Opinion on the proposal for a regulation amending Regulations (EU) 2021/1058 and (EU) 2021/1056 as regards specific measures to address strategic challenges in the context of the mid-term review (2025/0084(COD))

5.6.2025

Mr Dragoş Benea

Chair

Committee on Regional Development

BRUSSELS

Subject: Opinion on the proposal for a regulation amending Regulations (EU) 2021/1058 and (EU) 2021/1056 as regards specific measures to address strategic challenges in the context of the mid-term review (2025/0084(COD))

(2025/0084(COD))

Dear Mr Benea,

Under the procedure referred to above, the Committee on the Environment, Climate and Food Safety has been asked to submit an opinion to your committee. At its coordinators meeting of 23 April 2025, the committee decided to send the opinion in the form of a letter. It adopted the opinion at the meeting of 4 June 2025.

The proposed changes in the Regulations on the ERDF, CF and JTF at its mid-term review aim to allow Member States enlarging eligible investments in line with the Union’s new priorities, and to introduce simplifications and flexibilities. The proposals are not accompanied by an impact assessment, as pointed out by Opinion 02/2025 of the European Court of Auditors (ECA).

Regarding the ENVI Committee’s competences, the Commission proposes in Regulation (EU) 2021/1058 to broaden the sustainable water management priority with water resilience, to add a priority on energy interconnectors and related transmission and recharging infrastructures thus impacting EU greenhouse gas emissions, and to introduce an exemption to investments achieving the reduction of greenhouse gas emissions as per Directive 2003/87/EC (EU ETS Directive), when awarded a Seal of Excellence. It also proposes an exemption to the thematic concentration rules, notably allowing for investments in defence, military mobility or affordable housing to be counting towards the priority objectives. For Regulation (EU) 2021/1056 it suggests to allow granting JTF funding to projects having obtained the Seal of Excellence and the Sovereignty Seal, as well as removing requirements to substantially reduce greenhouse gas emissions in line with the EU ETS Directive.

The ENVI Committee broadly agrees with the Commission’s rationale on simplification and flexibility, aligning to the new geopolitical context and shifting priorities, while emphasising the importance of preserving a strong focus on cohesion and regional development in the green and digital transitions, ensuring that no region is left behind. It also explicitly supports adding water resilience as a key priority, recognising its vital role in climate adaptation and economic stability. The proposed support for sustainable water management, improved efficiency, and access to water—backed by similar financial incentives—will help address water scarcity and strengthen climate resilience across Member States. It also supports the addition of the affordable housing priority, which should be broadened with sustainability to reflect housings’ potential to contribute to better in- and outdoor environmental quality and reduced whole-lifecycle greenhouse gas emissions, including through energy performance, or sustainable building materials. The ‘renovation wave’ plays a key role in upgrading existing Union buildings and making them more energy efficient and is an important element to achieve the Union’s climate goals. Moreover, investments are also needed to ensure that housing is adapted and maintained to withstand the consequences of climate change such as extreme heat, higher tides or flooding which causes structural damage.

However, upon careful consideration, it appears that several aspects need adjustments, in order to fulfil the policy objectives on climate and environment, while avoiding overlaps with dedicated funds such as those disbursed through the Recovery and Resilience Facility (RRF), the Connecting Europe Facility (CEF) or those under the EU ETS Directive that can already fund energy infrastructure necessary to Union sovereignty. At the same time, projects contributing to Union climate targets and with the Sovereignty Seal as introduced under the Strategic Technologies for Europe Platform (STEP) could also be supported, to reflect these projects’ strategic importance for Europe. As regards the JTF, it has to be noted that it already can support investments to reduce greenhouse gas emissions from ETS installations, provided that such investments contribute to a transition to a climate-neutral economy and lead to a substantial reduction in greenhouse gas emissions, such as permanent carbon removals, including carbon capture and storage, going substantially below the benchmarks established for free allocation under the EU ETS Directive.

Throughout the proposal, the correctness and transparency in accounting for the set sustainability and climate mainstreaming objectives should be safeguarded. Finally, it needs to be clarified how the “do no significant harm” (DNSH) environment principle would be applied to defence investments, as was also pointed out by the ECA.

