How can energy transition be just to people in coal regions

The energy transition cannot succeed unless it is fair and just, and the authorities must act before people leave – these are some of the takeaways from the annual meeting of the Initiative for coal regions in transition in the Western Balkans and Ukraine. The stakeholders in the process reiterated that the transformation of the local economies including educational systems depends heavily on funding from governments, the European Union and international financing institutions. They also said the funds need to be specifically earmarked for the purpose.

The Initiative for coal regions in transition in the Western Balkans and Ukraine held its annual meeting in Brussels. Representatives of the European Commission, Energy Community, governments, local communities and authorities, international financing institutions (IFIs), state-owned power producers and the civil society gathered to articulate the way forward for people working in the coal industry and for the affected areas.

Speakers at the event highlighted the need to coordinate the efforts of all stakeholders and exchange experiences with the aim of phasing out coal and transforming the local economies.

The participants agreed that governments should determine coal exit dates and detailed plans to set the process in motion properly, with decarbonization as a strategic choice. “We must act before people leave,” Mayor of Bitola Toni Konjanovski said. Near the city is one of the two coal mining complexes with power plants in North Macedonia, but also one of the biggest solar power plants in the region.

Stakeholders must sustain momentum

Over the past three years, the initiative has established a communication hub between all parties concerned. It facilitates a program for exchange visits for municipalities, coal industry workers and governments to identify the best practices. Coal regions in the European Union are involved in the exchanges.

The cooperation has yielded results but stakeholders must sustain momentum, particularly toward establishing governance bodies for the transition of every coal region, according to the conclusions from the meeting.

The idea is that no transition to clean energy sources will be successful if it’s not fair to the industries and workers and their families. The initiative was launched by the European Commission and its partners: the World Bank, Energy Community Secretariat, European Bank for Reconstruction and Development, European Investment Bank, Poland’s National Fund for Environment Protection and Water Management, and College of Europe.

Most countries need to accelerate coal phaseout

Most countries of the region will need to accelerate the coal phaseout, said Cristina Lobillo, Director of the Energy Platform Task Force at the European Commission’s Directorate-General for Energy (DG ENER). The Western Balkans are equal partners in delivering the European Green Deal, which was highlighted at the Berlin Process Summit in October in Albania, she revealed.

“Many topics were discussed and all topics are relevant for a just transition, such as the potential of the value chain partnership between the European Union and the Western Balkans. This gives a strategic value to the region and in particular in the context of critical raw materials and batteries. We want to prioritize investment in research, innovation and sustainable mining practices,” Lobillo stated.

The transition cannot succeed unless it is fair and just, leaving no region, industry, worker or community behind, she underscored at the conference in Brussels.

In order to have just transition, you need to have transition

Energy transition specialist Anna Vasylyeva from the EBRD pointed to the lack of phaseout dates. “In order to have just transition, you need to have transition,” she said.

It is difficult for IFIs to fund just transition plans without clear dates

Municipal authorities should seek opportunities for scaling up their decarbonization undertakings, together with their governments, the EBRD expert stressed.

“It was difficult to support, for example, the just transition roadmaps and other plans, especially the planning for the workforce and reskilling and requalifications without clear dates for transition, because that needs to be taken into account. We would have also liked to see more projects done. We very quickly realized that a lot of the projects were rather small. And that is a problem for all of the IFIs because we can only finance larger projects,” Vasylyeva stated.

EU should extend Just Transition Mechanism to Western Balkans, Ukraine

The initiative covers coal regions in Bosnia and Herzegovina, Kosovo*, Montenegro, North Macedonia, Serbia and Ukraine. Albania has no coal power plants. Shutting down mines and coal-fired facilities impacts jobs and livelihoods on the local as well as the national level, so securing a just and inclusive transition for the workers, their families and entire local communities is of paramount importance.

The EU is planning a just transition initiative for the Western Balkans under IPA 2024

Representatives of the municipal authorities and trade unions reiterated at the gathering in Brussels that they require funding specifically intended for the purpose. There was a suggestion for the EU to extend its Just Transition Mechanism to the Western Balkans and Ukraine. The stakeholders are also pressing state governments to include just transition in their reform plans.

The audience at the event heard that the European Commission is planning a just transition initiative for the Western Balkans under the Instrument for Pre-accession Assistance (IPA) 2024 program, scheduled for launch by the end of next year. It would expand on the coal regions initiative and involve the private sector in projects for the coal phaseout and carbon-heavy industries.

Single just transition funds on national level instead of fragmented schemes

Slovenia has split its just transition fund through eight ministries, said Karla Sitar, who heads the Development and Economy Department in the Municipality of Velenje. Therefore the local authority couldn’t apply with one strategic project, she stressed. Sitar pointed to the example learned from Poland, where there is one fund on the national level.

Determining a coal exit date contributed to the transformation of the SAŠA coal region in Slovenia

Velenje is part of the Savinja and Šalek coal region (Savinjsko-Šaleška – SAŠA), which is facing the loss of the second-largest district heating system in Slovenia and 5,000 jobs, she noted. It aims to switch to renewables within eight years.

Velenje had useful exchange visits with Pljevlja in Montenegro, Sitar said. “Each region and city has something to show… Local communities are close to the people and they are defending the public interest,” she asserted.

Determining a coal exit date contributed to the transformation of the SAŠA area, which indicates that such an approach would be successful in the Western Balkans, according to Igor Golubović from the Business Transformation Office at the RUPV Coal Mine Pljevlja in Montenegro.

Progress with NECPs is slow

Montenegro is the only country in the region that is yet to submit a draft national energy and climate plan. Aneta Kankaraš from the government’s Office for Sustainable Development said a just transition roadmap would be completed by the end of the year. It is a step in the development of the NECP, which should be drafted by mid-2024, in her words.

As for Bosnia and Herzegovina, Kosovo* and Serbia, the drafts that they recently presented don’t envisage new coal, but there is also no coal phaseout, warned Viktor Berishaj, coordinator for the Western Balkans climate and energy policy in Climate Action Network (CAN) Europe. The governments there assume they will keep using coal-fired power plants that are already very old, he added.

“Just transition is just a phrase” in the three documents and the authorities are yet to enable public participation in the energy transition process, Berishaj said.

Special approach required for youth

The Ministry of Mining and Energy of Serbia, which is in charge of the transition of the country’s two coal regions, is not reaching out enough to local communities, Ognjan Pantić from the Belgrade Open School opined. The discussions should be held in the affected municipalities rather than in downtown Belgrade, he noted. Conversely, as delegates from Serbia learned during a study visit to the Jiu Valley in Romania, the process there is governed by a coalition of stakeholders, Pantić stressed.

President of the Trade Union of RMU Banovići Miners in BiH Mirnes Mujkić said they weren’t aware of the aspects of the upcoming transition until mid-2022. The exchanges were valuable in that sense, he added. Employees in the coal mine are now learning about energy efficiency and the local authority is working on the mitigation of the social impact and developing solar power projects, he asserted.

In addition, the trade union is motivating younger colleagues to requalify for jobs in new technologies like solar and wind power, Mujkić told the audience.

The conference participants agreed that coal regions require special programs for youth and, moreover, a substantial change in the educational system. On the one hand, it is inevitable that some will leave, but creating opportunities for young people can go a long way, they said.