Regulation (EU) 2021/1056 establishing the Just Transition Fund

What it is

to establish a Just Transition Fund to assist territories facing economic and social transformation as part of their transition to a climate-neutral economy by 2050. PROPOSED ACT: Regulation of the European Parliament and of the Council. ROLE OF THE EUROPEAN PARLIAMENT: the European Parliament decides in accordance with the ordinary legislative procedure on an equal footing with the Council. BACKGROUND: the transition to a circular, climate-neutral economy is one of the main strategic objectives of the Union. On 12 December 2019, the European Council endorsed the objective of achieving a climate-neutral Union by 2050, in line with the objectives of the Paris agreement. The Committee on Regional Development adopted the report by Manolis KEFALOGIANNIS (EPP, EL) on the proposal for a regulation of the European Parliament and of the Council establishing the Just Transition Fund. The committee recommended the European Parliament to adopt its position at first reading in accordance with the ordinary legislative procedure, subject to the following amendments. Members stipulated that the proposed Regulation shall establish the Just Transition Fund (‘JTF’) to provide support to the people, economy and environment of territories that face serious socio-economic challenges deriving from the transition process towards the achievement of the Union’s 2030 targets for energy and climate, and a climate-neutral economy of the Union by 2050. Members called for the support of the scope to be broadened in order to include sustainable investments in: (i) microenterprises and SMEs, including start-ups and sustainable tourism; (ii) social infrastructures; (iii) investments in smart and sustainable mobility and environmentally-friendly transport infrastructure; (iv) research and innovation activities, including in universities and public research institutions; (v) projects fighting energy poverty, particularly in social housing, and promoting energy efficiency, a climate neutral approach and low-emission district heating in most affected regions;(vi) green infrastructure as well as regeneration and decontamination of sites, brown fields and repurposing projects, when the ‘polluter pays’ principle cannot be applied. The following shall be excluded from the scope of the JTF funding: - investment in enterprises other than SMEs, involving the transfer of jobs and production processes from one Member State to another or to a third country; - operations in a NUTS 2 region where an opening of a new coal, lignite or oil shale mine or of a peat extraction field or a reopening of a temporarily decommissioned coal, lignite or oil shale mine or of a peat extraction field is scheduled during the duration of the programme. For regions heavily reliant on the extraction and combustion of coal, lignite, oil shale or peat, Members proposed a derogation for investments in activities related to natural gas. In this sense, the Commission may approve Territorial Just Transition Plans that include such activities, if they qualify as “environmentally sustainable” in accordance with the Taxonomy Regulation and comply with six additional cumulative conditions. Members requested a…

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