalytic effect at programme level (as defined below).

Box 8: The catalytic effect

In summary, the monitoring and evaluation framework is designed to facilitate the assessment of LIFE’s performance in the following ways:

0.Contribution towards meeting EU environmental, nature and biodiversity and climate targets: measured in quantitative terms (as a direct outcome) using standard EU environmental indicators, with the metric, baseline and milestone set at project level for use as illustrative examples to assess progress at programme level in qualitative terms.

1.Contribution towards improved environmental and climate governance: measured in quantitative terms (as a direct output) by the extent of LIFE projects supporting the development, implementation, monitoring and enforcement of environmental and climate policies. The contribution to improved environmental and climate governance is assessed at programme level in qualitative terms against a wider policy landscape.

2.Contribution towards socio-economic transition: measured at programme level in qualitative terms (as an indirect outcome) by the extent of LIFE’s catalytic effect according to various dimensions, including: temporal (project runs for an extended time period), sectoral (approaches or techniques are adopted across sectors), spatial (approaches or techniques are adopted across territories), quantitative (a novel or emerging technique succeeds in becoming commonplace), or financial (additional finance is secured to support large scale deployment).

The proposed monitoring and evaluation framework reflects the change in focus arising from the revised general and specific objectives as well as the lessons learned from the current programming period (section 1.2.). Notably, the reporting requirements at project level have been simplified and the application of the performance criteria (in qualitative terms) has been centralised. The reporting requirements and indicator design that inform this framework are set out in section 5.2 below.

5.1.    Lessons learned related to the existing monitoring and evaluation framework

The present LIFE Regulation (Article 3.3) identifies the performance indicators against which the programme should be assessed in relation to its general objectives. It also empowers the Commission to adopt delegated acts to further define the performance indicators in relation to the programme’s priority areas and thematic priorities.

Given that the MAWP establishes qualitative and quantitative outcomes, indicators and targets for each priority area and type of project, no delegated act was adopted in this respect.

As specified in the MAWP, the number and scope of successful projects within a priority area mainly depend on factors that the Commission cannot influence, e.g. the number of eligible applications per priority area and technical and socio-economic factors. Hence, expected final outcomes have also been defined at a project level in relation to project’s objectives and an initial baseline.

The existing qualitative and quantitative outcomes, indicators and targets primarily address issues in a project-centric way and some are focused solely on project outputs, outcomes and impact because action grants correspond to the bulk of the funding (a minimum of 81% of the overall budget 55 ). The system was designed to assess project results for both programme and policy purposes.

Consequently, a system of key indicators has been established at project level. It ensures a good coverage of the grant monitoring and is a source of information on the effectiveness of the programme as a whole since some project level data can be aggregated at the programme level (albeit with some difficulties, as project baselines, metrics, timeframes and reporting vary between projects 56 ).

Experience has shown the following shortcomings in the system:

1.not only the grants, but also the results of other delivery mechanisms (e.g. procurement) should be included in the performance framework of the programme;

2.the project level indicators are too complex and numerous; the collection of data is resource-consuming and sometimes of limited use;

3.outcome indicators are only available at a late stage in the implementation of the programme, taking into account the time needed to put it in place and the multi-year duration of most projects;

4.the burden related to the collection of data for project level indicators is on the shoulders of the project beneficiaries,

5.not all the programme-level indicators defined in the Regulation are measurable;

6.the catalytic role of the programme is difficult to capture.

Moreover, the existing key project indicators would need to be up-dated:

1.to incorporate, wherever possible, the SDGs indicators, to which LIFE is expected to contribute;

2.to reflect experience gained during the first year of operation of the key project indicators database, including its suitability to meet policy development needs;

3.to ensure, as far as possible, greater harmonisation and comparability at EU level. E.g. the Commission is working on cross-cutting indicators on Natura 2000 for the ESI funds that will allow tracking the level of EU funding in support of the Natura 2000 network and marine protected areas. LIFE should also use these indicators.

5.2.    Monitoring and evaluation framework for post 2020 indicators

The proposed monitoring and evaluation framework for post 2020 LIFE builds directly on the existing framework, with some modifications. This general consistency should allow continuity in reporting between programming periods and enhance reporting through the application of lessons learned.

At a high level, the changes are summarised as follows:

·Programme level reporting of process and output indicators established: Extended scope of process indicators to include reporting for all delivery mechanisms and linked to financial reporting.

·Reduced number of outcome indicators: use of key project indicators.

·Reduced reporting burden for the beneficiary: only required to report process and outcome indicators, using key project indicators for the latter, where appropriate.

·Greater robustness and relevance established for impacts: targeted assessment of impacts.

More detail concerning these changes is set out below according to the reporting requirements for the monitoring and evaluation framework for the LIFE programme post 2020 which will be based on the types of indicators mentioned in the following figure. The indicators defined for the LIFE programme are aligned with those established for the wider MFF.

Figure 51 LIFE Programme: indicators' types and timeline

They include:

Process indicators: They measures all the resources mobilised: the financial resources, the delivery mechanisms. In the case of grants they involve data related to the demand per priority area and type of projects, in terms of number and types of applicants, country of origin, contribution requested and total project costs, time-to-grant, time-to-pay, error rate, etc..

Coverage:    All the interventions

Availability:    Once a year. Generally at the end of year n. No baseline.

Burden:    Commission and the applicants

Tool:        A database on information on grant proposals is available (cd. infoview).

Output indicators: they measure physical outputs (e.g. number of interventions per priority area and delivery mechanism). In the case of grants they include data per project types, number and types of beneficiaries, country of origin, amount of grants and external cofinancing). Data will also be collected on the number of LIFE-financed projects which include the exploitation and deployment of research and innovation results, financed from Horizon Europe or previous R&I programmes.

Coverage:    All the interventions

Availability:    Once a year. Generally in year n+1. No baseline.

Burden:    Commission

Tool:        A database on information on grant projects is available (cd. infoview).

Outcome indicators: they measure the direct results of the interventions in terms of deliverables/achievements (e.g. a conference, persons informed, hectares of ecosystem restored, CO2 emissions reduced, etc.)

Coverage:    All the interventions

Availability:    At the beginning of the intervention in terms of anticipated results (usually, for projects, in year n+2) and at the end of each intervention (generally, for projects in year n+4) . Depending from its duration, the progressive achievement of the results is monitored. Baseline to be defined.

Burden:    Commission, the beneficiary (in terms of grants) and the monitoring team

Tool:    A database on information on indicators at project level is available (cd. KPIs database).

Impact indicators: they measure the full impact of the results of the intervention after its end, including both direct and indirect impact and, in particular, the catalytic effect of LIFE.

Coverage:    Selected interventions. They can be meaningless for some interventions (i.e. study contracts)

Availability:    From 3 to 5 years after the end of the intervention. Once, two times for the selected interventions. Generally in year n+7/n+9

Burden:    Commission

Tool:    Ad hoc

5.2.1.    How the outcomes and impact/catalytic role of the programme will be assessed

The outcomes and impact of each LIFE project are currently assessed on the basis of a system of indicators developed by the Commission. At the beginning of a project, a baseline is defined according to the system of indicators, together with the results expected at its end and 3 years thereafter.

The values are defined by the beneficiaries and checked by a team of external monitoring experts with experience in the specific field and in the concerned country. They are validated by the operational officer who is entrusted with the technical supervision of the project. During the project, the results are monitored at least every year.

At the end of the project, the beneficiaries are required to update the values of the indicators, thus providing information on the final results of the project (versus the expected ones) and to prepare an after-LIFE plan to define how they intend to sustain and replicate the activities and further disseminate the project results.

The public consultation showed the need to simplify and streamline these indicators, which were found by the beneficiaries too complex to be managed.

A new evaluation framework for the projects with a reduced number of outcome and impact indicators is being defined. The work is on-going given the need to take into account the indicators related to the SDGs and to have a harmonised framework across the Commission.

The evaluation framework is composed of a system of indicators per priority with multiple levels, plus some horizontal indicators. For each indicator, the number of interventions, the beneficiaries and the amount of the related interventions will be provided.

This framework is also intended to incorporate the results other activities, related not only to grant projects. At the launch of the related procedure, the expected results will be defined. They will be confronted with the final results assessed at the end of the intervention.

To assess the impact and the catalytic role of the Programme, it is necessary to strike a balance between the need to get data and the associated costs. It is therefore proposed to combine the following sources:

1.a significant sample of projects that can be assessed on the basis of sources and tools independent from the project itself (e.g. regional data on air quality 57 or data from the register of enterprises). These projects will be systematically identified;

2.the data mentioned for each project in the KPI database and in the After-LIFE plans, will be checked after one year for the majority of projects and, on sample basis, through ex-post missions, after more than one year from project end;

3.the data provided by the beneficiaries of already ended projects on a voluntary basis 58 checked on sample basis and through ex-post missions;

4.enquiries of main actors at national and EU level.

In this way the burden related to the collection of the data will be further shifted from the beneficiaries 59 to the monitors (monitoring team, external monitors, EASME and the Commission).

5.2.2.    The timetable and the evaluations of the LIFE Programme 2021-2027

The timeline related to the availability of indicators’ values is showed on the below figure.

Figure 5.2 – Timeline on the availability of data for the assessment of the LIFE Programme

The monitoring and evaluation framework of the future Programme would have three main building blocks:

ØContinuous monitoring of the programme management and implementation through process and output indicators starting from year 2. They allows checking of whether the programme is on track and if adjustments need to be made;

Among these indicators the ones mentioned in the following tables will be mentioned in the Draft Regulation:

ØAnnual monitoring of the programme performance thanks to outcome and impact indicators starting from year 3: this allows assessing to which extent the programme is progressing towards its objectives, based on predefined baselines and targets; 

Moreover a regular monitor and report on mainstreaming of climate and biodiversity, including the amount of expenditure, will be ensured. The contribution of the LIFE programme to the EU budget-wide target of 25% of expenditure contributing to climate objectives shall be tracked through the EU climate marker system. Biodiversity-related spending will be tracked using a specific set of markers to quantify the commitment appropriations expected to contribute respectively to climate and to biodiversity objectives over the period 2021-2027 at the appropriate level of disaggregation.

ØTwo fully-fledged evaluations of the programme performance at mid-term and at the end of the programming period (upon completion). The evaluations will assess the Programme's effects on the ground based on the programme indicators/targets and a detailed analysis of the degree to which the programme can be deemed relevant, effective, efficient, provides enough EU added value and is coherent with other EU policies. They will include lessons learnt to identify any lacks/problems or any potential to further improve the actions or their results and to help maximise their exploitation/impact.

The mid-term evaluation would capture the first anticipated outputs and outcomes of the LIFE programme 2021-2027, as well as some of the final outcomes and impact of the current LIFE programme and the previous LIFE+ Programme. The final evaluation at the end of the programming period would capture the on-going and the final anticipated outcomes of the LIFE programme 2021-2027 and the final outcomes and impact of the current LIFE programme and the previous LIFE+ Programme.

ANNEXES

ANNEXES

Table of contents

Annex 1: PROCEDURAL INFORMATION

1.1.Organisation and timing

1.2.Consultation of the Regulatory Scrutiny Board

1.3.Evidence used in the impact assessment

Annex 2: STAKEHOLDERS CONSULTATION

2.1.Consultations

2.1.1.Opinion of the Committee of the Regions (CoR) of the LIFE MTE

2.1.2.Opinion of the European Economic and Social Committee (EESC) of the LIFE MTE

2.1.3.Opinions of environmental NGOs

2.1.Other inputs

2.1.4.Inputs from relevant units within DG Environment and Climate Action and with representatives from other DGs

2.1.5.Inputs from EASME

Annex 3: EVALUATIONS RESULTS

3.1.Summary of the mid –term evaluation of LIFE (2014-2020)

3.2.Summary of the evaluations of LIFE+ (2007-2013)

3.3.Summary of evaluations of IEE/Horizon 2020 Energy Efficiency

ANNEX 4: NEEDS ANALYSIS

4.1.Environmental problems and needs

4.2.Who is affected by unmet environment and climate needs?

4.3.The need to address the drivers of environmental and climate problems

4.4.Sector-specific Needs

4.5.Needs for LIFE Strategic Integrated projects:

4.6.Conclusions

ANNEX 5:DESCRIPTION OF THE PRESENT LIFE PROGRAMME AND THE BUSINESS AS USUAL (BAU) SCENARIO

5.1.Overview of the LIFE Programme since 1992

5.2.LIFE 2014 – 2020

5.3.Methodology for Assessing the Impact of LIFE under the Business as Usual Scenario

ANNEX 6.Gaps and synergies analysis

6.1.Step one: LIFE and other EC programmes coverage of different stages

6.2.Step two: Potential overlaps / synergies between LIFE and other EC programmes

ANNEX 7: METHODOLOGY

7.1.Step 1: Identification and characterisation of the remaining challenges

7.2.Step 2: Development of the specific objectives and operational goals

7.3.Step 3: Identification of the options

7.4.Step 4: Screening of the options

7.5.Step 5: Impact assessment of the short-listed options

7.6.Step 6: Summary of conclusions

ANNEX 8: DESCRIPTION AND SCREENING OF OPTIONS

8.1.Options linked to programme scope and structure

8.2.Options linked to delivery mechanisms

8.3.Options related to programme management

ANNEX 9:IMPACT ASSESSMENT OF OPTION 1 - INTEGRATION OF CLEAN ENERGY TRANSITION PROGRAMME IN LIFE

9.1.Needs analysis

9.2.Lessons learnt from the current and past programmes and assessment of the next MFF proposal

9.3.Assessment of impacts of the Clean Energy Transition Programme in LIFE

9.4.Conclusion

Annex 1: PROCEDURAL INFORMATION

Lead DGs: Directorate Generals Environment (ENV) and Climate Action (CLIMA)

1.1.    Organisation and timing

In December 2017, an Inception Impact assessment on "The future of the EU Programme for Environment and Climate Action (LIFE)" was prepared and submitted to the Regulatory Scrutiny Board (RSB). An upstream support meeting was then held with the RSB on the 11th of January 2018.

As follow up of the mid-term evaluation findings, on December 2017, an Inception Impact assessment was prepared "The future of the EU Programme for Environment and Climate Action (LIFE)" and submitted to the Regulatory Scrutiny Board (RSB). An upstream support meeting was then held with the RSB on the 11th of January 2018.

The Inter Service Steering Group (ISSG) for the Impact Assessment was set up by the SG in February 2018 and includes the following additional DGs and Services: SJ, ECFIN, GROW, EMPL, AGRI, ENER, MOVE, RTD, MARE, REGIO, SANTE, NEAR, DEVCO, BUDG, OLAF, JRC.

Three meetings were organised between February 2018 and May 2018. Further consultations with the ISSG were carried out by e-mail.