Against this background, the following adjustment should be made to the Commission proposal:

“Regulation (EU) 2021/1058 is amended as follows:

(1) Article 3 is amended as follows:

(a) paragraph 1 is amended as follows:

[...]

(ii) in point (b), point (v) is replaced by the following:

‘(v) promoting secure access to water, sustainable and integrated water management and enhanced water resilience, including through nature-based solutions, ensuring measurable improvements in water efficiency, reduction of pollution, and ecosystem restoration;’

[...]

“(iii) the following points (xi) and (xii) are added:

(xi) promoting access to decent, sustainable and affordable housing, and related reforms;

(xii) promoting energy and electricity interconnectors and related transmission infrastructure, and the deployment of recharging infrastructure.; ’

[...]

(v) in point (d), the following point (vii) is added:

‘(vii) promoting access to decent, sustainable and affordable housing, and related reforms.’;”

(2) In Article 4, paragraph 10 is replaced by the following:

“10. The thematic concentration requirements set out in paragraph 6 of this Article shall be complied with throughout the entire programming period, including when ERDF allocations are transferred between priorities of a programme or between programmes and at the mid-term review in accordance with Article 18 of Regulation (EU) 2021/1060. Where a Member State submits a request for an amendment of a programme in accordance with Article 24 of Regulation (EU) 2021/1060, amounts programmed for the specific objectives referred to in paragraph 1, points (a)(vi) and (b)(ix), of this Article, as well as for the specific objectives referred to in paragraph 1, points ▌, (b)(v), (b)(xi), (b)(xii), ▌, (d)(vii) and (e)(iii), of this Article, may be counted towards either the amounts required for PO 1 or PO 2 or divided between the two, limited to the shares that demonstrably contribute to climate mitigation or adaptation, as verified by the managing authority in accordance with the Climate Tracking Methodology under Regulation (EU) 2021/1060 and the objectives defined in Article 3 of this Regulation, while avoiding double counting in case of combination of several funding streams.

’”

(4) In Article 7, paragraph 1 is amended as follows:

(a) point (b) is amended as follows:

“ ‘(b) investment to achieve the reduction of greenhouse gas emissions from activities listed in Annex I to Directive 2003/87/EC, except those which have been awarded a Sovereignty Seal under Article 4(1) of Regulation (EU) 2024/795 in a call for proposals under Commission Delegated Regulation (EU) 2019/856 ▌;’ ”

(5a)(new) In Article 8, paragraph 2, the following paragraphs are inserted:

2a. By 1 January 2026, the Commission shall assess the progress towards the objective referred to in Article 3(1), point (b), as well as the shares of expenditure supporting climate objectives as required by this Regulation and, where further progress needs to be achieved, propose actions required to reach that objective by the same date.

2b. By 1 January 2026, the Commission shall provide guidance on the application of Article 17 of Regulation (EU) 2020/852, in conjunction with Regulation (EU) 2021/1060, for the specific objectives referred to in Article 3(1), points (a)(vii) and (c)(iii), of this Regulation.“

(7) In Annex I, Table 1 is amended as follows:

“Annex I, Table 1

(a) in policy objective 2, the row for specific objective (v) is replaced

by the following:

(c) in policy objective 2, the following rows are added:

(e) in policy objective 4, the following row is added:

(f) in policy objective 5, the following row is added:

“Article 2

Regulation (EU) 2021/1056 is amended as follows:

“(1) Article 8(2) is amended as follows:

(a) in the first subparagraph, the following point (p) is added:

‘(p) promoting access to decent, sustainable and affordable housing, and related reforms.’;

[...]

▌

[...]

▌

Should the Council opt to amend these parts of the proposal in a different way, the ENVI Committee would like to remain involved in the spirit of sincere and good cooperation during the inter-institutional negotiations.

Yours sincerely,

Antonio Decaro

ANNEX: entities or persons

from whom the rapporteur for the OPINION has received input

The Chair in his capacity as rapporteur for the opinion declares under his exclusive responsibility that he did not receive input from any entity or person to be mentioned in this Annex pursuant to Article 8 of Annex I to the Rules of Procedure.