14 – FINANCIAL AND OPERATIONAL CAPACITY AND EXCLUSION

14.1    Financial standing

1. Applicants must declare that they are natural persons or the entity they represent have not gone bankrupt or been bankrupt, are not in a state of liquidation, and have not been criminally convicted by a court decision.
2. A company will be deemed to be in financial difficulty if, over the past two years, its liabilities-to-equity ratio has exceeded 7.5. Furthermore, a company is considered to be in difficulty if, in the last two years, the interest coverage ratio has been below 1. Companies facing financial difficulty are ineligible to submit bids for any tender of this Scheme.

14.2     Financial capacity

3. Applicants are required to possess stable and sufficient resources to effectively implement the projects and contribute their respective shares. Organisations involved in multiple projects must demonstrate adequate capacity to manage all these initiatives. The assessment of financial capacity will be conducted using documents from the last two financial years, which applicants are required to upload to their online application form during the grant preparation phase. This includes items such as profit and loss account, balance sheet, business plan, and an audit report produced by an approved external auditor certifying the accounts for the last closed financial year. The analysis will focus on neutral financial indicators but will also consider other factors, such as dependence on EU funding and past deficits and revenues.
4. If an applicant applying for investment aid for an existing project has previously received public funding for the energy storage component, they are required to disclose information and comply with the per project / per undertaking limits specified in Regulation (EU) 2023/1315.
5. The check will normally be done for all beneficiaries, except public bodies (entities established as public body under national law, including local, regional or national authorities) or international organisations
6. If the Committee considers that an applicant’s financial capacity is not satisfactory, it may require:
   1. further information
   2. an enhanced financial responsibility regime, i.e., joint responsibility for all beneficiaries or joint liability of affiliated entities or
   3. request that an affiliated entity is replaced or, if needed, reject the entire proposal.

14.3     Requirements for bank guarantees, good operation and participation fee.

Table 3: Bank Guarantees

The annual production will be compared based on national data and if the system produces up to ±20% of the average expected generation then the 10% will be released.

For self-consumption projects, a report from the monitoring system and / or SCADA will be also accepted as a proof of good operation. MECI has the right to inspect the storage system once a year before the 10% is released.

14.4     Operational capacity

1. Applicants are required to possess the necessary expertise, qualifications and resources to effectively implement the projects and contribute their share, which includes having sufficient experience with projects of similar scale and type. This capacity will be evaluated in conjunction with the ‘Quality’ award criterion, which considers the skill and experience of the applicants and their project teams, as well as their operational resources (human, technical and others).
2. If the evaluation of this criterion is favourable, the applicants will be deemed to have adequate operational capacity. Applicants must demonstrate their capacity by providing the following information:
   1. general profiles (qualifications and experiences) of the staff responsible for managing and implementing the project
   2. description of the consortium participants, if applicable
   3. applicants’ activity reports of last year
   4. list of previous RES projects
3. Additional supporting documents may be requested, if needed to confirm the operational capacity of any applicant.

14.5     Exclusion

1. Applicants which are subject to an EU exclusion decision or in one of the following exclusion situations that bar them from receiving EU funding can NOT participate:
   1. bankruptcy, winding up, affairs administered by the courts, arrangement with creditors, suspended business activities or other similar procedures (including procedures for persons with unlimited liability for the applicant’s debts) in breach of social security or tax obligations (including if done by persons with unlimited liability for the applicant’s debts);
   2. shown grave professional misconduct (including if done by persons having powers of representation, decision-making or control, beneficial owners or persons who are essential for the award/implementation of the grant);
   3. committed fraud, corruption, links to a criminal organisation, money laundering, terrorism-related crimes (including terrorism financing), child labour or human trafficking (including if done by persons having powers of representation, decision-making or control, beneficial owners or persons who are essential for the award/implementation of the grant);
   4. shown significant deficiencies in complying with main obligations under an EU procurement contract, grant agreement, prize, expert contract, or similar (including if done by persons having powers of representation, decision-making or control, beneficial owners or persons who are essential for the award/implementation of the grant);
   5. performed irregularities within the meaning of Article 1(2) of Regulation No 2988/95 (including if done by persons having powers of representation, decision-making or control, beneficial owners or persons who are essential for the award/implementation of the grant);
   6. created under a different jurisdiction with the intent to circumvent fiscal, social or other legal obligations in the country of origin or created another entity with this purpose (including if done by persons having powers of representation, decision-making or control, beneficial owners or persons who are essential for the award/implementation of the grant).
   7. Applicants may also be rejected if it turns out that:
      1. during the award procedure they misrepresented information required as a condition for participating or failed to supply that information;
      2. they were previously involved in the preparation of the call, and this entails a distortion of competition, in case the information was kept confidential from other participants, that cannot be remedied otherwise (conflict of interest).

[1] Bank guarantee will be released once the project is validated by the Committee.

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