Poland may lose funds for a just transition

Access to half of the resources from the Just Transition Fund depends on the Polish government’s declaration of achieving climate neutrality by 2050.

On 25 February, the European Council’s website published the Just Transition Fund (JTF) Regulation in the version agreed by the European Commission, the Council and the European Parliament. The Just Transformation Fund is to help regions dependent on fossil fuel extraction to find and develop new economic alternatives that will provide jobs for the local community. Poland is allocated €3.9 billion under the JTF.

As Article 7 of the Regulation indicates, a Member State that does not commit to the climate neutrality target will only have access to 50% of its JTF allocation for each subsequent year of the Fund’s implementation.

In other words, from the very beginning of the programme, Poland will not be able to use half of the funds to which it is entitled, i.e. almost €2 billion. The possibility of reaching for this money in the future will also be blocked. Without a commitment to climate neutrality, the quotas for the coal regions will be reduced right from the start.

If a Member State commits to climate neutrality by 2050, it will be able to apply for the full annual tranches. Delaying this could prove costly. The rules are clear: a country can only apply for funds attributed to the year in which it has declared to reach the Net Zero target, and for subsequent years until the end of the Multiannual Financial Framework, i.e. 2027. Unused funds from earlier tranches, corresponding to years in which the country has not declared a climate neutrality target, will be irretrievably cancelled. This clock will start ticking as early as next year, and each additional year of delay means the loss of hundreds of millions of euros from the Just Transition Fund. If Poland, for which every Polish zloty should count, wants to benefit from all the funds allocated to it under the JTF, it must declare its accession to the EU climate target by the end of next year at the latest.

Although the Regulation mentions climate neutrality at the EU level, it explicitly cites the content of the Council conclusions of 12 December 2019, under which the EU neutrality target was adopted. A caveat is written in there saying that „at this stage, one Member State cannot, as far as it is concerned, commit to this objective“. This is Poland, and the withdrawal of this reservation and a formal commitment to the EU target is a condition for accessing the full JST funds.

Polish coal regions are currently preparing their Territorial Just Transformation Plans to benefit from EU money in creating a new post-coal future. Access to just 50% of the funds due to the ‚black gold‘ regions will lead to missed opportunities to finance key investments that create new jobs for miners and improve the quality of life in the region.