Greece revises EU-aided plan
Government hopes that energy transition money will raise Recovery Fund grants to €18.2 bln
The government will submit its revised plan for funding from the European Union’s Recovery Fund on Thursday.
The revised plan would ditch some approved projects budgeted at €800 million deemed unnecessary or difficult to implement and replace them with others. The government aims to absorb all available EU funds by August 2026.
Even though the total budget for Greece 2.0, Greece’s plan, has been reduced by some €340 million to an overall €17.43 billion, due to the economy’s rapid growth, the Greek government hopes to secure additional funding of €795 million through the REPowerEU program aiming to facilitate energy transition and end EU dependence on Russian fossil fuels by 2030. This would bring the total funding to €18.22 billion.
At the same time, Greece will request a further €5 billion in loans from the Recovery Fund, bringing the total to €17.7 billion. Greece has already taken €11.08 billion in loans from the Recovery Fund, in two installments and, in May, applied for a third disbursement of €1.717 billion.
Together with the hoped-for €18.22 billion in grants, the Recovery Fund’s contribution, in all forms, will rise to €36 billion.
Even though Greece has been among the top EU countries in securing disbursements from the fund, and has been lauded by the Commission for its performance, future disbursements will progressively depend on the state of completion of the funded projects.
But the usual snags that Greece’s public investment programs produce are starting to affect funding. For example, a contractor’s court action against a project whose progress was considered a milestone for the disbursement of the third loan installment has led the EU to delay sending the money until the Council of State, Greece’s highest administrative court, rules on the case. And more legal challenges are expected as more bids are awarded.
In its latest guidelines to Greece, the European Commission notes that implementation of Greece 2.0 will increasingly depend on regional and local authorities, who have known administrative and implementation weaknesses. The authorities must be assisted and closely supervised, the Commission said.
