Just transition framework in the EU

Our key takeaway: The case for a just transition to a sustainable economy is clear: it will help us weather the worst impacts of climate change and ensure as many people as possible benefit from this whole-scale economic and societal transformation. Not only is this the right thing to do, but it’s also key to getting the social licence for the transition to take place, says WWF. While the EU has taken steps to recognise the importance of a just transition in the European Green Deal - by creating the Just Transition Fund and the Social Climate Fund - WWF states that this is “insufficient to ensure an inclusive society-wide transition.” To fully embed the just transition into the EU policy sectors (power, industry, transport, buildings and agriculture and forestry), the report recommends: 1) grounding decisions in thorough social and economic impact assessments; 2) conducting meaningful consultation with stakeholders, including local communities; 3) capitalising on opportunities to build green energy infrastructure on mining and fossil fuel plant areas to mitigate job losses; and 4) recognising and respecting culture and identity when discussing change.

WWF published The fair way forward: opportunities for all through an EU just transition (March 2024):

• The importance of a just transition: The report emphasises the unprecedented transformation needed across all sectors of the economy to combat climate change, and likened the speed and focus required to times of war. The benefits of the transformation are clear: “clean air, energy independence, warm homes, healthy ecosystems and, of course, avoiding the worst impacts of catastrophic climate change on food security, health and livelihoods.” At the same time, the benefits will not be shared by all equally and some are at risk of being disadvantaged due to the transition. For example, those who are less-qualified, older and/or already in a lower-income bracket are more likely to need support to access the opportunities of the clean economy. The report makes the case for ensuring a just transition based on values and the social licence to operate: “Ensuring a just and fair transition is therefore critical, both as the right thing to do to abide by European values in the transformation of our economy and societies, but also to avoid the public backlash that results from inadequate attention to the social impacts of rapid change, particularly at a time when many EU citizens are already struggling with cost-of-living problems resulting from other crises.”
  

• The state of play in the EU: The EU has taken some measures to support a just transition in the region. For instance, the European Green Deal emphasises the importance of a just transition as part of the EU’s growth strategy to achieve net-zero by 2050. Under the European Green Deal, the Just Transition Fund and the Social Climate Fund were established to tackle challenges with ensuring a just transition. The Just Transition Fund provides financial assistance and technical expertise to regions heavily dependent on fossil fuels and carbon-intensive sectors like steel, cement and chemicals. Support includes: workforce adaptation, investments in Small and Medium-sized Enterprises (SMEs), low-carbon solutions like clean energy, and environmental rehabilitation and green infrastructure. The Social Climate Fund will provide funding to Member States to distribute to citizens that will be adversely affected by the Emissions Trading System, which will become operational in 2027. While the EU has taken notable steps to ensure a just transition, the report states that they are “insufficient to ensure an inclusive society-wide transition, and extra measures will be required as transition progresses.”
  

• The need for a strengthened Just Transition policy framework: The report provides recommendations on how to embed just transition more fully into the power, industry, transport, buildings, agriculture and forestry policy sectors of the EU economy. When it comes to the power sector, policy-makers should consider: 1) robust social and environmental impact assessments when building renewables, grid development and energy storage facilities, focusing on meaningful public consultation and supporting local communities; 2) energy policies which support equitable energy ownership and access; 3) concrete measures to train the labour force and address the skills shortage in the renewable sector; 4) support to social dialogue and collective bargaining; and 5) building renewables in former mining or fossil fuel power plant locations to mitigate job losses. In relation to industry, company and sectoral transition plans should focus on decent work, and developed in partnership with other stakeholders: “Company and sectoral transition plans should be used to develop a shared long-term perspective which enables investment and supports quality jobs, skills development and access to re-employment services. Transition plans developed together with trade unions, civil society, and work councils can be powerful tools for ensuring smooth and widely-supported change.” In the transport sector, policy-makers can provide incentives to the private sector to electrify company fleets. In the buildings sector, policy-makers can tackle the supply-side issue of not having enough skilled workers to build energy efficient buildings: “Use programmes of support for energy improvement of buildings as an opportunity to train and employ workers in green construction and renovation, providing the skills framework and standards to ensure that these are quality jobs.” In relation to agriculture and forestry, policy-makers can utilise learnings from other transitions like coal phase out and engage in meaningful stakeholder conversations: “Use lessons from other transitions (for example coal phase out) to understand the challenges of adjustments in livelihoods, the necessity for genuine dialogue with farmers, forest-owners and other stakeholders to ensure flourishing rural communities, and the importance of recognising culture and identity when discussing change.”