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Romania has secured EUR 790 million for the closure of four coal mines. The funds would be used for the social and safety costs of the coal phaseout.
The European Commission has approved, under the European Union state aid rules, Romania’s package of EUR 790 million (RON 3.9 billion) for covering exceptional costs arising from the closure of the four uncompetitive coal mines Lonea, Lupeni, Livezeni and Vulcan in the Jiu Valley.
Jiu Valley is Romania’s main coal region and one of the 20 coal regions in the European Union. They are all are included in the EU’s Initiative for Coal Regions in Transition, launched by the European Commission in December 2017.
The aid covers social costs for workers who have lost or will lose their jobs
The measure will help Romania to phase out coal by 2032 in line with its binding commitment under its National Recovery and Resilience Plan and Territorial Just Transition Plan, according to the commission.
Romania is officially planning to complete its coal phaseout in 2032. However, in August it was revealed that Romania’s electricity transmission system operator Transelectrica doesn’t see coal power plants having any share in the country’s transmission system in 2026 and beyond.
The commission said EUR 790 million would be transferred to Societatea Complexul Energetic Valea Jiului S.A., which operates the four mines and the Paroșeni power plant.
An independent consultant would monitor that the coal extraction is strictly limited to what is necessary for public safety
The aid covers social costs for workers who have lost or will lose their jobs due to the closure of the mines, and expenses related to the safety and remediation works necessary for the closure of the mines. In particular, to secure mine shafts, repair environmental damage and recultivate land after the closure of the four facilities, the announcement adds.
The funds can be spent on eligible costs that occurred from October 1, 2023, to December 31, 2032. Of note, in December 2023 the government approved EUR 70.4 million in state aid for the Jiu Valley coal region.
An independent consultant would monitor that the coal extraction is strictly limited to what is necessary for public safety. For example, to avoid self-ignition and provide annual reporting to this effect. The Romanian Government has accepted the obligation.
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