Proposal for a COUNCIL RECOMMENDATION on ensuring a fair transition towards climate neutrality
Date: 2021-12-14
Institutions: Directorate-General for Employment, Social Affairs and Inclusion, European Commission
Subjects: EU environmental policy, adaptation to climate change, carbon neutrality, climate change, environmental protection, green economy, greenhouse gas, sustainable development

EN 

  EN 

   EUROPEAN COMMISSION  Strasbourg, 14.12.2021  COM(2021) 801 final 2021/0421 (NLE)  Proposal for a COUNCIL RECOMMENDATION on ensuring a fair transition towards climate neutrality    {SWD(2021) 452 final}  
 
EXPLANATORY MEMORANDUM 

1. 

CONTEXT OF THE PROPOSAL 

Reasons for and objectives of the proposal 

• 
The  European  Green  Deal1  (‘the  Green  Deal’)  launched  a  new  strategy  to  transform  the 
European Union into a sustainable, fair and prosperous society, with a modern,  circular and 
competitive economy and  zero net  emissions of greenhouse  gases  in  2050.  It  underlines  the 
Commission’s  commitment  to  tackle  climate  change  and  environmental  degradation  and  to 
deliver  on  the  objectives  adopted  under  the  United  Nations  Framework  Convention  on 
Climate Change (the ‘Paris Agreement’) to keep the global temperature increase well below 
2°C  and  pursue  efforts  to  keep  it  to  1.5°C.  The  cost  of  non-action  on  climate  and 
environmental  policy  would  be  immense  for  people,  in  particular  those  in  vulnerable 
situations, in terms of living standards, health and wellbeing. With a view to the path to net 
zero  emissions,  the  need  for  a  fair  transition  is  an  integral  part  of  the  Green  Deal  which 
underlined that no person and no place should be left behind. 

In June 2021, the Council of the European Union and the European Parliament  adopted the 
‘European  Climate  Law’2,  which  sets  out  the  binding  objective  of  climate  neutrality  in  the 
Union by 20503, and a binding intermediate target of a net domestic reduction in greenhouse 
gas emissions of at least 55% compared to 1990 levels by 2030. To deliver on these targets, 
the  Commission  proposed  the  ‘Fit  for  55’  legislative  package  in  July  2021.  The  package 
comprises a coherent set of measures in legislative proposals. Among these, the package puts 
forward a proposal for establishing a new Social Climate Fund4 of EUR 72.2 billion for the 
period  2025-2032  to  support  vulnerable  households,  transport  users  and  micro-enterprises 
affected  by  the  introduction  of  emissions  trading  for  fuels  used  in  road  transport  and 
buildings. 

Fairness  and  solidarity  are  defining  principles  of  the  European  Green  Deal.  At  the 
international  level,  Member  States  have  endorsed  in  particular  the  UN  Sustainable 
Development  Goals  and  the  Paris  Agreement,  which  refers  to  ‘the  imperatives  of  a  just 
transition  of  the  workforce  and  the  creation  of  decent  work  and  quality  jobs’.  This  is 
confirmed  and  in  line  with  Article  2(1)  of  the  Paris  Agreement,  the  European  Council’s 
Strategic  Agenda  2019-2024  and  Article  2(2)  of  the  European  Climate  Law,  as  well  as  the 
European Pillar of Social Rights. The International Labour Organisation (ILO) Guidelines for 
a  just  transition  towards  environmentally  sustainable  economies  and  societies  for  all  also 
provide  an  internationally  established  policy  framework  for  a  just  transition.  Furthermore, 
Member  States  and  social  partners  endorsed  the  2018  Solidarity  and  Just  Transition  Silesia 
Declaration,  adopted  at  COP-24  in  Katowice,  and  the  2021  Declaration  on  Supporting  the 
Conditions for a Just Transition Internationally, adopted at COP-26 in Glasgow.  

Policy  actions  to  support  people  and  their  active  participation  are  required  for  a  successful 
green  transition.  The  vision  for  a  fair  transition  towards  a  strong,  climate-neutral  Social 

1  Communication from the Commission ‘The European Green Deal’, COM(2019) 640 final. 
2  Regulation (EU) 2021/1119 of the European Parliament and of the Council of 30 June 2021 establishing the 
framework  for  achieving  climate  neutrality  and  amending  Regulations  (EC)  No  401/2009  and  (EU) 
2018/1999 (‘European Climate Law’) (OJ L 243, 9.7.2021, p. 1). 
In pursuit of the long-term temperature goal set out in point (a) of Article 2(1) of the Paris Agreement. 

3 
4  Proposal for a Regulation of the European Parliament and of the Council establishing a Climate Social Fund, 

COM(2021) 568 final. 

EN 

1 

  EN 

                                                 
Europe  reflects  the  20  principles  of  the  European  Pillar  of  Social  Rights,  which  were 
proclaimed at the Gothenburg Summit in November 2017, and comprise the ‘social rulebook’ 
for fair and well-functioning labour markets and welfare systems in 21st century Europe. The 
implementation  of  the  Pillar  will  support  a  fair  transition,  which  is  key  for  ensuring  social 
cohesion.  The  European  Pillar  of  Social  Rights  Action  Plan5  aims  at  rallying  forces  at  all 
levels to turn the principles into concrete actions. It sets three EU headline targets for 2030 in 
the areas of employment, skills, and poverty reduction, which were welcomed by EU leaders 
in the Porto Declaration of May and by the European Council in June 2021. It emphasises the 
need to  strengthen the European social dimension  across all policies of the Union to  ensure 
that the transition to climate-neutrality is socially fair and just. 

Accompanied with the right policies, the transition could create around 1 million jobs in the 
EU by 20306 and 2 million jobs by 20507. It could create particularly middle-skilled, middle-
paying jobs8, with varying impacts across countries, regions and sectors. This could contribute 
to  mitigating  labour  market  polarisation  stemming  from  other  megatrends,  notably 
digitisation, to raising incomes and to reducing poverty overall9. As highlighted in the impact 
assessments of the 2030 Climate Target Plan and the legislative proposals of the ‘Fit for 55’ 
package,  significant  labour  reallocation  within  and  across  sectors  will  require  large-scale 
investment  in  reskilling  and  upskilling.  For  example,  while  it  is  estimated  that  160,000 
additional  construction  jobs  could  be  created  in  the  EU  by  2030  through  the  climate 
transition10,  currently  skills  gaps  are  visible  in  occupations  related  to  green  design, 
technologies and materials  in  this sector.  The  right  accompanying policies  can reduce -  and 
even prevent - energy poverty, which stems from a combination of low income, a high share 
of  disposable  income  spent  on  energy  and  poor  energy  efficiency.  In  addition,  they  can 
promote access to  affordable and  low-emission transport and mobility options, tackle social 
exclusion  and  socio-economic,  regional  and  health  inequalities,  improve  health  and  well-
being, and promote equality, in general and also for disadvantaged persons. 

To fully realise the employment and social potential of the green transition, it is essential  to 
use all available tools and put the right accompanying policies in place at EU, Member States, 
regional  and  local  levels.  Conversely,  in  the  absence  of  well-designed  accompanying 
employment and social policies, there are socio-economic risks. It is therefore crucial that the 
responsible authorities put in place the appropriate polices, and do so without undermining the 
incentives  for  the  changes  in  investment  and  consumption  required  by  the  transition. 
Importantly,  such  mechanisms  should  be  accompanied  by  measures  to  ensure  inclusive 
governance and the active involvement of those most affected by the green transition.   

5  Communication from the Commission ‘The European Pillar of Social Rights Action Plan’, COM(2021) 102 

final, 4 March 2021. 

6  According to the impact assessment accompanying the 2030 Climate Target Plan (SWD(2020)176 final). 
7  European  Commission  (2019),  ‘Sustainable  growth  for  all:  choices  for  the  future  of  Social  Europe, 
Employment  and  Social  Developments  in  Europe  2019’,  4  July  2019.  Based  on  the  In-depth  analysis 
accompanying the Communication of the Commission COM(2018) 773. 

8  Eurofound  (2019),  ‘Energy  scenario:  Employment  implications  of  the  Paris  Climate  Agreement’, 

Publications Office of the European Union, Luxembourg. 

9  European  Commission  (2019),  ‘Sustainable  growth  for  all:  choices  for  the  future  of  Social  Europe, 
Employment and Social Developments in Europe 2019’, chapter 5 ‘Towards a greener future: employment 
and social impacts of climate change policies’, 4 July 2019. 

10  Communication  from  the  European  Commission:  Renovation  Wave  for  Europe  -  greening  our  buildings, 
creating  jobs,  improving  lives,  SWD(2020)  550  final,  14  October  2021.    Given  the  investment  needs  in 
renovation at EUR 275 billion annually, as referred to in the Communication, and the ability of retrofits and 
energy efficiency investments to create 9-20 jobs per every million dollar invested (SWD(2021) 623 final), 
the figure could be significantly higher.  

EN 

2 

  EN 

                                                 
While Member States have put in place and are preparing a multitude of actions to promote a 
fair  transition  towards  climate  neutrality,  there  is  scope  to  further  enhance  the  design  of 
policies  supporting  a  fair  green  transition  and  ensure  coherence  of  the  efforts  between  the 
various tools available at EU and national level (see next section). Therefore the Commission 
announced as part of the ‘Fit for 55’ package  a proposal for a Council Recommendation by 
the  end  of  2021  to  provide  further  guidance  to  Member  States  as  how  to  best  address  the 
social  and  labour  aspects  of  the  green  transition.  In  parallel  to  delivering  on  the  European 
Green  Deal,  the  Commission  is  also  closely  monitoring  short-term  developments  on  energy 
markets driven primarily by global market developments and, on 13 October 2021, presented 
a  Communication  on  ‘Tackling  rising  energy  prices:  a  toolbox  for  action  and  support’ 
outlining  immediate  measures  to  protect  consumers  and  businesses11.  This  forthcoming 
proposal  was  also  referred  to  in  that  Communication  as  policy  framework  to  support  a  fair 
green transition over the medium run and build resilience to any future price developments. 

• 

Consistency  with  existing  policy  provisions  in  the  policy  area  of  employment, 
skills, social and distributional aspects of the green transition 

In  line  with  the  Political  Guidelines  of  the  Commission  2019-202412  the  European  Pillar  of 
Social Rights Action Plan highlights that, as part of a new ‘social rulebook’, social rights and 
the  European  social  dimension  need  to  be  strengthened  across  all  policies  of  the  Union  as 
enshrined in the Treaties, in particular Article 3 TEU and Article 9 TFEU, to move towards a 
greener and more digital decade in which Europeans can thrive. In turn, the European Green 
Deal foresees the mainstreaming of sustainability in all EU policies, in particular by pursuing 
green finance and investment and ensuring a fair transition. 

The Commission Recommendation on effective active support to employment following the 
COVID-19  crisis  (EASE)13  highlighted  that  the  EU  and  the  Member  States  should  act 
together  to  promote  a  dynamic,  job-rich  and  inclusive  recovery  and  facilitate  the  green  and 
digital  transition  in  the  European  labour  market.  The  2020  guidelines  for  the  employment 
policies  of  the  Member  States14  stated  that  policy  action  should  combine  measures  to  boost 
labour  demand,  increase  labour  supply,  improve  access  to  employment,  skills  and 
competences, and  enhance the functioning of labour markets  and the effectiveness  of social 
dialogue, while taking into account their environmental, employment and social impact. The 
proposed  Joint  Employment  Report  2022  emphasised  that  investing  in  upskilling  and 
reskilling are a top priority to foster an inclusive recovery and support the digital and green 
transitions15. Member States are invited to inter alia introduce support for the reallocation of 
labour,  for  instance  via  well-designed  hiring  incentives  and  training,  notably  towards  the 
green and digital economy, while protecting workers during the transition. This is in line with 
previous  related  Council  Recommendations,  such  as  on  reinforcing  the  Youth  Guarantee16, 

11  COM(2021) 660 final. 
12  ‘A  Union  That  Strives  for  More:  My  Agenda  for  Europe’  –  Political  Guidelines  for  the  next  European 

Commission 2019-2024, 16.07.2019, President von der Leyen. 

13  Commission Recommendation (EU) 2021/402 of 4 March 2021 on an effective active support to employment 

following the COVID-19 crisis (EASE) (OJ L 80, 8.3.2021, p. 1). 

14  Council Decision (EU) 2020/1512 of 13 October 2020 (OJ L 344, 19.10.2020, p. 22). 
15  COM (2021) 743 final, Proposal for a Joint Employment Report 2022. 
16  Council Recommendation of 30 October 2020 on ‘A Bridge to Jobs – Reinforcing the Youth Guarantee and 
replacing  the  Council  Recommendation  of  22  April  2013  on  establishing  a  Youth  Guarantee’  (OJ  C  372, 
4.11.2020, p. 1). 

