Connecting Europe Facility

The Connecting Europe Facility (CEF) is the European Union’s dedicated funding instrument for strategic investment in transport, energy and digital infrastructure, established to support the development and completion of trans-European networks.

Role and mandate

CEF provides grant-based co-financing to projects of common interest across three pillars: transport, energy and digital infrastructure. In the transport sector — by far the largest component — the instrument is primarily directed at realising the Trans-European Transport Network (TEN-T), with emphasis on cross-border connections, missing links and the deployment of interoperability systems.

The programme is managed by the European Climate, Infrastructure and Environment Executive Agency (CINEA) on behalf of the European Commission.

CEF operates on a competitive, call-based system. Member states, international organisations, joint undertakings and public or private entities may submit proposals. Projects are evaluated and ranked; the Commission then formally adopts a selection decision, after which CINEA prepares individual grant agreements with beneficiaries.

Legal basis

The instrument was first established for the 2014–2020 budget period and renewed for 2021–2027 under Regulation (EU) 2021/1153, adopted in July 2021. The current programme — informally referred to as CEF 2 — operates within the EU’s Multiannual Financial Framework for that period and is governed by a multiannual work programme that defines funding priorities and available amounts per call. The work programme was amended in July 2023.

Scope and coverage

CEF 2 has a total budget of EUR 33.71 billion, of which EUR 25.81 billion is allocated to transport, EUR 5.84 billion to energy and EUR 2.07 billion to digital infrastructure. Within the transport envelope, EUR 11.3 billion is earmarked for cohesion countries eligible to receive Cohesion Fund transfers.

Rail is the dominant beneficiary. Between 2021 and 2024, over EUR 21 billion had been allocated under CEF Transport, with rail receiving EUR 15 billion — the largest share of any mode. Across individual annual calls, rail has consistently captured 77–80% of awarded grants.

Priority categories include completion of the TEN-T core network by 2030 and the comprehensive network by 2050, deployment of the European Rail Traffic Management System (ERTMS), cross-border sections and missing links, and since 2022, dual civil-military use of transport infrastructure.

Co-financing rates

CEF grants co-finance projects at rates ranging from 20% to 50% of eligible costs depending on project type. Infrastructure projects typically receive 30% of eligible costs, rising to 50% for certain categories and studies.

Cross-border transport actions can receive up to 50%; projects in outermost or isolated regions can reach 70%, and in cohesion fund countries the ceiling reaches 85%. ERTMS deployment — both trackside and onboard — is funded via a unit grant mechanism based on a fixed cost per unit rather than a percentage of total eligible costs.

Key decisions and enforcement actions

Projects funded under the 2021, 2022 and 2023 calls amount to EUR 21.1 billion, representing 82% of the available CEF Transport budget for 2021–2027. Major recipients include Rail Baltica, the Lyon–Turin corridor, the Brenner Base Tunnel and ERTMS deployments across multiple member states.

CEF also finances smaller-scale infrastructure where strategic function justifies EU co-funding. At Palemonas near Kaunas, Lithuania, a EUR 37.4m dual-gauge terminal is under construction to transfer NATO military cargo between the European standard gauge and the 1,520 mm broad-gauge network running north to Latvia, Estonia and the port of Klaipėda.

CEF contributes EUR 13.3m; the remainder is covered by the Lithuanian state budget. The terminal is purpose-built for military logistics and directly supports the permanent basing of a German brigade in Lithuania — the first such deployment abroad since the Second World War. Completion is set within 16 months of construction start in May 2026.

Following the 2024 call, in which 94 projects were selected for nearly EUR 2.8 billion in grants, approximately 95% of the total CEF Transport 2021–2027 budget had been allocated. Rail secured 77% of the 2024 call allocation — around EUR 2.15 billion — directed primarily at the TEN-T core and extended networks in cohesion countries, including Rail Baltica, high-speed lines in Czechia and Poland, and ERTMS deployment across 11 member states.

Relation to other instruments

CEF is the primary EU grant instrument for TEN-T projects but operates alongside complementary mechanisms. The Cohesion Fund finances eligible member states separately, with a portion transferred into the CEF transport envelope.

CEF does not finance rolling stock directly; support for onboard ERTMS units is permitted as an exception given its direct network interoperability function. Larger projects typically combine CEF grants with European Investment Bank financing or national co-funding to reach full project capitalisation.