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It’s time to put an end to EU funding of fossil gas

Background 

The European Parliament agreed on 21 June 2022 to adopt the European Commission’s proposal to exclude fossil fuels financing via the Modernisation Fund. Following the European Parliament’s decision, the Environmental Council will meet on 28 June 2022 to discuss the Emissions Trading System (ETS) revision file, including the future use of the Modernisation Fund.  

This document lays out the current state of play regarding the funding of fossil fuels under the Modernisation Fund in four recipient countries in central and eastern Europe: Poland, Romania, Czechia and Slovakia. The document shows that large percentages of the funding allocated for the transition to climate neutrality is being used to fund fossil gas projects. This risks locking in the use of fossil fuels in Member States for decades to come. 

Poland 

So far, Poland has received funding in three disbursement cycles for eleven investment schemes worth approximately EUR 2.9 billion. Poland has already requested EUR 590.6 million of this amount.  

Although most of the investment schemes listed above are indeed in line with Modernisation Fund priorities, a key problem is the limited catalogue of potential beneficiaries. Large, mostly state-owned, energy companies are receiving a disproportionate amount of funding.  

There are three particularly controversial schemes supported under the Modernisation Fund in Poland: 

  • Cogeneration for energy and industry 
  • Cogeneration for district heating 
  • The use of alternative fuels for energy purposes 

The two cogeneration investment schemes, worth EUR 440 million (already requested for disbursement: EUR 44.4 million) and EUR 666.7 million (already requested for disbursement: EUR 66.6 million) respectively, allow for the use of fossil gas. This means that nearly 19 per cent of funds disbursed to Poland under the Modernisation Fund are earmarked for investment schemes allowing for the use of fossil gas. Another controversial investment scheme, with budget amounting to EUR 666.7 million (of which EUR 266.4 million has been already requested) is aimed at increasing the use of alternative fuels and opens the door to developing and expanding waste incineration installations. The three schemes mentioned were confirmed by the European Investment Bank (EIB) as priority investments, contributing to the Fund’s goals, even though they allow for the use of fossil fuels and waste incineration (the latter of which is not in line with the ‘do no significant harm’ principle).  

The Modernisation Fund is managed behind closed doors in Poland, and civil society is not included in the planning and preparation of investment schemes. Public consultations are organised only after the schemes are accepted by the EIB. The indicative list of investments for 2022 and 2023 has not been published. In addition, the Ministry of Climate and Environment considers the Fund an ad hoc instrument to quickly direct money to areas in need, confirming suspicions that there is no unified strategy for spending Modernisation Fund resources by 2030. Thus, it is not possible to determine whether new investment schemes allowing funding for fossil gas will be submitted. Much will depend on the outcome of the ETS Directive Revision and whether gas investments will be excluded from the Modernisation Fund. 

Romania 

EUR 1.4 billion has so far been allocated to Romania from the Modernisation Fund. The funds will aim at financing nine priority sectors. 

The European Commission approved the Oltenia Energy Complex’s decarbonisation plan and restructuring plan this year in order to replace existing lignite capacities with fossil gas and reduce greenhouse gas emissions. The Ministry of Energy subsequently announced the submission of two projects to be financed under the Modernisation Fund: the construction of two fossil gas power plants with a total capacity of 1325 megawatts (MW), worth an approximate total of EUR 841 million, with a disbursement from the Modernisation Fund amounting to over EUR 420 million.  

No calls for projects were held, and the bureaucratic structure around the Modernisation Fund in Romania has so far been opaque and unclear. This has made it challenging for private companies to apply for funding. Consequently, the only beneficiaries so far are fully or partially state-owned companies. Seventeen priority projects have been approved in 2022 by the EIB and two non-priority projects by the Investment Committee. 

Slovakia 

Slovakia had a total of EUR 169.5 million disbursed in the second and third disbursement cycles (October 2021 and March 2022) to support:

  • Modernisation of energy systems, including energy storage and energy efficiency improvements – rehabilitation and extension of district heating and cooling networks 
  • High-efficiency cogeneration 
  • Solar and wind power deployment 

All investments thus far have been in the priority sector. 

