The European Commission has approved nearly €650m in grants under the Connecting Europe Facility (CEF) to support 14 cross-border energy infrastructure projects, including significant investments in pumped storage hydropower and electricity grid modernisation.
Of the total funding, almost €470m is allocated to six electricity infrastructure projects, including smart grids and hydropower-related developments. The largest single grant, €180m, will support the AGUAYO II reversible pumped-storage hydropower project in Spain. The project involves the construction of a new underground pumped storage facility designed to support renewable energy integration without expanding existing water reservoirs.
The modernisation of the Čierný Váh pumped storage hydropower facility in Slovakia will receive €63m. The upgrade will combine traditional pumped storage with large-scale battery storage, a configuration intended to improve system flexibility and grid balancing capabilities.
Another €103.7m has been allocated to a smart grids project linking Romania and Bulgaria. The project will upgrade transmission and distribution networks to enable higher volumes of renewable electricity and improve cross-border power flows.
In addition, nearly €113m will be invested in strengthening the resilience and protection of critical electricity infrastructure in Poland, Estonia, Latvia and Lithuania as part of the Baltic Synchronisation programme. The funding will address physical and cyber security risks affecting cross-border grid operations.
Two further electricity projects will receive funding for preparatory studies: an internal transmission line in Austria and the Greece–Egypt GREGY Green Energy Interconnector.
Alongside electricity infrastructure, more than €176m will be directed to hydrogen-related projects, including €120m for the Gronau hydrogen storage project in Germany. While hydrogen investments represent a growing share of CEF funding, pumped storage hydropower remains a central component of the EU’s strategy to support renewable integration and long-duration energy storage.
Dan Jørgensen, Commissioner for Energy and Housing, said: “A strong and independent Energy Union which delivers clean and cheap energy to consumers must be built on integrated and safe energy infrastructure. The projects we are supporting financially will enhance Europe’s competitiveness and energy security, bringing us on a steady pathway towards independence.”
The funding follows the second call for proposals under the current list of Projects of Common Interest (PCIs) and Projects of Mutual Interest (PMIs). The approved budget exceeds the initial €600m allocation for the call, reflecting high demand for cross-border infrastructure support.
Member States endorsed the funding package through the CEF Coordination Committee on 15 January 2026. Formal adoption of the award decision is expected in the coming weeks, after which the European Climate, Infrastructure and Environment Executive Agency (CINEA) will finalise grant agreements with project developers.
The next CEF call for energy infrastructure proposals is scheduled for the second quarter of 2026.