EN 

3 

  EN 

                                                 
and  on  vocational  education  and  training  (VET)  for  sustainable  competitiveness,  social 
fairness and resilience17. 
In the framework of the Energy Union and Climate Action Governance Regulation18, Member 
States  draw up integrated national  energy and climate plans (NECPs), which cover ten-year 
periods, taking into account the long-term perspective, and the five dimensions of the Energy 
Union,  i.e.  energy  security;  the  internal  energy  market;  energy  efficiency;  decarbonisation; 
research, innovation  and competitiveness.  Such NECPs shall be updated five  years after the 
first submission of the NECPs and subsequently every ten years. Pursuant to Article 3(3) (d) 
of Regulation (EU) 2018/1999 on the Governance of the Energy Union and Climate  Action, 
in the event that a Member State finds that it has a significant number of households in energy 
poverty,  it  shall  include  in  its  plan  a  national  indicative  objective  to  reduce  energy  poverty 
together  with  a  timeframe  for  when  the  objectives  are  to  be  met  as  well  as  policies  and 
measures  to  address  energy  poverty,  including  social  policy  measures  and  other  relevant 
national  programmes19.  While  several  Member  States  have  developed  concrete  initiatives 
aimed  at  tackling  energy  poverty  and/or  supporting  vulnerable  consumers  that  may  also 
address the potential distributional effects of climate policies20, the Commission’s assessment 
in 2020 of the final NECPs concluded21 that, ‘a large majority of Member States still needs to 
develop  clearer  strategies  and  objectives  through  a  cross-cutting  approach  to  identify  and 
measure the social, employment and skills consequences and other distributional impacts of 
the energy transition and give proper consideration on how to address these challenges’. 
Under the Common  Provisions Regulation22, which covers inter alia the European Regional 
Development Fund (ERDF), the European Social Fund + (ESF+), the Cohesion Fund and the 
Just  Transition  Fund  (JTF),  Member  States  are  expected  to  take  account  of  the  contents  of 
their integrated NECPs and the Commission recommendations regarding these plans, for their 
programmes,  including  during  the  mid-term  review.  The  territorial  just  transition  plans 
(TJTPs) under the JTF should focus on tackling the socio-economic impact of the transition in 
selected territories relying on fossil fuels or greenhouse gas-intensive industrial activities and 
include  a  general  section  on  the  national  transition  process  based  on  the  NECPs.  The  Just 
Transition Platform was set up to support all relevant stakeholders in using the resources of 
the Just Transition Mechanism. In addition to the Just Transition Fund (pillar 1), it contains a 
dedicated scheme under Invest EU (pillar 2) and a public sector loan facility (pillar 3). 

With  three  of  the  six  pillars  setting  out  the  scope  of  the  Recovery  and  Resilience  Facility 
focusing on social elements, the recovery and resilience plans (RRPs) under the Recovery and 
Resilience  Facility  (RRF)  outline  a  significant  number  of  reforms  and  investments  that 
address  the  aspects  of  the  fair  transition  in  terms  of  both  reforms  and  investments.  The 
national  plans  and  operational  programmes  are  to  be  implemented  within  the  current 

17  Council Recommendation of 24 November 2020 on vocational education and training (VET) for sustainable 

competitiveness, social fairness and resilience (OJ C 417, 2.12.2020, p. 1). 

18  OJ L 328, 21.12.2018, p. 1. 
19  EED  recast  proposal  Art.  8  (4)  also  asks  Member  States  to  include  information  on  energy  efficiency 
measures  and  end-use  energy  savings  achieved  among  people  affected  by  energy  poverty,  vulnerable 
customers and, where applicable, people living in social housing. 

20  Eurofound  (2021),  ‘Distributional  impacts  of  climate  policies  in  Europe’,  Publications  Office  of  the 

European Union, Luxembourg. 

21  COM(2020) 564 final. 
22  Regulation  (EU)  2021/1060  of  the  European  Parliament  and  of  the  Council  of  24 June  2021  laying  down 
common  provisions  on  the  European  Regional  Development  Fund,  the  European  Social  Fund  Plus,  the 
Cohesion  Fund,  the  Just  Transition  Fund  and  the  European  Maritime,  Fisheries  and  Aquaculture  Fund  and 
financial rules for those and for the Asylum, Migration and Integration Fund, the Internal Security Fund and 
the Instrument for Financial Support for Border Management and Visa Policy (OJ L 231, 30.6.2021, p. 159). 

EN 

4 

  EN 

                                                 
financing  period.  While  the  reforms  and  investments  are  designed  to  have  a  lasting  impact, 
because of this limited duration, they do not provide for a fully comprehensive approach on 
fair  transition  at  the  national  level  beyond  2027,  notably  with  a  view  to  the  EU  climate 
targets.  

Other  available  sources  of  funding  support  further  complementary  actions  in  this  area, 
including ERASMUS+, the European Globalisation Adjustment Fund for Displaced Workers 
(EGF), the Recovery Assistance for Cohesion and the Territories of Europe (REACT-EU), the 
Modernisation Fund and auctioning revenues under the EU Emissions Trading System (ETS), 
the  LIFE+  programme  and  the  Horizon  Europe  Programme.  In  particular,  the  ESF+ 
Regulation23  stipulates  that  the  ESF+  shall  aim  to  contribute,  in  line  with  its  specific 
objectives under Article  4(1), to  objectives related to  a greener, low carbon Europe through 
the improvement of education and training systems necessary for the adaptation of skills and 
qualifications,  upskilling  including  of  the  labour  force,  the  creation  of  new  jobs  in  sectors 
related to the environment, climate, energy, the circular economy and the bio-economy. 

Several  other  strategies  and  actions  plans  contribute  to  a  fair  green  transition.  The  2020 
European Skills Agenda24 aims to empower individuals to learn and make sure their skills are 
fit for the twin transition. In the Skills Agenda, the Commission announces a set of actions to 
support  the  acquisition  of  skills  for  the  green  transition,  including  on  individual  learning 
accounts25,  a  European  approach  for  micro-credentials26  and  learning  for  environmental 
sustainability27.  The  Pact  for  Skills28  aims  at  mobilising  private  and  public  stakeholders  to 
take  concrete  action  for  the  up-  and  reskilling  of  people  on  the  labour  market,  and,  where 
relevant, pool  efforts in  partnerships. As of end November 2021, five such partnerships had 
been  established29,  which  committed  to  the  up-  and  reskilling  of  1.5  million  people  in  the 
coming  years.  By  end  November  2021,  the  Pact  for  Skills  had  assembled  more  than  500 
members, including sectoral business organisations, large and small companies, universities, 
VET  providers,  social  partners,  chambers  of  commerce,  regional  and  local  authorities  and 
public and private employment services. The EU’s updated New Industrial Strategy supports 
job  creation  in  the  green  economy,  stipulating,  for  example,  the  important  roles  of 
investments  in  skills,  agile  public-private  partnerships,  cooperation  in  stimulating  social 
dialogue,  as  well  as  the  creation  of  green  jobs,  such  as  through  the  various  European-wide 
alliances, notably on batteries, clean hydrogen, circular plastics, and raw materials. The New 
Consumer  Agenda30  aims  to  support  the  green  transition  to  empower,  support  and  enable 

23  Regulation (EU) 2021/1057 of the European Parliament and of the Council of 24 June 2021 establishing the 
European Social Fund Plus (ESF+) and repealing Regulation (EU) No 1296/2013 (OJ L 231, 30.6.2021, p. 
21). 

24  Communication  from  the  Commission  ‘European  Skills  Agenda  for  sustainable  competitiveness,  social 

fairness and resilience’, COM(2020) 274 final, 1 July 2020. 

25  Proposal for a Council Recommendation on individual learning accounts, COM(2021) 773 final, 8 December 

2021. 

26  Proposal for a Council Recommendation on a European approach to micro-credentials for lifelong learning 

and employability, COM(2021) 770 final, 8 December 2021. 

27  Proposal for a Council Recommendation on learning for environmental sustainability, COM(2021) 557 final, 

8 December 2021. 

28  https://ec.europa.eu/social/main.jsp?catId=1517&langId=en . 
29  These  cover  the  following  industrial  eco-systems:  automotive;  microelectronics;  aerospace  and  defence; 

shipbuilding; offshore renewable energy. 

30  Communication  from  the  Commission  ‘New  Consumer  Agenda  Strengthening  consumer  resilience  for 

sustainable recovery’, COM(2020) 696 final. 

EN 

5 

  EN 

                                                 
every  consumer,  regardless  of  their  financial  situation,  to  play  an  active  role  in  the  green 
transition without imposing a specific lifestyle and without social discrimination31.  
Moreover,  the  Long  Term  Vision  for  the  EU´s  rural  areas32  aims  at  making  rural  areas 
stronger, more connected, resilient and prosperous, also through the green transition. Last, the 
EU  Roma  strategic  framework  for  equality  inclusion  and  participation  for  2020  -  2030  sets 
seven  objectives  at  the  EU  level  for  the  period  up  to  2030,  including  increasing  effective 
equal access to adequate desegregated housing and essential services33. 

• 

Consistency with other Union policies 

Social fairness is built into the design of the legislative proposals in the ‘Fit for 55’ package. 
In particular, the proposed revision of the Energy Taxation Directive34 offers possibilities for 
temporarily exempting vulnerable households from higher energy taxes. The proposed recasts 
of the Energy Efficiency Directive35 and of the Energy Performance of Buildings Directive36, 
and  the  proposed  revision  of  the  Renewable  Energy  Directive37  stimulate  energy  savings 
which can be strong instruments for alleviating energy poverty. Further to that, the application 
of the ‘energy efficiency first principle’ will ensure that economically disadvantaged  groups 
will  benefit  from  energy  efficiency  solutions  being  considered  as  the  first  option  in  policy, 
planning  and  investment  decisions  and  other  policy  areas.  The  Energy  Efficiency  Directive 
recast  proposal  furthermore  includes  a  specific  obligation  for  Member  States  to  support 
energy-poor and vulnerable households to achieve energy savings. The proposed Alternative 
Fuels  Infrastructure  Regulation38  will  ensure  that  charging  and  refuelling  infrastructures  for 
zero emission vehicles will reach all parts of Europe and be accessible to all. 

Moreover,  while  every  Member  State  will  have  to  contribute  to  the  increased  emissions 
reduction  target,  different  starting  points  and  different  capacities  are  taken  into  account. 
Instruments  such  as  the  Effort  Sharing  Regulation39  aim  at  a  fair  distribution  of  efforts 
between  Member  States,  to  ensure  solidarity  between  Member  States  and  regions.  The 

31  As announced in the New Consumer Agenda, the Commission will present a legislative proposal to empower 

consumers for the green transition. 

32  Communication  from  the  Commission  ‘A  long-term  Vision  for  the  EU's  Rural  Areas  -  Towards  stronger, 

connected, resilient and prosperous rural areas by 2040‘, COM(2021)345 final. 

33  Communication  from  the  Commission  ‘EU  Roma  strategic  framework  for  equality  inclusion  and 

participation for 2020 – 2030’, COM(2020) 620 final. 

34  Proposal for a Council Directive restructuring the Union framework for the taxation of energy products and 

electricity (recast), COM(2021) 563 final. 

35  Proposal  for  a  Directive  of  the  European  Parliament  and  of  the  Council  on  energy  efficiency  (recast), 

COM(2021) 558 final. 

36  Proposal for a Directive of the European Parliament and of the Council amending the Directive 2010/31/EU 
of the European Parliament and of the  Council of 19 May 2010 on the energy performance of buildings (as 
amended by Directive (EU) 2018/844/EU of 30 May 2018),  COM(2021) 802 final. 

37  Proposal for a Directive of the European Parliament and of the Council amending Directive (EU) 2018/2001 
of the European Parliament and of the Council, Regulation (EU) 2018/1999 of the European Parliament and 
of  the  Council  and  Directive  98/70/EC  of  the  European  Parliament  and  of  the  Council  as  regards  the 
promotion of energy from renewable sources, and repealing Council Directive (EU) 2015/652, COM(2021) 
557 final. 

38  Proposal for a Regulation of  the European Parliament and  of the  Council on  the deployment of alternative 
fuels  infrastructure,  and  repealing  Directive  2014/94/EU  of  the  European  Parliament  and  of  the  Council, 
COM(2021) 559 final. 

39  Proposal  for  a  Regulation  of  the  European  Parliament  and  of  the  Council  amending  Regulation  (EU) 
2018/842  on  binding  annual  greenhouse  gas  emission  reductions  by  Member  States  from  2021  to  2030 
contributing to climate action to meet commitments under the Paris Agreement, COM(2021) 555 final. 

EN 

6 

  EN 

                                                 
Modernisation  Fund40  supports  ten  lower-income  EU  Member  States  in  their  transition  to 
climate  neutrality  by  helping  to  modernise  their  energy  systems  and  improve  energy 
efficiency. The Just Transition Fund41 is designed to address the social and economic impacts 
of the green transition, focusing on the regions, industries and workers who face the greatest 
challenges during the transition. 

The  proposed  Social  Climate  Fund  will  help  mitigate  the  impact  on  vulnerable  households, 
transport  users  and  microenterprises  that  are  significantly  affected  by  the  price  increases  of 
fossil fuels as a result of the introduction of emissions trading for fuels used in buildings and 
road  transport.  It  will  promote  fairness  and  solidarity  between  and  within  Member  States 
while mitigating the risk of energy poverty and transport challenges, complementing existing 
mechanisms. The Fund will support households when investing into the energy efficiency and 
clean  heating  and  cooling  of  buildings,  including  the  integration  of  renewable  energy,  and 
also finance access to zero- and low- emission mobility. Where needed, pending the impact of 
the  investments  on  reducing  vulnerable  groups’  emissions  and  energy  bills,  the  Fund  will 
enable  Member  States  to  finance  measures  providing  temporary  direct  income  support  to 
vulnerable  households  and  households  that  are  vulnerable  transport  users  to  reduce  the 
immediate  impact  of  the  increase  in  the  price  of  fossil  fuels  resulting  from  the  inclusion  of 
buildings and road transport into the scope of Directive 2003/87/EC.  

Moreover, as outlined in the impact assessment accompanying the 2030 Climate Target Plan 
and in some of the initiatives of the ‘Fit for 55’ package, Member States can further make use 
of  the  revenue  generated  from  the  auctions  of  the  EU  ETS  allowances,  levies  and  taxes  on 
energy prices, as well as from environmental taxes to support disadvantaged groups. 

2. 

• 

LEGAL BASIS, SUBSIDIARITY AND PROPORTIONALITY 

Legal basis 

The proposal will be based on Article 292 TFEU, in conjunction with Article 149 TFEU and 
Article 166 TFEU. 

• 

Subsidiarity (for non-exclusive competence)  

Member States will design and select the measures and investments to ensure a fair transition 
to  climate  neutrality,  including  dedicated  measures  they  can  propose  under  the  existing 
funding, policy instruments and governance mechanisms. 

