The Council of the EU has officially adopted a €17.5 billion Just Transition Fund (JTF) for communities that rely on fossil fuel industries.
The council made the announcement yesterday (Monday, June 8). The JTF is, according to the council, aimed at “financing projects that will alleviate the socio-economic costs for communities across the EU that are heavily dependent on fossil fuels or greenhouse gas-intensive industries”.
Communities that have a “need to diversify the local economy” will be in line for the funding, the council said. The midlands region of Ireland is expected to fall into this category.
The EU is aiming to cut greenhouse gas (GHG) emissions by 55% by 2030, and to be climate neutral by 2050.
“The success of the European Green Deal rests on us mitigating the consequences for those most affected by the decarbonisation of the economy,” said Nelson de Souza, Portugal’s minister for planning (Portugal currently holds the presidency of the council).
He added: “The Just Transition Fund will provide much needed support to companies and workers at local level, so that we can combat climate change together, leaving no one behind.”
According to the council, the JTF aims to prevent disparities by investing in territories that will have to phase out the production and use of coal, lignite, peat and oil shale under current and future climate regulations.
The council noted that EU regions and member states have “different starting points in the climate transition and different capacities to tackle the challenges ahead”.
The funding will be made available only on the basis of territorial just transition plans to be prepared by member states together, with the relevant local and regional authorities.
The €17.5 billion is made up of €7.5 billion available for budgetary commitments for the period 2021-2027 and €10 billion from the recovery instrument (Next Generation EU) available over the years 2021, 2022 and 2023.
Member states will also contribute towards JTF programmes. In addition, they can transfer resources from the European Regional Development Fund and the European Social Fund Plus. This can potentially mobilise close to €30 billion in investments.
The main emphasis of the fund, the council says, is helping people adapt to new employment opportunities through investment in training and retraining of workers and job seekers; job-search assistance; and measures for social inclusion.