The ISSG discussed the Inception Impact Assessment and the main milestones in the process, in particular the inclusion of the Energy component and the draft Impact Assessment report before the submission to the Regulatory Scrutiny Board.

This impact assessment has drawn extensively on the Mid-term evaluation of the present LIFE programme, preparation of which began on July 2015 and ended in October 2017 when the Commission Report and the staff working document were published and submitted to the European Parliament and the Council, as well as to the Committee of the Regions and the European Social and Economic Committee.

1.2.    Consultation of the Regulatory Scrutiny Board

The Regulatory Scrutiny Board ("RSB") received the draft version of the present Impact Assessment report on the 21st of March 2018. The RSB gave some preliminary indications of what was required through an upstream support meeting. Further to the meeting with the RSB on the 11th of April 2018, the RSB gave a positive opinion with reservations on the 13th April 2018. The opinion included recommendations, which have been addressed in the revised IA report as explained in the table below.

1.3.    Evidence used in the impact assessment 

The Commission sought external expertise through a contract for a support study with RICARDO – Energy and Environment. From the deliverables of this contract, the IA report used in particular the analysis and methodology of the different policy options.

oRicardo “Support for an ex ante impact assessment of the post 2020 (LIFE) financial instrument for environment and climate”, ongoing

In addition, the JRC provided a contribution concerning the analysis of the future indicators at programme level

The IA report and the options considered in the IA report were developed based on the following documents, sources and evidence:

A Rocha et al. (2017) Position Paper on the EU LIFE Programme in the next Multi-annual Financial Framework (MFF)

AC Teon (2012) Comparative study of pressures and measures in the major river basin management plans in the EU Task 4 b: Costs & Benefits of WFD implementation

CoR (2017) CoR opinion: Mid-term evaluation of the Programme for the Environment and Climate Action (LIFE) 2014-2020

COWI (2009) Ex-post evaluation of LIFE

Decision No 1386/2013/EU of the European Parliament and of the Council of 20 November 2013 on a General Union Environment Action Programme to 2020 ‘Living well, within the limits of our planet’

EASME (2017) Annual work plan

EC (2006) Thematic Strategy for Soil Protection - Impact assessment of the thematic strategy on soil protection

EC (2011) Impact Assessment. Accompanying the document Proposal for a Regulation on the establishment of a Programme for the Environment and Climate Action (LIFE). SEC(2011) 1542 final

EC (2013) The Declaration of the Commission annexed to the Horizon 2020 Regulation (1291/2013)

EC (2013) Specific financial statement, EASME.

EC (2014) Commission Implementing Decision on the adoption of the LIFE multiannual work programme for 2014-17. (2014/203/EU)

EC (2014) Financing the energy renovation of buildings with Cohesion Policy funding

EC (2015) Roadmap for the LIFE Programme

EC (2015) Summaries of the data on the progress made in financing and implementing the financial instruments for the programming period 2014-2020 in accordance with Article 46 of Regulation (EU) No 1303/2013 of the European Parliament and of the Council

EC (2015) The State of Nature in the European Union Report on the status of and trends for habitat types and species covered by the Birds and Habitats Directives for the 2007-2012 period as required under Article 17 of the Habitats Directive and Article 12 of the Birds Directive. COM/2015/0219 final

EC (2016) Fitness Check of the EU Nature Legislation (Birds and Habitats Directives). SWD(2016) 472 final

EC (2016) Qualitative and quantitative outcome indicators for LIFE projects

EC (2017) A stronger and renewed strategic partnership with the EU's outermost regions. COM(2017) 623 final

EC (2017) Clean Energy Transition Programme Inception Impact Assessment

EC (2017) Draft General Budget of the European Union for the financial year of 2018. Working document Part I. Programme statement of operational expenditure

EC (2017) Inception Impact Assessment: The future of the EU Programme for Environment and Climate (LIFE)

EC (2017) Reflection paper on the EU finances

EC (2017) Report on financial instruments supported by the general budget according to Art.140.8 of the Financial Regulation as at 31 December 2016. COM(2017) 535 final.

EC (2017) Report on the Mid-term Evaluation of the Programme for Environment and Climate Action (LIFE). SWD(2017) 355 final.

EC (2017) Study for the strategy for a non-toxic environment of the 7th Environment Action Programme, prepared by Okopol, Milieu, RPA and RIVM

EC (2017) The future of food and farming. COM(2017) 713 final

EC (2018) Commission Implementing Decision on the adoption of the LIFE multiannual work programme for 2018-2020. (EU/2018/2010)

EC (2018) Environment - LIFE: Toolkit. Project management tools: Standard Agreement and Common Provisions. [online] Available at: http://ec.europa.eu/environment/life/toolkit/pmtools/life2014_2020/guidelines.htm [Accessed 2 Mar. 2018]

EC (2018) Toolkit for the key project-level indicators (KPI) under LIFE

ECA (2003) Special report No 11/2003 concerning the financial instrument for the Environment (LIFE), together with the Commission’s replies. OJ C292/1.

ECA (2009) The sustainability and the Commission’s management of the LIFE-Nature projects. Special report No 11.

ECA (2013) Has the environment component of the LIFE programme been effective? Special Report No 15

Ecorys (2017) Support for an external and independent LIFE Mid Term Evaluation Report

EEA (2015) SOER 2015 – The European environment – state and outlook 2015

EEA (2017) Environmental indicator report 2017: In support to the monitoring of the 7th Environment Action Programme. EEA Report No. 21/2017

EEB (2018) The EEB Memorandum to the Bulgarian Presidency of the European Union Including the Ten Green Test

EESC (2017) EESC opinion: Mid-term evaluation of the LIFE programme

EIB (2017) Energy efficiency in buildings: how to accelerate investments?

EP (2016) LIFE – How to use €3.46 billion for environment and climate protection. Study for the ENVI Committee

EP (2017) Implementation of the 7th Environment Action Programme – Mid-term review

EPRS (2017) Reducing air pollution National emission ceilings for air pollutants. Briefing EU Legislation in Progress. |European Parliamentary Research Service

European Commission Regulatory Scrutiny Board (2017) Opinion Evaluation / LIFE Programme for Environment and Climate Action

GHK et al. (2011) Combined Impact Assessment and Ex Ante Evaluation of the Review of the LIFE+ Regulation: Options Development

GHK, Arcadis & Vito (2010) Mid-Term Evaluation of the Implementation of the LIFE+ Regulation

ICF International, LDK, Hinicio (2015) Evaluation of Intelligent Energy Europe Projects Supporting Sustainable Energy Communities- Final report

IEEP et al. (2017) Integration approach to EU biodiversity financing: evaluation of results and analysis of options for the future

IUCN (20147) The BEST Initiative

LIFE Indicators Database

LIFE Projects Database 

Lopez, P.D. (2017) LIFE Key Project-level Indicators (KPI). Presentation by the European Commission

Milieu, IEEP and ICF (2016) Evaluation Study to support the Fitness Check of the Birds and Habitats Directives

NABU and BirdLIFE (2017) Additional information to the public consultation on Mid-term evaluation of the LIFE Programme

Neemo & EY (2016) LIFE: Contributing to employment and economic growth

Regulation (EC) No 614/2007 concerning the Financial Instrument for the Environment (LIFE+)

Regulation (EU) No 1293/2013 on the establishment of a Programme for the Environment and Climate Action (LIFE) and repealing Regulation (EC) No 614/2007

Ricardo and CE Delft (2017) Report on the first results of Horizon 2020 on energy efficiency and system integration – Final report

Ricardo, IEEP and Trinomics (2017) Climate mainstreaming in the EU budget: preparing for the next MFF

Trinomics (2012) Final evaluation of LIFE+: Summary of conclusions and recommendations

WWF (2018) The EU Multiannual Financial Framework: WWF Position Paper on the next EU Budget and its application

Annex 2: STAKEHOLDERS CONSULTATION

As part of the mid-term evaluation of the current LIFE Programme a wide range of consultation activities were conducted, including (i) a 12-week public consultation generating more than 250 responses, (ii) six specific surveys with more than 200 responses, and (iii) over 150 interviews (and where relevant site visits) of the key stakeholder groups, including project beneficiaries, project coordinators, external monitoring experts and stakeholders related to the LIFE financial instruments.

A summary of key stakeholder messages from the above consultation activities is presented in the box below:

Box 01: Summary of key messages from stakeholders consulted under the MTE of LIFE

Source: Ecorys (2017) Support for an external and independent LIFE Mid Term Evaluation Report

Although it was not considered necessary to organise a new, broad public consultation for this impact assessment, further opinions on the MTE results and the future of the LIFE Programme were received from environmental NGOs and some consultation activities to discuss the challenges and opportunities of the programme were undertaken with relevant stakeholders, including relevant units within DG Environment and DG Climate Action, as well as representatives from other DGs taking part in the Inter-Service Steering Group meetings, and with EASME.

These consultations provided further justification for the conclusions of the MTE but also provided new insights into the future direction of the LIFE programme. A summary of these points is presented in the box below while Annex 3provides more detailed information.

Box 22: Summary of key points from further discussions

2.1.    CONSULTATION ACTIVITIES

As indicated in the main report, as part of the mid-term evaluation of the current LIFE Programme extensive consultation activities took place which included a 12-week long public consultation, six specific surveys targeting relevant stakeholders and more than 150 interviews with a wide range of LIFE stakeholders.

Given the above, it was not considered necessary to undertake a new and wide-ranging public consultation. Nevertheless, a limited set of further consultation activities were undertaken. This included some discussions on the potential challenges and opportunities relevant to the LIFE programme post-2020 with relevant stakeholders, including relevant units within DG Environment and DG Climate Action, representatives from other DGs taking part in the Inter-Service Steering Group (IISG) meetings, and with EASME.

In addition, the Committee of the Regions and the European Economic and Social Committee have adopted specific opinions on the future of the LIFE Programme after having acknowledged the results of the mid-term evaluation and certain environmental NGOs have prepared position papers outlining their views on the funding priorities under the next MFF, which included some views on the LIFE programme. While this evidence is biased towards the views of a single stakeholder group, so cannot be considered representative, the options are still useful

2.1.1.    Opinion of the Committee of the Regions (CoR) of the LIFE MTE

The Committee of the Regions in its opinion 60 on the mid-term evaluation of the LIFE Programme provided the following conclusions:

§Reiterated its strong support for the LIFE Programme and called for its continuation with a significantly increased budget in the post-2020 MFF.

§Called for the increase of funds for the Nature and Biodiversity priority area and indicated the need to significantly increase the programme’s contributions to the Natura 2000 network.

§Recommended to strengthen the Climate Action sub-programme of LIFE.

§Recommended to reinforce LIFE’s role in tackling uneven implementation and enforcement of the EU environmental acquis in the Member States.

§Recommended the further implementation of the (strategic) integrated projects and the Governance and Information priority areas.

§Called for the increase of co-financing rates under the future LIFE programme.

§Called for revisiting the decision on the phase out of national allocations.

§Called for the introduction of further simplification of the application procedures for project applicants.

§Called the Commission to assess the opportunities for LIFE to support large-scale deployment.

§Called the Commission to assess the role of the financial instruments of the LIFE programme with the aim to attract investors related to the Environment and Resource Efficiency priority area.

2.1.2.    Opinion of the European Economic and Social Committee (EESC) of the LIFE MTE

The European Economic and Social Committee in its opinion 61 on the mid-term evaluation of the LIFE Programme provided the following conclusions:

·Reiterated its support to retain and further develop the LIFE Programme.

·Acknowledged the important role of the LIFE programme in supporting EU environmental policy. Particular emphasis was put on LIFE’s role in directly achieving direct and tangible environmental impacts and in supporting EU citizens to understand and accept EU environmental policy.

·Highlighted LIFE’s role in identifying inconsistencies in EU policy decisions in relation to environmental and climate objectives.

·Called for the need for LIFE to support the Sustainable Development Goals.

·Recommended that the future LIFE should be the main instrument for funding the Natura 2000 network and that appropriate funds are earmarked for this.

·Recommended to further assess how LIFE projects could be better replicated.

·Recommended to establish a clearer distinction between LIFE and Horizon 2020 projects, i.e. to not provide LIFE funding for conventional research projects.

·Recommended to further develop the Climate Action sub-programme, in particular with a focus on adaptation actions.

2.1.3.    Opinions of environmental NGOs

Since the publication of the mid-term evaluation of LIFE a set of position papers on the direction of the future LIFE Programme were published by a set of environmental NGOs. They included:

-    A joint statement from 17 environmental NGO members 62 of the European Habitats Forum 63 ;

­A position paper on the post-2020 MFF by WWF 64 ;

­A joint position paper by NABU and BirdLife on the MTE 65 ;

­The EEB’s Memorandum on the Bulgarian Presidency 66 .

2.1.3.1    The need to significantly increase the future LIFE budget

All environmental NGOs emphasised the important role LIFE plays in supporting environmental and climate objectives in the EU. Given the programme’s importance and the continued need to tackle environmental and climate challenges the NGOs argued that the LIFE Programme should be continued in the future MFF. In addition, all NGOs agreed that the programme’s budget needs to be significantly increased. LIFE currently represents 0.3% of the EU budget. The member NGOs of the European Habitats Forum suggested increasing this share to 1%. At the same time, EEB in its note on suggested priorities for the Bulgarian EU Presidency presented an argument for a ten-fold increase in LIFE’s budget.

NGOs not only argued for the overall increase of the LIFE Programme but to also increase the dedicated budget to the Nature and Biodiversity priority area. NGOs re-iterated the importance of LIFE in funding biodiversity conservation and also pointed to the continuous conservational challenges within the EU. Members of the European Habitats Forum argued that 50% of LIFE should be dedicated to LIFE while earlier in a joint position paper BirdLife and NABU suggested a 10% increase in funding for nature.

2.1.3.2.    The need to increase co-financing rates

A need for an increased co-financing rate was emphasised by all NGOs. They argued that in order to overcome the financial challenges project beneficiaries facing co-financing rates need to be increased to 75%. They argued that in some cases co-financing rates could be even increased to 90%, for instance in the case of those projects that target species which are considered to be in an unfavourable-bad status under the Habitats Directive.

2.1.3.3.    The need to reduce administrative burden for applicants

All NGOs highlighted that currently project applicants have to face complex and time-consuming processes and there is a need to reduce administrative burden. They specifically highlighted the need to introduce the two-step application process more widely under the programme.

2.1.3.4.    The need to support 'traditional' standard projects more widely

WWF emphasised the need to increase support for 'traditional' standard projects which have a bottom-up approach and thus have potential to bring LIFE projects “closer to citizens”. WWF suggested to provide a 50% earmarking within action grants for 'traditional' standard projects.