• 

Proportionality 

Action at Union level is necessary to achieve a fast and robust green transition that delivers on 
the binding targets adopted in the European Climate Law while leaving no one behind, in line 
with the European Green Deal, European Council’s Strategic Agenda 2019-24, the European 
Parliament Report on ‘a strong social Europe for Just Transitions’42, the European Economic 

40  Directive  (EU)  2018/410  of  the  European  Parliament  and  of  the  Council  of  14  March  2018  amending 
Directive  2003/87/EC  to  enhance  cost-effective  emission  reductions  and  low-carbon  investments,  and 
Decision (EU) 2015/1814 (Text with EEA relevance.) (OJ L 76, 19.3.2018, p. 3). 

41  Regulation (EU) 2021/1056 of the European Parliament and of the Council of 24 June 2021 establishing the 

Just Transition Fund (OJ L 231, 30.6.2021, p. 1). 

42  European  Parliament  resolution  of  17  December  2020  on  a  strong  social  Europe  for  Just  Transitions, 

(2020/2084(INI)). 

EN 

7 

  EN 

                                                 
and  Social  Committee’s  Report  on  ‘No  Green  Deal  without  a  social  deal’43,  and  the 
Committee of the Region’s Opinion on ‘A Strong Social Europe for Just Transitions’44. This 
also  requires  that  the  social  and  labour  challenges  arising  from  the  green  transition  are 
addressed in a coherent and efficient manner across all Member States.  

According to the Commission’s EU-wide assessment of the final integrated National Energy 
and Climate Plans published in September 202045, additional efforts are required to ensure a 
clean  and  fair  energy  transition  in  the  most  affected  regions.  Guidance  to  Member  States 
appears necessary and proportionate given the scale and effects of the proposed action.  

To  avoid  unnecessary  administrative  burden  for  Member  States,  the  implementation  of  the 
policy  guidance  provided  in  this  Recommendation  will  be  monitored  via  the  European 
Semester process and other existing processes, notably the Governance of the Energy Union 
and Climate Action, as adequate. 

• 

Choice of the instrument 

The  proposed  instrument  is  a  proposal  for  a  Council  Recommendation,  which  respects  the 
principles  of  subsidiarity  and  proportionality.  It  builds  on  the  existing  body  of  European 
Union law and is in line with the type of instruments available for European Union action in 
the  areas  of  employment  and  social  policy.  It  lays  down  measures  to  be  considered  by 
Member  States  and  provides  a  strong  basis  for  cooperation  at  European  Union  level  in  this 
area, while fully respecting Member States competence in the relevant policy fields. 

3. 

• 

RESULTS 
CONSULTATIONS AND IMPACT ASSESSMENTS 

EX-POST 

EVALUATIONS, 

OF 

STAKEHOLDER 

Ex-post evaluations/fitness checks of existing legislation 

Not applicable. 

• 

Stakeholder consultations 

The  services  of  the  Commission  have  already  undertaken  a  number  of  general  and  targeted 
consultation activities on the green transition, including its social and labour aspects, notably 
through: 

 

 

Targeted consultations, as well as online public consultations as part of the ‘Fit 
for  55’  legislative  packages  of  July  2021  and  December  2021  (e.g.  EU 
Emissions  Trading  System,  Energy  Taxation  Directive,  Energy  Efficiency 
Directive, Energy Performance of Buildings Directive, and others); 

Bilateral/multilateral  stakeholder  meetings,  including  more  than  50  meetings 
on the ETS revision, in particular in the context of the package adopted on 14 
July 2021; 

43  Opinion of the European Economic and Social Committee on ‘No Green Deal without a social deal’ (Own-

initiative opinion), EESC 2020/01591 (OJ C 341, 24.8.2021, p. 23). 

44  Opinion  of  the  European  Committee  of  the  Regions  –  A  Strong  Social  Europe  for  Just  Transitions,  COR 

2020/02167 (OJ C 440, 18.12.2020, p. 42). 

45  COM(2020) 564 final. 

EN 

8 

  EN 

                                                 
 

An online open public consultation on the 2030 Climate Target Plan (Mar - Jun 
2020;  over  1,000  replies),  following  a  4-week  consultation  on  the  Inception 
Impact Assessment. 

For  the  preparation  of  this  proposal  for  a  Council  Recommendation,  the  Commission 
conducted  in  October  and  November  2021  targeted  consultations  and  exchanges  with  the 
Employment  Committee  (EMCO),  the  Social  Protection  Committee  (SPC),  the  Economic 
Policy Committee (EPC), the European social partners, and civil society organisations active 
in the area of disability, social and employment policies.  

Consultations provided a broad support to an initiative addressing social and labour aspects of 
the transition, ensuring that no one is left behind. More specifically, parties agreed, overall, on 
the  need  for  several  elements:  comprehensive  policy  packages  to  achieve  a  fair  transition, 
including  measures  for  up-and  reskilling;  making  good  use  of  existing  policies  and  funding 
instruments,  avoiding  duplication  and  administrative  burden;  an  improved  understanding  of 
employment and social impacts of climate change policies, including effects on the quality of 
jobs,   and  related monitoring and  reporting based on  ‘real  life data’  and  relevant  indicators; 
mainstreaming equality,  but  also  requests for more funds and capacity building, notably  for 
SMEs;  integration  into  existing  governance  mechanisms;  and  the  involvement  of  social 
partners  and  civil  society in  the  design  and  implementation  of  climate  change  and  funding 
strategies for fair transitions.  

The  Commission  also  launched  an  open  Call  for  Evidence  from  29  October  2021  to  19 
November  2021,  having  received  66  contributions  from  a  broad  spectrum  of  stakeholders: 
public  authorities,  European  and  national  social  partners,  civil  society  organisations  in  the 
area  of  social  affairs,  but  also  climate  and  environmental  organisations  and  academic  and 
research institutions. 

Overall, respondents displayed strong support for a long-term strategy on green transition and 
welcomed  the  focus  on employment  and  social aspects. More  specifically,  the  potential 
impact  on  inequalities,  jobs  and  skills  was  raised  in  several  contributions,  with  an  overall 
appeal  for  providing  adequate funding,  as  well  as  technical  assistance  regarding  available 
funding  instruments to  Member  States, notably  focusing  on vulnerable regions,  sectors 
and groups.  Contributions  also  highlighted  an  increased  need  to  invest  in reskilling  and 
upskilling initiatives,  capacity  building  and infrastructures. There  was  broad  support 
to strengthening  social  dialogue  and  collective  bargaining,  with  some  respondents  calling 
for workers’  right  to  information,  consultation  and  co-decision.  Moreover,  the  vast  majority 
of contributions  stressed  the need for  a granular mapping  and  analysis. Other  issues  were 
mentioned in numerous contributions, notably direct income support measures to vulnerable 
workers and households, access to essential services, including transport, ensuring health and 
safety at work which is adapted to ‘green jobs’.  

• 

Collection and use of expertise 

The  European  Commission  gathers  expertise  in  social,  employment  and  related  policies 
through,  among  others,  the  Social  Situation  Monitor  (SSM)46,  to  foster  knowledge  in  the 
fields of social policy, social protection and employment while delivering policy-relevant and 
evidence-based research on the current socio-economic situation in the EU. Four main areas 

46  https://ec.europa.eu/social/main.jsp?langId=en&catId=1049  

EN 

9 

  EN 

 
                                                 
of  research  are  covered  by  the  SSM:  Poverty,  income  inequality,  social  inequalities,  health 
and well-being; employment, unemployment and labour market outcomes; the welfare state, 
social,  and  labour  market  policies;  and  labour  market  and  distributional  impacts  of 
megatrends. 

Following  on  from  earlier  events  on  the  topic,  in  November  2021,  the  SSM  held  its  yearly 
research  seminar,  under  the  title  "Social  and  Labour  Aspects  of  the  Transition  to  Climate 
Neutrality".  The  event  focused  on  the  potential  impacts  of  the  green  transition  in  terms  of 
employment,  job  quality,  skills  and  other  distributional  impacts  such  as  energy  poverty  and 
access to essential services. 

According to the main findings discussed with the experts, at the aggregate level, the expected 
impact  is  overall  positive,  with  a  boost  of  employment  predicted  in  the  energy-saving, 
construction and renewable energy sectors, including for low and medium-skilled workers. In 
contrast, employment and wages are expected to be reduced in energy-intensive and hard-to-
abate  "brown  industries",  highlighting  the  need  for  investment  in  the  massive  up-  and 
reskilling challenge. 

Among the policy instruments identified by the experts to foster a fair transition were taxes, 
transfers,  subsidies  and  regulations,  each  entailing  diverse  levels  of  equity  and  efficiency. 
Experts  agreed  broadly  on  the  importance  of  offsetting,  through  transfers  and  subsidies, 
certain  regressive  or  disproportionate  effects  in  particular  for  low  income  and  lower  middle 
income households, also to garner and safeguard social acceptance of policy measures. 

The seminar also identified areas that would benefit from further research, including on: (a) 
the  geospatial  dimension  of  employment,  social  and  distributional  effects  of  climate  action, 
including through further simulations covering all EU countries and estimation of impacts by 
area and degree of urbanisation; (b) integration of macro- and micro-models, including a more 
granular modelling of labour market transitions, notably across sectors, and the related social 
investment  needs  to  support  retraining,  reskilling  and  upskilling;  (c)  integration  of  income 
distribution  and  household  budget  models  into  the  underlying  macro-models;  and  (d)  the 
development of indicators of the ‘greenness’ of tasks, jobs and skills. 

• 

Impact assessment 

The  proposed  instrument  –  a  Council  Recommendation  –  offers  guidance  on  the 
implementation  of  social,  employment  and  related  policies  to  address  the  challenges  of  the 
green transition. However, as it provides flexible guidance to Member States with respect to 
the choice and design of the measures, an impact assessment is not required.  

An  accompanying  Staff  Working  Document  provides  an  overview  and  discussion  of  the 
available  evidence  underpinning  the  recommended  policy  interventions,  building  on  the 
analyses  presented  in  relevant  impact  assessment  reports  accompanying  the  2030  Climate 
target  plan  Communication  and  the  initiatives  of  the  ‘Fit  for  55’  package.  It  integrates  new 
evidence  from  additional  analyses  carried  out  by  the  European  Commission,  including 
updates  of  energy  poverty  indicators  by  income  group  for  those  Member  States  for  which 
2020  data  are  already  available  in  the  EU-SILC  database.  Finally,  it  benefits  from  the 
feedback  received  during  targeted  consultations  in  autumn  2021,  when  the  European 
Commission  reached  out  to,  among  others,  Member  States,  social  partners,  civil  society, 
including young people, and experts in the area of labour market analysis, social policy and 
fair transition.  

EN 

10 

  EN 

 
Some of the most relevant pieces of evidence concern the following policy aspects:  

Demonstrating  how  the  job  creation  potential  of  the  transition  hinges  both  on  the  active 
support to labour market transitions and job creation, and on the ability of workers to obtain a 
skillset adapted to  a labour market  and industrial  landscape characterised by  green jobs  and 
climate-friendly production processes. 

Providing  modelling  evidence  for  the  ability  to  shift  tax  revenues  away  from  labour  to 
climate-related  revenue  generation,  to  internalise  negative  environmental  externalities  by 
promoting the ‘polluter pays principle’ and improve labour market outcomes while lowering 
exposure to environmental hazards, not least for the most vulnerable, as well as the ability to 
mitigate  adverse  distributional  effects  through  targeted  measures  transferring  back  revenues 
from energy taxes and carbon pricing to the most affected households, in particular vulnerable 
ones. 

Underlining  how  dedicated  investments  in  energy  efficiency,  decarbonisation  of  heating, 
cooling and transport, access  to  essential services, including alternative sustainable mobility 
solutions, and awareness raising, complemented where necessary with temporary and targeted 
direct  income  support  for  vulnerable  consumers  and  households,  can  ensure  a  fair  and 
inclusive  energy  transition,  with  a  focus  on  the  most  affected  people  and  households,  in 
particular vulnerable ones. 

• 

Regulatory fitness and simplification 

Not applicable. 

• 

Fundamental rights 

No negative impact has been identified on fundamental rights. On the contrary, the initiative 
promotes  rights  enshrined  by  the  Charter  of  Fundamental  Rights  of  the  European  Union, 
including  the  Equality  and  Solidarity  titles,  such  as  the  right  to  fair  working  conditions 
(Article  31),  the  right  to  education  (Article  14),  and  the  entitlement  to  social  security  and 
social  assistance  (Article  34),  which  refers  to  social  security  benefits  and  social  services 
providing protection in certain cases, as well as the right to social and housing assistance. 

4. 

BUDGETARY IMPLICATIONS 

This  proposal  for  a  Recommendation  does  not  require  additional  resources  from  the  EU 
budget.  

Funding  opportunities  under  the  EU  budget  relating  to  the  fair  transition  towards  climate 
neutrality are already available in line with the policy of objectives and intervention logic of 
the different funds and programmes47.  

The Recommendation includes guidance referring to national budgets and their possible role 
in implementing the Recommendation. 

47  An overview of relevant funding instruments and their inter-linkages, as well as their role in addressing the 
recommendations  made  under  this  proposal,  are  described  in  further  detail  in  the  accompanying  Staff 
Working Document (SWD(2021) 452). 

EN 

11 

  EN 

                                                 
5. 

• 

OTHER ELEMENTS 

Implementation plans and monitoring, evaluation and reporting arrangements 

It  is  proposed  that  the  Commission  monitors  the  implementation  of  this  Council 
Recommendation in cooperation with the Member States and in the context of the European 
Semester. 