The process has not been sufficient for achieving a sustainable energy transformation. The lack of transparent governance makes it almost impossible to distinguish which projects align with the REPowerEU objectives. Moreover, district heating and cooling networks and high-efficiency cogeneration plants might include fossil gas support. Their overall allocation is EUR 149.5 million – approximately 88 per cent of the first three disbursement cycles. 

In addition, Slovakia lacks a vision for ambitious modernisation in the district heating and cooling sector without fossil gas and extensive use of biomass. The Slovak National Energy and Climate Plan is based on outdated policy and provides no pathway to carbon neutrality.  

Czechia 

Czechia has received EUR 320 million so far for the first two disbursement cycles:  EUR 202 million for the first disbursement cycle and EUR 118 million for the second disbursement cycle. For the third disbursement cycle, Czechia is expected to receive an additional EUR 520 million. The following schemes have been supported: 

  • Support for photovoltaic power plants with installed capacity up to 1 MW from the Renewable Energy Sources+ Programme 
  • Support for photovoltaic power plants with installed capacity above 1 MW from the Renewable Energy Sources+ Programme 
  • Modernisation of energy sources priority investments from the programme HEAT 
  • Modernisation of energy production priority investments from the programme ENERG ETS 

We have seen gas projects being funded under the current setup in the Czech Modernisation Plan. One example is the HEAT programme, which supports the use of renewable energy sources and low-carbon sources of energy for heating through changing the fuel base from coal to other sources (mainly gas and biomass) and through modernising heat sources and distribution systems. Nine projects received funding from this programme in 2021: two in the priority sector, and seven in the non-priority sector. According to information provided on the State Environmental Funds webpage, out of these seven projects, five are expected to use gas technology in transitioning from coal. All of the non-priority investments are related to combined heat and power (CHP) technology using gas as a fuel. 

In 2022, it is envisaged that another EUR 150 million will finance gas infrastructure. ‘Natural gas’ is directly mentioned in the programmes HEAT and ENERG ETS. Projects that focus on the conversion to ‘natural gas’ with CHP will be from now on considered priority investments. This change in categorisation was approved by the Investment Committee of the EIB. The list of schemes including fossil gas from the third disbursement cycle is as follows: 

  • Modernisation of energy sources to natural gas without CHP; non-priority investments of the programme HEAT (Modernisation of thermal energy supply system) 
  • Modernisation of energy sources to natural gas without CHP; non-priority investments of the programme ENERG ETS (Improvement of energy efficiency and reductions of emissions of greenhouse gases in EU ETS industry) 
  • Modernisation of natural gas energy sources without CHP; ENERG ETS programme 
  • Modernisation of energy sources to natural gas with CHP; priority investment of the programme HEAT (Modernisation of thermal energy supply systems) 
  • Modernisation of energy sources to natural gas with CHP; priority investments of the programme ENERG ETS (Improvement of energy efficiency and reductions of emissions of greenhouse gases in EU ETS industry) 
  • Modernisation of energy sources to natural gas with CHP; priority investments of the programme ENERG ETS (Improvement of energy efficiency and reductions of emissions of greenhouse gases in EU ETS industry) (P‐5 Modernisation of natural gas energy sources with CHP) 

Western Balkan coal pollution still massive, illegal and deadly – new report

The entry into force of new legal standards on 1 January 2018 should have brought reductions in deadly air pollution. But the report – Comply or Close – shows that in 2021, dust emissions from coal plants included in the National Emissions Reduction Plans (NERPs) of Bosnia and Herzegovina, Kosovo, North Macedonia and Serbia increased compared to previous years, while sulphur dioxide emissions only decreased slightly.

