Just transition to climate neutrality – Council agrees its position on the new public sector lending facility
Just transition mechanism
EU institutions are working to address the social and economic consequences of the process of transitioning towards the EU’s climate targets by 2030 and the EU’s climate neutrality target by 2050.
Member States’ Ambassadors to the EU today approved the Council’s position on a new public sector lending facility to be created under the Just Transition Mechanism to support public sector investments in the most vulnerable regions. affected by the transition to a climate neutral economy due to their carbon impact of intensive economies and a lower capacity to face the challenges of the transition.
The new public sector loan facility will provide € 1.5 billion in grants from the EU budget to enable financial partners to support projects responding to the challenges of the transition process. As a financial partner, the European Investment Bank is expected to provide 10 billion euros in loans, which should mobilize up to 25-30 billion euros in investments to help the most affected regions identified in the plans for just transition of member states.
In its position, the Council suggests some limited changes to the Commission proposal presented in May. In particular, the Board specifies that the facility should not support activities excluded from the scope of assistance under the Just Transition Fund. This includes investments related to nuclear power plants, tobacco products and fossil fuels, depending on the Council’s position on this fund. In addition, the Council position provides for the possibility for projects supported under the Facility to also benefit from advisory and technical support from other EU programs.
Today’s Council position will guide the Presidency in negotiations with the European Parliament.