Moreover,  it  is  proposed  that  Member  States  take  into  consideration  this  Council 
Recommendation  in  the  update  of  their  integrated  National  Energy  and  Climate  Plans 
(NECPs) in 2023 (for draft NECPs) and 2024 (for the final NECPs) pursuant to Article 14 of 
Regulation (EU) 2018/1999 on the Governance of the Energy Union and Climate Action (‘the 
Governance Regulation’) and in their national energy and climate progress reports pursuant to 
Article  17  of  that  Regulation.  In  particular,  the  Recommendation  should  inform  the 
mainstreaming of fair transition aspects across the measures and actions foreseen under each 
of  the  five  dimensions  of  the  Energy  Union  outlined  in  Article  1(2)  of  the  Governance 
Regulation. The Recommendation should also inform specific national actions and measures 
aimed  at  addressing  employment,  skills,  energy  poverty  and  other  social  and  distributional 
aspects  of  the  internal  energy  market,  where  Member  States  choose  to  take  such  actions, 
thereby  supporting  them,  in  particular  those  with  a  significant  number  of  households  in 
energy  poverty,  to  outline  adequate  policies  and  measures  addressing  the  issue  in  their 
integrated  NECPs  in  line  with  Article  3(3d),  including  social  policy  measures  and  other 
relevant national programmes and policies. 

Through the multi-lateral  surveillance mechanism  and governance mechanisms in  place, the 
Commission will analyse possible impacts of the transition, identify the most affected people 
and  address,  where  appropriate,  country-specific  recommendations  to  Member  States  in  the 
context  of  the  European  Semester,  on  the  basis  of  the  guidelines  for  the  employment  and 
social policies of the Member States. 

• 

Explanatory documents (for directives) 

Not applicable. 

• 

Detailed explanation of the specific provisions of the proposal 

§ 1 to 2 indicates the subject matter, objectives and structure of this Recommendation. 

§ 3 contains definitions which are to be applied for the purpose of the Recommendation. 

§  4  to  7  recommend  to  Member  States  to  establish  and  implement  comprehensive  and 
coherent policy packages for a fair green transition with a view to providing active support to 
quality employment; ensuring access to quality and inclusive education, training and life-long 
learning;  providing  for  fair  tax-benefit  and  social  protection  systems;  ensuring  access  to 
affordable essential services and housing as part of the transition towards climate neutrality. 

§  8  to  9  recommend  to  Member  States  to  establish  and  implement  other  cross-cutting 
elements that promote a fair and inclusive green transition, in particular with view to ensuring 
an  inclusive  whole-of-economy  approach,  and  providing  for  a  strong  evidence  base  that  is 
needed to put in place sound social and labour market policies promoting a fair and inclusive 
transition. 

§  10  recommends  Member  States  to  make  optimal  use  of  public  and  private  funding  with 
view  to  providing  effective  financial  support,  in  particular  by  committing  and  deploying 

EN 

12 

  EN 

adequate  national  resources;  designing  an  adequate  mix  of  measures  in  the  national  plans 
under the proposed Social Climate Fund; and ensuring a coherent and optimal use of funding 
linked to the fair transition at all levels, including at the EU level. 

§  11  welcomes  the  Commission’s  intention  to  take  follow-up  actions  to  the  Council 
Recommendation,  in  particular  with  view  to  promoting  public  debate  on  the  fair  transition, 
enhancing  the  data  and  methodological  basis,  monitoring  and  foresight  analysis,  reviewing 
progress  in  the  implementation  of  this  Recommendation  in  the  context  of  multilateral 
surveillance  notably  in  the  European  Semester  and  in  the  context  of  the  Energy  Union  and 
Climate Action. 

EN 

13 

  EN 

2021/0421 (NLE) 

Proposal for a 

COUNCIL RECOMMENDATION 

on ensuring a fair transition towards climate neutrality  

THE COUNCIL OF THE EUROPEAN UNION, 

Having  regard  to  the  Treaty  on  the  Functioning  of  the  European  Union,  and  in  particular 
Article 166(4), and Article 292 in conjunction with Article 149 thereof. 

Having regard to the proposal from the European Commission, 

Whereas: 

(1) 

(2) 

(3) 

Greenhouse  gas  emissions  need  to  be  urgently  reduced,  in  particular  to  decrease  sea 
level rise and the likelihood of extreme weather events that already affect every region 
across  the  globe48  and  to  reduce  the  economic  and  social  costs  associated  with  the 
effects of global warming49. The Union and its Member States are Parties to the Paris 
Agreement  adopted  under  the  United  Nations  Framework  Convention  on  Climate 
Change  (UNFCCC)  in  December  2015  (‘the  Paris  Agreement’)50,  which  binds  its 
Parties  to  holding  the  increase  in  the  global  average  temperature  to  well  below  2°C 
above pre-industrial levels and to pursuing efforts to limit the temperature increase to 
1.5°C above pre-industrial levels.  

Climate change and environmental degradation pose severe threats that require urgent 
action,  as  reaffirmed  most  recently  by  the  Sixth  Assessment  Report  of  the 
Intergovernmental  Panel  on  Climate  Change  (IPCC)  on  the  Physical  Science  Basis. 
Human  suffering  and  economic  losses  stemming  from  more  frequent  climate-related 
extreme  events,  such  as  floods,  heatwaves,  droughts  and  forest  fires,  are  becoming 
more common. In the EU, these losses already average over EUR 12 billion per year51. 
These losses could reach an additional EUR 175 billion (1.38% of EU GDP) per year 
if global warming reaches 3°C above pre-industrial levels. 3°C as opposed to EUR 65 
billion for 2°C and EUR36 billion per  year for 1.5°C. This would disproportionately 
harm  certain  groups,  notably  people  already  in  vulnerable  situations  and  regions 
already facing challenges. 
The  European  Green  Deal52  sets  out  the  strategy  for  the  Union  to  become  the  first 
climate-neutral continent and transform the Union into a sustainable, fairer and more 
prosperous society that respects the planetary boundaries. The need for a fair transition 

48  IPCC,  2021:  Climate  Change  2021:  The  Physical  Science  Basis.  Contribution  of  Working  Group  I  to  the 

Sixth Assessment Report of the Intergovernmental Panel on Climate Change. 

49  JRC, PESETA IV, https://ec.europa.eu/jrc/en/peseta-iv/economic-impacts . 
50  Paris Agreement (OJ L 282, 19.10.2016, p. 4). 
51  European Commission (2021), PESETA IV study ‘Climate change impacts and adaptation in Europe’, Joint 

Research Centre, Sevilla, http://ec.europa.eu/jrc/en/peseta-iv . 

52  Communication from the Commission ‘The European Green Deal’, COM(2019) 640 final.  

EN 

14 

  EN 

 
 
                                                 
(4) 

is  an  integral  part  of  the  Green  Deal  which  underlined  that  no  person  and  no  place 
should  be  left  behind.  The  European  Climate  Law53  sets  out  a  binding  Union-wide 
objective  of  climate  neutrality  by  2050  and  a  binding  intermediate  target  of  a  net 
domestic reduction in greenhouse gas emissions of at least 55% by 2030 compared to 
1990  levels.  The  8th  Environment  Action  Programme  to  203054  aims  to  protect, 
conserve and enhance the Union's natural capital and protect the health and well-being 
of citizens from environment-related risks and impacts. 

The transformation to a climate neutral economy and society requires comprehensive 
policy  action  and  substantial  investment  across  many  areas,  such  as  climate  action, 
energy,  environment,  industry,  research  and  innovation.55  To  deliver  on  the  binding 
Union-level target for 2030, the Commission put forward the ‘Fit for 55’56 package on 
14  July  2021.  This  package  includes  proposals  for  updating  relevant  legislation, 
including  the  EU  Emissions  Trading  System  (ETS)57,  the  energy  taxation,  energy 
efficiency  and  renewable  energy  Directives,  the  CO2  emission  standards  Regulation 
for  cars  and  vans,  the  Regulation  on  the  inclusion  of  greenhouse  gas  emissions  and 
removals  from  land  use,  land  use  change  and  forestry,  the  Directive  on  alternative 
fuels  infrastructure,  and  the  effort  sharing  Regulation  with  respect  to  sectors  outside 
the current ETS, namely transport and building sectors. It also includes new legislative 
proposals,  notably  to  support  the  use  of  cleaner  fuels  in  the  aviation  and  maritime 
transport sectors, as well as to introduce a Carbon Border Adjustment Mechanism and 
establish a Social Climate Fund, which is directly related to the proposed introduction 
of emissions trading system for fuels used in buildings and road transport. The ‘Fit for 
55’ package, combined with measures taken at EU level to support and incentivise the 
necessary  public  and  private  investments  will  help  to  support  and  accelerate  the 
growth of new markets, for instance for clean fuels and low-emission vehicles, thereby 
driving down the costs of the sustainable transition for businesses and citizens alike. 

(5)  Member  States  have  committed  in  the  European  Council’s  Strategic  Agenda  2019-
2024 to ensure a fair transition towards climate neutrality that is inclusive and leaves 
nobody  behind.  At  the  international  level,  Member  States  have  endorsed  the  UN 
Sustainable  Development  Goals  and  ratified  the  Paris  Agreement,  which  refer  to  the 
imperatives of a just transition of the workforce and the promotion of decent work and 
quality jobs. ILO Guidelines provide an internationally established policy framework 
for a just transition  towards environmentally sustainable economies and societies for 
all.58  Furthermore,  54  signatories  (countries  and  social  partners)  endorsed  the  2018 

53  Regulation (EU) 2021/1119 of the European Parliament and of the Council of 30 June 2021 establishing the 
framework  for  achieving  climate  neutrality  and  amending  Regulations  (EC)  No  401/2009  and  (EU) 
2018/1999 (‘European Climate Law’) (OJ L 243, 9.7.2021, p. 1). 

54  Proposal  for  a  Decision  of  the  European  Parliament  and  of  the  Council  on  a  General  Union  Environment 

Action Programme to 2030, COM(2020) 652 final. 

55  For  instance  as  regards  infrastructure,  Europe  will  need  an  estimated  EUR  350  billion  in  additional 
investment  per  year  over  this  decade  to  meet  its  2030  emissions-reduction  target  in  energy  systems  alone, 
alongside EUR 130 billion need for other environmental goals. 

56  Communication from the Commission ‘‘Fit for 55’: delivering the EU's 2030 Climate Target on the  way to 

climate neutrality’, COM(2021) 550 final.   

57  Proposal  for  a  Directive  of  the  European  Parliament  and  of  the  Council  amending  Directive  2003/87/EC 
establishing  a  system  for  greenhouse  gas  emission  allowance  trading  within  the  Union,  Decision  (EU) 
2015/1814 concerning the establishment and operation of a market stability reserve for the Union greenhouse 
gas emission trading scheme and Regulation (EU) 2015/757, COM(2021) 551 final. 

58  The  guidelines  define  the  concept  of  just  transition  and  call  upon  policy-makers  and  social  partners  to 

promote a just transition at the global level. 

EN 

15 

  EN 

                                                 
(6) 

(7) 

Silesia Declaration on Solidarity and Just Transition, adopted at COP-24 in Katowice, 
including  the  European  Commission  on  behalf  of  the  European  Union59  and  21 
individual EU Member States. The European Union and 10 individual Member States 
signed  the  2021  Declaration  on  Supporting  the  Conditions  for  a  Just  Transition 
Internationally, adopted at COP-26 in Glasgow, committing to include information on 
just  transition  in  Biennial  Transparency  Reports  in  the  context  of  reporting  on  our 
policies and measures to achieve our Nationally Determined Contributions.  

Fairness  and  solidarity  are  defining  principles  of  the  Union’s  policies  towards  green 
transition  and  a  requisite  for  its  broad  and  sustained  public  support.  The  European 
Green Deal stresses that the transition must be fair and inclusive, putting people first 
and  paying  particular  attention  to  supporting  those  regions,  industries,  workers, 
households  and  consumers  that  will  face  the  greatest  challenges.  Moreover,  the 
Communication  on  a  Strong  Social  Europe  for  Just  Transitions60  underlines  that 
implementing the European Green Deal will give Europe the tools to strive for more 
when it comes to upward convergence, social fairness and shared prosperity. 
The European Pillar of Social Rights Action Plan61 highlights that unity, coordination 
and solidarity are needed to bounce forward towards a greener and more digital decade 
in which Europeans can thrive. It proposed three EU headline targets for 2030, namely 
that at least 78% of the population aged 20 to 64 should be in employment by 203062; 
at  least  60%  of  all  adults  should  participate  in  training  every  year63;  the  number  of 
people at risk of poverty or social exclusion should be reduced by at least 15 million 
by  203064.  These  2030  headline  targets  were  welcomed  by  EU  leaders  in  the  Porto 
Declaration of May 202165 and by the European Council of June 2021.  

(8)  With the right accompanying polices in place66, the green transition could in aggregate 
create around 1 million additional quality jobs67 in the EU by 2030 and 2 million by 
205068, in sectors such as construction, ICT or renewable energy, while mitigating the 
protracted  decline  in  middle-skilled  jobs  as  a  result  of  automation  and  digitisation. 

59  General Secretariat of the Council, 14545/1/18 REV1 of 26 November 2018. 
60  Communication  from  the  Commission  ‘A  Strong  Social  Europe  for  Just  Transitions’,  COM(2020)  14, 

launching the public consultation for the European Pillar of Social Rights Action Plan. 

61  Communication from the Commission ‘The European Pillar of Social Rights Action Plan’, COM(2021) 102 
final. The European Pillar of Social Rights, proclaimed and signed by the Council of the European Union, the 
European  Parliament  and  the  Commission  at  the  Gothenburg  Summit  in  November  2017,  is  the  Union’s 
guiding compass to a strong social Europe. 

62  In  order  to  achieve  this  overall  goal,  Europe  must  strive  to  at  least  halve  the  gender  employment  gap 
compared  to  2019;  to  reduce  the  share  of  young  people  (15-29)  who  are  neither  in  employment,  nor  in 
education or training (NEETs) to 9%, and to increase the provision of formal early childhood education and 
care (ECEC). 

63  In  particular,  at  least  80%  of  those  aged  16-74  should  have  basic  digital  skills,  and  early  school  leaving 

should be further reduced and participation in upper secondary education increased. 

64  Out of 15 million people to lift out of poverty or social exclusion, at least 5 million should be children. 
65  European Council, Porto Declaration, 8.5.2021. 
66  Communication from the Commission ‘‘Fit for 55’: delivering the EU’s 2030 Climate Target on the way to 

climate neutrality’, COM(2021) 550 final. 

