The ten Polish regions most closely related to coal may receive additional coal fund money for transformation during the 2021-2027 period. However, the money will be much less than planned.
The good news is that a request made two years ago will be implemented. First, the Committee on Industry, Research and Energy, chaired by the former Polish Prime Minister Jerzy Buzek, passed a resolution that the new EU budget should include the Fair Energy Transformation Fund.
The proposal was then accepted by the entire Parliament and appealed for the EU’s multi-annual budget for this purpose to include $5.3 billion (€4.8 billion) for the years 2021-2027.
Get stories like this straight to your smartphone with the Born2Invest app. The mobile application collects the latest finance headlines making sure that you’re always up to date, no matter where you are.
Coal funds to help those exposed to significant costs
The coal fund was also included in the program of the new President of the European Commission, Ursula von der Leyen. The Commission under her leadership will start work on Dec. 1 and is likely to present a proposal on the so-called “Righteous Transformation Initiative” as early as Dec. 11.
Therefore, the idea whose aim was to help primarily Polish coal regions, which were exposed to significant costs related to the European strategy of climate neutrality, became a flagship postulate of Ursula von der Leyen and the new Commission.
However, there is also bad news – though the proposal should gain support it was gradually watered down. According to the documents that “Rzeczpospolita” saw, there will be as many as 50 regions in the EU to donate.
The Commission is not hiding that this is necessary to gain support for the new instrument that will be part of the EU budget. And this must be accepted unanimously.
Therefore, according to this logic, it cannot finance only Polish or German mines, and others must also benefit from it. But then such support may not bring the intended effects.
Hypothetical numbers for the new proposal
What exactly will be in the new proposal? First of all, let’s look at the figures. The fund is to cover $16.57 billion (€15 billion), of which only $5.52 billion (€5 billion) is new money that the Member States will have to agree to.
They will do this by either going further than what is provided for in the current multiannual EU budget proposal, or by looking for savings in other expenditures.
On top of this, there is the $5.52 billion (€5 billion) that will be cut out of the funds proposed for cohesion policy and the $5.52 billion (€5 billion) that will be contributed by the Member States themselves.
The second pillar of the initiative is to be an investment fund. The EU would provide $552.672 million (€500 million) from the budget, which would be converted into $1.65 billion (€1.5 billion) in bank guarantees and multiplied by the assumed leverage of $15.14 (€13.7), to give $22 billion (€20 billion) in private investment.
Therefore, the EC will certainly inform that there will be $38.69 billion (€35 billion) for the energy transformation.
DISCLAIMER: This article was written by a third party contributor and does not reflect the opinion of Born2Invest, its management, staff or its associates. Please review our disclaimer for more information.
This article may include forward-looking statements. These forward-looking statements generally are identified by the words “believe,” “project,” “estimate,” “become,” “plan,” “will,” and similar expressions. These forward-looking statements involve known and unknown risks as well as uncertainties, including those discussed in the following cautionary statements and elsewhere in this article and on this site. Although the Company may believe that its expectations are based on reasonable assumptions, the actual results that the Company may achieve may differ materially from any forward-looking statements, which reflect the opinions of the management of the Company only as of the date hereof. Additionally, please make sure to read these important disclosures.
First published in RZECZPOSPOLITA, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.
Although we made reasonable efforts to provide accurate translations, some parts may be incorrect. Born2Invest assumes no responsibility for errors, omissions or ambiguities in the translations provided on this website. Any person or entity relying on translated content does so at their own risk. Born2Invest is not responsible for losses caused by such reliance on the accuracy or reliability of translated information. If you wish to report an error or inaccuracy in the translation, we encourage you to contact us.
Lonza showed impressive year-to year performance
Lonza is an integrated solutions provider and a pharmaceutical supplier that is going to have a new CEO at the...
Gaps and uncertainty: how cannabis legalization is progressing in Mexico
Cannabis regulation in Mexico is among the top legislative priorities of 2020. With respect to the domestic drug policy, the...
West African banks are battling cyberattacks
Cybercrime is affecting major banks in the sub-Saharan Africa region. More than 85% of financial institutions of Central African countries...
How blockchain technology is disrupting gambling
Blockchain technology has provided somewhat a guarantee to the gamblers that the online casino is indeed playing by the rules....
Great expectations for gold, silver and the precious metals mining companies in 2020
Since November, the Dow Jones is once again seeing one new all-time high after another. As of the close of...