2.2.    Other inputs

2.2.1.    Inputs from relevant units within DG Environment and Climate Action and with representatives from other DGs 

The below sections provide a summary of the main points raised by Commission services in reflection on the future of the LIFE Programme.

The need to ensure synergies between LIFE and other funds

While the MTE of the LIFE Programme highlighted that there are synergies already in place between LIFE and various other financial programmes, DGs within the European Commission indicated that these synergies should be further explored and supported whenever possible. Specific references were made to the European Regional Development Fund (EDRF) and the Research and Innovation Framework Programme 9 (Horizon Europe).

In relation to research and innovation, the possibility to include the sustainable energy component of Horizon 2020 in the future LIFE Programme was discussed and it was concluded that given the suitable nature, objectives and intervention logic of this part of Horizon 2020 this could be a viable option for the post-2020 LIFE.

The need to ensure a critical mass

Commission services emphasised the need to reflect on the “critical mass” that is needed to effectively implement the future LIFE Programme. This reflection needs to take account of the identified needs. It was also highlighted that it is important to consider the need for flexibility in view of the critical mass identified.

The need to foster project replicability

The importance to continue replicating successful LIFE projects was highlighted. For instance, it was emphasised that an important feature of LIFE is that it can support projects which can then be replicated by the Structural Funds at later stages.

Other issues

In addition to the above issues, Commission services called for the need to address the unbalanced access to LIFE funds for beneficiaries within the Member States. This was asked to be addressed by relevant delivery mechanisms.

Finally, the need to assess how to deal with the participation of third countries in the LIFE Programme was requested.

2.2.2.    Inputs from EASME

The discussion with EASME focussed on the management cost implications of the options for changing the scope of LIFE and also covered the options relating to reducing the administrative burden. The interviewee was also able to offer some personal input based on his long experience of the LIFE programme.

Validity of current role of EASME in LIFE

EASME do the management of virtually all LIFE projects, including the integrated projects. They don’t do procurement and some preparatory projects, and they felt that there would be little to gain from them taking these on. Procurement is policy driven and from EASME’s experience in other programmes (COSME and EMFF) putting this type of action into an agency does not add value.

NGO funding

The interviewee felt that the annual budget structure is a constraint, but this is required by the financial regulations. He stated that the current two-year funding approach is enabled by signing a framework type contract with the recipients, however he did not feel that it generates that much of an administrative saving. The interviewee felt that longer framework partnership agreements should be considered

Simplification

On the benefits of a two-stage application approach, EASME doesn’t have calculations on this, but the justification is to reduce applicant time. The interviewee felt that an approximate estimate of the time savings would be that a full proposal takes 2-3 person months of man days, which costs at least €10k, but could be as much as €30-40 k. In contrast preparing a short (outline (stage one)) proposal should take no more than 2-3 weeks and cost €5k at most. The interviewee thought applicants with a long history of success, who know the programme well, would not like this idea, because it loses some of the advantage their experience gives. However, this was not the case, as Birdlife (a very successful applicant) were very enthusiastic as it would allow new applicants to approach LIFE. The interviewee felt that a two-stage approach would almost definitely result in more applications. EASME asked DEVCO about their experience and the conclusion was extremely positive The interviewee raised one down side, with the question of how the concept notes should be evaluated. There is a risk of being more subjective in evaluating them as it would be difficult to have detailed criteria that would justify an approval of a certain top ranked percentage. This risk may be addressed by carefully designing the concept note structure and associated guidelines The interviewee stated that the two-stage application process is already used in parts of Horizon 2020, and that the approach is expanding to other programmes. For example, DG EAC also use a two-stage process. He felt that it works best in programmes that have lots of proposals, or where the level of detail (required for the full bid) is very high.

The interviewee stated that other potential simplifications for the full proposals include reusing the text entered for the concept note and reducing the level of detail in the application forms. EASME are assuming responsibility for the IT for LIFE and in due time, will have sufficient capacity to make the changes required. to the existing IT tools to introduce these simplifications The intention is to move to the E grant tool by 2020 (as used by most other programmes). This is intended to become a single portal to access all EU financial programmes. This switch might lose a few specificities (to LIFE), but efforts will be made to keep the best (and most useful) things.

Moving some of the energy parts of Horizon 2020

The interviewee felt that the positive elements of this option are that it would boost the LIFE budget and quality and the EASME LIFE and Horizon 2020 Energy units are close in terms of approach and interests. He also felt that taking some of the energy projects (the former IEE programme) out of Horizon 2020 would give more flexibility to the projects it supports. It would also address the feeling that these projects get ‘lost’ in Horizon 2020. He felt that there could be some extra costs of moving the Horizon 2020 energy projects into LIFE. For example, if the monitoring approach for the Horizon 2020 projects is adjusted to be the same as for the LIFE projects it will mean more national monitors are required, though the required growth would not be entirely linear. The project negotiation process would also add extra costs. On the positive side the interviewee stated that according to ex-post audits there is a lower error rate in LIFE projects (currently some 0.25%) than Horizon 2020 projects. He felt that the project revision process helps with this as do the national monitors. The interviewee felt that if the LIFE approach were applied to the Horizon 2020 projects the extra administrative costs would be largely offset by a lower error rate.

Third countries and outermost regions

The interviewee stated that Article 5 allows associated counties to participate in any programme if they sign an agreement and contribute to the budget of that programme. For LIFE that hasn’t been taken up, largely because the likelihood of these countries getting back their contribution is low. A system to guarantee that at least a share of that money would be reinvested in the countries that contributed might be considered to make the scheme more appealing.

The interviewee stated that Article 6 of the LIFE programme allows actions to be supported anywhere in the world if they are necessary to deliver results in the EU. An obvious example is helping migratory birds in their wintering countries. This approach could be expanded to include problems clearly caused by the EU - e.g. illegal ship recycling in Asia. However, this is an exceptional approach, so clear evidence of EU relevance would be needed on a case by case basis.

Unequal geographic distribution of LIFE participation:

The interviewee felt that there is historical evidence that the approach of a certain percentage of the total number of 'traditional' standard projects for each MS is a distortive element. The evidence shows that it in no way helped low performing MSs to increase their share of take from LIFE. The only way is to work patiently on the real causes in each MS , but also in every economic or social sector. He felt that there is arguably some merit in having a geographical distribution factor for integrated projects, on the basis of numbers of projects per MS, rather than share of budget per MS.

General scope

In the traditional grant area, the interviewee felt that the bottom up approach to sourcing projects is the main success factor of LIFE. He agreed that the current mix between priorities and bottom up ideas should be maintained and improved striking the right balance between predictability and flexibility and between EU policy priorities and local capacity and perception of where problems lie. The budget for these projects could easily be doubled to better match the historic level of demand and absorption.. He also agreed that Integrated projects could be expanded to cover additional themes e.g. energy, noise, marine, etc.) and be regarded as a primary mainstreaming method for the Commission, but again this would require a significant budget increase. With regard to preparatory projects, their overall budget is small, but these are important top-down projects driven and may justify a certain increase.

The interviewee felt that the current balance of objectives between the Regulation and the annual program appears a good solution as it allows some flexibility year to year. In general, all parts of LIFE appear worthy of retention (scope and approach) with the exception of the capacity building element, and the country allocation approach. The current single MS capacity building approach should be replaced by one or two grants addressing the support of the whole network of LIFE National Contact Points

Monitoring and Evaluation

With regard to the option of changing the approach to Monitoring and Evaluation, by bringing it back into the Commission and doing it all from Brussels. The interviewee felt that this change would not only be very difficult in view of the staff figures we would be looking for (100-150), but more important we would kill the most visible and appreciated special feature of the LIFE program: the network of professional monitors. In every evaluation or audit across the years, this special feature has been prized by beneficiaries, member States and even EU institutions. Internalising this staff in EASME could be materially possible, but they would never be able to ensure the proximity, the language coverage and the logistic flexibility that the LIFE monitors bring.

Annex 3: EVALUATION RESULTS

3.1.    Summary of the mid –term evaluation of LIFE (2014-2020)

During its 25 years of existence, the LIFE programme has been evaluated a number of times. The current programme is the result of these evaluations and has been shaped by the lessons learnt from the programme’s implementation over the years.

The mid-term evaluation

As required by the LIFE Regulation, the mid-term evaluation builds on the external study ‘Mid-term analysis of the LIFE Regulation’, carried out by independent contractors.

The mid-term evaluation was carried out at an early stage of the programme's implementation. This means that most projects were not started yet, and few projects were completed (the average duration of a LIFE project is 4 to 5 years).

For these reasons the mid-term evaluation focused mainly on the processes put in place (launch of calls, signing of contracts, funding of projects, etc.) to reach the LIFE programme's objectives. Where relevant, the evaluation looked at their expected results more than the results achieved. Moreover a comparison was done with the previous programme (its outputs are used as a reference) because most of the activities and the related procedures ('traditional' standard projects, operating grants and procurement) continue to be as they were under the LIFE+ programme.

3.1.1.    Main findings

Overall, the mid-term evaluation provided reasonable assurance that the LIFE programme is on track to be:

·effective, because it is well placed to meet its targets and deliver on environmental and climate objectives and contribute to the pillars of the Europe 2020 strategy.

Ongoing projects from the 2014 calls for proposals are expecting to reach 70% of each milestone envisaged for 2017, for example, by targeting better conservation of 114 species, 59 habitats and 85 Natura 2000 sites.

Activities are in place to fulfil all the general objectives and to contribute to resource-efficiency, innovative technologies and, in a limited way, employment.

Some of the most recent policy developments have been financed by LIFE - namely the circular economy package adopted in 2015 and the 2030 climate and energy framework adopted in 2014, the implementation of the Paris Agreement ratified in 2016 as well as the EU's adaptation strategy -.

·efficient, because the projects are expected to provide value for money. It is estimated that the benefit to society of some of the projects from the 2014 call for proposals will amount to EUR 1.7 billion. This figure alone represents four times the cost of the overall LIFE budget for 2014.

The transfer of most of the grant management from the Commission to the executive agency EASME is well on track and it is expected to produce an overall gain in efficiency, above the EUR 8.2 million gains initially planned for 2014-2020.

·relevant, because the ongoing projects are addressing some crucial challenges such as halting the loss of biodiversity, deriving savings from the circular economy, reducing the costs of inaction related to the consequences and effects of climate change.

·complementary to and works in combination with other programmes (thus producing synergies). As confirmed by the analysis of areas with similar objectives, the fact that the different programmes do not have the same primary focus means that there is little possibility of overlapping. Initial findings also show that the LIFE programme has encouraged using the results of the projects financed by research programmes. It has also encouraged taking advantage of the European Structural and Investment Funds, in particular through the integrated projects.

Moreover, the LIFE programme showed a substantial and unanimously recognised EU added value, because it helps to make the application of EU environmental and climate legislation and policies consistent across the EU. It allows a better sharing of responsibility and promotes solidarity for the management/conservation of EU environmental assets. Some evidence also confirms that the programme is successfully playing its role as catalyst, promoting activities to exchange best practice and knowledge and to improve the utilisation of project results as well as transfer of know-how.

The evaluation also highlighted aspects which need to be improved. This involves:

·simplifying grant management procedures, in particular the application and reporting processes;

·increasing the strategic focus of the demand-driven part of the programme, e.g. by targeting topics not covered by the projects funded in previous years;

·doing more to reproduce the projects and transfer their results, e.g. by developing the capacity to plan and implement investments and addressing the lack of financial resources;

·improving the communication strategy to better target audiences, deliver more objective-specific and target-specific key messages and ensure more structured coordination between players.

The results of the LIFE mid-term evaluation exercise helped to improve these aspects under the next multiannual work programme (2018-2020) and will be addressed in the next multiannual financial framework.

3.1.2.    RSB Opinion

On February 2017 the Regulatory Scrutiny Board gave a positive opinion on the evaluation of the staff working document (SWD) on the mid-term evaluation, with observations on how the SWD could still be further improved. These recommendations were taken into account and several changes were made in the final version of the SWD.

3.2.    Summary of the evaluations of LIFE+ (2007-2013)

3.2.1.    Summary of the final evaluation of LIFE +

The final evaluation 67 of the LIFE+ Programme (2007-2013) conclude that the programme was successful in promoting the implementation of the EU’s environmental policy and legislation with significant EU added value. However, it also identified a number of shortcomings concerning the action grants and the NGO operating grants. These challenges are presented below in two sections; the first shows those that were addressed in the design of the current LIFE Programme (2014-2020), and how this was achieved, according to the Mid-term evaluation (MTE)  68 of LIFE. The second section presents those challenges that do not appear to have been explicitly addressed.

The following challenges of the LIFE+ Programme (2007-2013) were identified in its final evaluation and were addressed in the current Programme:

1.There was a need for a more strategic focus. A minimum of 78% of the LIFE+ budget was devoted to action grants, so its success in addressing EU’s environmental and climate policy issues was strongly influenced by the quality and quantity of the applications received, given the ‘bottom-up’ approach of responding to the demand for action grants.

The LIFE Programme (2014-2020) addressed this issue by:

a)Shifting from a pure bottom-up approach to a flexible bottom-up approach, which could better steer demand, with specific thematic priorities and project topics defined for the Environment Sub-programme.

b)Dedicating a minimum of 81% of the LIFE budget to action grants projects, funded via an annual call for proposals, and to operations grants, financed by financial instruments. While both projects and operations still depend on the quality and quantity of the application, the definition of priorities is assumed to have improved the Programme’s strategic focus.

2.LIFE+ stakeholders indicated that the application process and reporting obligations should be simplified.

The LIFE Programme (2014-2020) addressed this issue by:

a)Shifting to a two-step application procedure for the integrated projects.

b)Waiving the requirement to submit an external audit certificate and/or a VAT certificate.

c)Streamlining the system to enable applicants to submit their proposals electronically (e-proposal).

ØHowever, despite the adjustments mentioned above, the MTE of LIFE (2014-2020) indicated that stakeholders still found the application process and the reporting requirements burdensome and that they need to be simplified.

3.The LIFE+ Programme objectives were not always clear and certain strands were lacking definition, especially the ‘Environmental Policy and Governance’ and the ‘Information and Communication’ parts.

The LIFE Programme (2014-2020) addressed these issues by:

a)Changing the overall objective and adding two additional objectives (Objective (a) and (c) contained in Article 3(1) of the LIFE Regulation 69 ), which clarify the general purpose of the LIFE Programme, the importance of environmental and climate governance involving all stakeholders, and the role of LIFE in the enforcement of environmental and climate policy and legislation.

b)Creating a sub-programme for climate action, which upgraded the thematic strand ‘climate change’ during the LIFE+ Programme.

4.There was a need to better utilise project results and transfer know-how by focusing on implementing and creating multipliers.

