Pieter de Pous / Jan 2020
Poland’s continued reluctance to commit to zero emissions by 2050 is now putting it at risk of getting left out in the cold. Namely, from new sources of financial support to achieving that very goal.
Backed by a small and decreasing group of other Member States, Poland spent much of 2019 dragging its feet over an EU agreement on a zero emissions target by 2050. The county argued it needs more financial support to sign up.
With negotiations going down the wire in December 2019 over the EU’s endorsement of a 2050 climate neutrality goal, Poland’s reservation about its own commitment to implement that goal quickly backfired. Not least because von der Leyen had responded to Polands’ request for more financial support with an offer of a €100 billion Just Transition Mechanism.
France, a net contributor to the EU budget, was quick to point out that this funding is only available to those committing to the new climate goal, while Greece, a net recipient of the EU Budget, was equally eager to take advantage of Poland’s ambiguity and write the new Fund’s rules to its advantage.
By the time the Council will revert to the topic of climate neutrality in June 2020, the debate will already have moved on. Negotiations on the new EU Climate Law, which will regulate the 2050 as well as a new 2030 climate goal and the new Just Transition Fund set for publication this week, will be in full swing by then. With those negotiations following the qualified majority rule, Poland won’t be able to block it the way it did before.
The crucial question in the months ahead for EU negotiators will no longer be one of ambition for 2050, but how together a new Climate Law and Just Transition Fund can deliver.
Central to the Just Transition Fund’s success will be so-called climate-conditionality, the notion that only countries that commit to implement EU climate targets will receive funding The Commission has been hinting to this over the past months, arguing for example that ‘If one sets up a just transition fund, one should also be sure that the transition progresses, otherwise it’s a bit problematic’. Critical to making this climate-conditionality work in practice will be a clear, legally binding requirement for the ‘Just Transition Strategies’ to be developed under the new Fund to include ambitious coal phase out plans.
A second important element is to ensure the new fund helps decarbonize the entire European economy, not just its energy sector. This could be achieved by prioritising spending on Europe’s coal and coal dependent heavy industry regions in its first years and then extending the Fund’s scope to other sectors in a second phase, using a review mechanism.
This wider scope will, incidentally, also be in the interest of a lot of Central and Eastern European countries whose manufacturing sector is highly dependent on western European car makers, most of whom by now are playing catch up with Tesla and embracing electrification.
But also other sectors like farming which have yet to face up to transformational changes being driven by a combination of changing diets, climate impacts and technological developments in precision biology and fermentation. The agriculture sector will need support from this Fund to urgently start considering future scenarios and employment impacts.
Last but not least the Fund should set realistic objectives for itself, in particular for the expected 7.5 billion of additional money. Highest added value will be secured if that funding is prioritized for the development of Just Transition Strategies.
If EU negotiators get the design of the Just Transition Fund right, a European-wide coal phase out by 2030 will be within reach. To the skeptical, just look at 2019’s end of year and decade reviews which demonstrated how fast the UK’s power system transformed from one dominated by coal, to one led by renewables and gas. It took less then a decade.
Now Poland will need to make up its mind about its energy future. Last December’s Council decision means it will be a low carbon one. The choice Poland now has is whether it wants to accept the helping hand it has been offered by its European partners in recognition of its particularly challenging situation, or not.