Just Transition Fund (JTF)

The JTF addresses the socio-economic and environmental impacts of the low-carbon transition to secure employment and sustainable regional economies. In Finland, the basis for JTF preparation is the state-ment in the Government Programme on reducing the energy use of peat by half by the end of 2030. The peat industry employs about 2,500 people in Finland. The direct and indirect adverse effects of a major contraction of the sector on regional economies and employment will be significant, which the JTF will address through the EU’s regional and structural policy measures.

JTF actions must be in line with the national climate and energy strategy. As a horizontal principle, the ‘do no significant harm’ principle, among other things, will be adhered to. JTF actions will be automatically counted as 100% climate actions. No separate emission reduction targets are required for JTF actions.
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The use of JTF funds is defined in regional transition plans, drawn up in the regions under the leadership of regional councils and the regional Centres for Economic Development, Transport and the Environment in compliance with the partnership principle in 14 regions: seven provinces of Eastern and Northern Finland, and the regions of South Ostrobothnia, Satakunta, Central Finland, South Karelia, Kymenlaakso, Ostrobothnia and Pirkanmaa. However, the Pirkanmaa JTF area only comprises Parkano, Kihniö, Virrat and Punkalaidun.

Transition plans have been intensely prepared in the regions since February 2021. The regional division of JTF funding (EUR 644 million including the national contribution at current prices) was agreed upon at the Ministerial Committee on Economic Policy on 30 September 2021. The content of the JTF is intended to be outlined in the Ministerial Working Group on Sustainable Growth in November 2021.

The overall goal of the preparations is to have the implementation of the fund commenced in the sum-mer of 2022. The timetable is demanding and requires that the transition plans have been brought to completion for submission to the Commission by the end of March. The Commission has emphasised that the plans must be of a sufficiently high quality and complete. Finland’s JTF proposal, including the transition plans, will be submitted as an amendment proposal to the Innovation and Skills in Finland 2021−2027 programme. No transition plan can afford to be rejected, as in that case the whole amend-ment proposal will fail as well. The JTF mandate can only be allocated when the JTF proposal and all the transition plans accompanying it have been approved by the Commission.

The fund’s complementarity and potential for synergies with regard to other funds and instruments will be considered in connection with the regional transition plans. From the point of view of the JTF, complementary actions will be especially sought for under Pillars II (InvestEU JTF) and III (Public Sector Loan Facility) of the Just Transition Scheme (JTS), as well as other EU instruments such as the ERDF, ESF+, EAFRD and RRF.

More information:
Pari Rantahalvari
Helinä Yli-Knuutila
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