The European Commission has increased five-fold its proposed EU fund to wean carbon-intensive regions off fossil fuels, with fresh cash from a new recovery fund to help Europe’s ailing economies rebound after the new coronavirus pandemic.
Countries are already clamouring for a slice of the EU’s just transition fund, with 18 member states preparing to apply for support to wind down coal sectors, retrain workers and help carbon-heavy businesses pivot to greener activities.
The Commission on Wednesday (27 May) confirmed how much money will be on offer – €40 billion, made up of €30 billion from an EU coronavirus recovery fund and €10 billion from the bloc’s budget for 2021-27, according to Euractiv.com.
This is in 2018 prices, the Commission said, and would be worth roughly €44 billion in current prices. Its proposal needs approval from member states and EU lawmakers.
The proposal is more than five times bigger than the €7.5 billion just transition fund the EU executive proposed in January before it overhauled its budget proposals amid the pandemic.
When combined with €10 billion in loans from the European Investment Bank, the fund aims to trigger a total of at least €150 billion in just transition investments over 2021-27, including private capital, the Commission said.
The EU executive did not specify how the cash will be split between countries. The Commission’s previous proposal prioritised regions whose economies and jobs depend on polluting industries. Under those criteria, Poland was set to get the largest slice of the fund, with €2 billion, followed by Germany with €877 million.