The EU Cohesion Policy Instruments against Climate Change

Human activities are estimated to have caused approximately 1.0°C of global warming above pre-industrial levels. The temperature rise is likely to reach 1.5°C between 2030 and 2052 if it continues to increase at the current rate.

According to the 2018 IPCC Special report: “Warming from anthropogenic emissions from the preindustrial period to the present will persist for centuries to millennia and will continue to cause further long-term changes in the climate system, such as sea level rise, with associated impacts but these emissions alone are unlikely to cause global warming of 1.5°C (medium confidence).”¹

In addition to that: These risks depend on the magnitude and rate of warming, geographic location, levels of development and vulnerability, and on the choices and implementation of adaptation and mitigation options.” ²

There are large regional disparities in the projected models in regional climate characteristics between present-day and global warming of 1.5°C, and between 1.5°C and 2°C.

Among them are:

• a rise in mean temperature in most land and ocean regions;
• hot extremes in most inhabited regions;
• heavy precipitation in several regions;
• the probability of drought and precipitation deficits in some regions Strategies capable to limit global warming to 1.5°C require fast and far-reaching transitions in a range of areas, namely: energy, land, urban and transport infrastructure and buildings, industrial systems.

These systems transitions require a significant upscaling of investments in those options. For instance, coal is the most carbon intensive fossil fuel and phasing it out is a key step to achieve the emissions reductions needed to limit global warming to 1.5°C, as stipulated in the Paris Agreement.

Most emissions from coal are in the electricity sector and, as we already have the technologies that can replace coal, phase out is a relatively cheap and easy option to reduce emissions.

According to the research available, it will be beneficial if coal will be phased out globally by 2040 to meet the commitments made in Paris. Climate change, together with other natural and human-made health factors, influences human health and disease in numerous ways. Climate change can affect public health by disruptions of physical, biological, and ecological systems.

The health effects of these disruptions include increased respiratory and cardiovascular disease, injuries and premature deaths related to extreme weather events, changes in the prevalence and geographical distribution of food- and water-borne illnesses and other infectious diseases. The threats to mental health should be considered as well.

Cohesion policy is among the key EU instruments helping to address the climate crisis and to deliver EU climate policy objectives. In order to reach these goals and support the diverse development needs in all EU regions, EUR 351.8 billion – almost a third of the total EU budget – has been allocated for Cohesion Policy for 2014-2020. Cohesion Policy benefits all EU regions. The level of investment reflects the development needs of Member States.

Regions are categorised according to their GDP level. Depending on this, the Funds provide between 50% and 85% of the total financing of a project. Together with other policy areas such as education and employment, research and innovation, energy and environment received significant funding. EU Cohesion policy is channelled through three main funds: the European Regional Development Fund (ERDF), the European Social Fund (ESF), and the Cohesion Fund (CF).

The role of Cohesion policy is critical in the fight against climate change:

• Cohesion Fund: invests in green growth and sustainable development, and improves connectivity in Member States with a GDP below 90% of the EU-27 average. The Cohesion Fund allocated a total of € 63.4 billion (during 2014-2020) to activities under the following categories: trans-European transport networks, notably priority projects of European interest as identified by the EU. of renewable energy, developing rail transport, supporting intermodality, strengthening public transport, etc.
• European Regional Development Fund (ERDF): aims to strengthen regional economic and social cohesion by investing in growth-enhancing sectors to improve competitiveness and create jobs. The ERDF also finances cross-border cooperation projects;
• European Social Fund (ESF): invests in people, with a focus on improving employment and education opportunities. The funding is delivered to citizens through a close collaboration between the Commission, Member states and the Regions. Programmes are managed, and individual projects selected, by Managing Authorities in the Member States. If the total cost of a project is over EUR 50 million, it is subject to approval by the Commission.

During the 2014-2020 programming period, 3 of 11 cohesion policy objectives were dedicated to combating environmental issues and climate change, namely:

Objective 4. Supporting the shift towards low carbon economy;

Objective 5. Promoting Climate change adaptation, risk prevention and management;

Objective 6. Preserving and protecting the environment and promoting resource efficiency. During the 2014- 2020 programming period, over 9400 projects improved the sustainability and effectiveness of EU cities and regions and 1200 km roads and 1500 km railway helped to establish an efficient trans-European transport network (TEN-T).

