June 09, 2020 by Luke James
Earlier this year, the European Union announced the European Green Deal’s Investment Plan, highlighting how the EU aims to spend money set aside for a greener Europe.
From financial Eurozone crises to Brexit, the European Union (EU) has pushed on through a series of crises for decades. Today, one of the biggest challenges being faced by the EU is climate change, a cross-border problem where collective action will have a far greater impact than dispersed national-level initiatives. This creates a strong case for climate action to be a part of the EU’s mission, and the European Green Deal is a concept designed to bring about a greener future for the Union.
Earlier this year, it was announced how the EU plans to spend funding allocated under the European Green Deal’s Investment Plan for achieving its goal of a greener Europe. Under the investment plan, the EU will utilize public investment and help to unlock private funds through EU financial instruments, such as investEU, which could lead to almost €1 trillion of investments.
Although all EU Member States, regions, and sectors will need to contribute, the scale of the challenge is not the same across the board. Some regions will be affected more than others by the upcoming transformation, and this will lead to profound economic and social change. The Just Transition Mechanism (JTM) will provide financial and functional support to help workers and generate necessary investments in those areas.
The President of the European Commission, Ursula von der Leyen, said: “People are at the core of the European Green Deal, our vision to make Europe climate-neutral by 2050. The transformation ahead of us is unprecedented. And it will only work if it is just – and if it works for all. We will support our people and our regions that need to make bigger efforts in this transformation, to make sure that we leave no one behind.”
The European Green Deal acts as a roadmap to make the European Union's economy sustainable.
So far, much of the focus of the JTM has been on coal workers and coal regions. Although coal mining represents a relatively small number of well-paying jobs among an ageing workforce concentrated in a few regions with limited alternative economic opportunities, they still deserve support.
Executive Vice-President for the European Green Deal, Frans Timmermans, said: “The necessary transition towards climate-neutrality is going to improve people’s well-being and make Europe more competitive. But it will require more efforts from citizens, sectors and regions that rely more on fossil fuels than others,” and this is who the JTM is designed to support—by making investments more attractive and proposing financial and practical support packages worth “at least” €100 billion.
However, other transition challenges will not be the same as coal. The move to electric vehicles, for example, means that cars have fewer moving parts which will have an impact on jobs in manufacturing, maintenance, and mechanical engineering. While we will see a fall in demand for jobs in these areas and those with roots in the coal sector, such as gas heating engineers, we will see a sharp rise in demand for skilled electrical and design engineers, plumbers, and insulation installers.
But why has the EU decided to act now?
A lot of it comes down to how renewable technologies have now been proven and can be built at scale today. They offer the large-scale and labour-intensive projects that politicians today are looking for, ranging from the obvious stuff, such as building wind farms and laying the foundations for a hydrogen economy, to the less obvious, such as installing large networks of charging points for electric vehicles and the revamping of mass transport systems.
Just like the American New Deal which saw the building of road infrastructure and dams, the European Green Deal will provide tens, if not hundreds, of thousands of people in high-skilled, local jobs. And with the COVID-19 crisis driving joblessness to levels near the Great Depression (and far above those seen in the wake of the 2008-2009 Global Financial Crisis), governments need to find ways to employ lots and lots of people, and quickly.
