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The pilot phase of the Europe 2020 Project Bond Initiative

The Europe 2020 Project Bond Initiative aims to revive and expand capital markets to finance large European infrastructure projects in the fields of transport, energy and information technology. The scope of this pilot phase is to test the project bond concept at the end of the multi-annual financial framework 2007-2013.

The pilot phase of the EU-EIB Project Bond Initiative was established by Regulation No. 670/2012pdf. It started its operations in 2012 and is  being implemented by the European Investment Bank (EIB). 

Objectives of the pilot phase

  • to stimulate investment in key strategic EU infrastructure in transport, energy and broadband;
  • to establish debt capital markets as an additional source of financing for infrastructure projects.

The aim is to attract institutional investors to the capital market financing of projects with stable and predictable cash flow generation potential by enhancing the credit quality of project bonds issued by private companies.

The intention is to support capital market financing of projects as a form of finance to complement loans, not to replace other sources of financing, such as grants, nor to intervene in stages prior to financing, such as feasibility studies, assessments or procurement, where grants are also widely used.

Commercially viable infrastructure projects in the EU, which are eligible for funding under the TEN-T or TEN-E policies or under the CIP-Decision on broadband, can benefit from the initiative.

Project bond initiative

Projects currently supported

Audit Report

A full-scale independent evaluation of the Project Bond Initiative (PBI) Pilot Phase, as required by Regulation (EU) No. 670/2012, was concluded in December 2015 by Ernst & Young, covering the period November 2012 - July 2015. On the basis of this evaluation, the European Commission prepared a Commission Staff Working Document which was published in March 2016.

The evaluation drew upon the results of the previous external evaluation concluded in June 2014 (see below) and assessed the effectiveness, efficiency, relevance, value added and additionality of the Pilot Phase of the PBI, with a view to draw lessons from the implementation of this financial instrument from its establishment until the time of the evaluation.

The evaluation was based on a combination of stakeholder interviews, desk research and an analysis of a number of recent infrastructure transactions.

The evaluation concludes that the Project Bond Credit Enhancement solution has provided long term competitive solutions for the financing of infrastructure projects in Europe and therefore should continue to be deployed by the European Commission and the European Investment Bank under the Connecting Europe Facility. The evaluation also presents arguments on how to optimize the implementation of the Project Bond Credit Enhancement product in the future, including its potential to be complementary to other EU initiatives, such as the European Fund for Strategic Investments.

Interim Audit Report

The external ad-hoc audit of the Project Bond Initiative Pilot Phase was carried out in the context of the Commission reporting exercise to the European Parliament and the Council on the implementation of the pilot phase. The evaluation was concluded in June 2014.

The main goal of the ad-hoc audit report was to assess the effectiveness and efficiency of the PBI Pilot in opening up debt capital markets to infrastructure projects, with a view to formulate recommendations as to the future of the instrument within the 2014-2020 MFF period, in particular in respect of the full deployment of the Project Bonds instrument under the Connecting Europe Facility (CEF), including the scope and budget.

The ad-hoc audit was based on desk research, interviews and analysis of a number of recent infrastructure transactions, with a particular focus on projects financed by bond issues. The final report provides the main findings and recommendations with regard to lessons learnt from the PBI Pilot and presents arguments on how to optimise the implementation of the main phase of the PBI. Overall the report considers the progress of the PBI Pilot implementation to be satisfactory while proposing adjustments to be reflected in the CEF Debt Instrument.

Final report – March 2016pdf Choose translations of the previous link 

Related documents

European Commission documents

External documents

Please note: These external publications have been posted with the permission of the publishing organisations for general information purposes. The opinions expressed therein are solely those of the publishing organisation, the author or the consulted parties as specified. Please consult the websites of the organisations for updates, copyrights and disclaimers.

Questions and Answers

Differences between the Europe 2020 Project Bonds and the Eurobonds or Stability Bonds

The aim of the Europe 2020 Project Bond Initiative is to enhance the credit standing of private entities that need to raise private funds for the infrastructure projects they promote. This is fundamentally different from the idea of the so-called "Eurobonds" or "Stability Bonds", i.e. the joint issuance of bonds to provide general funding for Member States' government funding needs. In contrast, neither the Commission nor the Member States will issue bonds under the Europe 2020 Project Bond Initiative.

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