Ubiquitin-like modifier involved in cytoplasm to vacuole transport (Cvt) vesicles and autophagosome formation. With ATG4, mediates the delivery of the vesicles and autophagosomes to the vacuole via the microtubule cytoskeleton. Required for selective autophagic degradation of the nucleus (nucleophagy) as well as for mitophagy which contributes to regulate mitochondrial quantity and quality by eliminating the mitochondria to a basal level to fulfill cellular energy requirements and preventing excess ROS production. Participates also in membrane fusion events that take place in the early secretory pathway. Also involved in endoplasmic reticulum-specific autophagic process and is essential for the survival of cells subjected to severe ER stress. The ATG8-PE conjugate mediates tethering between adjacent membranes and stimulates membrane hemifusion, leading to expansion of the autophagosomal membrane during autophagy. Moreover not only conjugation, but also subsequent ATG8-PE deconjugation is an important step required to facilitate multiple events during macroautophagy, and especially for efficient autophagosome biogenesis, the assembly of ATG9-containing tubulovesicular clusters into phagophores/autophagosomes, and for the disassembly of PAS-associated ATG components. Contributes to normal formation of appressoria in the earlier steps of morphogenesis and to pathogenicity