MEPs voted overwhelmingly in favour of an agreement struck last month to create a fund to finance projects including renovating Europe's buildings to improve their energy efficiency, grid-connected renewable energy generation, electric vehicles and energy-saving local infrastructure like smart grids and electricity storage.

The fund will get a total of €146.34 million left over from the €3.98bn European Energy Recovery Plan once the deadline for committing money to priority projects has expired at the end of the year.

In the first instance, the plan earmarked money for gas and electricity interconnections, carbon capture and storage (CCS) and offshore wind farms. But MEPs insisted on a mechanism to use any unspent money for energy efficiency and innovative renewables projects to counterbalance the billions given to traditional energy sources.