Entrenching the just transition into the EU Green Deal

The Social Climate Fund proposal has been designed to compensate energy price increases. Its potential would be much greater if it was turned into a strategic instrument to address comprehensively the multi-faceted issues preventing European citizens to meet their heat and mobility needs.

Today’s energy prices are massively impacting household bills. While this unprecedented crisis must be tackled swiftly by EU leaders, it should also prove an opportunity to deliver an instrument with long-lasting impact that delivers structural change rather than corrective measures. It is in this perspective that a meaningful landing of the Social Climate Fund must be envisaged.

Energy poverty is a crippling problem across Europe (more than 30 million Europeans suffer from it), and the staggering increase in energy prices raises the pressure on the most vulnerable. Whatever the decisions concerning the extension of the carbon pricing system to buildings and road transport, a social climate fund is more than necessary to face the already extremely strong inequalities inherent to the energy transition.

This fund and the amounts dedicated to it must be up to the ambitious goals of a just transition. Local and regional authorities are best placed to offer a response adapted to the local context. Many practical cases show the effectiveness of local action to mitigate energy poverty and democratize the energy transition.

However, the current governance model of the Social Climate Fund is based on a top-down governance approach mirroring that of the Resilience and Recovery Facility (RRF) which risks defeating the purpose of the fund.

Our recommendations

• Extending the Social Climate Fund into a broader Social Climate Facility which addresses social climate action in a more integrated and decentralised way
• Using the Cohesion Policy approach as a model for the governance of the fund, instead of the Resilience and Recovery Facility
• Relying on a proven model (partnership principle of the Cohesion policy and its local development mechanisms) to guarantee the relevance and effectiveness of social climate action
• Avoiding that only well-resourced and organised entities access the money: dedicate a portion of SCF funding to the creation of an EU coordination platform with national focal points dealing with capacity-building and the allocation of seed funding
• Guarantee that each of the 3000+ Local Action Groups already set up across Europe have a social action agenda through dedicated funding
• Improving the perceived European added value through a more local, and thus visible, channelling of climate action funds