A new EU fund will facilitate the green transition in the public sector

Author: Yannick Laude



To kick-start and succeed in the green transition in Europe, it is necessary to combine promising projects with investments and funding and for all sectors to contribute and to be part of the progress. These factors are combined in the new fund, the Public Sector Loan Facility. It is an essential pillar of the Just Transition Mechanism (JTM), which was created to allow the regions of Europe to seize the opportunity of the crisis to decarbonize the local economy, prioritising those that have less capacity to deal with the costs of the transition. The Facility, on which the European Parliament and the Council have agreed today after a long interinstitutional negotiation, will allow the public sector of local authorities to be actors and driving forces behind this regional variation of the Green Deal. It will make some public sector-projects, ideas and initiatives possible as it pairs them with the necessary funding through loans and grants. Renew Europe has paid particular attention to ensuring that the final compromise allows easy access to financing for beneficiaries, provided that they respect the rule of law and that their investment projects meet the required environmental and climate objectives.

Nicolae ŞTEFĂNUȚĂ (Uniunea Salvați România, Romania), Renew Europe spokesperson on this dossier within the Parliamentary Committee on Budgets (BUDG), said: "We fought for increasing the budget for technical assistance that would help the less developed regions to draft and submit good projects. We have also secured a bigger amount of grants for them. One of the Green Deal's promises was to leave no one behind in this green transition, which has a big cost and represents a challenge for the poorer regions in the EU. This is also about people, to make sure that no one is left behind, but everyone brought into the new, sustainable economy."

Linea SØGAARD-LIDELL (Venstre, Denmark), spokesperson for Renew Europe in the Parliamentary Committee on Economic and Monetary Affairs (ECON), added: "It is important that the green transition succeeds in all corners and sectors of the EU. I am therefore delighted that we have reached an agreement on the Public Sector Loan Facility where the green transition and climate aspects are at the core of the Facility. We managed to include that facility-funded projects should be in line with the Taxonomy requirements and the updated climate and energy goals, which will safeguard that public funding will go towards our common goal of climate-neutrality".

Renew Europe has particularly insisted that the funds under the Facility shall be available only to regions whose member state have a territorial just transition plan approved by the European Commission. Moreover, it made sure that enough technical assistance and advisory support would be available for beneficiaries, increasing its envelope to EUR 35 million, also at the application stage of the process. Renew Europe also insists that free competition should not be distorted by this mechanism more than necessary for the achievement of its objectives, and that the projects should be published in order to strengthen accountability and transparency at local level.

The Public Sector Loan Facility is based on a system of grants and loans for regional public entities. The grants come from the European budget, the loans are granted by the EIB, via local financial partners. As many lagging regions lack sufficiently solid banking and financial structures, legislators have provided for increased subsidies to them.

For more information, please contact

Laude Yannick

Tel : +32 2 284 31 69

Mob : +32 495 22 78 37

Email : yannick.laude@europarl.europa.eu


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