The LIFE Programme (2014-2020) addressed this issue by:

a)Making the potential for replicability and transferability of project results one of the project award criteria.

b)Close monitoring and organising of platform meetings during the implementation of the project, which makes it easier to disseminate and transfer project results.

c)Drawing up ‘after-LIFE Plans’ to organise the continuation of project activities and enhancing the ex-post monitoring visits two years after LIFE financing ends.

5.A lack of complementarity and synergies with other EU Funds.

The LIFE Programme (2014-2020) addressed this issue by:

a)The LIFE regulation explicitly highlights the need to develop synergies with Horizon 2020

ØEASME’s analysis 70 confirmed that LIFE and Horizon 2020 contribute to common objectives in different ways, reinforcing each other.

b)The common provisions regulation (CPR) of the ESI Funds contains a section that promotes coordination and synergies between the ESIF and LIFE, and in particular the ERDF was mentioned in the Mid-term evaluation as complementary to LIFE.

6.Restrictions on funding activities in countries not directly participating in the LIFE+ Programme reduced the Programme’s effectiveness

The LIFE Programme (2014-2020) addressed this issue by:

a)Adding in the regulation of the currently running programme that interventions in countries outside the EU and participation of legal persons based in those countries in activities financed under LIFE should exceptionally be possible.

7.There was an uneven distribution of funding between the Member States. Italy, Spain and Germany received disproportionally more amounts of LIFE+ support, while newest Member States had a lower rate of success

     The LIFE Programme (2014-2020) addressed this issue by:

a)Introducing ‘capacity-building projects’, which aim to provide financial support to enhance the capacity of Member States, including national and regional contact points, to participate more effectively in the LIFE Programme.

ØHowever, the MTE of the currently running programme indicated that the uneven distribution of funds among Member States remains, with Italy, Spain and Germany receiving most of the grants.

The following weaknesses of the LIFE+ Programme (2007-2013) were identified in its final evaluation but do not appear to have been explicitly addressed in the next Programme:

1.There was room for more synergies and coherence with national, regional, and local programmes in Member States.

2.There were liquidity problems for the NGOs that received operating grants due to issues related to the speed and timing of payments.

Based on the opinions that small and new MS NGOs are not frequently supported) trialling the inclusion of a stream of funding to support new member state and small NGOs.

3.2.2.    Programme coverage and Thematic choices

Results of the mid-term evaluation of the LIFE+ Programme (2007-2013) suggested a need to increase the strategic focus of the programme. This was re-iterated by the impact assessment for the 2014-2020 LIFE Programme, which stated that the “MTE argued that LIFE could be improved, particularly in terms of a more strategic, multiannual approach that better articulated and translated the strategic EU priorities, especially in relation to the implementation and integration of environmental policy, as the basis of programme activity”. The need for a more strategic approach was considered in the Impact Assessment (IA, 2011) of the various policy options for the post-2014 LIFE Programme

With regard to future thematic choices, the IA (2011) considered the contemporaneous environmental issues and environmental policy requirements. The IA identified that major environmental issues were well defined and subject to ongoing monitoring and research by the European Environment Agency (EEA) and periodically presented by theme and Member State in the State of Environment report. The issues were briefly summarised with regard to three policy areas:

·“The physical environment”, primarily related to nature and biodiversity and including climate change impacts

·“The existing acquis”, including air quality, freshwater management and implementation of the Water Framework Directive; and

·“Resource efficiency and decoupling” in terms of resource use (including climate change mitigation) and waste.

Essentially, the IA recognised a continuum of environmental issues from those specifically concerning the state of the environment, stock of environmental assets and associated ecosystem services to those more generally related to resource efficiency and decoupling of resources. The IA noted that there was also a continuum between the need to further develop environmental policies (supported by public procurement of service contracts) and policy implementation (largely supported by LIFE programme’s action grants). However, against this backdrop, none of the responses to the IA’s stakeholder survey supported restricting LIFE to addressing one particular environmental issue or policy and general consensus was that it was difficult to prioritise individual themes because of the extent of interactions between all of them. This was also the view of 75% of respondents to a Committee of the Regions survey, although the remainder were in favour of prioritising climate change, management of the Natura 2000 Network and the Habitats and Birds Directives. A separate survey conducted by the EC’s LIFE Unit in “Your voice in Europe”, also identified that 60% of respondents felt that the Commission should set thematic environmental priorities, especially for nature and biodiversity, although a wide range of other environmental policy areas were also flagged as important.

3.2.3.    Territorial choices

The IA (2011) identified that the main territorial concern was the extent to which third countries should benefit from LIFE finding, in what ways and whether activities beyond the EU should be eligible. Three arrangements were considered in terms of potential scope:

·“Exclusively EU”

·“Minor allowances for third country involvement” (e.g. clear transboundary issues which affect implementation of a specific EU environmental policy)

·“Greater integration of third countries” based on defined needs and thematic focus, given Treaty requirements for international action and importance of global and European neighbourhood environmental problems. It was noted that this would require cooperation between DG ENV and former DG RELEX and DG DEV and could weaken development policy coherence.

Stakeholders across all consultations associated with the IA generally supported potential for LIFE to fund activities outside the EU provided the EU benefited. Most stakeholders also felt that the indicative 15% share of LIFE+ funds ear-marked for transnational projects was reasonable.

3.2.4.    Options assessment

One of the five options (Option 5) assessed by the IA (2011) considered narrowing the thematic focus of the LIFE programme to implementation of Article 8 of the Habitats Directive, to secure the effective management and stewardship of the Natura 2000 network and the related biodiversity policy agenda. The assessment of this option concluded that expansion of the Nature component would provide increased benefits from wider biodiversity-related activity, Nature activities should not be overly constrained by a focus on Natura 2000 sites, and that associated projects should be larger with broader scope and scale.

The preferred option arising from the IA (Option 3) had a thematic focus reflecting the general objective of developing, updating and implementing EU environmental policy, i.e. addressing emerging problems of EU scale across the whole of the environmental acquis. This included action outside the EU where it provided EU added value, in cooperation with former DG RELEX and DG DEV. The ex-ante evaluation of this preferred option suggested that there would be no negative distributional effects, as environmental problems (e.g. pollution) disproportionately affect lower income households.

Ultimately, a “flexible bottom-up” approach was introduced, i.e. inclusion of thematic priorities under the Environment sub-programme.

3.2.4.1.    The need to increase catalytic role

LIFE+ MTE

The MTE indicated that LIFE+ played an important catalytic role in leveraging MS funds that would otherwise not be allocated. It also noted that among MS, while national funding for Natura 2000 strongly varied, there was generally a heavy reliance on EU financing instruments. However, the LIFE+ MTE noted that while the programme was relevant to the specific objectives and effective at project level, it was not fulfilling its potential to realise EU added value due to lack of a strategic approach to the programme. It neither fully reflected EU policy needs in programme activity nor fully used project results in support of policy needs. While all projects were required to disseminate results and there was some synthesis of lessons by project by theme, the MTE noted that there was limited effort was made to build networks between projects and stakeholders that might apply and replicate project results more widely. The MTE advocated that LIFE+ could be improved by a more strategic, multi-annual approach to programme activity reflective of the EU’s strategic priorities, especially in relation to implementation and mainstreaming of environmental policy, as well as by improving project’s knowledge transfer to different stakeholders.

LIFE IA 2011

The LIFE IA (2011) identified three options that it identified as having extensive catalytic potential:

·Option 3 – Strategic programming option – expanding the planning and delivery of the financial instrument. This option continued with a specific financial instrument for the environment (LIFE) but that was more strategically focused and linked directly to DG ENV’s policy priorities and work programmes. The option differed from the LIFE+ instrument by having a greater emphasis on: establishing strategic priorities in the MAWP based on DG ENV’s well-defined needs; increasing its catalytic potential and synergies with other financial instruments by increasing multiplication and replication, leveraging additional funding and expanding use of project results. The option proposed that LIFE’s catalytic effect would be increased through developing projects, for example, to: improve peer-to-peer mutual learning networks between competent authorities; maximise the contribution of other EU financial instruments to environmental goals; serve as pilots for subsequent mainstreaming under the Cohesion Policy of CAP; improve synergies with other financial instruments, given LIFE’s relatively limited resources; encourage increased cross-working between financial instruments (i.e. as integrated projects).

·Option 4 – Restricted activities option – focusing on a limited set of activities. This was based on Option 3 but with a reduced range of activities by excluding specific information and communications activity and eco-innovation. The thematic focus reflected the general objective to develop, update and implement EU environmental policy across the whole acquis. Territorial focus was on the EU except, minorly, where there were specific transnational interests. The option had the same emphasis as Option 3 on maximising the catalytic value of LIFE.

·Option 5 – Restricted thematic (Nature) option – focusing the instrument on the statutory area requiring co-finance. This was a thematically focused version of Option 3 intended to meet the legal obligations to co-finance the Natura 2000 network and to address climate change.

In addition to address Environment, the LIFE Regulation 2014-2020 71 subsequently introduced a sub-programme for Climate Action. In relation to the Environment sub-programme, the Regulation identified three priority areas – Environment and Resource Efficiency; Nature and Biodiversity; Environmental Governance and Information -. These encompass thematic priorities and associated activities set out in Annex III to the Regulation. The multiannual work programme (MAWP) for 2014-2017 also contained a non-exhaustive list of project topics implementing the thematic priorities under the Environment sub-programme. The Regulation also sets three priority areas for the Climate Action sub-programme – Climate Change Mitigation, Climate Change Adaptation, Climate Governance and Information. In contrast to the Environment sub-programme, no thematic priorities are established. Instead relevant policy areas are mentioned in the MAWP and key priorities are further detailed in the yearly calls for proposals.

3.2.4.2.    Delivery mechanisms

Historically, the main delivery mechanism for the LIFE budget programme has been action grants, and this remains true for the current programming period (2014-2020) (e.g. GHK, 2011; Ecorys, 2017). Their design has evolved overtime in response to the issues encountered and to improve implementation of the LIFE budget programme across all Member States (see below). The main issues identified through previous evaluations include: complex application and implementation processes; low visibility of the budget programme; territorial imbalances concerning access to the budget programme (linked to low levels of interest and weak capacity to develop high quality project applications); low transparency in the project award process; inadequate monitoring at programme level; low sustainability of projects; and weak catalytic effect (related to dissemination as well as design aspects of operating grants) (COWI, 2009; ECA, 2009; Trinomics, 2012; 2014; Trinomics, 2012; European Parliament, 2016).

In response to the issues identified, there has been a stronger focus on improving capacity building and dissemination with a good degree of success. Particularly - efforts to establish ‘mutual learning’ through the Commission website toolkits and communication tools as well as the annual Best Projects exercise to share best practice. It is also observed that external and inter-project communication within the programme has improved, e.g. better website and project database, platform meetings, themed brochures and conferences and clustering of projects.

A key ongoing challenge appears to be territorial imbalances relating to uptake. With national allocations deemed ineffective (and having unintended adverse effects on competition within certain Member States), the conclusions from previous evaluations pointed to the need for strengthened capacity building through targeted delivery mechanisms (as established by the capacity building and technical assistance projects in the current programming period) together with greater stakeholder engagement in project design (as established through integrated projects).

Table 31: Overview of issues encountered through previous evaluations

3.2.4.3.    Programme Management

The management arrangements for the LIFE programme have evolved over time as lessons have been learned from previous programming phases. A brief summary of the main issues identified in previous evaluations, and the relevant actions taken to address the problems, are summarised below. The table should not be considered comprehensive as other actions may have been taken which have not been summarised in the relevant reports.

Table 32: Overview of issues encountered through previous evaluations

3.3.    Summary of evaluations of IEE/Horizon 2020 Energy Efficiency

3.3.1.    Evaluation overview

The IEE/Horizon 2020 Energy Efficiency activities and specific sub-sections of them (e.g. building-related projects) have been reviewed in various evaluations. These comprise:

·COWI (2016): Evaluation of the BUILD UP Skills initiative under the Intelligent Energy Europe Programme 2011-2015. Final report.

·Deloitte (2011): Ex-ante evaluation of a successor of the “Intelligent Energy – Europe II” (2007-2013). Final report.

·ICF (2015): Evaluation of building projects under the Intelligent Energy Europe II Programme. Final Report.

·PWC (2016): Evaluation of the Project Development Assistance implemented under the Intelligent Energy Europe. Final Report. Specific contract ENER/C3/2013-426

·Ricardo AEA, CE Delft (2017): Report on the first results of Horizon 2020 on energy efficiency and system integration – Final report. Contract ENER/C3/SER/2015 -659/SI2.729305/2015- 665/SI2.731474

Whereas these studies deal with the individual analysis of the IEE/Horizon 2020 Energy Efficiency, their overall macroeconomic effect is often not clearly addressed. In order to close this gap, the overall evaluations of reaching the overall EU sustainable energy goals, notably, the 30% energy efficiency objective in 2030 can serve to identify investment needs as well as economic, social and environmental impacts. These evaluations comprise:

·Impact Assessment for the Proposal for a Directive of the European Parliament and of the Council amending Directive 2012/27/EU on Energy Efficiency. SWD(2016) 405 final

·Impact Assessment for the amendment of the Energy Performance of Buildings Directive, SWD(2016) 414

·Impact Assessment for the recast of the Renewables Directive, SWD(2016) 418

·Ricardo AEA, CE Delft (2016): Study evaluating progress in the implementation of Article 7 of the Energy Efficiency Directive. ENER.C3.dir(2014)3156530

·Energy Efficiency Financial Institutions Group (EEFIG) Final Report, February 2015. https://ec.europa.eu/energy/sites/ener/files/documents/Final%20Report%20EEFIG%20v%209.1%2024022015%20clean%20FINAL%20sent.pdf.

3.3.2.    Major findings addressed by the evaluations and impact assessments

The following table lists the major findings of these evaluations that are relevant for evaluating the different options under this Impact Assessment.

Table 33: Overview of the relevant findings from previous evaluations

ANNEX 4: NEEDS ANALYSIS

Despite numerous benefits brought by EU environmental, clean energy and climate policy, the Union’s 2050 long-term vision – to live well within the planet’s ecological limits, as set out in the 7th Environment Action Programme (7EAP), is far from being achieved. Environmental problems are expected to continue to exist post-2020, as several of the 2020 targets are unlikely to be met, and new problems emerge due to human activities.

4.1.    Environmental problems and needs

The European Environment Agency (EEA) in its State of the Environment 72 and environmental indicator 73 reports provides a comprehensive assessment of the European environment’s state, trends and prospects. Moreover, a recent review of the 7th Environment Action Programme (2017) 74 assessed the progress that had been made with respect to the implementation of environmental and climate policies in Member States. The reviews identified several thematic areas where problems persist with respect to environmental and climate policy implementation, and where they are likely to persist in the near future. A lack of adequate funding has been frequently cited as one of the main reasons for lack of progress in addressing environmental and climate problems.

