Poland and Romania have earmarked a combined EUR 2.7 billion in EU public funds for gas expansion, a new report by Bankwatch reveals. In Romania, this unprecedented amount of money will be used to construct a new distribution network in Oltenia, an area currently not connected to the gas network. The ‘hydrogen-ready’ project will initially carry 80 per cent fossil gas and 20 per cent renewable hydrogen starting in 2026, with the aim of eventually transporting 100 per cent hydrogen from 2030 onwards. But there’s a real worry that the gas pipeline network will continue to transmit fossil gas, feeding the region’s addiction.
Poland’s Clean Air Programme, launched in 2018, aims to replace polluting heat sources and renovate existing building infrastructure. However, in reality, the programme is not so clean. With no thresholds for fossil gas boilers in place, and considering Poland continues to perceive fossil gas as a ‘clean’ energy source, the programme could result in hardcore gas lock-in for decades to come.
”The EU has adopted an ambitious climate policy, guided by the European Climate Law, ‘Fit for 55’ Package and REPowerEU. According to think tank E3G, EU fossil gas demand could be slashed by 52 per cent by 2030 (compared to 2019) if the REPowerEU plan is implemented. On the other hand, new gas projects, if approved today, will continue to operate well past 2050, releasing harmful pollutant emissions. Despite this, some EU Member States and the gas industry are trying to justify their plans to expand fossil gas infrastructure as being compatible with climate goals, based on the wishful claim that the infrastructure can be easily converted to supply hydrogen in the future,” says the report consulted by Energynomics.
”Poland and Romania are among them. Both rely heavily on fossil gas for their ‘decarbonisation’ plans and take strongly pro-gas stances at the EU level; in both cases, EU funding plays a critical role in the countries’ infrastructure investments, as both have been amongst the largest net recipients of EU funding in recent years.”
The cohesion policy is the EU’s main investment policy, providing funding equivalent to 8.5 per cent of government capital investment in the EU. In Poland and Romania, the share of cohesion policy funding in public investments is much higher than the EU Member States’ average: 60 per cent in Poland and approximately 45 per cent in Romania.
”The findings show that although the EU has put some restrictions on fossil gas financing in the current period, in Poland and Romania, EU funding for fossil gas has actually increased, rather than decreased. These examples show how allocations for fossil gas under existing EU programmes and funds are not compatible with the EU climate and energy transition agenda and, as such, require urgent revision,” Bankwatch concludes.