Hungary could be compensated through just transition fund
The European Commission estimates that the financial and humanitarian burden of transition for fossil fuel-dependent regions could require EUR 35 bn over the seven-year budget cycle..
The so-called Just Transition Fund (JTF) will focus on the "regions and industries most affected by the challenges," according to an EC document. Grants will be tied to decarbonising, such as closing down coal-fired power plants or retraining labour.
Partly in reaction to social pressure, the EU is accelerating its carbon dioxide emission cut programme and intends to achieve a climate-neutral economy by 2050. However, 240,00 people in 41 regions of 12 member states are still working in coal-related jobs, while 8 million employees across Europe are working in carbon-intensive industries.
The EUR 35 bn funding could come from two sources. For a start, there's the EUR 5 bn the EP approved to add to the multiannual financial framework (MFF) in May 2018 for fossil fuel-dependent regions. This could be doubled by regrouping funds from the two main structural funds, with a further EUR 5 bn added through national co-financing. Meanwhile, the InvestEU investment programme set up by the Juncker plan would create a separate financial product for the just transition, mobilising EUR 20 bn from the capital markets using a EUR 1.5 bn guarantee. As a result, the total amount earmarked for the transition of affected regions between 2021 and 2027 could reach EUR 35 bn.