What goes on in Poland on the 15th of January.
The three pillars of the just energy transition mechanism
The European Commission has proposed that the Just Energy Transition Fund should include EUR 7,5 billion in new funds. Meanwhile, all investments for the European Green Deal are to amount to at least a trillion euros.
According to the European Commission communique, the first of the three main sources of funding for the mechanism will be the Just Transition Fund, which will receive 7,5 billion EUR of new EU funds, which will increase the amount foreseen in the Commission proposal for the next long-term EU budget. In order to use their funds, the Member States, when conducting a dialogue with the Commission, will have to identify eligible areas in the so-called territorial plans for just transition. They will also have to commit that Member States will contribute the same amount from the European Regional Development Fund and the European Social Fund Plus to the resources of the Fair Transformation Fund and make additional national resources available. In total, this will provide funding of EUR 30-50 billion, which will attract even more investment. The fund will primarily be used to provide grants to regions. For example, it will support employees in developing the skills and competences needed in the future on the labor market, and help SMEs, start-ups and business incubators to create new economic opportunities in these regions; It will also support investments aimed at converting to clean energy, for example increasing energy efficiency.
The second element will be a special just transition system under Invest EU to launch investments worth up to EUR 45 billion. Its purpose will be to attract private investment, including in sustainable energy and transport infrastructure, benefiting the affected regions and helping these economies find new sources of growth. The last source will be the European Investment Bank’s loan facility for the public sector, guaranteed by the EU budget, to mobilize investments worth EUR 25-30 billion. It will be used for loans to the public sector, for example for investments in heating networks and renovation of buildings. In March 2020, the Commission will present a legislative proposal to establish this instrument.
Poland is negotiating the terms of agreeing to the goal of climate neutrality by 2050. In return, it expects to receive specific support for the energy transition that will achieve this goal. The European Commission’s proposal will be subject to further discussions within the EU institutions. – From the perspective of Poland is disappointing that the money will be available to all Member States, so the stream that will reach it will be smaller than if the funds were directed only to poorer countries – informs the Polish Press Agency. – Another disappointment may be that the funds will not only go to regions whose economies are heavily dependent on coal, but also, for example, where peat is extracted (it is used as an energy resource in Ireland). Areas where shale oil is exploited are also eligible.