67  Staff  Working  Document  from  the  Commission,  Impact  Assessment  accompanying  the  Communication 
‘Stepping  up  Europe’s  2030  climate  ambition  -  Investing  in  a  climate-neutral  future  for  the  benefit  of  our 
people’, SWD(2020)  176 final.  Projections based on E-QUEST using a ‘lower taxation  low-skilled labour’ 
scenario. 

68  European  Commission  (2019),  Sustainable  growth  for  all:  choices  for  the  future  of  Social  Europe, 
Employment  and  Social  Developments  in  Europe  2019,  4  July  2019.  Based  on  the  In-depth  analysis 
accompanying the Communication of the Commission COM(2018) 773. 

EN 

16 

  EN 

                                                 
(9) 

However, in a pessimistic scenario, the impacts of the green transition towards climate 
neutrality combined with an inadequate policy mix could imply job and GDP losses of 
up 0.39% in the Union, and job losses of up to 0.26%69. 

The impacts of the green transition on business and employment will vary by sector, 
occupation,  region  and  country,  implying  job  changes  within  sectors  and  industrial 
ecosystems,  as  well  as  large  labour  reallocations  across  them70.  Restructuring  and 
adjustment  in  the  companies,  sectors  and  ecosystems  concerned  require  the 
development of new business models and large labour reallocations across sectors and 
regions. For instance, job losses are expected in some mining activities or fossil-fuel 
based energy production, as well as in parts of the automotive sector. Conversely, new 
job  opportunities  are  expected  in  circular  value  retention  activities  and  sustainable 
transport  and  energy  production.  Member  States  should  therefore  follow  granular 
approaches,  focusing  on  the  individual  regions  and  ecosystems  concerned,  in  liaison 
with social partners and/or local and regional authorities and stakeholders. 

(10)  By creating quality job  opportunities for everyone while taking measures to alleviate 
and prevent energy and transport poverty, the green transition can contribute to raising 
incomes  and  reducing  inequalities  and  poverty  overall71.  It  can  thus  help  tackle  pre-
existing socio-economic inequalities and social exclusion, improving health and well-
being,  and  promoting  equality.  Particular  attention  should  go  to  certain  population 
groups, notably those in already vulnerable situations. This includes notably low- and 
lower-middle income households, who spend a high share of their income in essential 
services such as energy, transport and housing, as well as micro, small and medium-
sized  enterprises.  Modelling  results  show  that  whether  environmental  taxes  are 
progressive  or  regressive  will  depend  largely  on  instrument  design,  including,  for 
example, the extent to  which income tax cuts  or  other revenue recycling  options are 
targeted at lower income earners72.  

(11)  Circular  value  retention  activities  (including  repair,  re-use,  remanufacturing  and 
servitisation  business  models)  can  foster  affordable  and  sustainable  access  to  goods 
and  services.  They  also  generate  jobs  and  opportunities  at  various  skill  levels, 
including for women, people with disabilities and groups in vulnerable situations, with 
social  economy  enterprises  active  in  these  areas.  By  avoiding  new  purchases,  they 
reduce carbon emissions vastly, whilst the jobs created are in proximity to the products 
that need to be maintained, refurbished or shared.  

(12)  According  to  latest  available  data  in  EU-SILC  for  2019/202073,  energy  poverty 
affected about 8% of the EU population, i.e. more than 35 million people, who were 
unable  to  keep  their  homes  adequately  warm,  with  significant  differences  between 

69  SWD(2020) 176 final. 
70  SWD(2020) 176 final. 
71  European  Commission  (2019),  ‘Sustainable  growth  for  all:  choices  for  the  future  of  Social  Europe, 
Employment and Social Developments in Europe 2019’,  chapter 5, 4 July 2019, and European Commission 
(2020), ‘Leaving no one behind and striving for more: fairness and solidarity in the European social market 
economy’,  Employment  and  Social  Developments  in  Europe  2020,  chapter  4.2.2,  15  September  2020. 
Overall poverty in this context is measured using the agreed indicator for the at-risk-of poverty rate, in line 
with  Social  Scoreboard  indicators  and  the  related  2030  headline  target  under  the  European  Pillar  of  Social 
Rights Action Plan. 

72  IEEP (2021), Green taxation and other economic instruments: internalising environmental costs to make the 

polluter pay. 

73  2019 EU-SILC data available for all MS; 2020 data not available for all Member States yet. 

EN 

17 

  EN 

                                                 
income  groups74.  Overall, 

Member  States  and  between 
the  Energy  Poverty 
Observatory  estimates  that  more  than  50  million  households  in  the  European  Union 
experience  energy  poverty.  Energy  poverty,  resulting  from  a  combination  of  low 
income, a high share of disposable income spent on energy and poor energy efficiency, 
has been a major challenge for the Union for some time. This form of poverty affects 
not  only  low-income  households, but  also  lower middle-income  households in  many 
Member  States75.  Households  with  above-average  energy  needs,  which  includes 
families  with  children,  persons  with  disabilities,  and  older  persons,  are  also  more 
susceptible  to  energy  poverty76  and  to  its  effects.  Women,  and  in  particular  lone 
parents  and  older  women77,  are  also  particularly  affected  by  energy  poverty.  In 
addition to energy poverty, the concept of transport poverty is increasingly recognised 
where  certain  categories  of  population  are  unable  to  attain  a  socially  and  materially 
necessitated level  of transport services. Without  the right  accompanying  measures  to 
alleviate  and  prevent  energy  and  transport  poverty,  these  risk  being  exacerbated 
notably due to the internalisation of emissions costs in price formation or to the costs 
of adaptation towards higher-efficiency, lower-emission alternatives. 

(13)  Principles of social fairness and solidarity are firmly built into the design of relevant 
climate, energy and environmental frameworks at the Union level78, including via the 
‘polluter pays principle’  and the effort sharing between Member States  as well as in 
some  redistribution  of  ETS  allowances  for  the  purposes  of  solidarity,  growth  and 
interconnections  within  the  Union  and  their  use  for  the  Modernisation  Fund  which 
contributes to the significant investment needs of the lower-income Member States to 
modernise  their  energy  systems.  Moreover,  the  framework  of  the  EU  energy  policy 
legislation provides Member States with tools to ensure the protection of energy poor 
and vulnerable household customers while avoiding market distortions79. While these 
tools help in facilitating the green transition, they are intended to provide the means to 
ensure  the  necessary  protection  more  generally,  as  shown  for  instance  by  the  recent 
Communication on ‘Tackling rising energy prices: a toolbox for action and support’80. 
In  addition,  establishing  a  Social  Climate  Fund  of  EUR  72.2  billion  for  the  period 
2025-2032  would  support  vulnerable  households,  transport  users  and  micro-
enterprises  affected  by  the  introduction  of  emissions  trading  for  fuels  used  in  road 
transport  and  buildings81.  The  Fund  facilitates  addressing  the  social  impacts  via 
measures and investments intended to reduce reliance on fossil fuels through increased 

74  Moreover, up to 6.2% of Europeans, i.e. over 27 million people, have arrears in paying their utility bills. 
75  SWD(2019)579 final. 
76  See the report of the workshop on ‘Energy Poverty’, organised on 9 November 2016 for the EP Committee 

on Industry, Research and Energy (ITRE). 

77  See Gender perspective on access to energy in the EU (europa.eu), Gender and energy | European Institute 

for Gender Equality (europa.eu), GFE-Gender-Issues-Note-Session-6.2.pdf (oecd.org). 

78  Social  fairness  is  also  incorporated  in  the  design  of  Commission  proposals  that  are  part  of  the  ‘Fit  for  55’ 
package,  including  proposals  on  the  Energy  Taxation  Directive,  the  Energy  Efficiency  Directive,  the 
Renewable  Energy  Directive,  the  Alternative  Fuels  Infrastructure  Directive,  the  Effort  Sharing  Regulation, 
and the proposal to establish a Social Climate Fund. 

79  Article  5  of  Directive  (EU)  2019/944  of  the  European  Parliament  and  of  the  Council  of  5  June  2019  on 
common  rules  for  the  internal  market  for  electricity  and  amending  Directive  2012/27/EU  (Text  with  EEA 
relevance.) (OJ L 158, 14.6.2019, p. 125); Article 3 of Directive 2009/73/EC of the European Parliament and 
of the Council of 13 July 2009 concerning common rules for the internal market in natural gas and repealing 
Directive 2003/55/EC (Text with EEA relevance) (OJ L 211, 14.8.2009, p. 94). 

80  COM(2021) 660 final, 13 October 2021. 
81  Proposal for a Regulation of the European Parliament and of the Council establishing a Social Climate Fund, 

COM(2021) 568 final. 

EN 

18 

  EN 

                                                 
energy  efficiency  of  buildings,  decarbonisation  of  heating  and  cooling  of  buildings, 
including  the  integration  of  energy  from  renewable  sources,  and  granting  improved 
access  to  zero-  and  low-emission  mobility  and  transport  to  the  benefit  of  vulnerable 
households,  vulnerable  micro-enterprises 
transport  users, 
complemented  with  temporary  direct  income  support  to  vulnerable  households, 
including vulnerable transport users, where necessary. 

and  vulnerable 

(14)  Member States have  a range of tools at  their disposal  to  outline and coordinate their 
actions  for  a  fair  transition.  National  Energy  and  Climate  Plans  (NECPs)  should  to 
assess the number of households in energy poverty and outline the measures needed to 
address the social and territorial implications of the energy transition82. Territorial Just 
Transition  Plans (TJTPs)  should  identify the territories eligible for support  under the 
Just Transition Fund up to 202783. Funded by NextGenerationEU, national  Recovery 
and Resilience Plans (RRPs) set reforms and investments to foster the green transition, 
inclusive growth, social and territorial cohesion, resilience and prospects for the next 
generation, with an implementation horizon up to 2026.84   

(15)  Building on the principles and policies of the European Green Deal and the European 
Pillar of Social Rights in particular, there is scope to enhance design of policies in a 
comprehensive  and  cross  cutting  manner,  and  ensure  coherence  of  the  spending 
efforts,  at  the  EU  and  national  levels.  In  its  assessment  of  the  final  NECPs85,  while 
recognising  that  they  provide  some  indicators  and  policies  on  energy  poverty,  the 
Commission  concluded  that  they  do  not  always  provide  a  clear  prioritisation  of 
funding needs for a  fair transition, nor for reskilling and upskilling  or for supporting 
labour market adjustments. The TJTPs should focus on selected territories and thus are 
not  expected  to  lay  out  an  overall  strategy  and  policies  for  a  fair  transition  at  the 
national  level.  While  the  reforms  and  investments  they  support  and  help  finance  are 
designed  to  provide  lasting  impact,  both  TJTPs  and  RRPs  are  limited  in  time.  Some 
actions for a fair transition are also implemented in the context of other programmes 
and initiatives, in particular the Cohesion policy funds. The Social Climate Plans will 
play  an  important  role  in  assisting  the  most  affected  and  vulnerable  groups  in  the 
context  of  the  introduction  of  emissions  trading  for  fuels  used  in  road  transport  and 
buildings.   

(16)  A fair transition  towards climate neutrality in  the Union by 2050 will ensure that no 
one  is  left  behind,  in  particular  workers  and  households  most  affected  by  the  green 
transition, and notably those already in vulnerable situations. To this end, as set out in 
this  Recommendation,  Member  States  should  put  in  place  comprehensive  policy 

82  Regulation  (EU)  2018/1999  of  the  European  Parliament  and  of  the  Council  of  11  December  2018  on  the 
Governance of the Energy Union and Climate Action, amending Regulations (EC) No 663/2009 and (EC) No 
715/2009  of  the  European  Parliament  and  of  the  Council,  Directives  94/22/EC,  98/70/EC,  2009/31/EC, 
2009/73/EC,  2010/31/EU,  2012/27/EU  and  2013/30/EU  of  the  European  Parliament  and  of  the  Council, 
Council  Directives  2009/119/EC  and  (EU)  2015/652  and  repealing  Regulation  (EU)  No  525/2013  of  the 
European Parliament and of the Council (Text with EEA relevance) (OJ L 328, 21.12.2018, p. 1). 

83  Regulation (EU) 2021/1056 of the European Parliament and of the Council of 24 June 2021 establishing the 

Just Transition Fund (OJ L 231, 30.6.2021, p. 1). 

84  Communication  from  the  Commission  ‘Europe's  moment:  Repair  and  Prepare  for  the  Next  Generation’; 
Regulation (EU) 2021/241 of the European Parliament and of the Council of 12 February 2021 establishing 
the Recovery and Resilience Facility (OJ L 57, 18.2.2021, p. 17). 

85  Communication  from  the  Commission  ‘An  EU-wide  assessment  of  National  Energy  and  Climate  Plans 
Driving  forward  the  green  transition  and  promoting  economic  recovery  through  integrated  energy  and 
climate planning ‘, COM(2020) 564 final. 

EN 

19 

  EN 

                                                 
packages86,  strengthen  cross-cutting  elements  that  promote  fair  green  transition,  and 
make optimal use of public and private funding. The policy packages should consider 
those people and households that are most affected by the green transition, notably by 
job losses but also by changing working conditions and/or new task requirements on 
the  job,  as  well  as  those  subject  to  adverse  impacts  on  disposable  incomes, 
expenditure,  and  access  to  essential  services.  As  part  of  the  most  affected  groups, 
policy packages should in particular - but not only - consider people and households in 
vulnerable  situations,  notably  people  furthest  away  from  the  labour  market,  for 
instance due to their skills, territorial labour market conditions, or other characteristics, 
such  as  sex,  racial  or  ethnic  origin,  religion  or  belief,  disability,  age  or  sexual 
orientation.  Moreover,  people  and  households  in  vulnerable  situations  may  include 
those living in or at risk of poverty and/or energy poverty, facing barriers to mobility, 
or  an  overburden  of  housing  costs.  Policy  packages  should  be  adapted  to  local 
circumstances, taking into account the needs of the most vulnerable and remote parts 
of the EU, including the outermost regions. 

