JESSICA EVALUATION STUDY FOR GALICIA Ref.: IR812 This document has been produced with the financial assistance of the European Union. The views expressed herein can in no way be taken to reflect the official opinion of the European Union. FINAL REPORT 15/09/10 JESSICA GALICIA FINAL REPORT JESSICA EVALUATION STUDY FOR GALICIA Final Report IR 812 Contents: 1 INTRODUCTION ........................................................................................ 5 1.1 What does JESSICA represent within the Structural Fund investment and expenditure programmes? .................................................................... 5 1.2 JESSICA and Galicia .......................................................................... 5 1.3 Objectives of the evaluation study ................................................... 6 1.4 Methodology and procedures for conducting the study .................... 6 1.5 How is the JESSICA initiative structured? .......................................... 7 2 TERRITORIAL AND URBAN FRAMEWORK IN GALICIA ................................. 9 2.1 Geographical description ................................................................. 9 2.2 Economic Activity ........................................................................... 12 2.3 Population and urban system ......................................................... 14 2.4 Territorial and urban planning in Galicia ........................................ 19 2.5 Urban Initiative 2000‐ 2013 ............................................................ 22 2.6 Integrated Refurbishment Areas .................................................... 23 1 JESSICA GALICIA FINAL REPORT 2.7 JESSICA planning framework .......................................................... 25 3.3.6 Axis 5, Issues 56 and 57: protection and development of natural heritage ‐ Other grants to improve tourism services ................................ 33 2.7.1 Territorial planning .................................................................... 26 3.3.7 Issue 61: Integrated urban regeneration projects ....................... 34 2.7.2 Sectoral planning ....................................................................... 26 4 THE FRAMEWORK FOR THE DEVELOPMENT OF JESSICA PROJECTS IN 2.7.3 Urban Planning .......................................................................... 26 GALICIA .......................................................................................................... 35 3 THE 2007‐2013 OPERATIONAL PROGRAMME IN GALICIA ......................... 27 4.1 The experience of public‐private funding and initiatives in Galicia .. 35 3.1 Priority Axes ................................................................................... 28 4.2 JESSICA and ERDF fund managers ................................................... 35 3.1.1 Axis 1: Development of the knowledge economy (R&D, Education, 4.2.1 Phase I: Initial context and general explanation of the JESSICA Information Society and ICT) ................................................................... 28 initiative ................................................................................................. 36 3.1.2 Axis 2: Enterprise innovation and development .......................... 28 4.2.2 Phase II: Analysis of possible UDFs in the field of land, building and 3.1.3 Axis 3: Environment, protection of natural resources, energy .................................................................................................. 37 management, distribution and treatment of water, risk prevention ........ 29 4.3 JESSICA and other institutional and economic agents ..................... 39 3.1.4 Axis 4: Transport and Energy ...................................................... 29 3.1.5 Axis 5: Sustainable local and urban development ....................... 29 4.4 Role and attitude regarding JESSICA at regional credit institutions . 39 3.1.6 Axis 6: Social infrastructure ....................................................... 29 4.4.1 The financial system in Galicia .................................................... 39 3.1.7 Axis 7: Technical support and reinforcement of institutional 4.4.2 Attitude of financial intermediaries to JESSICA ........................... 39 capacity .................................................................................................. 30 5 ELIGIBLE PROJECTS .................................................................................. 41 3.2 Availability of Funds ....................................................................... 30 5.1 Eligibility criteria ............................................................................ 41 3.3 JESSICA and its alignment with the ERDF OP ................................... 32 5.1.1 Eligibility alignment of ERDF OP projects .................................... 41 3.3.1 Possibilities for the JESSICA initiative under the 2007‐2013 Operational Programme .......................................................................... 32 5.1.2 Sustainable planning framework ................................................ 41 3.3.2 Axis 2, Issue 8: Other investments in companies ......................... 33 5.1.3 Respect for competition laws ..................................................... 42 3.3.3 Axis 4, Issue 41: renewable energy. Biomass .............................. 33 5.1.4 Accumulation of grants .............................................................. 42 3.3.4 Axis 4, Issue 43: Energy efficiency, co‐generation and energy 5.1.5 Other specific JESSICA initiative eligibility criteria ....................... 42 management .......................................................................................... 33 5.2 Project included in Axis 4: Energy and Transport ............................. 42 3.3.5 Axis 4, Issue 52: Development of clean urban transport .............. 33 2 JESSICA GALICIA FINAL REPORT 5.2.1 Renewable energy projects. Priority Issues 40, Solar, and 41, 6.3.1 Description of the project .......................................................... 65 Biomass. ................................................................................................. 42 6.3.2 Initial hypotheses: Project development without JESSICA funding. 5.2.2 Energy efficiency in buildings line. Priority Issue 43. ................... 43 .................................................................................................. 67 5.2.3 Energy efficiency in services and urban amenities. Issue 43: Energy 6.3.3 Development with JESSICA funding. ........................................... 71 efficiency, co‐generation and energy management .................................. 44 6.4 Renewal of efficient urban bus fleets (financial leasing) ................. 75 5.2.4 Energy transformation. Priority Issue 43 ..................................... 44 6.4.1 Description of the Project .......................................................... 75 5.2.5 Line of finance for public transport (in partnership with the Directorate‐General for Mobility). Priority Issue 52: Development of clean 6.4.2 Initial hypotheses: Project development without JESSICA funding. urban transport ...................................................................................... 45 .................................................................................................. 76 5.2.6 Selected projects ........................................................................ 45 6.4.3 Development with JESSICA funding. ........................................... 81 5.3 Axis 2, Enterprise Development and Innovation. Issue 8: Other 6.5 Sensitivity Analysis ......................................................................... 85 investments in companies .......................................................................... 45 6.6 Summary ....................................................................................... 89 5.3.1 Selected projects ........................................................................ 45 6.6.1 Project eligibility criteria ............................................................ 89 5.4 Axis 5. Accommodation for students and other service amenities ... 46 6.6.2 Profitability ............................................................................... 90 5.4.1 Selected projects ........................................................................ 46 6.7 Other projects analysed ................................................................. 93 5.5 Axis 5, Issues 56 and 57: protection and development of natural heritage ‐ Other grants to improve tourism services ................................... 46 7 JESSICA STRUCTURE FOR GALICIA ............................................................ 95 5.5.1 Selected projects ........................................................................ 46 7.1 The three JESSICA funding tools: Holding Fund, Urban Development Fund and Projects ...................................................................................... 95 6 DESCRIPTION OF THE PROJECT AND FINANCIAL MODELLING ................... 47 7.1.1 Holding Fund (HF) ...................................................................... 95 6.1 Development with JESSICA funding ................................................. 49 7.1.2 Urban Development Funds (UDFs) ............................................. 95 6.2 High environmental quality public buildings ................................... 52 7.1.3 Eligible projects ......................................................................... 96 6.2.1