EU lawmakers have struck a deal on a new structural aid fund and are approaching a compromise on supporting regions transitioning from coal, with the final white smoke from co-legislators on total regional support from the EU’s next seven-year budget expected on Wednesday. (9 December).
MEPs and government ministers have agreed on the European Regional Development Fund and Cohesion Fund (ERDF/CF) that will channel €242.9 billion to regions over the next seven years, provided Hungary and Poland lift their veto on the EU’s next long term budget.
The Council and the Parliament managed to resolve the sticky issue of financing gas projects as a transition fuel in coal-dependent regions by agreeing to provide support to countries through the ERDF/CF funds based on their income levels and coal reliance, while at the same time prohibiting using the €17.5 billion Just Transition Fund (JTF) for gas projects.
The richest countries will be able to use a maximum 0.2% of their ERDF/CF allocation to support gas projects that replace coal-based heating systems, 1% for countries whose gross national income (GNI) per capita is below 90% of the EU average.
Countries whose GNI per capita is below 60% of the bloc’s mean income levels or get more than a quarter of their energy from coal will be able to use 1.55% of their ERDF/CF for transition gas projects, which will Bulgaria, Czechia, Estonia, Poland and Romania.
While the negotiations on the JTF are still ongoing, EURACTIV understands that a final compromise is expected to reached on Wednesday.
As increasingly more people live in cities, the support earmarked for sustainable urban development was increased from 6% to 8%, while at least 30% of the total allocations will have to be spent on greening.
Asked if this could shift away focus from the rapidly depopulations rural areas, Susana Solís Pérez MEP said that attention needs to be given to both at the same time.
“For the first time this regulation includes a new definition of areas facing demographic decline, and takes into account the social impact of the population in areas,” Solís Pérez said.
According to the liberal MEP, connectivity should be at the forefront of support for depopulating rural areas, which is a precondition “to put in place innovation projects or to attract entrepreneurs and people.”
The rural development and cohesion funds suffered some of the biggest budget decreases following the decision of European leaders at the July summit, leading to a 11% cut compared to the last seven-year budget.
However, if counted together with all additional resources for regional support from new funds such as REACT-EU, which is designed to act as a bridge between the unspent cohesion money that was reallocated for the coronavirus response and the longer-term ERDF, the overall amount available to narrow the gap between different European regions has increased by 1.2% compared to 2014-2020.
Solís Pérez said “now we don’t have a problem with funding but investing in the right direction.”
[Edited by Benjamin Fox]