(17)  Active support to  quality  employment  should focus on  helping  workers,  job  seekers, 
people not in employment, education or training (NEETs) and the self-employed most 
affected by the green transition. In particular, underrepresented people such as women 
or people with comparatively low capacities to adapt to changes on the labour market 
require  support  to  improve  their  employability  and  for  finding  employment,  in  line 
with  the Commission  Recommendation for Effective Active Support  to  Employment 
following  the  COVID-19  crisis  (EASE)87.  Building  on  previous  policy  guidance88, 
policy packages should thus include tailored measures to support hiring and transition 
incentives,  entrepreneurship  support  and  quality  job  creation  measures,  in  particular 
for  micro,  small  and  medium-sized  enterprises  and  in  most  affected  territories.  They 
should  also  foster  the  effective  implementation  and  enforcement  of  existing  rules  on 
working  conditions  and  support  to  socially  responsible  restructuring  in  line  with 
existing rules and standards. Social partners have a vital role to play to  contribute to 
addressing,  through  dialogue,  the  employment  and  social  consequences  of  the 
challenges of the green transition. 

(18)  Access  to  quality  and  inclusive  education,  training  and  life-long  learning  for  all  is 
essential for ensuring that the workforce has the skills required to deliver on the green 
transition.  Fair  transition  aspects  should  thus  be  integrated  in  the  development  and 
implementation  of  national  skills  strategies, in  line with  the European Skills  Agenda 
and the EU’s new updated Industrial Strategy89. Skills partnerships under the Pact for 
Skills will also be an important lever. Up-to-date labour market and skills intelligence 
and  foresight,  including  at  regional,  sectoral  and  occupational  levels  allows  for  the 
identification  and  forecasting  of  relevant  occupation-specific  and  transversal  skills 
needs,  also  as  a  basis  for  adapting  curricula  to  meet  the  skills  needs  for  the  green 
transition. VET should equip young people and adults, in particular women, with the 

86  In  particular  the  Annual  Sustainable  Growth  Strategies  (ASGS)  2021  and  2022,  the  Euro  area 

recommendations 2021, and Country-Specific Recommendations. 

87  Commission  Recommendation  (2021)  402  of  4  March  2021  on  Effective  Active  Support  to  employment 

following the Covid-19 crisis (EASE), (OJ L 80, 8.3.2021, p. 1). 

88  In  particular  the  EASE  Recommendation  and  the  guidelines  for  the  employment  policies  of  the  Member 

States adopted in October 2020 and reconfirmed in October 2021. 

89  Communication  from  the  Commission  ‘Updating  the  2020  New  Industrial  Strategy:  Building  a  stronger 

Single Market for Europe’s recovery’, COM(2021) 350 final. 

EN 

20 

  EN 

                                                 
skills  needed  to  master  the  green  transition90.  Apprenticeships  and  paid  traineeships, 
including  strong  training  components,  in  particular  for  young  people,  contribute  to 
labour  market  transitions,  notably  towards  activities  contributing  to  climate  and 
environmental  objectives,  and  sectors  facing  particular  skills  shortages.  Increasing 
adult  participation  in  lifelong  learning  should  be  promoted  to  meet  upskilling  and 
reskilling needs, inter alia by empowering individuals to seek training that is tailored 
to their needs and via short, quality-assured courses on skills for the green transition, 
building on the European approach to micro-credentials, which will also make it easier 
to value and recognise the outcomes of such courses. 

the  need 

(19)  The  composition  of  tax-benefit  systems  and  social  protection  systems  should  be 
reviewed against the specific needs stemming from the green transition, reflecting also 
the  ‘polluter  pays  principle’  and 
that accompanying  policies  will 
not introduce subsidies  to  fossil  fuels  consumption, will  not  lock  in  consumers  to  a 
specific technology and will not decrease incentives for building renovations, thermal 
energy system substitutions and in general energy efficiency measures. A combination 
of  various  policies  can  support  the  most  vulnerable  households  and  workers  most 
affected  by  the  green  transition.  Depending  on  the  national  and  individual  situation, 
this  could  for  instance  involve  a  shift  of  taxation  away  from  labour  and  towards 
climate  and  environmental  objectives  in  line  with  the  proposal  for  revision  of  the 
Energy  Taxation  Directive91,  a  review  of  unemployment  schemes  and/or  temporary 
and  targeted  direct  income  support,  where  necessary.  Social  protection  and  social 
inclusion systems can be assessed and, where applicable, adapted in light of the green 
transition,  in  particular  to  provide  for  income  security,  notably  during  job-to-job 
transitions, and to provide adequate social, health and care services through adequate 
social infrastructure, notably in most affected territories (e.g. rural and remote areas) in 
order  to  prevent  social  exclusion,  and  address  health  risks.  To  build  physical  and 
financial  resilience  to  the  irreversible  impacts  of  climate  change  in  an  inclusive 
manner,  risk-awareness,  risk  reduction  and  risk-transfer  solutions  need  to  be 
promoted,  in  particular  by  increasing  the  availability  of  insurance  solutions  and  by 
investing in disaster risk management and adaptation to reduce the physical impacts of 
climate  change  and  thereby  reducing  losses  as  well  as  the  climate  protection  gap, 
taking  into  account  micro,  small  and  medium-sized  enterprises,  as  well  as  rural  and 
remote  areas.  Disaster  risk  management  including  civil  protection  systems  at  the 
national and EU level should be reinforced to better prevent, prepare for and respond 
to climate related shocks. 

(20)  Everyone has the right to access essential services of good quality, including energy, 
transport,  sanitation,  financial  services  and  digital  communications,  and  support  for 
equal access to such services should be made available to those in need92.  Also, access 
to social housing or housing assistance of good quality should be provided for those in 
need93.  In  addition,  low  and  medium  income  households,  vulnerable  customers, 
including  final  users,  people  facing  or  risking  energy  poverty  and  people  living  in 

90  Council Recommendation of 24 November 2020 on vocational education and training (VET) for sustainable 

competitiveness, social fairness and resilience (OJ C 417, 2.12.2020, p. 1). 

91  Proposal for a Council Directive restructuring the Union framework for the taxation of energy products and 

electricity (recast), COM(2021) 563 final. 

92  ‘European  Pillar  of  Social  Rights’,  solemnly  proclaimed  by  the  European  Parliament,  the  Council  and  the 

Commission, 17 November 2017, principle 20. 

93  ‘European  Pillar  of  Social  Rights’,  solemnly  proclaimed  by  the  European  Parliament,  the  Council  and  the 

Commission, 17 November 2017, principle 19 (a). 

EN 

21 

  EN 

                                                 
social  housing  can  benefit  from  the  application  of  the  ‘energy  efficiency  first 
principle’.  In  addition  to  protecting  and  empowering  energy  consumers,  specific 
measures  are  needed  to  prevent  and  tackle  the  root  causes  of  energy  poverty,  in 
particular  by  promoting  investments  targeted  at  energy  efficiency  improvements, 
notably in the social housing sector, in line with the proposal on the Energy Efficiency 
Directive94  recast  adopted  on  14  July  2021,  as  well  as  the  proposal  for  the  Energy 
Performance  of  Buildings  Directive95  adopted  on  14  December  2021,  which  also 
tackles  the  main  non-economic  barriers  to  renovation  such  as  split  incentives, 
including owner-tenant settings, and co-ownership structures. In this context, specific 
attention should be paid to particular groups which are more at risk of being affected 
by energy poverty, such as women, persons with disabilities, elderly people, children, 
and  persons  with  a  minority  racial  or  ethnic  background.  Pre-existing  and  emerging 
mobility challenges can be tackled through support measures and the development of 
the  necessary  infrastructure,  such  as  public  transport.  The  affordability,  accessibility 
and safety of sustainable mobility and different modes of transport, including private 
and public transport are key to ensure everyone benefits from and is part of the green 
transition. Urban mobility plays a significant role in this context, as also reflected by 
the European Urban Mobility Framework96 adopted on 14 December 2021.  

(21)  A  whole-of-economy  approach  to  the  fair  transition  should  support  policy  action, 
based on the coordination of policy-making and strengthened operational capacities at 
all levels and across all relevant policy areas, giving also an active role to regional and 
local authorities, the involvement of social partners at all levels and stages, as well as 
effective  and  impactful  participation  of  civil  society  and  stakeholders.  Such 
coordination and engagement could ensure that the European Green Deal principles of 
fairness and solidarity are integrated in policy design, implementation and monitoring 
from  the  outset,  providing  the  basis  for  broad  and  long-term  support  for  inclusive 
policies advancing the green transition. 

(22)  A strong evidence base is key to put in place sound social and labour market policies 
that ensure a fair and inclusive transition. To this end, the gradual harmonisation and 
consistency of definitions, concepts, classifications and methodologies, notably based 
on  Commission  Recommendation  (EU)  2020/1563  on  energy  poverty97,  facilitate 
assessments  and  their  comparability.  Further  research  and  innovation  actions  can 
contribute  to  the  knowledge  base  that  may  feed  into  policy  and  public  discourse.  In 
turn,  exchanges  with  the  public  in  all  its  diversity  and  with  key  stakeholders,  for 
instance  on  the  outcomes  of  evaluations,  foresight  and  monitoring  exercises,  can 
contribute to policy-making and ownership. 

(23)  Appropriate  granular  and high quality data and indicators are needed in  particular to 
assess employment, social and distributional impacts of climate change policies. Such 
data and indicators are currently not fully available. For instance, while some progress 
has  been  made  on  the  measurement  of  energy  poverty,  indicators  to  assess  transport 
poverty  could  be  developed.  Monitoring  and  evaluation  can  be  strengthened  via  a 

94  Proposal  for  a  Directive  of  the  European  Parliament  and  of  the  Council  on  energy  efficiency  (recast), 

COM(2021) 558 final. 

95  Proposal for a Directive of the European Parliament and of the Council amending the Directive 2010/31/EU 
of the European Parliament and of the Council of 19 May 2010 on the energy performance of buildings (as 
amended by Directive (EU) 2018/844/EU of 30 May 2018),  COM(2021) 802 final. 

96  Communication from the Commission ‘The European Urban Mobility Framework’, COM(2021) 811. 
97  Commission  Recommendation  (EU)  2020/1563  of  14  October  2020  on  energy  poverty  (OJ  L  357, 

27.10.2020, p. 35). 

EN 

22 

  EN 

                                                 
number  of  actions,  focussing  on  indicators,  scoreboards  as  well  as  small-scale  pilot 
projects  and  policy  experimentation.  Actions  can  build  on,  or  draw  from,  existing 
scoreboards  such  as  the  Social  Scoreboard  and  the  European  Green  Deal  dashboard, 
which contain relevant information on specific aspects of fair transition policies 

(24)  Finally,  the  optimal  and  efficient  use  of  public  and  private  funding  and  the 
mobilisation of all available resources and their effective deployment, is of particular 
importance  in  light  of  the  significant  investment  needs  stemming  from  the  green 
transition.  At  the  Union level,  relevant  actions  are  supported  through  the  EU  budget 
and  NextGenerationEU.  They  will  be  implemented  under  with    the  Recovery  and 
Resilience  Facility  (RRF),  the  Just  Transition  Mechanism  (JTM),  including  the  Just 
Transition Fund (JTF), the European Social Fund Plus (ESF+), the European Regional 
Development  Fund  (ERDF),  the  Cohesion  Fund,  the  Recovery  Assistance  for 
Cohesion and the Territories of Europe (REACT-EU), ERASMUS+ and the European 
Globalisation Adjustment Fund for Displaced Workers (EGF), the  LIFE  programme, 
the  Horizon  Europe  programme,  the  Modernisation  Fund98,  the  Social  Climate  Fund 
and  the  funds  under  the  Common  Agriculture  Policy  (CAP).  In  addition,  the 
Commission  supports  Member  States  through  the  Technical  Support  Instrument,  by 
providing tailor-made technical expertise to design and implement reforms, including 
those promoting a fair transition towards carbon neutrality. 

(25)  The  European  Semester  is  the  EU  economic  and  employment  policy  coordination 
framework, including in  relation to economically and socially relevant aspects of the 
green and digital transitions. It will continue to play this role in the recovery phase and 
in advancing the twin transitions, structured around the four dimensions of competitive 
sustainability  and  in  line  with  the  Sustainable  Development  Goals.  Under  the 
European  Semester,  the  Commission  will  monitor  socio-economic  outcomes  and 
impacts 
country-specific 
recommendations  to  ensure  that  no  one  is  left  behind.  Complementarity  with  the 
measures supported under the Recovery and Resilience Facility will be a priority. The 
monitoring  of  this  Recommendation  will  therefore  take  place  in  the  context  of  the 
European  Semester,  based  on  adequate  assessments,  policy  impact  evaluations,  and 
the state of implementation of the guidance provided in this Recommendation.  

relevant,  propose 

and  where 

targeted 

closely 

(26)  Moreover, as part of the draft and final update of their National Energy and Climate 
Plans  (NECPs)  in  2023 and  2024,  respectively,  in  accordance  with  Article  14  of  the 
Governance  Regulation99,  Member  States  should  draw  on  this  Recommendation  to 
consider mainstreaming employment, social and distributional impact assessments and 
fair  transition  aspects  across  the  five  dimensions  of  the  Energy  Union  and  further 
enhance  policy  measures  for  addressing  these  impacts,  with  a  particular  focus  on 
energy poverty. 