Number and Impact of the projects dedicated to improving environment and transport during the 2014-2020

Improving Environment	Modernising Transport
Water supply systems have been modernised, benefitting 3.2 million citizens 9400 projects improved the sustainability and attractiveness of towns and cities	1200km of roads and 1500 km of railway line have helped to establish an efficient trans European transport network (TEN-T)

In May 2020, the European Commission proposed an updated Multiannual Financial Framework (MFF) for 2021-2027 and a new recovery instrument, Next Generation EU targeting essentially the impact of COVID-19. Next Generation EU of EUR 750 billion as well as the overall reinforcements of the EU budget for 2021-2027 will increase the total amount of the budget of the EU to EUR 1.85 trillion. 9

According to the proposal, in this period Cohesion Policy would amount to 29.4% of the overall proposed MFF (compared to 34% in the period 2014-2020), equalling EUR 323.2 billion (EUR 85.6 billion for ESF+, EUR 196.9 billion for ERDF, EUR 40.7 billion for CF).

Cohesion policy funding as per MFF 2020-2027 proposal

Name of the Fund	Funding allocated 2020-2027
ESF+	EUR 85.6 billion
ERDF	EUR 196.9 billion
CF	EUR 40.7 billion
Total	EUR 323.2 billion

The five main priorities of EU Cohesion Policy post 2020 include a strong emphasis on combating climate change.

The Policy Objective (PO 2) Greener, carbon free Europe is one of the five priorities formulated:

• PO1 Smarter Europe, through innovation, digitisation, economic transformation and support to small and medium-sized businesses
• PO 2 a Greener, carbon free Europe, implementing the Paris Agreement and investing in energy transition, renewables and the fight against climate change
• PO 3 a more Connected Europe, with strategic transport and digital networks
• PO 4 a more Social Europe, delivering on the European Pillar of Social Rights and supporting quality employment, education, skills, social inclusion and equal access to healthcare
• PO 5 a Europe closer to citizens, by supporting locally-led development strategies and sustainable urban development across the EU.

In addition, rules on thematic concentration will require a budgetary focus on PO2: in case of transition and less developed regions minimum 30% of the budget should be spend on PO2 and in more developed regions minimum 85% spending should address PO1 (Smarter Europe) and PO2. For this reason, it is important that policymakers are well informed about the characteristic of the current support of the Cohesion Policy for the EU low-carbon transformation and the potential of the future Cohesion Policy for supporting EU Green Deal and climate actions. It is important to understand the different aspects and distinguish between Cohesion Policy support for the environmental protection in general and the actions linked to the fight against climate change. During the 2020-2027 period the traditional EU Cohesion Policy instruments will be supported by two new funds. One of them targets namely climate change, not environmental issues in general:

• Just Transition Fund with a total budget of 40 billion EURO. It will assist Member States in accelerating the transition towards climate neutrality; 10
• REACT-EU – a 50 billion EURO fund designed to face the socio-economic impacts of the coronavirus crisis, including the level of youth unemployment and the relative prosperity of Member States. It is important to highlight the specific role of the Just Transition Fund which will support the delivery of EU Green Deal.

The EUR 40 billion dedicated to the fund will be matched with additional funding from Member States. EU countries will have to match each euro received from this Fund, for the share financed from the Union budget (€10 billion) with EUR 1.5 to EUR 3 from their resources of the European Regional Development Fund (ERDF) and the European Social Fund Plus (ESF+).

This spending from the EU budget will be supplemented by national co-financing according to cohesion policy. As a result, the JTF overall financing capacity exceeds €89 billion and may reach €107 billion.

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1. IPCC, 2018: Summary for Policymakers. In: Global Warming of 1.5°C. An IPCC Special Report on the impacts of global warming of 1.5°C above pre-industrial levels and related global greenhouse gas emission pathways, in the context of strengthening the global response to the threat of climate change, sustainable development, and efforts to eradicate poverty [Masson-Delmotte, V., P. Zhai, H.-O. Pörtner, D. Roberts, J. Skea, P.R. Shukla, A. Pirani, W. Moufouma-Okia, C. Péan, R. Pidcock, S. Connors, J.B.R. Matthews, Y. Chen, X. Zhou, M.I. Gomis, E. Lonnoy, T. Maycock, M. Tignor, and T. Waterfield (eds.)]. World Meteorological Organization, Geneva, Switzerland, 32 pp.

2. IPCC, 2018: Summary for Policymakers. In: Global Warming of 1.5°C. An IPCC Special Report on the impacts of global warming of 1.5°C above pre-industrial levels and related global greenhouse gas emission pathways, in the context of strengthening the global response to the threat of climate change, sustainable development, and efforts to eradicate poverty [Masson-Delmotte, V., P. Zhai, H.-O. Pörtner, D. Roberts, J. Skea, P.R. Shukla, A. Pirani, W. Moufouma-Okia, C. Péan, R. Pidcock, S. Connors, J.B.R. Matthews, Y. Chen, X. Zhou, M.I. Gomis, E. Lonnoy, T. Maycock, M. Tignor, and T. Waterfield (eds.)]. World Meteorological Organization, Geneva, Switzerland, 32 pp