Keeping the flame alive with emission revenues: How the EU Modernisation Fund props up fossil gas and waste incineration
Report | 8 May 2025
Launched in 2021, the Modernisation Fund was designed to channel EU emissions trading revenues into energy transition investments in 13 lower-income member states. However, Bankwatch’s analysis reveals that this climate fund has spent between EUR 4.2 billion and EUR 6.8 billion on a range of dirty energy infrastructure – from biomass heating and waste incinerators to gas-fired power plants. The bulk of this investment is in Romania, the Czech Republic and Poland.
The report also highlights the lack of support for several critical areas, including energy communities and just transition in post-coal regions.
Overall, this first-of-its-kind analysis demonstrates the lack of transparency that characterises the operation of this important climate fund.
Theme: Modernisation Fund
Location: Romania, Czech Republic, Poland
Project: Fossil gas
Tags: EU funds | district heating | fossil gas | renewables
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