What is the Just Transition Fund?

The EU Just Transition Fund (JTF) is a fund to assist communities to meet the challenges of the green transition. In line with the objective of achieving EU climate neutrality by 2050 in an effective and fair manner, the European Green Deal proposed a Just Transition Mechanism, to leave no one behind. The JTF is the first pillar of the Just Transition Mechanism and will provide support to all Member States.

Established within the framework of cohesion policy, the JTF will be a key tool to support the territories most affected by the social and economic impacts of the transition towards climate neutrality. The EU JTF is part of both the EU’s Multi-annual Financial Framework (MFF) and the €750-billion ‘Next Generation EU’ instrument, the European Union’s recovery programme in response to the Covid-19 virus.

The JTF will have an allocation of €19.2 billion to be distributed across EU Member States over the period 2021-2027. Ireland has been allocated up to €84.5 million under the EU Just Transition Fund and the Government of Ireland will also match this funding with Exchequer resources.

The fund will invest in specific projects that will generate employment in less carbon-intensive industries and help to absorb redundancies from the reduction in size or closure of the exiting factories or plants in the regions. The JTF supports include investment in SMEs and start-ups, research and innovation, transfer of advanced technologies, affordable green energy, as well as decarbonisation of local transport. This is to assist in the long-term process of phasing out production and use of coal, lignite, peat and oil shale, or transform carbon-intensive industries.

The investment support will be based on the specific investment needs identified in the Territorial Just Transition Plans as drafted by the EU Member States and the InvestEU programme (2021 – 2027).

One region of Ireland to be particularly affected by climate mitigation policies and decarbonising of the local economy is the Midlands region due to the significant presence of Bord na Móna. The phasing out of peat for electricity generation and home heating will generate a significant challenge to the local labour market, particularly for the employees of Bord na Móna and the businesses that support it.

In addition to the EU policy actions, the Irish Government has also established an Irish Just Transition Fund 2020 and the Office of a Just Transition Commissioner. The Just Transition Fund 2020 is a €11 million fund for retraining programmes of the workers and for supporting employment opportunities in green enterprises in the Midlands region. The fund has three areas of focus: employment and enterprise; training; and community transitioning. It may be a model for other areas.

 

Territorial Just Transition Plans

In order to access the Just Transition Fund, EU Member States must produce and submit Territorial Just Transition Plans to the European Commission. The territorial plans will outline the regions and sectors seeking funding from the EU Just Transition Fund. The plans will include the economic, social and environmental implications for the regions for decarbonising greenhouse gas-intensive sectors. The plans outlined a timetable of the proposed transition process until 2030, in terms of regional economic development, labour market training and reskilling needs, and environmental protection. The plans should also provide key performance indicators and governance mechanisms.

The EU Just Transition Platform offers technical and advisory support to regions and stakeholders. The aim of the platform is to assist regions in unlocking the EU supports available and help the regions absorb the funds.

For more information, please email EUJTF@decc.gov.ie