A new fund in the Cohesion Policy family

The Just Transition Fund (JTF) is one of the most striking and visible aspects of the 2021-2027 period of Cohesion policy. The JTF is part of the Just Transition Mechanism, created to make sure that no person and no region is left behind in the climate transition. 
The JTF was set up as part of the European Green Deal, Europe’s main growth strategy. The European Green Deal sets an ambitious long-term objective of becoming the first climate-neutral continent by 2050. Essentially, it is a strategy aimed at transforming the Union into a competitive economy, where there are no net emissions of greenhouse gases (GHG) and where economic growth is decoupled from resource use.
Use this data story to explore the investment plans of the JTF in the EU and in specific territories.

EUR 25 billion to soften the impacts of the transition

To support the climate transition, for example through energy efficiency or renewable energy, the ERDF and the Cohesion Fund are the primary investment instruments. The JTF, on the contrary, specifically aims to help the people and places that suffer the most from the transition to climate neutrality. It is therefore more targeted – both geographically and thematically – than other cohesion policy funds.
The JTF EU budget contribution is EUR 19.3 billion, of which EUR 19.2 billion is available to Member States (not counting the technical assistance available to the European Commission). The EU budget share includes EUR 8.4 billion from the Multi-Annual Financial Framework and EUR 10.8 billion from the European Recovery Instrument (NextGenerationEU). In combination with national co-financing, EUR 25.4 billion is currently available from the adopted JTF programmes to support necessary investments.
Note:- Greece used the option to transfer part of its allocations (EUR 545 million) from the ERDF and ESF+ to the JTF.

96 territories, covering coal regions and carbon-intensive regions

The JTF helps to deal with the negative social, economic, environmental, demographic and health impacts of the climate transition. While all Member States can benefit from the JTF, only the most negatively affected regions in each Member State are eligible. This can include territories dependent on the extraction or production of coal, lignite, peat and oil shale (which are expected to decline, leading to job losses and other negative impacts), or territories dependent on carbon-intensive industries such as steel, cement or chemicals (which need to fundamentally transform, leading to changes in skills and job profiles as well as other impacts).
The geographical scope of the JTF in each Member State was part of the negotiations on the territorial just transition plans (TJTPs), which are added to the cohesion policy programmes. Each TJTP includes an analysis of how the territories are most negatively affected, based on the economic and social impacts resulting from the transition. In particular, the plans look at how many jobs will be lost and describe the transformation of the production processes of industries with the highest emissions.
As a result of the JTF programming negotiations, the Commission approved 70 TJTPs, covering 96 specific territories. The JTF regions can be seen on the interactive map opposite.
Tips:
- Compare the Commission’s initial proposals by clicking on the ‘layers’ in the upper right corner.
- Change the base layer to open street map to see surrounding geographic features.

A variety of investment themes are supported 

The main objective of the JTF is to alleviate the impacts of the transition in the most affected territories. It does so by promoting a balanced socio-economic development based on investments in future-proof sectors that offer opportunities for affected workers and jobseekers. The two main priorities of the JTF are to diversify local economies (so that they do not depend anymore on a single, polluting sector) and to reskill and upskill workers and jobseekers. 

Overview of main JTF thematic priorities

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Tips:
- Use the drill up/down buttons (top left of charts) to explore the JTF major themes by  country / Intervention fields.
- Use the filter menu (top right of charts) to focus on specific countries or programmes.

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Do you want to know more about a particular country or programme?
Use the "master filter" below to display specific data on a country or programme in all the thematic charts below. 
Tips for the individual thematic charts below:
- Use the drill up/down buttons (top left of charts) to explore the JTF major themes by  country / Intervention fields / programme allocations.
- Use the filter menu (top right of charts) to focus on specific countries or programmes.  

Half of the JTF investments help people find new skills and reinvent the local economy

The main objective of the JTF is to alleviate the impact of the transition in the most affected territories. It does so by promoting balanced socio-economic development based on investments in future-proof sectors that offer opportunities for affected workers and jobseekers. The two main funding priorities of the JTF are to diversify local economies (so that they no longer depend on a single, polluting sector) and to reskill and upskill workers and jobseekers.  
The support from JTF will focus largely on the development of small and medium-sized enterprises (SMEs) and start-ups, so that new activities can blossom in the affected territories and the economy becomes more resistant to future shocks. A large part of the support will also flow towards research and innovation activities of SMEs.

