The Fair Transition Fund - JTF, worth € 17.5 billion, is one of the EU's key tools to support regions in transition to climate neutrality by 2050.

The emphasis is on:

EUR 17.5 billion to support people, the economy and the environment for 2021-2027
Investments in fossil fuels will not receive financial support
Focus on the least developed regions, the most remote regions, the islands
During the negotiations, the EU institutions agreed to extend the scope of the Fair Transition Fund to finance micro-enterprises, universities and public research institutions, digital innovation and activities in the field of education and social inclusion. Also, investments in renewable energy sources and energy storage technologies, investments in energy efficiency and heat production for district heating based on renewable sources, smart and sustainable local mobility will be financed.

Funding from the Fund is not eligible: decommissioning or construction of nuclear power plants, activities related to tobacco products and investments in the production, processing, transport, distribution, storage or combustion of fossil fuels.

At the initiative of the Parliament, the "Green Rewarding Mechanism" will be introduced if the JTF resources increase after 31.12.2024. Additional resources will be shared among Member States, those that manage to reduce the greenhouse gases emitted by their industrial plants, by receiving more funds.

Other agreed key measures:

In their territorial transition plans, Member States must focus on supporting the outermost regions and islands and set certain amounts from their national allocations;

Firms in difficulty can receive support in accordance with the temporary EU state aid rules established to deal with exceptional circumstances;

Resources can be transferred from other cohesion funds on a voluntary basis;

The share of investments to be provided with EU funds (co-financing) is set at a maximum of 85% for less developed regions, 70% for transition regions and 50% for more developed regions.

Next steps:

Parliament and the Council are now expected to support the content of the agreement.

Source