European Union countries on Monday approved the bloc’s flagship fund to wean them off fossil fuels and protect communities most affected, paving the way for members to start receiving the cash.
The 17.5 billion euro ($21.27-billion) Just Transition Fund (JTF) combines money from the EU’s budget and its COVID-19 recovery fund.
It is designed to support communities most affected by plans to shut down coal, peat and oil shale sectors or other emissions-intensive industries. It will back projects including managing closures of coal mines and retraining workers.
Replacing carbon-heavy sectors with green industries and jobs is key to putting the EU on track for its target to have zero net greenhouse gas emissions by 2050.
EU countries on Monday adopted the JTF regulation, the final hurdle before it enters into force. The European Parliament approved it last month.
“The Just Transition Fund will provide much needed support to companies and workers at local level,” said Portuguese planning minister Nelson de Souza. Portugal chairs meetings of EU ministers until July.
To receive funds, countries must submit plans to the European Commission for approval, showing how they will use the cash to transition to greener industries.
Poland is in line for the biggest share, followed by Germany and Romania. All three have coal-mining regions.
The Commission has warned, however, that the Polish region of Bogatynia will not receive funding if the government presses ahead with a plan to keep its Turow coal mine open until 2044.
JTF money cannot be spent on nuclear power or fossil fuels, including natural gas.
The Commission had proposed putting €40-billion in the fund, although the amount was cut during negotiations between EU countries last summer over the bloc’s budget.
Be smart with your money. Get the latest investing insights delivered right to your inbox three times a week, with the Globe Investor newsletter. Sign up today.