The climate crisis is the biggest threat humanity has ever faced. To ensure a safe future for the next generations, we must not only shift our economy away from fossil fuels in order to keep global temperature rise to well below 2C, but we must also ensure that this transition is just. That means taking into account the frontline communities currently impacted by the climate crisis, as well as ensuring that no one is left behind in a transition towards a more sustainable economy.
To make the transition just and leave no one behind, it is crucial to support those who still heavily rely on fossil fuel or carbon intensive industries. A just transition both protects those who will suffer the most from the climate crisis and the necessary transition. Its aim is to improve the overall quality of life by ensuring more equal societies, cleaner air, healthier ecosystems, greater energy security and a more innovative economy.
One of the European regions that will be heavily impacted by the transition is the southern region. For example, Greece, with its abundant coal resources in the Western Macedonia and Arcadia regions, it is one of the most lignite- (brown coal) dependent countries in Europe. The Greek government intends to shut down all the country’s lignite plants by 2028 which threatens the loss of 1,833 jobs in Western Macedonia alone and risks as many as 6,000-8,000 more jobs indirectly [WWF]. Although the opportunities in newer sectors such as land restoration, energy efficiency, clean energy and waste management are abundant, the abrupt shift, without a clear plan for a transition doesn’t protect those who will be impacted the most.
One key demand of the Greek green party, Oikologoi Prasinoi, is for the Just Transition Fund to take into consideration the speed of decarbonisation. The rapid decarbonisation strategy from Greece in comparison to the much slower coal phase out in Poland for example, doesn’t add up with the allocated budget to each country. Poland, while transitioning more slowly, will receive more EU funding, than Greece. We therefore need to consider how we can incentivize a rapid coal phase out, while also ensuring fairness between member states and support for the communities impacted. Along with this Greens are demanding sufficient funding focused in areas that will be impacted the most. The process needs to be transparent and involve citizens and communities at all stages.
Under the European Green Deal, the EU committed to becoming climate neutral by 2050. However, it is crucial to recognise that not all regions are starting from the same point when it comes to the transition. We might all share the same ambitions, but some may need more support than others to get there.
The European Green Deal’s Just Transition Mechanism was presented by the EU Commission on 14 January 2020 as a tool to ensure a just transition to a climate neutral economy. It was created to alleviate the socio-economic impact of the transition to a greener world and to ensure no one is left behind.
But what exactly is the Just Transition Mechanism?
The mechanism is based on three pillars;
The Just Transition Fund (JTF), the first pillar of the Just Transition Mechanism, is an EU funding tool for regions highly dependent on fossil fuels and high-emission industries. The aim is to help these regions during this necessary transition by investing in small- and medium-size enterprises (SMEs), the creation of new firms, research and innovation, environmental restoration, clean energy, reskilling of workers, job search assistance, and the transformation of carbon-intensive industries.
40 billion euros was the first proposed buget for the Just Transition Fund. But it was later cut in half by EU governments – even though Greens fought against this. The JTF now has 17,8 billion euros at its disposal (7,5 billion € come from the Multiannual Financial Framework while another 10 billion € come from the NextGenerationEU Fund). This does not meet the demands of the Greens/EFA Group and the EU commission itself. Nevertheless, the Greens/EFA Group has successfully ensured that money from this fund will not be used to support any new natural gas infrastructure nor other fossil fuels.
The second pillar; The Just Transition scheme under InvestEU, provides funding for a wider range of investments such as energy and transportation infrastructure, digitalisation and digital connectivity, and circular economy investments. This pillar is equipped with 1,8 billion euros.
The third pillar; The Public Loan Facility which will essentially support public investments by offering preferential loaning conditions to those areas most effected by the transition. It provides another 1,5 billion euros together with a 10 billion euro loan from the European Investment Bank to invest in energy and transport infrastructure, district heating networks, energy efficiency measures, and social infrastructure.
Green thoughts on the JTM
The Just Transition Mechanism focuses on making the transition away from extractive industries such as coal, oil shale and lignite coal, as well as other carbon intensive industries, fair. However, industries that contribute to global warming are not limited to those listed above. Industries such as agriculture, trade, transportation and fashion also pose a big threat, worsening global warming and endangering life on earth. The Just Transition Mechanism does not yet ensure a just transition for these other sectors that also play a significant role in the warming of our planet, biodiversity loss and endangering the future of humankind. Nor will it ensure fairness for workers and communities outside of the EU. Therefore, it is crucial that we also continue to fight for better trade deals, supply chain transparency and environmental standards.
Some of the Green demands, to enhance the Just Transition mechanism are to incorporate an element of time in allocating the budget (stated above) and involving local communities in the decision making of the JTM. Alongside this we are also advocating for immediate income solutions and re-education plans for those who have been heavily impacted or lost their jobs due to the transition.
As Greens we believe that the necessary transition to a greener and more sustainable future cannot be made without ensuring that no one is left behind. The EU Just Transition Mechanism is a crucial part of the EU Green Deal and contains much needed support for those who will be impacted the most by the transition towards a greener and fairer Europe. But we must ensure these promises are put into action. The mechanism must protect both people within the EU and those living beyond our borders in every sector impacted by the transition towards a greener world. As well as safeguarding the invested money and making sure it is only spent on real green action.