Environmental problems persist across all principal environmental (or natural capital) components. The most problematic areas that have been identified as requiring action are biodiversity, chemicals and health, water quality and management, waste management, ambient air quality as well as climate change mitigation and adaptation. 75 .

4.2.    Who is affected by unmet environment and climate needs?

A healthy environment is the fundamental prerequisite for humans to survive, their economies to develop, and their communities to thrive. Human activities, however, have led to a global and historically unprecedented transformation of nature that jeopardises their own existence, since the resulted environmental problems and climate change have far-reaching effects on individuals, businesses, civil society, and governments.

·Individuals experience the environmental degradation first and foremost by the increasing health problems that result from, among others, air and water pollution, the use of hazardous substances, and indirect effects of climate change. Moreover, the decreasing productivity of ecosystems adversely affect the meeting of their basic needs and the development of their economic activities. Well-being is also negatively impacted by environmental and climate hazards by, for example, health issues, heatwaves, heavy rainfalls etc that will create a more unfavourable environment for EU citizens to live in. Energy poverty creates a lock-in effect for low-income households who spend a big part of their income on energy costs, where energy efficiency improvements could provide a solution and improve both economic situation and living conditions.

·Businesses depend both on the state of the environment and on the policy and legislation developed to protect it. On the one hand, environmental degradation, resource depletion, climate hazards etc. can alter the internal and external factors of production of goods and services by either disrupting their production process or by increasing its costs. The energy price instability resulting from external (global) factors influencing fossil fuels prices have a negative impact on companies' competitiveness. On the other hand, environmental and sustainable energy policies impose significant changes in the production of goods and services so as to be aligned with the latest developments and standards in the protection of nature, human health, sustainable energy use and climate change mitigation. However, these policies can also be an opportunity for new business to be created, alternative business models to be developed, and

·Civil society as a whole is both majorly affected by the state of the environment and a great driving force for its protection. Firstly, local ecosystems and environmental conditions have always been the base upon which the interaction of people is taking place. This implies that climate change and degraded ecosystems will certainly have an effect on the social fabric of our communities with unknown consequences. Secondly, civil society is increasingly recognized as a key player in environmental protection and a central agent for change. A strong and active local community can ensure accountability, sustainable natural resource governance, environmental protection, and inclusive economic growth. Thus, empowering civil society helps governments to obtain effective and democratic policy-making and is critical to achieve sustainable development.

·Finally, in an increasingly globalized and interlinked world, governments are required to enhance their role in the protection of environment and act against the high-level problems that modern societies face. New evidence on the state of the environment and climate should be incorporated in every level of policy-making and in every sector. They are responsible for the development, implementation and enforcement of environmental clean energy and climate change regulation that addresses current and future problems.

4.3.    The need to address the drivers of environmental and climate problems

There are several drivers of the aforementioned current and persistent environmental problems. These drivers (or failures) may be at the level of individuals and communities and/or at the overarching level of the market policy, or institutions. These failures highlight the need for public intervention through for example policy/regulation or programmes such as LIFE, to support a transformation of society. Environmental problems are driven by several market and institutional failures, for example:

·Public goods failure: A diverse and healthy nature and good environmental status are considered as public goods since their preservation benefits all, while without intervention the costs of preserving them would be borne unequally only by some. Without public intervention such as policy, legislation or financial incentives, there would be no incentive to preserve and protect the environment and uncontrolled access to and exploitation of public environmental resources would take place in favour of economic gains, regardless of the principles of a circular economy that reconciles both objectives.

·Imperfect information: Insufficiency or asymmetric distribution of comprehensive information on environmental degradation and climate change impacts leads to behavioural bias through incorrect signals. With respect to nature, biodiversity and climate change in particular, the long run timing of many impacts means that the full consequences of individual or market-driven actions are not appreciable today. Another application of imperfect information refers to the challenge of implementing public interventions where net emissions of polluters are difficult to efficiently monitor (making it impossible to effectively implement emission charges and/or controls).

·Negative externalities: Unintended negative impacts of production and consumption practices that are not fully priced into the market. This lack of pricing results in the inability of the market to value the full social and economic benefits of a healthy environment. Pollution is again a good example here, where the health and biodiversity costs of air and plastic waste pollution are not taken into consideration in the production/consumption process despite circular economy models which provide solution to reduce them.

·Government, institutional, regulatory or policy failure: Although subtle differences exist across these terms, overall this failure refers to the imperfect nature of intervention by governance actors. In the case of variable/weak regulatory regimes, with poor enforcement or non-uniform implementation of rules at the Member State level, market actors may be more likely to pollute the environment or damage nature and environmental resources. This type of failure can be avoided at the EU-level by ensuring strong and coordinated policy action, with effective monitoring and enforcement. It can also be addressed by increasing support to virtuous behaviours that reduce the use of environmental resources while providing economic growth.

·Eco-innovation failure: By failing to assign an economic value to environmental costs and benefits, the market system also fails to fully incentivise or reward innovative ideas for reducing environmental and climate change impacts. Tailored regulation and policy-driven incentives can drive eco-innovation forward, for example through grant systems awarded for specific types of research. However, there is a fine line between stimulating and stifling the eco-innovation sector through regulation and policy and a careful balance is needed.

·Societal failure: The lack of societal acceptance of the need to change behaviour, reduce consumption and/or improve sustainability. This is particularly visible in cases where financial or welfare gains are dominant in producer and consumer choices. The growth in the aviation sector, with associated increase in emissions, presents an example of the divergence between societal and environmental needs, illustrating a dilemma for policy-makers.

·Infrastructure lock-in and investment failure

There are multiple ways of addressing the identified environmental problems and needs as well as failures. These include creating incentives for a transformative change by:

·enacting policies and legislation, mainstreaming of environmental, clean energy and climate considerations into other policies – primarily tackling market, regulatory and institutional failures, but can have behavioural impacts as well;

·raising public awareness and information – primarily tackling information asymmetry, cultural and societal failures;

·providing economic and financial incentives by market-based instruments and funding programmes, mainstreaming environmental and climate considerations into other funding programmes – primarily solving public goods and negative externalities failures but also other failures;

·providing direct financial support to the preservation or restoration public goods, such as nature and biodiversity, where this support cannot be provided through market based mechanisms or other funding programmes.

More has to be done to ensure that EU policies consistently incorporate environmental clean energy and climate objectives and/or consistently contribute to the implementation of EU environmental, clean energy and climate policy and legislation.

Lack of adequate and targeted funding, and insufficient mainstreaming of environmental, clean energy and climate objectives into other programmes and policies have been identified as two of the main reasons for a lack of sufficient progress on environmental, clean energy and climate policy implementation in the EU. Given the market and institutional failures mentioned above, the necessary funding is not forthcoming within the market system and requires public intervention.

With regard to mainstreaming of climate objectives into EU policy and spending, a recent review 76 highlighted difficulties in ensuring effective climate mainstreaming in some programme areas, as well as a lack of a widespread understanding among policymakers of potential for mainstreaming climate in programmes or projects.

With regard to mainstreaming of environmental and climate objectives and biodiversity, a recent report of the Court of Auditors 77 highlighted that the majority of EU funding for biodiversity and the Natura 2000 network has been made available by integrating biodiversity goals into various existing EU funds or instruments. However, most of the instruments are primarily targeted on delivering the EU goals on rural, regional, infrastructural, social and scientific development. While this allows the integration of biodiversity into broader rural and regional contexts, it also makes the availability of funding dependent on the overall goals and mechanisms of the given funding instruments 78 . As underlined in another recent special report, the funds made available are not sufficient and do not effectively target the achievement of the EU’s biodiversity targets 79 .

LIFE plays a special role in supporting the implementation of the Nature Directives, the estimated funding under LIFE to support biodiversity and nature in 2007-2013 was around EUR 750–837m (around EUR 107–120m/ year, actual and planned allocations respectively). This represented around 35-39% of the total LIFE+ budget. In comparison, for the 2014-2017 funding period, the estimated planned LIFE contribution to biodiversity and nature will be around EUR 610m (around EUR 153m/ year. This represents only 2.6% of Natura 2000 funding requirements alone, and LIFE also supports nature and biodiversity outside the Natura 2000 network. In general, LIFE funding represents less than 1% of the total EU budget. 80 In spite of its small size LIFE fund has been of crucial importance for implementation of EU nature legislation and Natura 2000 in particular. Target LIFE projects have led to substantial improvement of the conservation status of a number of threatened habitat and species, have had catalytic effect by mobilising other funds for nature (particularly through integrated projects) and have tested a number of methods and approaches which later were replicated with great success in management of the Natura 2000 sites.

This shows that effective mainstreaming is essential but is not sufficient to solve the environmental problems. Targeted environmental, clean energy and climate funding is needed to address the additional financing needs but also to provide a catalytic effect to support relevant policy implementation and altogether more sustainable production and consumption behaviours. However, targeted funding programmes will only reach their full potential if complemented by appropriate mainstreaming.

As a result, both environmental and climate mainstreaming as well as targeted funding, such as the ones of the LIFE Programme, would be needed to adequately address the EU's environmental problems and failures.

Reporting:

The Fitness Check on Environmental Reporting and Monitoring (SWD(2017)230 and supporting study1) looked, amongst other issues, at the effectiveness and efficiency of the current approaches to data management. This uncovered a number of cross-cutting issues which are relevant to financing needs.

·The current LIFE Regulation covers a large part of the legally required operations related to environmental reporting. On one hand, the EEA is financed by LIFE+ and has estimated that it uses €4.5 mio annually to support DG ENV on legislative reporting. This does not include staff costs but operational costs. In addition, DG ENV spent between €4-€7 mio (2014-2016) annually from its LIFE operational budget to outsource reporting-related activities to address all those legally required actions that allow the Commission to exercise its duties of “Guardian of the Treaty” (in other words, to assess Member State implementation of EU environmental laws and report the results to the European Parliament and the Council).  These outsourced activities are mainly procurements with consultants or administrative arrangements with the JRC. There are also some few reporting activities related to chemicals legislation where ECHA is providing those services but no budgetary estimated was made. Finally, the Commission’s IT budget is covering a small part of these activities and the services are executed by Unit ENV A4. 

·The type of activities of all these actors related to reporting are all very similar. They execute several steps of the date management chain, namely:

ocollect and store information and data provided by the Member States

oquality assurance and control of the data

oput together the national data into a new, consolidate European datasets

oanalyze, assess and interpret the data and information

oprepare data products such as maps, statistics, dashboards, textual summaries, etc. 

·It is therefore apparent that:

oThe data management is highly fragmented and diverse.

oThe overall approach is highly inefficient. On average, the time between the moment that Member States are supposed to report the data and the Commission preparing its report to the EU institutions is 630 days. The best practices (all carried out by the EEA) are below half a year (180 days), the worst is more than 1200 days.

oThe EEA has been demonstrated as being generally more efficient and effective in reported data management.

oThe effectiveness of the data management can be improved significantly by reducing the textual information, increase the use of indicators, standardize data management procedures and allow for synergies, interoperability and coherent approaches between the different data management actors. This would involve to use more modern and standardized IT solutions. Through this, the quality of the products can be improved whilst saving time and money.

oCurrently the approaches, in particular from outsourcing to consultants, create a diversity of solutions and products and do not offer sustainability and continuity. The hosting of data products (such as databases or map viewers) is open done through the contracts. When these contracts run out, the products are either not hosted or maintained anymore or there is a indefinite need for having follow up contracts to cover such costs. This is not an effective use of the LIFE operational budget.  

All the above evidence is based on the Reporting Fitness Check and therefore relates to data management that is required in 58 pieces of environmental legislation (and 181 reporting obligations). However, the issues are similar and can be extrapolated to wider environmental data management, e.g. related to policies (where no legislation exists) such as circular economy, forestry, soil, etc. or evidence-based products which do not rely only on reported data such as the EEA’s SOER, the DG ENV’s EIR or any evaluation or impact assessment, and by analogy to climate needs. Therefore, LIFE financing is needed to support a coherent approach to evidence gathering, data management and processing in the areas of environment and climate.

Knowledge gaps and support for Eco-Innovation:

Back in 2013, the 7th Environmental Action Programme already stressed the importance of taking further steps to maintain and strengthen our knowledge and evidence base in order to ensure that policy in the Union continues to draw on a sound understanding of the state of the environment, possible response options and their consequences. The recent (draft) evaluation of this programme 81 has however revealed that significant knowledge gaps  remain in a number of environmental issues, for example on environmental thresholds (tipping points), the circular economy paradigm, the combined effects of chemicals, nano-materials, hazard identification methods, the impacts of micro plastics, and the interaction between systemic risks and other health determinants.

There is a need to develop an ecosystem for eco-innovation that supports the transition to a low carbon and circular economy as well as a better implementation of environmental legislation by building on the strengths of the sector – namely the local collaboration among administration, citizen and entrepreneurs. The most promising approach to build upon is provided by the European Institute of Technology (EIT) in the Climate-KIC and KIC-Inno Energy.

Innovation prices – as piloted in Horizon2020 and likely foreseen for continuation in future – could develop into a particularly interesting tool of specific interest for encouraging collaborative innovation among administration, citizen and entrepreneur.

4.4.    Sector-specific Needs

Concerning the specific needs by sector, a summary of the key environmental problems inside the EU and some of their investment needs is presented in the table below; it should be noted that there is no comprehensive information available about the total needs for most environmental sectors.

Table 41: Summary of environmental energy and climate problems and needs

4.5.    Needs for LIFE Strategic Integrated projects:

Whereas the previous section outlined the overall needs for environmental financing, from LIFE and other sources, a specific analysis was carried out concerning the needs for LIFE Strategic Integrated projects under the next MFF. This analysis takes into account the experience, to date, of the initial piloting of integrated projects under the present LIFE programme.

At present, LIFE finances integrated projects in four areas, on a pilot basis. By the end of the current programme, it is expected that about 60-70 integrated projects will be financed for these four areas. An assessment of these areas demonstrates the added value of the present projects as well as the scale needed for a significant impact on the target policy areas.

Table 42: Existing indicative areas

SIPs could also play a similar role in more policy areas than the four that are targeted under the current programme. Similar to the above table the needed scale of SIPs for new indicative areas is assessed in view of the identified challenges. This analysis shows that in view of the challenges related to the new indicative areas around 70 additional SIPs would be needed.

Table 43: New indicative areas

4.6.    Conclusions

From the above, it becomes evident that SIPs have already managed to mobilize resources to achieve the LIFE Programme’s objectives and to address the identified challenges. The table also suggest that, in order to address all the identified challenges through the generation of a critical mass of projects, allocations to SIPs should be scaled up by at least four-fold.

