EU unveils list of priority energy projects, including oil and gas

BRUSSELS (Reuters) - The European Commission published its list of energy projects on Thursday eligible to receive EU funding of up to 30 billion euros ($34 billion), including new oil and gas projects which are likely to draw criticism from Green EU lawmakers.

The question of whether projects related to fossil fuels such as natural gas should be able to receive EU funds has been hotly debated as the European Investment Bank, the union’s lending arm, has signaled its ambition to ban all fossil fuel-funding by the end of 2020.

But the European Commission, under its current head, Jean-Claude Juncker, has viewed natural gas as a transition fuel on the way for the bloc to become fully fossil fuel free by 2050.

The list published on Thursday comprises 151 projects which will be entitled to accelerated planning permission as well as the EU funding. It includes oil and gas projects as well as those related to electricity and smart grids, which will improve power supplies and integrate renewable energy sources.

The number of gas projects on the list is 32, down from 53 two years ago, the Commission said. These include pipeline and liquefied natural gas terminal projects to make the bloc less reliant on Russian gas.

The projects are deemed to be of importance to the EU’s shared energy infrastructure and are eligible for funding from a 30 billion euro fund that supports energy, transport and digital infrastructure.

Also on the list are power interconnectors between Britain and France, Germany and Norway and Britain and Norway as well as hydro pumped electricity storage and interconnectors between Baltic states.

The European Parliament and European Council have two months to either accept or reject the list of projects in full.

Incoming Commission president, Ursula von der Leyen, has made it one of her top priorities to make the EU completely carbon neutral by 2050, cutting greenhouse gas emissions by at least 40% by 2030 compared to 1990 levels.

Juncker’s stance on natural gas has drawn ire from Green EU lawmakers and civil society organizations, which say natural gas is not sustainable enough and investing in new projects at this stage in the transition to a carbon neutral EU.

In a statement on their website, the Commission said the amount of gas projects on the list “is in line with the role of gas when meeting the EU’s decarbonization objectives.”

Reporting by Jonas Ekblom; editing by Nina Chestney and Elaine Hardcastle