(27)  Furthermore, the monitoring of the implementation of this Recommendation can build 
on  existing  evidence  in  the  context  of  the  established  multilateral  surveillance 
processes notably under the European Semester. The Council or the Commission can 
request  the  Employment  Committee  and  the  Social  Protection  Committee,  in 
accordance  with  Articles  150  and  160  TFEU  respectively,  to  examine  in  their 
respective  area  of  competence  the  implementation  of  this  Recommendation  on  the 
basis  of  adequate  reporting  by  the  Commission  and  other  multilateral  surveillance 

98  Outside the EU budget and NGEU. 
99  In accordance with Article 14 of the Governance Regulation (EU) 2018/1999. 

EN 

23 

  EN 

                                                 
tools.  Also  against  this  background,  the  Commission  is  working  to  enhance  data 
availability,  to  update,  develop  and  use  frameworks  and  methodological  guidance, 
including  for  the  measurement  of  energy  and  transport  poverty  and  environmental 
inequalities, and for evaluating the effectiveness and actual impact of policy measures.   

HAS ADOPTED THIS RECOMMENDATION:  

OBJECTIVE   

(1) 

(2) 

In  line  with  the  principles  of  the  European  Green  Deal  and  the  European  Pillar  of 
Social  Rights,  this  Recommendation  aims  to  ensure  that  the  Union’s  transition 
towards a climate-neutral and environmentally  sustainable economy  by 2050 is fair 
and leaves nobody behind. 

Member States are invited, for that purpose, to adopt and, in close cooperation with 
social partners as relevant, implement comprehensive and coherent policy packages, 
addressing the employment and social aspects to promote a fair transition across all 
policies,  notably  climate,  energy  and  environmental  policies,  as  well  as  to  make 
optimal use of public and private funding. 

DEFINITIONS 

(3) 

For the purpose of this Recommendation, the following definitions apply: 

(a) 

(b) 

(c) 

(d) 

‘Green transition’ means the transition of the EU economy and society towards 
the achievement of the climate and environmental objectives primarily through 
policies and investments, in line with the European Climate Law laying down 
the obligation to achieve climate neutrality by 2050, the European Green Deal 
and the Paris Agreement. 

‘Climate and environmental objectives’ means the six objectives laid down by 
Regulation  (EU)  2020/852100,  namely:  climate  change  mitigation;  climate 
change  adaptation;  the  sustainable  use  and  protection  of  water  and  marine 
resources;  the  transition  to  a  circular  economy;  pollution  prevention  and 
control; and the protection and restoration of biodiversity and ecosystems. 

‘People  and  households  most  affected  by  the  green  transition’  means  those 
whose  effective  access  to  quality  employment,  including  self-employment, 
and/or  to  education  and  training  and/or  to  a  decent  standard  of  living  and 
essential services is significantly limited or at risk of being significantly limited 
as a direct or indirect consequence of the green transition. 

in  vulnerable  situations’  means 

‘People  and  households 
those  who, 
independently of the green transition, face or are at risk of facing a situation of 
significantly limited access to quality employment, including self-employment, 
and/or  to  education  and  training,  and/or  to  a  decent  standard  of  living  and 
essential services, implying low capacities to adapt to the consequences of the 
green transition. 

100  Regulation  (EU)  2020/852  of  the  European  Parliament  and  of  the  Council  of  18  June  2020  on  the 
establishment of a framework to facilitate sustainable investment, and amending Regulation (EU) 2019/2088 
(OJ  L  198,  22.6.2020,  p.  13)  (‘Taxonomy  Regulation’)  provides  a  common  classification  system  for 
sustainable economic activities. 

EN 

24 

  EN 

 
 
                                                 
(e) 

(f) 

(g) 

(h) 

‘Micro,  small  and  medium-sized  enterprises’  means  enterprises  that  employ 
fewer  than  250  persons,  including  solo  self-employed,  and  which  have  an 
annual turnover not exceeding EUR 50 million, and/or an annual balance sheet 
total not exceeding EUR 43 million, calculated in accordance with Articles 3 to 
6 of Annex I to Commission Regulation (EU) No 651/2014101. 

‘Energy  poverty’  means  the  situation  defined  in  Article  2(49)  of  the  Energy 
Efficiency Directive recast102, namely a ‘household’s lack of access to essential 
energy services that underpin a decent standard of living and health, including 
adequate  warmth,  cooling,  lighting,  and  energy  to  power  appliances,  in  the 
relevant national context, existing social policy and other relevant policies’103. 

‘Essential services’ means services of good quality, including water, sanitation, 
energy, transport and mobility, financial services and digital communications; 
support for access to such services should be made available for those in need, 
according to principle 20 of the European Pillar of Social Rights, together with 
providing  cost  saving  opportunities,  including  through  reuse,  repair,  donation 
and sharing services. 

‘Policy package’ means a comprehensive and coherent set of policy measures 
that  integrates  employment,  skills  and  social  policies  with  climate,  energy, 
transport,  environmental  and  other  green  transition  policies,  through  a  well-
coordinated approach based on one or several national strategies and/or action 
plans, and benefiting from EU-level coordination and governance mechanisms 
as appropriate. 

POLICY PACKAGES FOR A FAIR GREEN TRANSITION 

(4) 

To provide active support to quality employment for a fair transition and build on the 
EASE  Recommendation,  Member  States  are  encouraged,  in  close  cooperation  with 
social partners, to consider the following measures in support of people most affected 
by the green transition, notably those in vulnerable situations, and, where adequate, 
help  them  to  transit,  through  employment  or  self-employment,  towards  economic 
activities contributing to climate and environmental objectives: 

(a)  Effectively support access to quality employment, notably through tailored job 
search  assistance  and  flexible  and  modular  learning  courses  that  also  target 
green  and  digital  skills  where  appropriate.  Consider  also  well-designed, 
targeted  and  time-bound  employment  programmes  that  prepare  beneficiaries 
via  training,  in  particular  people  in  vulnerable  situations,  for  continued 
participation in the labour market.  

(b)  Make  effective  use  of  targeted  and  well-designed  hiring  and  transition 
incentives, including by considering the adequate use of wage and recruitment 

101  Commission  Regulation (EU) No 651/2014 of 17 June  2014 declaring certain categories of aid compatible 
with the internal market in application of Articles 107 and 108 of the Treaty Text with EEA relevance (OJ L 
187, 26.6.2014, p. 1). 

102  Proposal  for  a  Directive  of  the  European  Parliament  and  of  the  Council  on  energy  efficiency  (recast), 

COM(2021) 558 final. 

103  While  it  is  left  to  Member  States  to  define  the  concept  of  ‘vulnerable  customers’,  it  comprises  households 
unable to heat or cool their homes adequately and/or having arrears in paying their utility bills in line with 
Commission Recommendation on energy poverty, C/2020/9600 final (OJ L 357, 27.10.2020, p. 35). 

EN 

25 

  EN 

 
                                                 
subsidies and incentives linked to social security contributions, to accompany 
labour market transitions and labour mobility across regions and countries, in 
view of the opportunities and challenges of the green transition. 

(c)  Promote  entrepreneurship,  including  social  enterprises104,  in  particular  in 
regions  facing  transition  challenges  and,  where  appropriate,  in  sectors 
promoting climate and environmental objectives such as the circular economy. 
Support should combine financial measures, including grants, loans or equity, 
and  non-financial  measures,  including  training  and  advisory  services,  tailored 
to each phase of the business lifecycle. It should be inclusive and accessible to 
under-represented and disadvantaged groups. 

(d)  Stimulate  job  creation,  in  particular  in  territories  most  affected  by  the  green 
transition and, where appropriate, sectors promoting climate and environmental 
objectives  such  as  the  circular  economy,  by  facilitating  access  to  finance  and 
markets  for  micro,  small  and  medium-sized  enterprises,  in  particular  those 
contributing to climate and environmental objectives with a view to promoting 
competitiveness,  innovation  and  employment  across  the  single  market, 
including in sectors and eco-systems of strategic relevance in national and local 
contexts. 

(e)  Ensure  the  effective  implementation  and  enforcement  of  existing  rules  on 
working  conditions,  in  particular  concerning  occupational  health  and  safety, 
work  organisation  and  involvement  of  workers,  in  order  to  safeguard  job 
quality  in  the  transition,  including  in  economic  activities  contributing  to 
climate and environmental objectives.  

(f)  Foster  the  use  of  socially  responsible  public  procurement  standards105, 
including  via  social  award  criteria  creating  opportunities  for  people  most 
affected by the green transition, while also promoting green award criteria. 

(g)  Provide  for  the  full  and  meaningful  involvement  of  workers  and  their 
representatives  as  regards  the  anticipation  of  change  and  the  management  of 
restructuring  processes  including  those  linked  to  the  green  transition,  in  line 
with the EU Quality Framework for anticipation of change and restructuring106. 

(5) 

To  ensure  equal  access  to  quality  and  inclusive  education,  training  and  life-long 
learning  as  well  as  equal  opportunities,  Member  States  are  encouraged  to  consider 
the following measures, to be implemented in close cooperation with social partners, 
in  particular  in  support  of  people  and  households  most  affected  by  the  green 
transition, notably those in vulnerable situations.  

(a) 

Integrate  the  employment  and  social  aspects  of  the  green  transition  in  the 
development  and  implementation  of  the  national  skills  strategies  under  the 
European  Skills  Agenda  and  set-up  and  pro-actively  steer  stakeholder 
partnerships  under  the  Pact  for  Skills,  ensuring  notably  that  skills  are  at  the 

104  Communication  from  the  Commission  ‘Building  an  economy  that  works  for  people: an  action  plan  for  the 

social economy’, COM(2021) 778 final. 

105  In line with the Directive (EU) 2019/882 of the European Parliament and of the Council of 17 April 2019 on 
the accessibility requirements for products and services (Text with EEA relevance) (OJ L 151, 7.6.2019, p. 
70),  and  the  Commission  Notice  ‘Buying  Social  –  A  guide  to  taking  account  of  social  considerations  in 
public procurement – Second edition’ (OJ C 237, 18.6.2021, p. 1). 

106  Communication from the Commission ‘EU Quality Framework for anticipation of change and restructuring’, 

COM(2013) 882 final. 

EN 

26 

  EN 

                                                 
heart  of  co-created  transition  pathways  for  relevant  industrial  ecosystems 
contributing to climate and environmental objectives. 

(b)  Develop  up-to-date  labour  market  and  skills  intelligence  and  foresight, 
identifying  and  forecasting  occupation-specific  and  transversal  skills  needs. 
Build  on  existing  tools  and  initiatives,  including  the  expertise  of  and 
cooperation  with  social  partners  and  relevant  stakeholders.  Adapt  education 
and training curricula accordingly. 

(c)  Provide  high-quality  and  inclusive  initial  education  and  training,  including 
vocational  education  and  training,  that  equips  learners  with  skills  and 
competences  relevant  for  the  green  transition.  Learning  for  sustainability  – 
including  science, 
technology,  engineering  and  mathematics  (STEM), 
interdisciplinary  approaches,  and  digital  skills  –  should  be  an  integral  part  of 
these  programmes.  Take  specific  actions  to  attract  women  and  other  groups 
currently under-represented in the occupational areas concerned. 

(d) 

(e) 

Introduce  or  strengthen  support  schemes  for  apprenticeships  and  paid 
traineeships with a strong training component, in particular in micro, small and 
medium-sized  enterprises, 
to  climate  and 
environmental objectives and in  sectors  facing particular skill  shortages, such 
as  construction  and  ICT.  Such  schemes  should  be  subject  to  monitoring  and 
evaluation, and safeguard job quality, in line with the European Framework for 
Quality  and  Effective  Apprenticeships107  and  the  Quality  Framework  for 
Traineeships108. 

those  contributing 

including 

Increase adult participation in training throughout the working life, in line with 
the  upskilling  and  reskilling  needs  for  the  green  transition,  by  ensuring  that 
support  is  available  for  training  within  jobs,  professional  transitions  and  for 
transversal  skills,  notably  to  facilitate  reconversion  towards  sectors  and 
economic  activities  expected  to  expand.  To  this  end,  provide  training 
entitlements in line with the proposed Council Recommendation on individual 
learning accounts109 and in the form of paid training leave and career guidance. 
Support  the  development  of  short,  quality-assured  and  widely  recognised 
courses building on the European approach to micro-credentials110. 

(6) 

To ensure the continued fairness of tax-benefit systems and social protection systems 
in the context of the green transition, and building on the Recommendation on access 
to  social  protection  for  workers  and  the  self-employed111,  Member  States  are 
encouraged to consider the following measures in support of people and households 
most affected by the green transition, notably those in vulnerable situations, in order 
to  support  labour  market  transitions,  including  transitions  towards  economic 
activities contributing to climate and environmental objectives, prevent and alleviate 
energy and transport poverty and mitigate regressive impacts of policy measures: 

107  Council  Recommendation  of  15  March  2018  on  a  European  Framework  for  Quality  and  Effective 

Apprenticeships (OJ C 153, 2.5.2018, p. 1). 

108  Council Recommendation of 10 March 2014 on a Quality Framework for Traineeships (OJ C 88, 27.3.2014, 

p. 1). 

109  Proposal for a Council Recommendation on individual learning accounts, COM(2021) 773 final. 
110  Proposal for a Council Recommendation on a European approach to micro-credentials for lifelong learning 

and employability, COM(2021) 770 final. 

111  Council  Recommendation  of  8  November  2019  on  access  to  social  protection  for  workers  and  the  self-

employed (OJ C 387, 15.11.2019, p. 1). 