The Ugljevik coal plant in Bosnia and Herzegovina again emitted the most sulphur dioxide in the region in 2021 – 86 774 tonnes – despite having desulphurisation equipment installed at a cost of EUR 85 million. (1) Its emissions were similar to 2019, so even two years after testing began, the desulphurisation equipment clearly did not work.

The highest dust polluter in 2021 was Gacko in Bosnia and Herzegovina, whose emissions more than tripled to 4 960 tonnes in 2021 – more than 16 times as much as allowed by the country’s NERP. The reasons for this massive increase are unclear.

The Pljevlja coal plant in Montenegro also breached the Energy Community Treaty in 2021 by operating for more than 20 000 hours from 1 January 2018 without undertaking pollution control investments. (2)

The year ended with a region-wide energy crisis with coal supply problems and coal plants in Serbia, North Macedonia and Kosovo collapsing one after another. Coupled with poor hydrological conditions and high electricity import prices, this diverted attention from tackling pollution and in early 2022 provided a pretext for the Federation of Bosnia and Herzegovina to approve an illegal lifetime extension for the Tuzla 4 and Kakanj 5 units and for North Macedonia to start up an ancient oil-fired plant again after being in reserve for years. (3)

Ioana Ciuta of CEE Bankwatch Network – ‘Western Balkan governments are reacting to the energy crisis by opening new coal mines (4) and delaying power plant closures, but with such antiquated plants, the end of coal is closer than they think. A plan B is urgently needed – cutting energy wastage, opening markets and ramping up development of sustainable forms of renewable energy – but governments must take measures to cut pollution and save lives in the meantime.’

Pippa Gallop of CEE Bankwatch Network – ‘In 2021 the Energy Community Secretariat opened dispute settlement cases against Bosnia and Herzegovina, Kosovo, Montenegro, North Macedonia and Serbia but this has not been sufficient to spur them into action. The European Commission must redouble efforts to introduce deterrent penalties into the Energy Community Treaty if it wants Western Balkan governments to take EU law and human health seriously.’

The report findings, as well as additional context, can be found at https://www.complyorclose.org

Contacts

Pippa Gallop
Southeast Europe Energy Advisor, CEE Bankwatch Network
pippa.gallop@bankwatch.org
+385 (0)99 755 9787
Twitter: @pippagallop 

Ioana Ciuta
Energy coordinator for the Western Balkans, CEE Bankwatch Network
ioana.ciuta@bankwatch.org
+40724020281
Twitter: @unaltuser 

Davor Pehchevski
Balkan Air Pollution Campaign Coordinator, CEE Bankwatch Network
davor.pehchevski@bankwatch.org
+38971264087
Twitter: @dpehche

Notes for editors

(1) For more information about the Ugljevik coal plant, see here.

(2) For more information about the Pljevlja coal plant, see here.

(3) A statement by the Energy Community on Tuzla 4 and Kakanj 5  is available here.

(4) For example, North Macedonia has recently announced the opening of two new coal mines – Zivojno and Gusterica and Montenegro plans to open open-cast mines at Glisnica and Mataruge.

Civil Society From Across the Asian Region Urge the ADB to Stop Financing False Climate and Energy Solutions

Today, the NGO Forum on ADB is hosting an online press conference featuring representatives from groups based in Southeast and Central Asia and the Caucasus to speak about the need for the ADB to support decentralized, appropriately scaled, distributed variable renewable energy, and to pull back from sinking limited funds into risky resource intensive energy ventures that are neither clean nor just. In Manila, an in-person convergence will be coordinated by the Power 4 People (P4P) Coalition on the morning of June 17th, bringing together local and regional organizations united in the call issued to the ADB to stop financing false solutions. Details of the event location and timing will be disclosed separately. 

“We recognize this year at ACEF, though the ADB has made an effort to focus on support for ‘green’ energy technologies, it has been dominated by private sector proponents and by discussions about technologies that are neither ‘clean’ nor economically, socially or environmentally sound. As civil society organizations mobilizing and organizing for a rights based, lasting, inclusive, just transition, we are adamant that power must be wrested in the public domain, ensuring meeting people’s’ rights to water, land, territory and other resources are not only prioritized, but set as non-negotiable,” explained Tanya Lee Roberts-Davis, Energy Campaigns and Policy Strategist with the NGO Forum on ADB. 

