Financial Instrument for Urban Development for a Just Transition under Priority 4 of the Regional Development Programme 2021–2027
Fund Manager of Financial Instruments in Bulgaria EAD is implementing an operation for financial instruments under Priority 4, “Just Transition”, of the Regional Development Programme 2021–2027, co-financed by the European Union.
The Regional Development Programme is a two-fund programme, supported by the European Regional Development Fund under Priorities 1 and 2 and by the Just Transition Fund under Priority 4.
The Just Transition Fund (JTF) has been established to support investments with economic and environmental impact, supporting projects in the social sphere and increasing the employment in the regions and communities most affected by the European Union’s transition towards a climate-neutral economy by 2050, as well as by the implementation of the energy and climate targets set for the period up to 2030.
The overall amount of support under Priority 4 of the Regional Development Programme 2021–2027 for financial instruments and grants within a single operation totals EUR 600,000,000, of which EUR 490,438,467 is provided by the European Union through the JTF.
Support Measures
The envisaged support measures include investments in tangible and intangible assets, including infrastructure, equipment and working-capital financing for enterprises in the eligible regions; manufacture of equipment for renewable energy sources and energy-storage systems; construction of renewable-energy and energy-storage facilities; energy-efficiency measures for enterprises; acquisition of new equipment; support for digitalization; research and innovation activities; deployment of technologies, systems and infrastructure for accessible clean energy; investments in smart and sustainable local mobility; investments in the regeneration and decontamination of abandoned sites; improvements in circular-economy performance; and other related interventions.
Territorial Scope
The measures will be implemented in the districts most severely affected by the transition towards a climate-neutral economy, on the basis of the approved Territorial Just Transition Plans, namely Pernik, Kyustendil and Stara Zagora, including ten municipalities in the Maritsa Basin: Nova Zagora, Yambol, Simeonovgrad, Harmanli, Topolovgrad, Dimitrovgrad, Haskovo, Elhovo, Sliven and Tundzha.
Form of Financing
The resources will be provided in the form of a low-interest loan combined with grant support within a single operation, with the grant component amounting to 45% of the total financing.
Additional private resources will be mobilized alongside the resources of the Regional Development Programme in order to finance investments under the financial instrument.
Depending on the internal policy of the selected financial intermediary, loan financing is envisaged to have a repayment maturity of up to 20 years and a grace period of up to 3 years.
The planned allocation of resources among the financial products is as follows:
EUR 285.7 million for loans;
EUR 14.3 million for guarantees;
EUR 300 million for grants combined with financial instruments within a single operation.
The resources earmarked for financial instruments, including grant support within a single operation, are expected to enable the implementation of projects and investments contributing to the indicators under Priority 4 of the Regional Development Programme, as set out below:
RDP 2021–2027 indicators | Unit of measurement | Contribution of the financial instrument |
Enterprises receiving support, including microenterprises, SMEs and large enterprises | enterprises | 228 |
Enterprises receiving support through financial instruments | enterprises | 228 |
Additional renewable-energy production capacity | MW | 293 |
Jobs created in supported entities | annual FTE* | 1,833 |
Expected greenhouse-gas emissions | tonnes CO2 equivalent/year | 8,635.78 |
Total renewable energy produced, including electricity and thermal energy | MWh/year | 386,198.43 |
Installed additional operational capacity for renewable energy | MW | 205.91 |
* full-time equivalent
