Financing Europe’s Next Pipelines: How EU and EIB Programs Are Reshaping Energy Infrastructure
By G. FELLER, Contributor
(P&GJ) — As Europe transitions toward a decarbonized, interconnected and resilient energy system, the European Union (EU) and the European Investment Bank (EIB) have positioned financing as a cornerstone of this effort. Most fossil fuel pipelines are increasingly excluded from future EU funding, but a range of programs—from the Connecting Europe Facility (CEF) to the European Hydrogen Backbone initiatives—are actively supporting new-generation pipeline projects that focus on hydrogen (H2), carbon capture and renewable energy integration. The EIB, based in Luxembourg, acting as the EU’s lending arm, is simultaneously expanding its toolkit to include green industrial counter-guarantees and blended finance mechanisms—all of which are targeting energy transport infrastructure.
This article explores the main programs under both the EU and EIB financing pipeline-related projects, as well as those expected to play major roles in the near- to medium-term future.
CEF: Core EU funding for strategic pipelines. The CEF is the EU’s flagship program for infrastructure investment in energy, transport and digital connectivity. Within its energy pillar, CEF for Energy (CEF-Energy) supports cross-border projects that enhance the EU’s energy security, integration and decarbonization. These include electricity grids, gas pipelines repurposed for H2, and carbon dioxide (CO₂) networks.
In 2025, CEF has taken the lead in financing H2 pipeline corridors, particularly through projects designated as Projects of Common Interest (PCI). On February 3, 2025, the European Commission in Brussels announced more than €51 MM in CEF funding for three Finnish-led H2 pipeline projects, including the landmark Nordic H2 Route, a 1,000-kilometer (km) system linking Finland and Sweden across the Bothnian Bay. These pipelines, identified under the EU’s Trans-European Networks for Energy (TEN-E) policy, with a multibillion Euro annual budget, are central to achieving the target of sourcing at least 10% of Europe’s energy from renewable H2 by 2050.
CEF’s pipeline portfolio extends beyond H2, innovative CO₂ transport infrastructure—under the carbon capture, use and storage (CCUS) category—also falls within eligible investments. While new natural gas pipelines are no longer eligible, converting or repurposing existing gas networks to carry H2 and biogas remains a key financing focus.
Horizon Europe and innovation fund: Researching tomorrow’s pipeline technology. Beyond physical pipeline construction, the EU’s Horizon Europe program and Innovation Fund play a vital role in financing research, demonstration and first-of-a-kind industrial technology for clean energy transport systems. These programs target activities from concept design to pilot-level scale-up—the innovation precursors to full-scale deployment via mechanisms like CEF or EIB lending.
Horizon Europe supports pipeline-related research, particularly in H2 transport, carbon management and digital monitoring of energy networks. Under the EU’s Strategic Technologies for Europe Platform (STEP) framework, Horizon Europe will allocate co-funding to technologies advancing H2 compression, pipeline-material integrity and digital pipeline management. Projects that earn the STEP Seal of Excellence gain enhanced access to blended finance through InvestEU or EIB programs, allowing public and private capital to converge around Europe’s strategic technology priorities.
The Innovation Fund, financed by revenues from the EU Emissions Trading System, has already co-invested in early-stage CO₂ and H2 pipeline systems connecting industrial clusters in northern Europe. Its successor calls in 2026–2027 are expected to expand funding scope from cluster-specific pipelines to cross-border H2 corridors.
The Clean Energy Transition Partnership (CETPartnership): Aligning member state investments. The CETPartnership is a joint initiative between the European Commission and national funding organizations to coordinate research and innovation funding for the energy transition. While it focuses on technology development rather than large-scale infrastructure, its scope includes R&D for cost-effective and safe H2 pipeline materials, advanced monitoring systems and smart grid integration.
The 2025 Joint Call, launched on June 11, 2025, pools national and EU-level funds into modular research programs coordinated across the EU’s 27 Member States. Among the call modules are those directly focused on renewable fuels and systemic transformation, under which demonstration-scale pipeline systems—such as hybrid pipelines combining H2 and CO₂—are eligible. The CETPartnership’s two-stage application process enables public research institutions and private consortia to secure co-funding for pre-commercial deployment studies, effectively preparing these projects for later EIB or CEF investment.
The energy highways plan: A new EU framework for H2 corridors. Announced by Commission President Ursula von der Leyen in September 2025, the Energy Highways Plan represents the EU’s next phase of transcontinental energy integration—a vision centered on H2 pipelines, renewable energy highways and smart grid interconnections. It will establish financing streams that merge CEF-Energy with additional instruments from the European Climate, Infrastructure and Environment Executive Agency (CINEA).