“Net-zero should not be misconceived as real-zero. Short-sighted technocratic fixes such as carbon capture schemes are not a substitute for simply making the rapid and needed shift to invest in forward looking clean energy sources. Meanwhile, we are concerned the highly touted Energy Transition Mechanism risks creating a situation whereby the public may be forced to accept a heavy toll on their health, the environment and climate,  while coal companies will have the greenlight to continue to turn a profit over the course of several years during which the ADB and other donors sponsor the project’s retirement,” she continued. 

As asserted by Yobel Putra, of the Global Alliance for Incinerator Alternatives-Asia Pacific: “ACEF 2022 is not getting better as it adds more false solutions to the list. For years, ADB has insisted that waste-to-energy incineration is a renewable energy source and a low-carbon solution. However, the world knows that plastic is on track to become a bigger climate problem than coal. Burning municipal solid waste — especially when it contains plastics — is dirtier than coal-fired power plant in every aspects. In addition to the highly toxic emission and ash, WTE incineration is amongst the dirtiest energy sources on the grid both in the U.S. and the E.U.. Substituting one form of dirty fossil fuel with another and claiming it as renewable is greenwashing. Worse, ADB’s suggestion to couple its climate harming projects with carbon capture technology is a huge distraction. Our time is running out, ADB should stop becoming a climate criminal before it is too late.”

Andrey Ralev from CEE Bankwatch added: “The biodiversity and climate crisis can and must be addressed together. We fully support the upscaling of investments in renewable energy, but this should not be at the cost of biodiversity loss. The lack of strategic planning and cumulative impact assessment means that many hydro, wind and solar projects in the ADB pipeline are wrongly placed. The Zarafshan wind power project, for example, could lead to the extinction of the globally endangered saker falcon and Egyptian vulture.” 

In the Philippines and Southeast Asia, the recent Financing a Fossil Future report from the Manila based think-tank Center for Energy, Ecology, and Development (CEED) found that ADB is among notable public financiers helping bankroll the fossil gas industry in the region since the Paris Agreement was signed in 2015. Alarmingly, 84% of total financing for midstream gas projects mapped in the report were found to have been linked to public financial institutions. As Avril de Torres from CEED asserted: “It took 12 years for ADB to recognize that financing coal goes against the development it claims it wants to achieve for the Asia-Pacific region. By keeping the door open for fossil gas, however, ADB is sustaining its dirty energy legacy, merely switching from one fuel to another in dooming the region to climate catastrophe.” 

“ADB is also forcing grave economic burdens on our people – spiking gas prices as exacerbated by the Russia-Ukraine war are a warning sign against massive fossil gas expansion, if we wish to veer away from vulnerability to volatile fuel costs. If it hopes to become a genuine climate and development bank, we see no other path for ADB to take than working with Asia-Pacific peoples to advance renewables,” she concluded

 

Press Contacts: 

Tanya Lee Roberts-Davis, Energy Policy and Campaigns Strategist, NGO Forum on the ADB| Email: tanya@forum-adb.org   

Dennis T. Paule, Communication and Support Liaison Officer, NGO Forum on ADB | Email: dennis@forum-adb.org 

Aryanne, Center for Energy, Ecology and Development | Email: info@ceedphilippines.com

EU bank hands out billions to companies complicit in burning fossil fuels

The report, Flattering to deceive: A reality check for the ‘EU Climate Bank’, shows how the bank handed out at least €7.4 billion in financing to some of Europe’s fossil energy giants in 2020-21 – including €2 billion in loans to companies still burning coal. Even though EIB President Werner Hoyer declared “gas is over” last year, the gas industry made the most of the bank’s one-year transition period away from fossil fuel investments to secure €657 million in financing for gas infrastructure.

