Bulgaria can receive up to 2.7 billion euros under the Social Climate Fund? Why is he so important?
Bulgaria can receive up to 2.7 billion euros under the Social Climate Fund, which will be about 3.85% of the fund's budget, and the funds will be distributed around 900 million euros for the period 2025-2027 and 1.8 billion euro until 2032, it is clear from the agreement between the Council and the European Parliament on the creation of the Social Climate Fund.
Just a week ago, MEPs approved the Social Climate Fund with a budget of 86.7 billion euros. Poland, Romania, France, Italy, Spain will receive the largest part of the funds.
Why is it so important for EU and Bulgarian citizens? It affects all EU families and citizens and will help the most vulnerable and poor families to also achieve the EU's big targets for reducing carbon emissions and pollution to be carbon neutral by 2050. Everyone realizes that the green or energy transition as we call it will cover everyone and therefore the poorest families must be protected and encouraged to participate as well. The EU takes an important step and will include households and transport in the Emissions Trading Scheme from 2027.
"The first important step for the formation of the Social Climate Fund is to change the Multiannual Financial Framework for the next seven years. There must be political will in the Council to change the Multiannual Financial Framework. The Social Climate Fund will come into force from 2027, which is the last year of the Multiannual Financial Framework 2021-2027. We will see if there is political will for countries to do it. I think it is very important that there is a compromise because the Social Climate Fund is necessary because families need to achieve energy efficiency to reduce carbon emissions. This includes replacement of windows, windows, materials, complete renovation of the home. We need to give people money to do it, to make the Green transition," Margarida Marches, vice-chairman of the Budget Committee in European Parliament.
The fact that we are expanding the European Emissions Trading Scheme, we want to have this mechanism for households and for the transport sector, she added.
To our question: "Isn't it too complicated to include households in the Emissions Trading Scheme?" she commented that people are yet to be prepared for this period and it is very important that governments explain the subject in the appropriate way to all citizens.
"But if we want families to be more efficient and use less energy to be environmentally friendly, we have to give them the opportunity to do it. I'll give an example of changing the windows. We want to tackle climate change and make the climate transition, but we need to help people change their lifestyles, because a lot of emissions come from buildings and their efficiency. We can't expect the poorest people to pay for the Green Transition, and that's why we're creating this fund. That's a question of political will. The question of where the money will come from, that we need to change the Multiannual Financial Framework, is technical. Citizens, from my point of view, do not want to know where the money is coming from, they should be able to take concrete steps and be active participants in climate and energy transition. We are here to protect citizens and that is why we are so mobilized to create this fund." This was specified by Markesh in addition.
We plan to have a carbon neutral economy by 2050. That means we need to make progress and provide citizens with the means to do so. But it is clear that we have to switch from fossil fuels to renewable energy sources, Margarida Marches also emphasized.
The Social Climate Fund will cover households, micro-enterprises and transport users who are particularly affected by energy and transport poverty. Only measures and investments that respect the principle of "do no significant harm" and aim to reduce dependence on fossil fuels will receive support.
Parties to submit social climate plans to address energy and transport poverty
EU countries will have to submit "Social Climate Plans" after consultation with local and regional authorities, economic and social partners, as well as civil society, which will cover two types of initiatives, the European Parliament announced.
First, the fund will finance temporary direct income support measures to deal with the rise in road transport and heating fuel prices – capped at 37.5% of total estimated costs for each national plan. Second, it will also cover long-term structural investments, including building renovations, decisions about decarbonisation and integration of renewable energy, purchasing and infrastructure for zero and low emission vehicles, and the use of public transport and shared mobility services.
The Social Climate Fund will become operational in 2026, one year before the Emissions Trading Scheme is extended to cover buildings and road transport (so-called "ETS II"). If energy prices are extremely high, the extension of the scheme can be postponed by one year, the European Parliament specified at the beginning of the week.
Initially, the fund will be financed through the proceeds from the auction of 50 million allowances (estimated at around €4 billion). Once the extension of the scheme enters into force, the fund will be financed by the auction of allowances up to an amount of EUR 65 billion, with an additional 25% covered by national resources (the total budget will be EUR 86.7 billion).
Parliament and the Council must formally approve the agreement before it enters into force.
The Social Climate Fund is part of the 'Five for 55' package in 2030, which is the EU's plan to reduce greenhouse gas emissions by at least 55% by 2030 compared to 1990 levels, and is an important because it gives certainty to citizens that they will be able to afford the more expensive but ecological transition.