The heads of government of the 27 EU member states have massively scaled back the funding earmarked for the “Just Transition Fund” in a four-day marathon that Commission President Ursula von der Leyen described as “an emotional rollercoaster”.
The fund to help Member States accelerate the transition to climate neutrality appears to be the real victim of the compromise reached. The Financial Times reports that the bottom it will only have 10 billion euros.
The previous proposals were on a very different order of ideas. As much as 30-40 billion euros, a more acceptable sum for Eastern European energy transition laggards such as Poland which say they need more EU assistance due to its high dependence on coal and lignite.
The Just Transition Fund is part of the EU's planned Green Deal to achieve net-zero emissions by 2050.
Only countries that have signed up to the goal of climate neutrality by 2050 will be eligible for funding which, for now, would exclude Poland.
EU highlights wind, solar and hydrogen in €750 billion recovery plan.
German Chancellor Angela Merkel insisted in April that the EU's massive recovery fund must be linked to protecting the climate, a clause now very weakened given the new entity of the Just Transition Fund.
The summit on the EU's €19 billion post-Covid-750 stimulus package and the €1 trillion-plus budget for 2021-2027 have repeatedly been on the brink of failure. The stalemate was caused by the requests of the "four frugal countries" Austria, Holland, Sweden and Denmark to reject the amount of money to be allocated in non-repayable subsidies, in relation to that to be allocated in loans.
Roller coaster
“We are aware that this is a historic moment in Europe,” von der Leyen said after nearly 100 hours of tense negotiations. “This is a roller coaster of emotions,” he said, adding that the moment of success was breathtaking.