The EIB mainly financed renewable and other non-fossil projects, including those by oil and gas giants like ENI, Total Energies or ENGIE. However, none of these companies have a solid plan for honouring the Paris climate accord. Many are also ignoring warnings from the International Energy Agency and the IPCC to stop extracting fossil fuels or building related infrastructure. Big energy multinationals made billions in record profits last year while energy prices are surging, with the EIB’s financing helping these energy companies to boost their profits even more.

Frank Vanaerschot, Director at Counter Balance, said:

“It is crucial that the bank makes financing companies dependent on having a solid plan to phase out fossil fuels fast enough to be in line with the Paris agreement.”

“The EIB has to become a real ‘Climate Bank’. That means doing much more than just excluding fossil fuel projects. We need the EIB to be on the side of the people in Europe struggling to pay skyrocketing bills – not the energy companies making huge profits from them.”

“Locking us into decades of more fossil fuels simply isn’t compatible with living on a healthy planet, not to mention a gigantic waste of public money. The EIB should only finance projects with partners who are entirely focused on renewables, energy efficiency measures and public well being.”

The EIB’s support for fossil gas and hydrogen is concerning as the bank is due to review its approach to energy investments later this year. Given that its current energy policy contains many loopholes allowing fossil fuel investments to continue, there is a risk that the EIB could decide to support gas more overtly.

The report also reveals that almost 20 cents of every euro invested in transport by the EIB went to carbon-intensive and polluting transportation methods. Of the €21.2 billion invested in the sector, almost €3 billion was used to finance highly polluting expressways and highways. Airport infrastructure (€520 million) and expansions of sea ports (€339 million) are also environmentally problematic. The EIB is due to overhaul its transport policy in the coming months – a great opportunity for the bank to stamp out this destructive lending.

Anna Roggenbuck, EIB Policy Officer at CEE Bankwatch Network, said:

“Our report also showed that the EIB reported a record climate financing at the level of 40% of its overall lending, however we also noted that the bank changed its methodology for calculating this spending therefore it cannot be simply compared with previous results. Energy efficiency loans steadily grew from €3.6 billion in 2014 to €4.7 billion in 2021 while renewable energy sources have also been growing since 2015, although the EIB reached similar lending volumes in the past. In the context of the REPowerEU, the pace of the growth will have to accelerate with the energy savings and clean energy put at the core of climate action and energy sovereignty. 

 

For more information, please contact:

Anna Roggenbuck
Policy Officer
CEE Bankwatch Network
+48 509970424
annar@bankwatch.org

Paul Creeney
Media and Communications Officer
Counter Balance
+32 465 946 509
paul.creeney@counter-balance.org

Notes to editors

  • In November 2020, the EIB adopted a Climate Roadmap with the aim of aligning all of its operations with the goals of the Paris Agreement, and transforming itself into the ‘EU Climate Bank’. The previous year, the EIB adopted an energy policy in which it committed to phase out fossil fuels by the end of 2021.
  • The Flattering to deceive: A reality check for the ‘EU Climate Bank’ report analysed the EIB’s operations in 2020 and 2021, focusing on the energy and transport sectors – the largest sectors for direct EIB loans. Nevertheless, there are sectors of EIB activities that we could not explore in great depth, such as its support to carbon-heavy industrial sectors or the climate impacts of other operations like health, agriculture and research and innovation.
  • Counter Balance’s briefing, ‘EIB & Transport: Making EU Public Finance transform mobility across Europe and beyond’ exposes how the EIB’s current approach to transport needs to undergo radical change if it is to help the EU decarbonise its transport sector and achieve the objectives of the Green Deal.

Environmental groups challenge EU support for 30 fossil gas projects

  • Four environmental groups are starting legal action against the EU’s gas infrastructure priority list.
  • The organisations deem the inclusion of 30 proposed gas projects on the list unlawful and say the EU Commission breached its own climate and energy laws when approving the list.
  • The cost of all the gas projects amounts to €13 billion. Their collective CO2 and methane output have not been calculated by the Commission or project owners but can be expected to be sky-high.

