Is the EU Just Transition Fund all for naught?

(EurActiv, 6 Dec 2019) Whether €5 billion or €35 billion, the EU’s upcoming Just Transition Fund alone is unlikely to be enough to pay for the energy transition of Europe’s remaining coal countries. Nor is it necessary, argue Pieter de Pous and Rebekka Popp.

Pieter de Pous is senior policy adviser at E3G, a climate think tank. Rebekka Popp is a researcher at E3G’s Berlin office.

In a surprise announcement Wednesday (4 December), the European Commission President announced publication of a full legal proposal in January on the Just Transition Fund to help member states ditch coal.

In a bid to win support for new climate plans, the fund can now make an impact, but only if it aligns with the EU’s 2050 climate neutrality goal planned for adoption at next week’s summit, on 12-13 December.

Countries with a high use of coal in their energy mix undoubtedly face a major challenge in achieving zero emissions by 2050. And the creation of a Just Transition fund will undoubtedly help them overcome the difficulties of becoming climate neutral.

At the same time however, expectations for what this fund can deliver should be tamed. Whether €5 billion or €35 billion, the new fund alone is unlikely to be enough to pay for the energy transition of Europe’s remaining coal countries.

Nor is it necessary. Costs of decarbonisation are going down dramatically and will continue dropping, also in Central and Eastern European countries which are coal heavy. In Czechia, costs of new renewables are expected to be competitive with existing coal as early as 2021.

Analysis by WWF found additional investment needs for Poland are between €7.5 and €18 billion, providing a direct savings of €55 billion in reduced energy costs only. Other funds in the EU budget such as the European Social Fund, Cohesion Funds and the Modernisation Fund are available to help too.

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EurActiv, 6 Dec 2019: Is the EU Just Transition Fund all for naught?