EN 

27 

  EN 

                                                 
(a)  Assess and, where necessary, adapt taxation systems in view of the challenges 
arising  from  the  transition  towards  climate  neutrality,  notably  by  shifting  the 
tax burden away from labour and reducing the tax wedge for low and middle 
income  groups 
to  climate  and 
towards  other  sources  contributing 
environmental  objectives,  preventing  and  mitigating  regressive  impacts, 
preserving  the  progressive  character  of  direct  taxation  and  safeguarding  the 
financing  of  adequate  social  protection  and  investment  measures,  especially 
those targeted towards the green transition. 

including 

(b)  Assess  and,  where  applicable,  adapt  social  protection  systems  and  social 
inclusion  policies  in  view  of  the  employment,  social  and  health  challenges 
posed by the green transition, in order to ensure their continued adequacy and 
sustainability.  To  this  end,  consider  how  the  provision  of  adequate  income 
transition  schemes, 
security, 
unemployment benefits and minimum income systems can be best ensured and 
adapted  to  the  needs  arising  from  the  green  transition.  Also  ensure  the 
provision  and  sustainable  financing  of  high-quality,  affordable  and  accessible 
social, health and long-term care services, especially to people and households 
most  affected  by  the  green  transition,  notably  by  investing  in  social 
infrastructure for childcare, long-term care and healthcare.   

innovative 

job-to-job 

through 

(c)  Provide, where necessary, and complementing measures outlined in 7(a) while 
they are being deployed, targeted and temporary direct income support, notably 
to people and households in vulnerable situations, to mitigate  adverse income 
and  price  developments,  also  linked  to  improved  incentives  for  urgently 
achieving  necessary  climate  and  environmental  objectives  while  preserving 
price signals supporting the green transition. To this end, ensure the availability 
of  proper  funding  for  those  measures,  including  by  improving  the  quality  of 
public  expenditure,  making  optimal  use  of  the  Social  Climate  Fund,  and 
drawing on the budgetary resources created by energy and environmental taxes 
and the EU Emissions Trading System. 

(d) 

Improve risk-awareness, risk reduction and risk-transfer solutions as concerns 
households  and  enterprises,  in  particular  micro,  small  and  medium-sized 
enterprises, notably by ensuring the availability and affordability of insurance 
solutions, in particular for people and households in vulnerable situations.  

(7) 

To  ensure  access  to  affordable  essential  services  and  housing  for  people  and 
households  most  affected  by  the  green  transition,  in  particular  those  in  vulnerable 
situations, Member States are encouraged to consider the following measures: 

into 

renewable  energy 

(a)  Mobilise public and private financial support and provide incentives for private 
investments 
sources  and  energy  efficiency, 
complemented by advice to consumers to better manage their energy use and to 
take informed decisions on saving energy, in order to lower their energy bills, 
targeting  vulnerable  households  and  communities  especially.  To  this  end, 
ensure  the  availability  of  proper  funding  for  those  measures,  including  by 
improving the quality of public expenditure, making optimal use of the Social 
Climate Fund, and drawing on the budgetary resources created by energy and 
environmental taxes and the EU Emissions Trading System. 

EN 

28 

  EN 

(b)  Prevent  and  alleviate  energy  poverty  by  promoting  and  implementing  energy 
efficiency improvement measures, including public and private investments in 
dwellings to stimulate renovations, including in the social housing sector112. To 
this end, provide well-designed tax incentives, grants and loans, together with 
related advice, also to micro, small and medium-sized enterprises, while paying 
due  attention  to  incentives,  in  particular  among  owners  and  tenants,  and  the 
evolution of housing costs, notably for households in vulnerable situations. 

(c)  Empower energy consumers, including households in vulnerable situations, by 
developing  further  self-supply  via  individual  renewable  energy  arrangements 
as  well  as  other  services  via  citizen  energy  communities113,  accompanied  by 
educational  measures  and  campaigns,  with  a  special  focus  on  people  in 
vulnerable situations and consumers living in rural areas. 

(d)  Prevent  and  tackle  mobility  and  transport  challenges  and  obstacles  for 
households in vulnerable situations, especially in remote, rural and low-income 
regions  and  cities,  through  adequate  policy  and  support  measures  and  the 
development of the necessary infrastructure, to improve essential connectivity, 
enabling  access  to  education,  health,  employment,  and  social  participation. 
Ensure,  in  particular,  the  availability,  including  frequency,  of  low-emission 
public  transport  and,  where  appropriate,  promote  the  uptake  of  sustainable 
modes  of  private  mobility114,  with  a  focus  on  ensuring  affordability, 
accessibility and safety. 

(e)  Facilitate access to sustainable consumption, including nutrition, especially for 
people and households in vulnerable situations and  in particular children, and 
promote cost-saving opportunities linked to the circular economy. To this end, 
provide for effective incentives and tools, such as social innovation actions and 
local initiatives, support reuse, repair, donation and sharing schemes, including 
through  social  economy  enterprises,  and  promote  education  and  awareness 
raising for environmental sustainability for learners of all ages and at all levels 
of education115.  

CROSS-CUTTING ELEMENTS FOR POLICY ACTIONS SUPPORTING A FAIR GREEN 
TRANSITION 

(8) 

To advance the green transition in an inclusive and democratic way, integrating fair 
transition objectives from the outset into policy-making at all levels and ensuring an 
effective  whole-of-economy  approach to  fair transition  policies, Member  States are 
invited to: 

(a)  Coordinate  policy-making  at  all  levels  and  across  all  relevant  policy  areas, 
notably  in  the  context  of  the  European  Semester,  including  research  and 
innovation  with  a  view  to  building  an  integrated  and  enabling  policy 

112  In line with the upcoming revised Climate, Energy and Environmental Aid Guidelines foreseen to apply as of 

2022. 

113  As defined in Article 2(11) of the Directive (EU) 2019/944 of the European Parliament and of the Council of 
5 June 2019 on common rules for the internal market for electricity and amending Directive 2012/27/EU (OJ 
L 158, 14.6.2019, p. 125). 

114  In  line  with  the  Communication  from  the  Commission  ‘Sustainable  and  Smart  Mobility  Strategy  –  putting 

European transport on track for the future’, COM(2020) 789 final. 

115  Proposal for a Council Recommendation on learning for environmental sustainability, COM(2021) 557 final. 

EN 

29 

  EN 

 
                                                 
framework  that  pays  due  attention  to  distributional  impacts  as  well  as  to 
positive  and  negative  spill-overs,  including  in  cross-border  regions,  and 
integrates adequate and systematic evaluation strategies, including ex-ante and 
ex-post assessments.  

(b)  Give  an  active  role  to  regional  and  local  authorities,  given  their  proximity  to 
citizens  and  local  businesses,  in  the  implementation  and  monitoring  of  fair 
transition policies. 

(c) 

Involve  social  partners  at  national,  regional  and  local  levels  in  all  stages  of 
policy-making  foreseen  under  this  recommendation,  including  through  social 
dialogue  and  collective  bargaining  where  adequate.  In  addition,  promote 
further the full involvement of social partners in the design and implementation 
of transition pathways for industrial ecosystems  under the EU’s updated New 
Industrial Strategy. 

(d)  Empower  and  enable  people,  civil  society  and  stakeholders,  including 
organisations  representing  people  in  vulnerable  situations,  including  women, 
people  with  disabilities,  youth  and  children  calling  for  urgent  climate  action, 
and social economy actors including through European Climate Pact116, with a 
view to their participation in policy design and implementation, also by making 
use of new participatory models involving people in vulnerable situations.  

(e)  Strengthen the operational capacities of the relevant public services to provide 
effective  guidance  and  support  for  implementing  fair  transition  policies.  In 
particular,  strengthen  public  employment  services  to  support  labour  market 
transitions and skills intelligence,  as well as labour inspectorates to safeguard 
working  conditions.  In  addition,  mobilise  social  and  health  services  where 
appropriate,  notably  to  support  labour  market  transitions  and  address  energy 
poverty. 

(9) 

To ensure the availability and quality of the data and evidence that are needed to put 
in  place  sound  social  and  labour  market  policies  for  a  fair  transition  to  climate 
neutrality, Member States are invited to: 

(a)  Strengthen the evidence base on fair transition policies by inter alia advancing 
the  gradual  harmonisation  and  consistency  of  definitions,  concepts  and 
methodologies, including on the basis of  Commission  Recommendation (EU) 
2020/1563 on energy poverty and follow-up actions in the Energy Poverty and 
Vulnerable  Consumers  Coordination  Group,  and  using  available  methods  for 
policy impact evaluations. Include also evaluation and data collection strategies 
in  the  preparation  and  design  of  relevant  policy  measures  and  legislative 
initiatives.  

(b)  Develop and mainstream the use of robust and transparent employment, social 
and  distributional  (ex-ante)  impact  assessments  as  part  of  national  climate, 
energy and environmental reforms and measures. 

(c)  Ensure  effective  and  transparent  monitoring  and  independent  (ex-post) 
evaluation  of  the  employment,  social  and  distributional  effects  of  national 
reforms  and  measures  contributing  to  climate  and  environmental  objectives, 
involving  social  partners  and  other  stakeholders  in  the  identification  of 

116  Communication from the Commission ‘European Climate Pact’, COM(2020) 788 final. 

EN 

30 

  EN 

                                                 
evaluation  questions  and,  as  relevant,  in  the  design  and  implementation  of 
evaluation and consultation strategies. 

(d)  Strengthen research and innovation actions at national and EU levels including 
through  funding  from  the  Horizon  Europe  programme,  to  enhance  the 
modelling  and  assessment  of  the  macroeconomic,  employment  and  social 
dimension  of  climate  change  policies.  Promote  the  involvement  of  social 
partners  in  the  implementation  of  relevant  research  and  innovation  actions, 
notably  Horizon  Europe  missions  on  ‘Climate  change  adaptation,  including 
Societal Transformation’ and on ‘Smart and climate-neutral cities’, which can 
help  develop  practical  solutions  in  support  of  the  green  transition  at  regional 
and local levels. 

(e)  Present the outcomes of evaluations, foresight and monitoring exercises to the 
public  at  regular  intervals,  and  organise  exchanges  with  social  partners,  civil 
society and other stakeholders on the main outcomes and possible adjustments.  

OPTIMAL USE OF PUBLIC AND PRIVATE FUNDING 

(10) 

To provide cost-effective investment and financial support in line with the state aid 
framework to address the social and labour markets aspects of a fair green transition, 
while  exploiting  synergies  across  available  programmes  and  instruments,  and 
focusing  on  regions  and  industrial  ecosystems  most  affected,  Member  States  are 
invited to: 

(a) 

Implement fully the relevant reforms and investments under the Recovery and 
Resilience Plans, ensuring complementarity with other funds. 

(b)  Mobilise,  and  ensure  a  coherent  and  optimal  use  of  existing  instruments  and 
funding  options,  including  technical  assistance,  at  Member  States  and  EU 
level,  to  support  relevant  actions  and  investments.  EU  funding  instruments 
comprise,  in  particular,  the  Cohesion  Policy  funds,  the  Just  Transition 
Mechanism,  InvestEU,  the  Technical  Support  Instrument,  ERASMUS+,  the 
European  Globalisation  Adjustment  Fund  for  Displaced  Workers  (EGF),  the 
LIFE programme, and the Modernisation Fund.  

(c)  Commit  and  deploy  adequate  national  resources  to  contribute  to  the 
implementation  of  comprehensive  sets  of  measures  delivering  a  fair  green 
transition.  These  measures  should  be  adequately  financed,  including  by 
improving  the  quality  of  public  expenditure,  mobilising  further  private 
financing, and/or using additional public revenues, also drawing on increasing 
revenues  from  emissions  trading.  Take  into  account  employment,  social  and 
distributional aspects in the development of green budgeting practices. 

(d)  Design a balanced mix of measures in the national Social Climate Plans under 
the  proposed  Social  Climate  Fund,  including  by  complementing  green 
investments,  where  needed  pending  the  impact  of  investments  on  reducing 
emissions  and  energy  bills,  with  temporary  and  targeted  income  support 
measures  to  compensate  vulnerable  households  and  households  that  are 
transport  users,  taking  also  into  account  as  appropriate  relevant  country-
specific challenges identified and recommendations issued in the context of the 
European Semester. 

EN 

31 

  EN 

 
 
FUTURE ACTIONS FOR A FAIR GREEN TRANSITION 

(11) 

To pursue useful follow-up actions to this Council Recommendation, the Council of 
the European Union welcomes the Commission’s intention to: 

(a)  Further enhance the exchanges with key stakeholders, people and communities 
concerned  as  well  as  exchanges  of  best  practices,  including  in  the  context  of 
industrial ecosystems' transition pathways117, notably in a cross border context 
and with a focus on the regions and sectors most affected.  

(b)  Support  the  enhancement  of  the  adequacy,  consistency  and  effectiveness  of 
Member  States’  fair  transition  policies,  including  for  the  employment,  social 
and  distributional  aspects  to  be  considered  in  the  design,  implementation, 
monitoring  and  assessment  of  the  national  plans  and  long-term  strategies, 
possibly also in the context of the future review of the Governance Regulation 
as appropriate. 

(c)  Strengthen the database, notably by accessing administrative data sources and, 
where  relevant  data  from  social  partners,  industries,  civil  society,  and  public 
opinion  surveys,  and  update  methodological  guidance 
for  assessing 
employment, social and distributional impacts of fair transition and climate and 
energy  policies  including  in  the  context  of  the  European  Semester  as 
appropriate. 

(d)  Enhance  its  regular  monitoring  and  foresight  analysis  on  energy  poverty 
developments and risks in the EU, including social and distributional aspects, 
also  to  inform  the  work  of  the  Energy  Poverty  and  Vulnerable  Consumers 
Coordination Group and other relevant expert groups.  

(e)  Develop  further  research  and  strengthen  evidence  concerning  the  definition, 
monitoring and evaluation of progress towards the provision of adequate access 
to  essential  services,  also  by  developing  the  concept  of  ‘transport  poverty’  if 
appropriate,  particularly  within  the  context  of  the  green  transition  towards  a 
sustainable well-being economy. 

(f)  Review  progress  made  in  the  implementation  of  this  Recommendation  in  the 
context  of  multilateral  surveillance  in  the  European  Semester,  building  on 
existing  scoreboards  and  monitoring  frameworks,  extended  by  additional 
this 
indicators  where  necessary.  Consider  guidance  provided 
Recommendation  under  the  Energy  Union  and  Climate  Action  Governance 
Regulation,  in  particular  as  part  of  its  assessments  during  the  forthcoming 
update of integrated National Energy and Climate Plans in 2023-24.  

in 

Done at Strasbourg, 

For the Council 
The President 

117 

As  announced  in  the  updated  industrial  strategy,  such  as  construction,  energy  intensive  industries,  or 
mobility.  

EN 

32 

  EN