Every other year, the EU Commission draws up a list of priority energy infrastructure projects deemed beneficial to the whole bloc. Infrastructure on the “Projects of Common Interest” list gain fast-tracked permits and eligibility for EU funds.

Billions of euros are bound to be wasted on 30 major pieces of gas infrastructure like the EastMed pipeline – a €7 billion, 1,900km gas pipeline that will connect Eastern Mediterranean offshore gas fields from Israel and Cyprus to Italy via Greece.

The groups have been able to commence legal action through a request for internal review – a mechanism now open for use by NGOs and the public after a major reform of EU access to justice laws last year.

The four organisations request the EU Commission to review the decision that approved the PCI list and gave 30 proposed gas projects priority status. If the Commission refuses to amend its decision, the organisations will be able to ask the Court of Justice of the EU to rule.

ClientEarth lawyer Guillermo Ramo said: “This list amounts to a VIP pass for fossil gas in Europe, when we should be talking about its phase-out. The Commission did not consider the impact of methane emissions derived from gas infrastructure projects – in spite of evidence that these are substantial. That’s unlawful as it directly clashes with the EU’s own climate laws and its legal obligations under the Paris Agreement.”

Methane is the main component of fossil gas, with a global warming potential over 85 times higher than that of CO2 over 20 years. Yet, its impact when planning gas infrastructure is not taken into account. 

The environmental organisations argue the EU’s decision to support gas infrastructure puts the EU’s climate and energy goals under threat. Experts have clearly said no new gas or other fossil fuel developments should be built if we are to limit warming within 1.5C. The list also comes as Europe faces a gas price crisis, caused in part by over-reliance on price-volatile gas.

Despite this, the EU Commission’s REPowerEU strategy plans to unleash another €10 billion in new fossil gas infrastructure.

Some studies point out that the EU can end imports of all Russian fossil gas by 2025 – two years earlier than the European Commission’s current target of 2027 – without building new gas infrastructure or delaying the phase-out of coal.

Natasa Ioannou, climate campaigner with Friends of the Earth Cyprus said: “The EastMed pipeline is a disaster for communities and the climate. It is not in the interests of local people in the region who will bear the costs of fossil fuel lock-in, and the harm to the ecologically-sensitive Mediterranean Sea. All along the route of the EastMed pipeline people are saying no to new fossil fuel infrastructure and yes to climate justice and to peace. EU funding must focus on supporting projects that implement just, fair, safe, and renewable energy solutions.”

The European Commission now has up to 22 weeks to reply. The end result could be a judgement clarifying how the EU should take the climate impacts of infrastructure into account.

Notes to editors

What is the Projects of Common Interest list?

In November 2021, the EU Commission published a list of priority energy infrastructure – as it does every two years – which includes 30 fossil gas infrastructure projects. This list entered into force in April 2022.

  • These projects can receive streamlined environmental impact assessment, a fast-tracked permitting procedure and are eligible for EU funding.
  • They are aimed at facilitating gas transport, storage or import. They include pipelines and LNG terminals such as the EastMed pipeline, the Melita Transgas pipeline, the Cyprus LNG import terminal, the Baltic Pipe, the Poseidon pipeline, etc.
  • The cost of all gas projects on the list is estimated at €13 billion. But this doesn’t include the cost on nature, human health and climate.

The list is governed by the Trans-European Energy Networks (TEN-E) Regulation which was revised recently. Despite initial intentions to get rid of fossil fuel projects in TEN-E, the EU Council and Parliament have proposed loopholes that would still leave considerable room for gas projects on future editions of the priority list. The process of establishing the list has been repeatedly criticised for lack of transparency and for being heavily influenced by vested fossil gas industry interests.

What is the legal procedure used in this case?

ClientEarth has fought a decade-long battle to improve access to justice rights at EU level. In 2021, a landmark reform of EU access to justice laws was approved. This has lifted the main barriers preventing NGOs and people from challenging environmental wrongdoings in court.