.

ANNEX 5:    DESCRIPTION OF THE PRESENT LIFE PROGRAMME AND THE BUSINESS AS USUAL (BAU) SCENARIO

The baseline scenario for this report is 'business as usual' based on a continuation of the existing LIFE programme. The main body of this report presents the net expected impact of deviations from this baseline. The purpose of this annex is to describe the existing programme and to identify the key environmental, economic and social outcomes and impacts of the LIFE programme according to this business as usual (BAU) scenario.

5.1.    Overview of the LIFE Programme since 1992

The LIFE Programme is the EU’s funding instrument for environment and climate action. Since 1992, there have been four complete phases of the LIFE Programme: LIFE I (1992-1995), LIFE II(1996-1999), LIFE III (2000-2006), and LIFE+ (2007-2013). The current LIFE Programme began in 2014 and will run up until 2020.

During the first four phases (1992-2013), LIFE co-financed 3954 projects across the EU, contributing approximately €3.1 billion to the protection of the environment. 114 Under the present programme to date, LIFE has co-financed more than 400 projects addressing environment- and climate-related issues. A number of audit reports and evaluations have highlighted the strengths and weaknesses of past phases. Some examples of the achievements during the first four phases of LIFE include: improved conservation and restoration of some 4.7 million hectares of land; higher air quality for some 12 million people; waste prevention of around 300,000 tonnes; and annual CO2 emissions reduced by 1.13 million tonnes. 115  

The LIFE programme has evolved through its phases to reflect the lessons drawn from its implementation and to adapt to the ever-changing policy environment. One of the main lessons from the two decades of LIFE programmes is that for the environment (and for climate action), specific approaches are required which can tackle the uneven integration of objectives into Member States’ practices, the uneven and inadequate implementation of relevant legislation in Member States, and the insufficient dissemination of information about, and promotion of, policy goals. LIFE has consistently focussed on achieving a substantial impact, close synergies with EU other programmes and a high EU added value.

5.2.    LIFE 2014 – 2020

5.2.1.    Programme scope and structure

The LIFE Programme has the following general objectives:

(a)to contribute to the shift towards a resource-efficient, low- carbon and climate- resilient economy, to the protection and improvement of the quality of the environment and to halting and reversing biodiversity loss, including the support of the Natura 2000 network and tackling the degradation of ecosystems;

(b)to improve the development, implementation and enforcement of Union environmental and climate policy and legislation, and to act as a catalyst for, and promote, the integration and mainstreaming of environmental and climate objectives into other Union policies and public and private sector practice, including by increasing the public and private sector's capacity;

(c)to support better environmental and climate governance at all levels, including better involvement of civil society, NGOs and local actors;  

(d)to support the implementation of the 7th Environment Action Programme.

In pursuing those objectives, the LIFE Programme aims to contribute to sustainable development and to the achievement of the objectives and targets of the Europe 2020 Strategy and of relevant Union environment and climate strategies and plans.

Figure 51: The intervention logic of the current LIFE Programme

LIFE is meant to act as a catalyst, providing leverage that promotes changes in the development and implementation of environmental and climate policies, among others by offering a platform for exchanging best practices and knowledge-sharing.

The LIFE programme is comprised of two sub-programmes, one for Environment and a second for Climate Change.

The Climate Action subprogramme, with €864 million (25% of the total budget), targets climate change mitigation, climate change adaptation, and Climate Governance and Information. The Environment sub-programme, with €2593 million (75% of the total budget) targets the priority areas of Environment and Resource Efficiency, Nature and Biodiversity, and Environmental Governance and Information; under the Environment programme, thematic priorities are established for each priority area in an annex to the Regulation, and for each thematic priority, project topics (which are favoured in the project selection process) are established through a delegated act.

The Intervention logic of the present LIFE programme is illustrated in Figure 5-1

The two sub-programmes of LIFE use the same delivery mechanisms to mobilise LIFE funding. These delivery mechanisms are described in Table 5-2.

Table 52: Types of projects and activities by delivery mechanism and their key features

5.2.2.    LIFE Programme Uptake between 2014 and 2016

A total of 344 projects were awarded funding under the LIFE budget programme between 2014 and 2016. Although the main delivery mechanism to award this funding is the 'traditional' standard action grant; as illustrated below, both in terms of the number of projects awarded and the volume of EU contribution, the integrated projects have played a substantial role in terms of mobilisation of funding for environmental and climate objectives (see the table below).

Table 53: Overview of LIFE integrated projects and complementary sources of financing (2014-2016)

The number of SIPs supported is expected to increase in line with their intended use for the 2014-2020 programming period.

Capacity building projects and preparatory projects account for the smallest share in terms of both budgetary and project numbers behind support for governance and information and operating grants.

Figure 54: EU28 overview of LIFE expenditure and number of projects supported by delivery mechanism (2014-2016) 

Source: LIFE Projects Database

In the same period, the first phase of financial instruments was underway (2014-2017). The total planned EU allocation for this first phase was €30 million for the NCFF; however, uptake was slow initially. Following increased efforts to expand the pipeline, there were three projects signed by mid-March 2018, and more projects in the pipeline (see www.eib.org/ncff ). Going forwards, the NCFF is intending to execute between 3 to 4 projects a year. For the PF4EE, 4 operations were signed off at the end of 2016 with €14.1 million committed from the LIFE budget programme (with a total €80 million planned for the first phase). The PF4EE was intending to execute 10 projects in the first phase of financial instruments under LIFE.

By project theme, the greatest number of projects is awarded to biodiversity and nature, followed by resource efficiency and waste. The smallest number of projects are awarded to air quality and emissions; while for all other environmental and climate themes, the number of projects awarded is fairly similar. Note that project themes are reported by the LIFE Projects Database and do not correlate exclusively to the corresponding thematic priority.

Within 'traditional' standard action grants the most significant sub-programme is Environment (relating primarily to environment across multiple themes, and to a lesser extent nature which is mainly supporting projects relating to biodiversity and nature). Climate change adaptation and mitigation comprise a much smaller share of the total 'traditional' standard action grants awarded and were typically found to contribute to fewer multi-objective projects.

SIPs are contributing to air quality and emission reduction, climate action, nature, water and waste (including one which considers waste and the circular economy). This is aligned with the indicative areas set by the LIFE Regulation.

Operating grants were found to be supporting a higher share of climate change projects compared to other delivery mechanisms (almost 50%).

Financial instruments are targeted to energy efficiency and natural capital (including biodiversity, nature and climate change adaptation projects).

Figure 5-5: EU28 overview of awarded projects by theme and delivery mechanism (2014-2016)

Source: LIFE Projects Database

Figure 5-6: EU28 overview of awarded 'traditional' standard action grants by sub-programme and according to themes (2014-2016)

Source: LIFE Projects Database

Concerning beneficiary type, 'traditional' standard action grants are awarded to a relatively even split of beneficiary groupings (with competent authorities, NGOs, private sector, and research accounting for ~25%, respectively). It is interesting to observe that private sector and research bodies are key beneficiary groupings. Integrated projects are awarded primarily to competent authorities (~80%); together with NGOs (~15%) and research bodies (~5%). As to be expected, NGOs are the sole beneficiary awarded operating grants. They are also awarded a significant share of preparatory projects and governance and information projects (the latter via 'traditional' standard action grants); again, as these delivery mechanisms support capacity building type activities, it is to be expected that NGOs will form a key beneficiary.

The slow uptake of financial instruments in their first phase makes it difficult to determine any trend in beneficiary groupings; however, the NCFF has thus far received applications led mainly NGO and non-profits while the PF4EE has received applications led by the private sector.

Figure 5-7: EU28 overview of LIFE number of projects awarded by type of beneficiary (2014-2016)

Note: Blue denotes competent authorities; orange, NGOs; yellow, research bodies; and green, private sector.

   Source: LIFE Projects Database

According to the mid-term evaluation, from 2014 to 2016, more than a third of the financed LIFE projects have a co-ordinating beneficiary situated in Spain and Italy, moreover, no projects were awarded to Luxembourg. The share of project proposals received from beneficiaries from Italy and Spain is even higher and the success rate in these countries is below average. However, the strong concentration of project proposals from two Member States and the absence of project proposals from beneficiaries in other Member States indicate that the accessibility to the LIFE Programme is unequal.

There is evidence that a few Member States (Poland, Portugal and Greece) which previously had a below average adsorption rate of LIFE funding have now increased their rate to be above the EU average, which is indicative of a trend towards improved territorial balance between Member States.

Figure 5-8: EU28 overview of LIFE expenditure and number of projects supported by Member State (2014-2016)

Note: No projects awarded to Luxembourg between 2014 and 2016

Source: LIFE Projects Database

The uptake of financial instruments is limited to a handful of Member States owing to the slow uptake.

5.2.3.    Management of the Programme

The European Commission (DG Environment and DG Climate Action) is responsible for the Programme. On the operational level, most of the LIFE programme is directly managed and implemented by the Executive Agency for Small and Medium-sized Enterprises (EASME). At the strategic level, DG Environment and DG CLIMA both remain involved in the management of each respective sub-component 117 . Specifically, DG Environment and DG CLIMA are responsible for the following activities:

·Preparing the multi-annual work programme;

·Managing the LIFE committee;

·Supervision of EASME for each sub-component;

·Defining eligibility, selection and award criteria for implementation of calls;

·Definition of activities necessary to ensure smooth and effective integration of the programme results into policy (programme-policy integration);

·Definition of communication strategy;

·Reporting on implementation to the Council and to the EP; and,

·Policy development based on project results.

The main activities of EASME for both sub-programmes include:

·Implementation of calls, including drafting terms of reference, evaluating proposals, awarding grants and analysis of final reports;

·Ex-post monitoring, including financial ex-post audit and technical ex-post monitoring;

·Implementation of communication activities;

·Follow up of audits; and,

·Development and maintenance of IT applications.

External organisations are also contracted to assist the Commission and EASME with the delivery of some of the programmes’ activities, including project selection, monitoring and communication.

The European Investment Bank (EIB) manages the two financial instruments (PF4EE and NCFF) associated with the programme.

The decision to outsource programme management to EASME was taken on the following grounds 118 :

1.To allow the Commission to focus on policy making in view of the development, implementation and enforcement of Union environmental and climate policy and legislation and to catalyse and promote integration and mainstreaming of environmental and climate objectives into other Union policies and practices.

2.Considering the high degree of complementarity across programmes, delegation to EASME facilitates the practical development of synergy and coordination between the sub-programme for Environment and the one for Climate Action and with Horizon 2020, as envisaged by the Life Regulation.

3.Since EASME is focused exclusively on project management rather than a wider range of activities this increases the potential for identification of efficiency gains and simplification opportunities.

Public procurement is most managed by DGs ENV and CLIMA directly and is found to add substantial value to LIFE. The procurement includes:

·studies producing evidence for policy making incl. Impact Assessments

·activities directly supporting the implementation of legislation and policy instruments

·communication/ dissemination activity (including platforms, helpdesks, secretariats)

·ex-post evaluation or REFIT

·translation interpretation Technology/ IT assistance.

With respect to the overall management structure, the MTE found that the overall costs for the management of the LIFE programme were relatively low, for example they were perceived to have decreased compared to previous Programme periods. The MTE estimated that the total economic cost for EASME and NEEMO of implementing and running the whole programme for the period 2014-2017 was €82m (3.6% of the managed budget for the period of €2.3bn), with €8.2m savings having been realised through outsourcing specific activities to EASME.

Currently, according to the EASME Annual Work Program for 2017, the operating budget for EASME is €4.6m, with an additional €0.71 budget for management and administrative support, making a total budget of €5.3m. This figure covers staff related costs (Title 1), overhead costs (Title 2) and programme support expenditure/ other costs (Title 3) budget for LIFE. This does not include EC costs.

5.2.4.    Monitoring of the Programme

Developed in 2016, the LIFE Project Indicators Database 119 contains information concerning all LIFE projects financed by grants starting in 2015, as well as certain projects from the 2007-2013 programme. The contents of this database are based on self-reporting from the project beneficiaries, which is checked by the LIFE programme monitors and then validate by the operational desk officer in EASME. Although aggregated data should be treated with caution due to differences in assumptions, they can be used in some cases to produce programme impact indicators. Programme output indicators are derived from financial reporting.

5.3.    Methodology for Assessing the Impact of LIFE under the Business as Usual Scenario

The assessment of the impact of LIFE under the business as usual scenario is based on the following assumptions:

·Scale and scope of mechanisms:

oThe volume of EU expenditure and number of awarded projects are similar to those from the 2014-2016 period. (It should be noted that SIPs, capacity building projects and financial instruments were newly introduced in the current programming period so the scale at which they are used between 2014 and 2016 is limited compared to their intended use.)

o'traditional' standard action grants: continue to be the prevalent delivery mechanism.

oIntegrated projects (strategic integrated projects, SIPs): continue to be the second most significant delivery mechanism in terms of budgetary volume; supporting comparatively few projects in relation to 'traditional' standard action grants but the scale of their use will be greater as they become more established.

oPreparatory projects: continue to support targeted needs, representing a minor share of LIFE projects and spending.

oGovernance and information activities: continue to play supporting role (accounting for ~10% of projects in terms of numbers and spend).

oCapacity building projects: continue to support targeted Member States, representing a minor share of LIFE projects and spending 120 .

oOperating grants: continue to play supporting role (accounting for ~10% of projects in terms of numbers and spend).

oFinancial instruments: will become a more prominent delivery mechanism in their second phase, albeit still playing a supporting role.

·Average EU contribution per project according to the various delivery mechanisms:

o'traditional' standard action grants: €2.5 million (and €1.6 million for governance and information activities within this delivery mechanism)

oIntegrated projects (strategic integrated projects, SIPs): €10.2 million

oPreparatory projects: 0.5 million

oCapacity building projects: €0.7 million

oOperating grants: €2.9 million

oFinancial instruments: insufficient uptake to generate an average

·Project themes:

o'traditional' standard action grants: (including governance and information activities): continue to be awarded across all thematic priorities, contributing to multiple priorities where relevant. A larger share of projects will be awarded under the Environment and Nature sub-programmes (54% and 28%, respectively) compared to climate change (10% and 9% for adaptation and mitigation, respectively).

oIntegrated projects (strategic integrated projects, SIPs): continue to target waste, water, nature, air and climate action.

oPreparatory projects: continue to support a range of thematic priorities, on a needs basis.

oCapacity building projects: continue to support untargeted to thematic priorities.

oOperating grants: continue to support a range of thematic priorities with an even split between the environment and climate change sub-programmes.

oFinancial instruments: continue to target energy efficiency and natural capital (including biodiversity, nature and climate change adaptation).

