The "EU4Energy: Covenant of Mayors – Demonstration Projects" programme supports municipalities that have signed up to the Covenant of Mayors (CoM), a voluntary initiative that commits local authorities to reducing their CO2 emission by 20% by 2020. It provides grants as well as technical assistance to implement selected energy efficiency projects.

The programme aims to bridge the gap between Sustainable Energy Action Plans and their practical implementation in selected municipalities, signatories of the Covenant of Mayors, through the implementation of demonstration projects. The programme addresses the limited technical and financial capacities of municipalities that have signed up to the Covenant of Mayors, but are not able to finance the measures described in their action plans from their own budget.

The programme comprises two main components:
Grants awarded to 19 selected projects (11 projects in Ukraine, 3 in Moldova, 3 in Belarus, 1 in Armenia and 1 in Georgia) – grants range between €400,000 and €1.2 million. The selected projects focus on energy savings through:
- Building refurbishment (public and residential buildings).
- Upgrading district heating systems.
- Introducing energy-efficient street lighting.
- Upgrading public transport.
- Improving energy efficiency in (waste) water systems.
- Energy production through PV/solar and biomass.
Technical, procedural, communication and networking assistance provided by the programme Support Team, including individual consultations, trainings, networking events, engineering support and other supporting actions.

As a result of a competition organised by the EU in 2017, 14 new projects were selected for the second round of the "Covenant of Mayors – Demonstration Projects" programme. The projects will be implemented in 14 municipalities across five Eastern Partner countries. There will be 6 projects in Ukraine, 3 in Moldova, 2 in Belarus and Armenia, as well as 1 in Georgia. Many of the selected projects will involve retrofitting public buildings, increasing energy efficiency, modernising public lighting and developing the renewable energy sector. All the projects started in 2018 and will be implemented over the course of the next two to three years.