Environmental NGOs now have the right to ask EU institutions and bodies – in this case the European Commission – to review one of their own decisions for contravening EU law related to the environment. The Commission must officially reply to such a request within 16 weeks, a deadline that can be extended up to 22 weeks. If the claimants find that the Commission’s reply does not fix the legal violation, the claimants can sue the Commission in the Court of Justice of the European Union.

What are the climate impacts of gas and methane?

Gas extraction and transportation not only emits huge amounts of CO2, it is also a big emitter of potent and poisonous greenhouse gas methane. The drilling and extraction of gas from wells and its transit through pipelines results in emissions of methane – its primary component, which is a whopping 86 times more powerful than carbon dioxide in storing heat over 20 years. Beyond climate, methane also has devastating impacts on human health – via air pollution – and ecosystems.

Both the IEA and the IPCC have clearly said no new oil and gas extraction projects  should be built if we are to keep warming within 1.5C. Additionally, a recent study found that nearly half of existing fossil fuel production sites need to be shut down early if 1.5C is to be achieved.

EU recovery plans – a threat to nature

The report reveals the failure of EU recovery funds to address the biodiversity crisis – one of the biggest of our time – and exposes biodiversity damaging investments and reforms from the recovery plans of nine central and eastern European countries. 

The alarming state of biodiversity in the EU calls for immediate action, and the vast amount of EU funds now available provide a unique opportunity to address this crisis. The EU Biodiversity Strategy states that a minimum of EUR 20 billion per year is needed to address biodiversity loss. Yet less than 1 per cent of recovery fund spending has been allocated to nature protection or restoration projects, critical to achieving the objectives of the strategy. Even worse, some of the projects from the recovery plans are likely to cause further damage to biodiversity.  

In Bulgaria and Latvia, projects aimed at increasing renewable energy highlight the potential conflict between climate action and biodiversity, underlining the need for sufficient environmental safeguards. This issue could have been avoided by better planning and by taking into consideration the expertise delivered by civil society organisations. The Latvian government is simplifying permitting procedures which allow wind farms in forests, and snuck support for such projects into its recovery plan after the public consultation and ‘do no significant harm’ assessment had already been carried out.  

Similarly, water management projects in Hungary, Croatia, Latvia and Poland will support building reservoirs, pumping stations, channels, or rivers’ regulation, often in highly sensitive areas, including Natura 2000 sites. These threaten to turn rivers and streams into dead channels and ponds devoid of life, degrading water quality as a consequence. The cases from Slovenia, Estonia, the Czech Republic and Romania show how forestry projects that appear positive at first sight will instead most likely encourage even more intensive forest cutting. 

Many of these projects were planned and negotiated behind closed doors with no information on their location and without proper assessment of their impact on nature. Potential harm to biodiversity cannot be reverted and these examples show why and how EU funding must be biodiversity-proofed.   

Quotes 

Daniel Thomson, EU policy officer for biodiversity with CEE Bankwatch Network, said: ‘Billions of euros of public recovery funds are now in the process of being disbursed, yet we still don’t know the full details of what’s actually being financed. At first glance, many projects may appear harmless – or even beneficial – to nature. But digging a little deeper reveals a new wave of biodiversity-damaging funding that will have consequences for years to come.’ 

Thomas Freisinger, EU policy officer with EuroNatur, said: ‘Member States were given a unique opportunity to make this recovery a turning point to address biodiversity loss. Yet, business as usual was chosen. The Commission needs to create the incentives and safeguards that are necessary for a real shift.’ 

For more information contact   

Daniel Thomson  
EU policy officer for biodiversity  
CEE Bankwatch Network  
daniel.thomson@bankwatch.org 

Thomas Freisinger  
EU policy officer 
EuroNatur 
thomas.freisinger@euronatur.org  

The report ‘Behind the ‘green recovery’: how the EU recovery fund is failing to protect nature and what can still be saved is available here.