Within the support for skills and job-search, the majority of resources are dedicated to support access to employment programmes, especially for the long-term unemployed and youth. The JTF will also invest in the jobs of the future, focusing largely on digital skills and on the modernisation of the labour market. Last but not least, the JTF includes dedicated investments to overcome the structural gender imbalances in labour markets, in particular concerning women’s labour market participation and work-life balance.
Together, the JTF resources for reskilling people and reinventing the local economy will amount to almost half of the total JTF budget.


Getting ready for the future: clean energy, circular economy and innovation

Leaving no region behind in the climate transition means phasing out certain activities while creating chances for others. It is precisely for this that the JTF will finance the development of certain sectors that can absorb workers coming from phased-out activities. These ‘futureproof’ sectors will hold the key to a successful transition in the most affected territories and will make the shift to climate neutrality a tangible reality for EU citizens.
Many JTF regions want to turn themselves into alternative energy hubs. Regarding clean energy, the JTF will concentrate its support on solar, wind, biomass and other innovative technologies such as marine or geothermal energy. Dedicated investments in clean energy will also target the replacement of heating systems, including district heating and energy efficiency investments such as deep renovations in housing and enterprises.
Another promising area for JTF investments is the circular economy. While some coal regions want to use their expertise linked to coal extraction for other raw materials, other regions with carbon-intensive industries see it as an avenue to invest in reuse and recycling to transform the production of cement, glass, steel or other products. For the same reasons, Member States have allocated significant resources under the JTF to research and innovation.
These investments will lead to the development of clean technologies (‘cleantech’), helping regions to specialise in green and futureproof economic sectors and delivering on the Green Deal Industrial Plan (the plan proposed by the European Commission in February 2023 to support net-zero technologies needed to reach climate goals).

Cleaning the environment

To achieve a just transition we also need to remedy damage already caused in certain areas. The regeneration of sites that once hosted, for instance, coal or peat extraction activities is complex and costly. To give the most affected territories the necessary means to clean such spaces and make them ready for their reconversion, the JTF will provide specific support on cleaning the environment (but only after it is verified that the polluter cannot pay for it, according to the so-called ‘polluter pays principle’). This support also includes dedicated funding for water management and water resource conservation, where those are linked to former fossil fuel extraction activities.


In specific cases, the JTF supports large enterprises and ETS installations

The JTF can, under certain conditions, give support to large enterprises and, in industrial facilities, to investments reducing GHG emissions from certain activities. This is not possible under the provisions of the ERDF and Cohesion Fund. The activities in question are listed in Annex I to the EU Emissions Trading System (ETS) Directive.
In exceptional circumstances, the JTF can support large enterprises (linked to the production of goods and services) when the transition is expected to result in a large number of job losses that cannot be compensated by focusing the available support only on SMEs. This is often the case in territories where extraction of fossil fuels will decline in the coming years. In those territories, the TJTPs list a limited number of productive investments in large enterprises, which contribute to the transition to a climate-neutral economy, and will create a high number of new jobs.
In addition, the JTF can support projects that aim at reducing emissions from ETS activities (e.g. production of cement, steel, glass or fertilisers). These are allowed when they are necessary to protect a significant amount of jobs, and only if the projects reach an ambitious emission reduction in line with the climate neutrality target. Such investments are not separately tracked, but are included in categories linked to innovation or clean energy. They have been accepted in a limited number of Member States (Croatia, France, Lithuania, Romania and Sweden).

The Commission helps JTF regions to implement their plans

The implementation of the JTF will be more challenging than for other cohesion policy funds. This is largely due to the frontloading of NextGenerationEU resources, which have a shorter timeframe for execution. This means that 70% of the total JTF allocation is concentrated in the programmes' first two annual tranches, which need to be spent by the end of 2025 and 2026 respectively.
To help manage the programmes and their implementation, Member States can use the technical assistance that is available to them through the programmes themselves. Additional instruments are available at EU level, for instance for project preparation or administrative capacity-building (e.g. Technical Support Instrument, TAIEX-REGIO Peer2Peer, Jaspers).
In addition, in 2020 the European Commission set up the Just Transition Platform, to assist all stakeholders in accessing the resources from the Just Transition Mechanism. It includes the organisation of high-level conferences twice a year, JTP Groundwork (giving targeted assistance to JTF regions on the ground), the JTP Working Groups on carbon-intensive regions, a repository of knowledge products, and more.

More information

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Authors: Sander HAPPAERTS, Luis GALIANO BASTARRICA, Giulia OLIVIERI 
Date of text:  March 2023 (updated December 2023)