·Beneficiary type per project according to the various delivery mechanisms:

o'traditional' standard action grants: continue to be awarded to an even mix of beneficiary groupings (competent authorities, NGOs, private sector, and research. Within 'traditional' standard action grants, governance and information activities continue to support NGOs primarily, and private sector, competent authorities and research bodies to a lesser extent.

oIntegrated projects (strategic integrated projects, SIPs): continue to be primarily awarded to competent authorities, with support from NGOs and research bodies.

oPreparatory projects: continue to support NGOs primarily, and competent authorities and research bodies to a lesser extent.

oCapacity building projects: continue to support competent authorities.

oOperating grants: continue to support NGOs, only.

oFinancial instruments: the NCFF will continue to support projects led mainly NGO and non-profits while the PF4EE will continue to support projects mainly led by the private sector.

·The territorial balance would be similar to that occurring during the period 2014 to 2016 with a minimum of 6 to 8 projects per year per Member State

The impact of the individual projects was based on data available in the LIFE Indicator Database for a selected number of indicators and projects during 2014 and 2015. (Later data was not broadly available at the time of conducting this analysis.) Project details supported by financial instruments under the LIFE budget programme are gathered from the MTE and other sources. Procurement contracts are not considered in the analysis as they are not expected to have a significant environmental, economic or social impact. Where relevant, additional data sources have been used to fill gaps or provide context. It should be stressed that the data should not be treated as comprehensive for a programming period but rather indicative of main trends.

The indicators selected for analysis are set out in the following table:

Table 59: Selected indicators from the LIFE Indicator Database used to assess environmental and social impacts

Source: European Commission (2017) 121

The main metrics used for each of the indicators include the intended improvement achieved during the lifetime of the project, and beyond it. (Note that since the projects are still underway, only the 'intended' improvement is known; the actual improvement can only be measured after the end of the project.) The improvement beyond the project duration and/or area is intended to reflect the sustainability of the effects, as well as the catalytic effect e.g. further scaling up activities. Another metric is the intended persons affected or influenced by the project. This is also reported both for the lifetime of the project and beyond it.

The metrics described above vary considerably between projects. There are several reasons for this, not least the baseline and units used can vary, along with the timeframe considered. As such, it is not possible to aggregate the results and impacts reported; rather the data is used to ascertain the ratio of intended improvements, comparing between the intended impact during the lifetime of a project and the period beyond it.

On this basis, the environmental and social impacts were determined. The economic impacts are derived from data provided by EASME, as the main management body for LIFE. Aggregated results and impacts are included where derived as part of the MTE and details concerning their methodology are set out in the MTE.

It should be noted that financial instruments are not included in the LIFE Projects Database. The EU contribution to these projects should also be treated differently to the action and operating grants as they comprise mainly debt and equity instruments.

5.3.1.    Environmental Impacts of the Business as Usual Scenario

Environmental impacts can be determined at project level where a direct chain of causality between the project intervention and the impact can be established, i.e. where the outcome has a direct environmental impact. Difficulties also arise when determining impacts beyond a project – where the LIFE project is no longer the sole factor influencing the impact.

Where the project intervention is one of several factors influencing an environmental impact, it is not possible to quantify the impact of the LIFE project alone, i.e. where the outcome facilitates another outcome which may have a direct environmental impact. Thus, environmental impacts are more generally limited to LIFE projects supporting action on the ground and do not reflect the impact arising as a result of improved capacity or project replicability. Where environmental impacts can be monitored, difficulties then arise when aggregating these impacts at programme level, as outlined previously. Thus, environmental impacts are discussed in aggregate form in relation to their broad trends, and where relevant, illustrative examples are included to give an indication of environmental impacts.

The following sections present the environmental impacts reported by thematic priority for the current programming period, i.e. where a project is explicitly addressing a thematic priority identified in the MAWP (which is not always the case). For each thematic priority a series of corresponding targets were developed for the MAWP. Progress against these targets was reported in the MTE and is summarised here, where available.

5.3.1.1.    Environmental impacts - sub-programme for Environment

A. Air quality and emissions

Programme Level:

For air quality and emission reductions the MTE reported a total of 3 projects explicitly within this thematic priority; there are another 22 projects within other thematic priorities which are also contributing to air quality and emission reduction.

Progress towards targets is positive against many of the MAWP targets set for air quality and emissions as shown below.

Table 510: Progress towards air quality and emission reduction targets (2014-2015)

Source: MTE

At a programme level, the environmental impacts were aggregated for selected pollutants – as illustrated below. The impacts relate to improvements in pollutant concentrations and/ or reductions in emissions, comparing the beginning of a project to its end. Emission reductions were more commonly reported than improvements to air quality; and only two projects reported impacts relating to deposition. NOx and particulate matter are the most common pollutants impacted by LIFE projects, both being key pollutants at an EU level for air quality improvements (NO2) and emission reductions, and particularly relevant to the transport sector. For air quality, the impacts reported relate to 3 of the 12 pollutants with air quality standards. Despite this comparatively low pollutant coverage, the fact that the projects improve air quality with respect to NO2 and PM2.5 and PM10 is important as these are the most challenging pollutants at EU level with respect to air quality.

Table 511: Projected impacts concerning air quality and emissions (2014-2015)

Source: MTE

The sectoral split of air quality improvements and emission reductions, as reported in the MTE, indicates that both transport and industry (comprising energy, landfills and production) are well targeted by LIFE projects, supporting a shift towards a more sustainable mobility system and energy/ production system. However, agriculture is less well targeted.

Among the indicators used for air quality and emissions, the ones discussed in the following sections include the emissions to air only (indicator 6.1).

Note that air emission environmental objectives are not among the themes targeted by FIs in the current programming period.

'traditional' standard action grants:

'traditional' standard action grants support 14 projects contributing to emission reductions (in relation to the following pollutants: VOC, CH4, NH3, SO2/SOx, particulate matter (PM), NO2/NOX). The grants were awarded across the Environment (10), Nature (1) and Climate Change Mitigation (CCM) (3) sub-programmes.

The average co-financing rate for these projects was 55% (owing to a low average reported for those under the Environment sub-programme of 53%). The projects are awarded across 4 EU15 Member States with a majority in Italy (8).

Across all the sub-programme areas, the extent of improvement achieved through the project is larger beyond the project lifetime compared to during it (at a ratio of ~0.7:1). Whereas the extent of humans influenced or benefiting from the projects is the same between the two project phases.

In terms of outreach, of the projects reporting the environmental impacts described above, the following impacts were also reported:

·Stakeholder engagement (indicator 10.2; involvement of non-governmental organisations (NGOs) and other stakeholders in project activities): 2 projects (all within the CCM sub-programme).

·Website use (indicator 11.1): 5 projects (within the Environment and CCM sub-programmes).

·Networking (indicator 12.1): 5 projects (within the Environment and CCM sub-programmes); the most common group of individuals involved in networking activities are professionals. The impact of networking in terms of persons influenced is greater during the lifetime of a project compared to beyond it (by a factor of ~3:1).

According to the projects database, 11 projects contribute to air quality and emission reductions; all of which are funded under the Environment sub-programme (with an average co-financing rate of 54%). Thus, it is understood that the lower co-financing rate reported by the indicators database is primarily led by projects under the CCM; moreover, it is observed that there are a number of projects under the thematic priority of air which are not reporting impacts to the indicators database.

In addition, between 2014 and 2015 two governance and information 'traditional' projects were supported with an average co-financing rate of 60%.

The greatest impact is reported for the transboundary project, CLEAN HEAT (operating grant); affecting ~214 million residents across 7 Member States. The project aims to reduce PM caused by wood burning through information awareness. Immediate improvements occur in the lifetime of the project; although improvements in air quality are expected to be ongoing, to a lesser extent (improvements are estimated at ~4:1/ ~5:2 during the lifetime of the project compared to beyond, depending on the Member State).

The accuracy of the impacts quantified for CLEAN AIR is questionable as information awareness relies on uptake which cannot be guaranteed. Other governance and information activities include monitoring and information exchange tools and the impacts are be quantified.

Strategic integrated projects (SIPs):

A total of 2 SIPs were signed for air quality in 2014 and 2015 (in Poland and Italy) with an average co-financing rate of 60%. Neither project reported environmental impacts to the indicators database. In terms of outreach, no reporting was provided by the indicators database for SIPs.

The project will be completed in 2023 and while impacts cannot be quantified a qualitative discussion of the Polish SIP (providing support for the implementation of an Air Quality Plan in the Małopolska region) is included to give an indication of planned environmental impacts. The main area of activity targeted by the AQP, and the SIP, is the combustion of solid fuels in obsolete household boilers. Specifically, the SIP intends to facilitate:

·A reduction of the concentration of PM10, PM2.5 and NO2/ NOX emissions with 34% for the PM and with 26% for the NO2/ NOX emissions.

·Immediate improvements in the lifetime of the project; although improvements in air quality are expected to be ongoing, to a lesser extent (improvements are estimated at ~4:1 during the lifetime of the project compared to beyond)

·Number of persons affected considers residents in the region, which amounts to 3.3 million. (MTE)

·The project has secured a further €798 million for large scale deployment of the plan (sourced primarily from ESIF and the National and Regional Fund for Environmental Protection and Water Management). Thus, for every €1 from LIFE, the project has secured approximately €50.

·Improved design of air quality plans elsewhere, following the approach adopted for the Małopolska region

·Number of persons affected does not consider residents in adjacent areas including the province of Silesia, and regions in Slovakia and the Czech Republic; which will also benefit from improved air quality as a result.

·The project is expected to attract private investment; with additional and ongoing benefits for air quality which are not included in the current estimations

Other:

No capacity building or preparatory projects reported environmental impacts in the programming period reviewed.

B.Biodiversity and Nature

Programme Level:

According to the MTE, 47 projects were awarded in the area of nature and biodiversity. An additional 17 projects awarded were found to also be contributing to nature and biodiversity relevant indicators (amounting to 64 projects reporting biodiversity and nature environmental impacts).

For the 64 projects reporting against biodiversity and nature indicators, the following impacts were planned at the beginning of the projects (MTE):

·Over an area of 1,012,136 ha including 73 ecosystems supporting 237 ecosystem services, almost half of the ecosystem services were assessed as very poor/ poor/ moderate/ deteriorating the beginning of the project; and were expected to improve as a result of the project.

·Of the 167 natural or semi-natural habitats (over an area of 10,878,700 ha) targeted by LIFE projects, 129 were assessed as being less than favourable/ secure conservation status at the beginning of the project; and of these 129, 46% were planned to reach an improved conservation status by the end of the LIFE project.

·Of the 174 wildlife species targeted by LIFE projects, 66% (114 species) were planned to reach an improved conservation status by the end of the LIFE project.

Table 512: Progress towards biodiversity and nature targets (2014+2015)

Source: MTE

Among the indicators used for biodiversity and nature, the ones discussed in the following sections include the area or length of land within a project targeting the improvement of natural/ semi-natural habitats (indicator 7.3) or wildlife species (indicator 7.4) and protection from invasive alien species (indicator 7.5.1).

The only projects reporting against these indicators are supported via 'traditional' standard action grants (62) and SIPs (2). According to the projects database, in addition to 'traditional' standard action grants (as the main delivery mechanism) and integrated projects (environment only), a handful of governance and information projects (4) have also been awarded in relation to this environmental objective.

'traditional' standard action grants:

Between 2014 and 2015, 27 'traditional' standard action grants were reporting against the indicator, improvement of natural/ semi-natural habitats; the majority of which were Nature 'traditional' standard action grants (23). Projects were also supported by the Environment 'traditional' standard action grant (2) and Climate Change Adaptation (2). Note that for this indicator, 'traditional' standard action grants were the only delivery mechanism reporting impacts between 2014 and 2015.

The average co-financing rate for these projects was 62% - with climate change adaptation at the low end of this range (50%) and Nature at the high end (63%). The greatest number of projects are in Italy and Spain which have an average co-financing rate of 60% and 61%, respectively. The highest co-financing rates are reported for projects in new Member States (75%) - with the exception of Poland which has a low co-financing rate of 50% for the 1 project awarded.

Across all the sub-programme areas, the extent of improvement achieved through the project is larger during the project lifetime compared to beyond the lifetime of the project (at a ratio of ~3:1). However, the extent of humans influenced or benefiting from the projects is constant between this time.

Between 2014 and 2015, 27 'traditional' standard action grants were reporting against the indicator, improvement of wildlife species (indicator 7.4); all of which are within the Nature sub-programme.

The average co-financing rate for these projects was 64%. The projects span 15 Member States, with a fairly even split in biophysical terms but a minority based in new Member States (5). The greatest number of projects is in Italy; with an average co-financing rate of 62%. Co-financing rates are generally in the region of 70-75% across Member States - with lower than average rates only reported for projects in Austria, Croatia, Denmark, Germany, Italy, Malta, Spain and the UK.

The extent of improvement achieved through the project is larger during the project lifetime compared to beyond the lifetime of the project (at a ratio of ~2:1). However, the extent of humans influenced or benefiting from the projects is constant between this time.

Comparatively few projects reported impacts concerning invasive alien species (9). The majority of these are 'traditional' standard action grants and follow the same trends as described above for habitats and species, namely: an average co-financing rate of 61%; an average ratio of ~5:1 for improvements in the lifetime of a project compared to beyond; however, the extent of humans influenced or benefiting from the projects is constant between this time..

In terms of outreach, of the projects reporting the environmental impacts described above, the following impacts were also reported:

·Stakeholder engagement (indicator 10.2; involvement of non-governmental organisations (NGOs) and other stakeholders in project activities): 23 projects (all within the Nature sub-programme); NGOs are the main stakeholder engaged in biodiversity and habitat projects (13) with an average co-financing rate of 66%. Public bodies and other civil society organisations were awarded the highest rates of co-financing (75 and 70, respectively).

·Website use (indicator 11.1): 33 projects (within the Environment and Nature sub-programmes, but primarily the latter) with an average co-financing rate of 59 and 63%, respectively. Website traffic is greater during the lifetime of a project compared to beyond it (by a factor of ~2:1).

·Networking (indicator 12.1): 36 projects reported networking activities; the most common group of individuals involved in networking activities include professionals, followed by members of interest groups. The extent of humans influenced or benefiting from the projects is constant for the project duration and the time period beyond it.

In addition, a total of 10 projects were reported in the projects database in relation to governance and information projects for biodiversity and nature with an average co-financing rate of 59% (below the averages reported for 'traditional' standard action grants; but greater than the integrated projects).

Environmental impacts are not reported for these projects.

Strategic integrated project (SIPs):

At the time of the MTE, 3 SIPs for nature and biodiversity had been awarded. Environmental impacts are only reported for 1.