The plan’s early drafts indicate that the EU will co-finance H2 Backbone Extensions, prioritizing links between Spain, France and Germany, and interconnections from the Baltic H2 network to Central Europe. Funding eligibility will likely expand to include blended public-private financing vehicles, setting the stage for EIB participation alongside CEF grants. The implementation phase, expected from 2026 onward, is designed to align with the EU’s REPowerEU goals and the H2 strategy update planned for 2027.
EIB financing. The EIB is the EU’s long-term lending institution, owned by its 27 Member States, with a mandate to support EU policy objectives through project financing, loans, guarantees and advisory services. The EIB has become instrumental in financing the green transformation of Europe’s energy network—a shift underscored by its record €100-B financing ceiling approved in 2025.
Within its energy operations, approximately 60% of all financing is now directed toward climate action and environmental sustainability, including renewable electricity, grids and H2 networks.
EIB’s pipeline-related programs. In June 2025, the EIB announced expanded financing for wind manufacturing, grids and electrification, reinforcing Europe’s H2 and electricity transport capacity. Central to this expansion are several new and updated instruments directly relevant to pipeline investment:
- Counter-guarantee facilities for energy infrastructure: A €1.5-B package supporting grid and H2 infrastructure manufacturers. Eligible technologies include transmission networks, H2 pipelines and energy storage equipment.
- Corporate power purchase agreement (PPA) program: A €500-MM pilot initiative providing counter-guarantees for companies entering long-term clean power contracts, indirectly funding infrastructure such as renewable-power-coupled H2 pipelines.
- Green tech manufacturer support facility: A €250-MM program supporting small- and mid-sized manufacturers that produce components for H2 or CO₂ pipeline systems.
Furthermore, the EIB’s H2 Industry Financing Support Mechanism, introduced under the EU Clean Industrial Deal, channels loans and guarantees to H2 producers, storage operators and network developers—a framework applicable to pipeline construction projects meeting climate eligibility standards.
Near- and medium-term EIB priorities. EIB’s 2025–2030 strategy prioritizes accelerating the H2 and renewable gas networks across Europe. This includes potential financing of projects identified under the European H2 Backbone Initiative, which aims to connect 20,000 km of H2-ready pipelines by 2030. The EIB is expected to fund cross-border and national segments, contingent on compliance with the EU’s taxonomy for sustainable finance.
Additionally, the EIB’s advisory hub assists public sector entities and private investors in preparing bankable pipeline proposals. Operating alongside InvestEU, this platform helps structure financial packages for pipeline projects that blend EU grants, national co-financing and private capital.
The EIB Group expansion into project pipelines. In March 2025, the EIB introduced a new critical raw materials (CRM) task force overseeing a dedicated pipeline of investments in energy, water and industrial resilience. Although primarily focused on materials, this new one-stop-shop is also tasked with managing the operational pipeline of infrastructure projects that enhance energy security—including H2 and CO₂ transport systems.
The EIB Group, encompassing the EIB and the European Investment Fund (EIF), continues to expand its infrastructure investment funds portfolio to include greenfield energy transport and low-carbon industrial assets, as confirmed in mid-2025. This broader pipeline facilitates co-financing of early- and late-stage development phases, effectively creating a structured continuum between EU grant programs (like CEF and Horizon Europe) and EIB-backed lending.
The future of EU and EIB pipeline financing. The evolution of Europe’s pipeline financing policy reflects a strategic redefinition—from a fossil fuel-centric model to an integrated sustainability network. Over the coming decade, funding will increasingly target multi-energy infrastructures, encompassing cross-border H2 networks, upgraded CO₂ transport corridors and digitally managed pipelines embedded in renewable energy systems.
Key milestones expected by 2027 include:
- Rollout of the Energy Highways Plan, integrating CEF and EIB financing structures for H2 corridors.
- Expansion of Horizon Europe’s STEP funding, adding advanced materials and AI-based monitoring systems for pipeline safety.
- EIB participation in blended financing facilities, combining EU grant funding with commercial-scale debt instruments to deliver H2 transport interconnections across the EU’s Member States.
Takeaway. As Europe moves toward its 2050 climate neutrality goals, pipelines remain at the core of its new energy paradigm, but with a different substance flowing through them. H2, captured CO₂ and renewable gases represent the arteries of a continental clean energy system. The synergies between the European Commission’s funding programs and the EIB’s financial instruments provide many valuable resources.