On 17 July 2024, the Rail Baltica joint venture RB Rail AS, representing the Ministries of Climate of Estonia, Transport of Latvia, and Transport and Communications of Lithuania, announced that the project has been awarded an additional EUR 1.2 billion in the latest call from the Connecting Europe Facility (CEF). This significant funding, combined with national co-financing from the three Baltic States, will total EUR 1.5 billion, enabling the progression of construction activities and the development of the next stages of Rail Baltica.
Funding for implementing Rail Baltica activities within each country from the CEF instrument includes approximately EUR 370 million for activity implementation in Estonia, around EUR 346 million for activity implementation in Latvia, and approximately EUR 458 million in Lithuania. The financing approved for the Rail Baltica global project will be added to the existing funding of over EUR 2.6 billion secured from the CEF instrument and the three Baltic States.
“RB Rail submitted very strong proposals, and I am extremely pleased that after a rigorous and highly competitive selection process we can allocate EUR 1.2 billion to Rail Baltica. This underlines our strong support for the project. Estonia, Latvia and Lithuania must be better connected to the rest of the EU; the war in Ukraine has demonstrated how important that is. I count on the project partners to make the most of the support and get this connection in place as swiftly as possible,” said Director-General for Mobility and Transport (DG MOVE) at the European Commission Magda Kopczynska.
Several key activities supported by the new financing agreement
The financing agreement scheduled for signing between the European Climate, Infrastructure, and Environment Executive Agency (CINEA) and Rail Baltica in Q4 2024 will support several key activities:
In Estonia, financing is granted for mainline construction activities, particularly substructure works for various sections, including the Soodevahe – Kangru, Kangru – Saku, County Harjumaa (including the Lagedi traffic junction/viaduct), and the Hagudi – Alu sections. Additional mainline construction includes the Saku – Harju/Rapla border section and the Alu – Kärpla section. In total, Estonia is set to receive financing for up to 55 km of the mainline.
In Latvia, the focus is on the Misa – LV/LT border section, a priority for mainline construction set to begin in the coming months, covering approximately 27 km, as well as the relocation of the natural gas pipeline in the Vangaži-Misa section. Additional funding is allocated for partial supervision services and construction assessments, as well as the Iecava High-Voltage Connection Point and the Skulte construction facility, which will serve as a construction logistics base for Latvia’s northern section of the mainline towards Estonia.
In Lithuania, co-financing has been granted for mainline construction, with a focus on substructure works for the Ramygala – Berciunai and Berciunai – Joniskelis sections on the Ramygala-LT/LV state border, High-Voltage Connection Points at Panevėžys, Išorai, and Liudvinavas Rail Baltica traction substations, and mainline construction on the Kaunas – Seta section of the Kaunas – Ramygala line superstructure. In total, with the current funding, Lithuania will have secured founds for 114 km of substructure works for Kaunas-Lithuania/Latvia state border line and other activities.
Additionally, funding is granted for the design of Rail Baltica’s electrification subsystems (Traction Power System and Overhead Catenary System) and multiple Railway System Generic Designs. Ongoing activities include supervision services, and the assessment of construction works, encompassing areas such as NoBo (Notified Body), AsBo (Assessment Body), system engineering, risk management, progress reporting, supervision, and project management activities.
“We are proud of the EU’s continued priority commitment to Rail Baltica’s development as a missing link for the TEN-T corridor. This support is paramount to achieving the global project timelines outlined in the newly adopted Rail Baltica Delivery Programme 2030, which will promote sustainable transportation, enhance regional connectivity, and strengthen military mobility vital to our common defence. Passengers in the Baltics deserve the same quality, speed, and comfort level of railway travel options as those available to their neighbours in Western Europe,” said Marko Kivila, CEO and Chairman of the Management Board at RB Rail AS.
Grant agreement preparation will now commence, during which further details will be aligned with the European Climate, Infrastructure, and Environment Executive Agency, the ministries responsible for the implementation of Rail Baltica, and the national implementing bodies, with the aim of signing the grant agreement later this year.
The Commission has selected 134 transport projects to receive over EUR 7 billion in EU grants from the Connecting Europe Facility (CEF), the EU’s instrument for strategic investment in infrastructure. This represents the largest call under the current CEF Transport programme. Around 83% of the funding will support projects that deliver on the EU’s climate objectives, improving and modernising the EU network of railways, inland waterways and maritime routes along the trans-European transport (TEN-T) network. Rail projects will receive 80% of the EUR 7 billion. Funding will go to major projects to improve cross-border rail connections along the TEN-T core network – in the Baltic Member States (Rail Baltica), between France and Italy (Lyon-Turin), and between Denmark and Germany (Fehmarnbelt tunnel).
Rail Baltica progress in 2024
In 2024, the Rail Baltica project has progressed into its next implementation phase, with around 15% of the Rail Baltica mainline expected to be under construction by the year’s end. In Estonia, construction has commenced on 22 km of the mainline, while procurements for an additional 52 km are in the final stages, with plans to launch procurements for another 30 km later in 2024. This will bring the total mainline coverage under construction contracts in Estonia to 102 km by year-end.
In Latvia, agreements have been reached for constructing over 200 km of the mainline, with preparatory works underway in the southern section and the start of construction on the initial 13 km expected in the coming months. In Lithuania, construction is progressing on 29 km of the mainline, with intentions to extend this to around 70 km by the end of the year.
Furthermore, public procurement processes are set to begin for the upper construction on the Sveicarija-Sėta section, along with design and build procurements for specific structural elements on the Kaunas-Lithuania/Poland border section, aimed at accelerating project implementation.
The two largest procurements—for electrification and for the control-command and signalling system design and construction—are proceeding according to the project’s overall timeline.
According to the 2024 Cost-Benefit Analysis, Rail Baltica’s economic benefits, both direct and indirect, are expected to surpass the costs, totalling EUR 48 billion for the Baltic States. The implementation cost of the first project phase, which aims to establish an operational Rail Baltica line across the three Baltic States and connect to Poland by 2030, is estimated to reach EUR 15.3 billion.
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