According to the projects database a total of 5 SIPs were awarded between 2014 and 2015, in Belgium, Italy, Germany, Spain and the Netherlands. Of these, 3 provided support to the further development of regional Priority Action Frameworks (PAFs); strengthening the targets set and designing measures to meet the targets and facilitating discussions between different stakeholder groups representing various sectoral concerns; and between different governing bodies. Only a few SIPs provided targeted support to specific habitat types within PAFs, including wetlands and marine habitats; while one was found to target green infrastructure within the Natura 2000 network.

The average co-financing rate for these SIPs is 56%; which is much lower than the other delivery mechanisms contributing to biodiversity and nature objectives.

Of these SIPs, only 1 (in Germany) reported environmental impacts according to the indicators discussed here (with respect to the area or length of land within a project targeting the improvement of wildlife species (indicator 7.4) and protection from invasive alien species (indicator 7.5.1)). Of note, the extent of impacts achieved in terms of the improvement in area are expected to be greater beyond the project lifetime compared to during it (at a ratio of 0.7:1).

In terms of outreach, no reporting was provided by the indicators database for SIPs.

Preparatory projects:

The MTE reported 3 preparatory projects in relation to this delivery mechanism for biodiversity and nature; while only 2 are reported to the projects database for the same time-period (2014-2015), with an average co-financing rate of 60% (below the averages reported for 'traditional' standard action grants; but greater than the integrated projects).

Environmental impacts are not reported for these projects.

Other:

No capacity building projects reported environmental impacts in the programming period reviewed.

The slow uptake of funding via the Natural Capital Financing Facility (NCFF) in first few years of the current programming period has meant that there are few examples of signed projects, and even fewer of monitoring and reporting of environmental impacts.

However, the NCFF has evolved over the past year and starts to show successes. For instance, the first NCFF operation, a € 6 million loan to Rewilding Europe, was signed in April 2017. It will support over 30 nature-focused businesses across Europe. In addition, to the creation and consolidation of nature-based businesses, new nature-related business models will be supported in sectors like forestry, water management, sustainable fisheries and tourism. The agreement is expected to create 250 jobs.

C.Environment and health (including chemicals and noise)

Programme Level:

The MTE reported a total of 17 projects reporting against chemical indicators (7 relating specifically to chemicals and REACH legislation) and 3 projects reporting against noise indicators. In sum:

·Chemicals: 370,000 persons influenced by projects relating to chemicals; of which 240,000 are expected to be influenced in terms of implementing replicable actions during the lifetime of the project. Beyond the project (3-5 years): 1.3 million persons influenced; 1.6 million are expected to be influenced in terms of implementing replicable actions.

·Noise: Planned noise reduction by at least 3 dB for 2 of the 3 projects, influencing 4,319 persons which is expected to increase slightly after 3-5 years.

Table 513: Progress towards environment and health targets (2014+2015)

Source: MTE

Note that environment and health environmental objectives are not among the indicative areas targeted by SIPs or the themes targeted by FIs in the current programming period.

Furthermore, the number of projects contributing to noise is much greater in the projects database although this is because it is grouped together with air quality and emission reductions. Owing to this discrepancy in reporting, no comparison with the projects database is made for this environmental objective. There is no separate reporting for chemicals as this is grouped with industrial production and is more closely aligned with resource efficiency. Of the 41 LIFE projects concerning industrial production, 12 include aspects relating to chemicals.

Among the indicators used for noise, the one discussed in the following sections include the noise level/frequency – terrestrial (indicator 5.2.1).

'traditional' standard action grants:

Environmental impacts are only reported by 4 'traditional' standard action grants under the Environment sub-programmes in Belgium, Spain and Italy (with an average co-financing rate of 56%).

The environmental impact is expected to be greater beyond the lifetime of the project (compared to during it), at a ratio of ~0.4:1; while the number of persons affected or influenced is expected to remain constant.

In terms of outreach, no reporting was provided by the indicators database for these projects.

In addition, a total of 2 governance and information projects reported environmental impacts, 1 relating to energy efficiency and the other to renewable energy. Both projects are based in EU15 Member States and sit within the climate change programme with an average co-financing rate of 60%.

The extent of the impacts in relation to renewable energy are expected to be greater beyond the lifetime of the project (at a ratio of ~0.7:1). The type of renewable energy is not specified by the indicators database. Energy efficiency impacts are only reported in terms of the number of person influenced by the project, which is expected to be greater during the project lifetime compared to beyond it (at a ratio of ~3:1).

The projects database indicates an additional 2 governance and information projects are relevant to the resource efficiency thematic priority. These projects concern industrial production and sit within the environment sub-programme. The average rate of co-financing is lower at 56%.

Other:

No capacity building or preparatory projects reported environmental impacts in the programming period reviewed.

D.Resource efficiency (including soil, forests, and green and circular economy)

Programme Level:

According to the MTE a total of 15 projects directly target resource efficiency between 2014 and 2015; although 51 projects were found to contribute to relevant indicators in the indicators database (with 39 projects contributing to energy efficiency and 24 to achieving a circular economy).

The MTE reports the combined planned impacts of these projects as follows:

·Reduction in energy consumption from electricity [120,000 MWh/year]

·Reduction in energy consumption from methane [500,000 MWh/ year]

·Increase renewable energy production [300,000 MWh/year from unspecified sources; 190,000 MWh/year from biomass; 7 MWh from solar]

·Plan to sustainably manage 1,900 ha of forests, and provide data for 71 forests to the European Data Centre

·Projects covering 344 ha of soil

Progress towards targets is positive against many of the MAWP targets set for resource efficiency as shown below.

Table 5-14: Progress towards resource efficiency targets (2014-2015)

Source: MTE

The following analysis focusses on two of the indicators included in the indicator database, including energy efficiency – energy (indicator 4.1.1) and renewable energy (indicator 4.1.3). Of the two, energy efficiency relating to consumption is the most common indicator used to report the environmental impact of resource efficiency projects.

Note that resource efficiency environmental objectives are not among the indicative areas targeted by SIPs or the themes targeted by FIs in the current programming period.

'traditional' standard action grants:

'traditional' standard action grants are the primary delivery mechanism used by resource efficiency projects (according to the indicators database and the projects database). In relation to energy efficiency, projects are typically funded via the Environment sub-programme (total of 22 and to a lesser extent the climate change mitigation (7). Renewable energy 'traditional' standard action grant projects are funded by the full suite of sub-programmes: Environment (7), Nature (1), Climate Change Adaptation (CCA) (1) and Climate Change Mitigation (CCM) (3).

The average rate of co-financing is comparatively low next to other thematic priorities; and the territorial balance favours EU15 Member States with no projects awarded to new Member States between 2014-2015. Projects under the climate change programmes receive a much lower rate of co-financing (averaging 49% for energy efficiency under CCM; 50% and 58% for renewable energy under CCA and CCM, respectively). For energy efficiency projects, between Member States, the rate is lower still at 32% for a project funded in Sweden and 39% for two projects funded in Belgium. For renewable energy projects the rate of co-financing is more balanced between Member States; albeit still low compared to other thematic priorities.

Under energy efficiency, electricity is the main source of energy targeted by the projects funded (16 under the Environment sub-programme and 3 under CCM). The extent of the impact is on average greater during the lifetime of the project compared to beyond it (at a ratio of ~2:1 for those under the Environment sub-programme and ~5:1 under CCM).

Under renewable energy, the source of energy is largely undefined and only solar and biomass are specified by the indicators database. The extent of the impact and the extent of persons influenced are on average the same during the lifetime of the project compared to the time period beyond it.

The following impacts were also reported in terms of outreach related to these projects reporting environmental impacts:

·Stakeholder engagement (indicator 10.2; involvement of non-governmental organisations (NGOs) and other stakeholders in project activities): 9 projects (across all sub-programmes except CCA).

·Website use (indicator 11.1): 15 projects (across all sub-programmes except CCA). Planned website traffic is greater beyond the lifetime of a project compared to during it (by a factor of ~0.9:1).

·Networking (indicator 12.1): 15 projects reported networking activities; the most common group of individuals involved in networking activities is professionals. The impact of networking in terms of persons influenced is similar during the lifetime of a project compared to beyond it.

The projects database indicates a larger number of projects are contributing to the resource efficiency thematic priority, taking into account a wider range of activities (rather than focussing on energy). By theme, the following observations can be made:

·Energy: 1 project awarded under the Environment sub-programme with a co-financing rate of 58%

·Environmental management: 11 projects awarded under the Environment sub-programme with an average co-financing rate of 58%

·Industry – production: 56 projects awarded across the full scope of sub-programmes (primarily under the Environment sub-programme) with an average co-financing rate of 56%

·Land-use: 21 projects awarded across the full scope of sub-programmes (of which, 19 under the Environment sub-programme) with an average co-financing rate of 54%. The remaining 2 projects fall under the CCA programme and have an average co-financing rate of 38%.

Other:

No capacity building or preparatory projects reported environmental impacts in the programming period reviewed.

E.Waste

Programme Level:

The MTE reports that 16 projects were funded under the waste thematic priority between 2014-2015; and that a total of 30 projects were found to be contributing to relevant indicators. The combined planned impact of indicators of these 30 projects was reported to be 218,275 tonnes/ year in waste prevention and 141,906 tonnes/ year in recycling with impacts covering 43 municipalities and regions. Progress against targets was not reported in the MTE.

The following analysis focusses on one of the indicators included in the indicator database, waste management (indicator 3.1).

Note that waste management environmental objectives are not among the themes targeted by FIs in the current programming period.

'traditional' standard action grants:

'traditional' standard action grants are the main delivery mechanism relating to waste management projects. Of these projects, 40 reported to the indicators database against the waste management indicator between 2014 and 2015. Of these, 34 are supported under the Environment sub-programme, 3 under Nature, 1 under CCA and 2 under CCM. The majority relate to non-hazardous waste management with just 3 concerning hazardous waste management. Across all waste management 'traditional' standard action grants the extent of waste management is much greater during the lifetime of the project compared to beyond (at a ratio of ~10:1). The extent of the persons influenced are on average the same during the lifetime of the project compared to the time period beyond it.

The rate of co-financing is relatively low compared to other thematic priorities (at 57%); the average is brought lower by the 3 hazardous waste management projects (46%). Territorial coverage is limited with projects in EU15 Member States only.

By sector the greatest number of projects are supported in the industry and agriculture sectors (17 and 12 projects, respectively). This followed by household (5), mining (4) and construction (1). The rate of co-financing is greatest for mining projects (average of 59%) while the lowest is for industry and construction (averages of 56%). The relatively large ratio of improvement achieved during the project lifetime compared to beyond is driven by projects in the industry and agriculture sectors (at a ratio of ~15:1 and ~10:1, respectively).

The projects database reports a similar number of projects as the indicators database, with the rate of co-financing also relatively low compared to other thematic priorities (at 55%).

The following impacts were also reported in terms of outreach related to these projects reporting environmental impacts:

·Stakeholder engagement (indicator 10.2; involvement of non-governmental organisations (NGOs) and other stakeholders in project activities): 22 projects (across all sub-programmes except CCM); an equal number of private for profit and NGO represent the main stakeholders engaged (6, respectively) with an average co-financing rate of 50% and 54%, respectively.

·Website use (indicator 11.1): 33 projects (across all sub-programmes). Planned website traffic is expected to be greater during the lifetime of the projects compared to beyond it (at a ratio of ~2:1).

·Networking (indicator 12.1): 38 projects reported networking activities; the most common group of individuals involved in networking activities include members of interest groups. Across all groups of persons, planned activity is expected to be greater during the lifetime of the projects compared to beyond it (at a ratio of ~2:1).

In addition, the projects database reports 6 governance and information within the Environment sub-programme projects relating to waste management between 2014 and 2015 with a co-financing rate of 59%. Of these projects, none report to the indicators database on waste management.

Strategic integrated project (SIPs):

One SIP was awarded between 2014 and 2015 to support with the national waste management plan of Finland with a co-financing rate of 60%. The project supports with the updating of the 2017-2022 plan. It does not report any environmental impact in relation to waste management and in terms of outreach, no reporting was provided by the indicators database for SIPs.

Other:

No capacity building or preparatory projects reported environmental impacts in the programming period reviewed.

F.Water

Programme Level:

According to the MTE, 16 projects targeted water as a thematic priority between 2014 and 2015. Although in total 40 projects reported relevant environmental impacts in the indicators database.

At the time of the MTE, progress towards the MAWP targets was below target but not significantly – as shown below.

Table 5-15: Progress towards water targets (2014-2015)

Source: MTE

The following analysis focusses on two of the indicators included in the indicator database, including terrestrial extent affected by the pressure or risk addressed (indicator 2.1) and aquatic extent affected by the pressure or risk addressed (indicator 2.2).

Note that water environmental objectives are not among the themes targeted by FIs in the current programming period.

'traditional' standard action grants:

A total of 12 projects reported the terrestrial extent affected by the pressure or risk addressed and 16 projects reported the aquatic extent affected by the pressure or risk addressed. These are mainly under the Environment sub-programme (17) and to a lesser extent the CCA sub-programme (5).

For projects reporting the terrestrial extent affected by the pressure or risk addressed, the main pressures targeted include flood protection, diffuse pollution from industry, morphological changes and water quality. The average ratio of improvement during the lifetime of projects compared to beyond it is greater (~5:1); this is primarily due to projects targeting flood protection and diffuse pollution from industry.

For projects reporting the aquatic extent affected by the pressure or risk addressed, the average ratio of improvement is reportedly the same for the time period beyond the project and the lifetime of the project.

For projects reporting the terrestrial extent affected by the pressure or risk addressed, the average co-financing rate is 55%. For projects reporting the aquatic extent affected by the pressure or risk addressed, the average co-financing rate is 56%. Across all projects, there is a greater number of projects in EU15 Member States (5) compared to new Member States (2).

The following impacts were also reported in terms of outreach related to these projects reporting environmental impacts:

·Stakeholder engagement (indicator 10.2; involvement of non-governmental organisations (NGOs) and other stakeholders in project activities): 13 projects (across all sub-programmes except CCM); public bodies are the most common stakeholders engaged across projects (4), followed by an equal number of private for profit and NGOs (3, respectively). Co-financing rates are lowest for the projects involving NGOs (52%)

·Website use (indicator 11.1): 16 projects (across all sub-programmes except CCM). Planned website traffic is expected to be greater beyond the lifetime of the projects compared to during them (at a ratio of ~2:1).

·Networking (indicator 12.1): 38 projects reported networking activities across all groups of stakeholders at a relatively even split. The extent of networking activity is greater during the lifetime of a project compared to beyond it (at a ratio of ~2:1).

A much greater number of projects are reported by the projects database in relation to the water thematic priority (35 under the Environment and Nature sub-programmes) and with a slightly higher co-financing rate comparatively (58%).