Published on July 5, 2022

Just transition lessons: how Kichevo can learn from Gorj County

, Nevena Smilevska (Just transition coordinator for Western Balkans, CEE Bankwatch Network)

European Union (EU) Member States have been working on phasing out coal from their energy mix for several years. This phase-out has had and will continue to have inevitable economic and social impacts on regions affected by the closures of coal-fired power plants and coal mines: job losses, diminishing options for youth and an overall feeling of uncertainty for the future. Since there is a large number of regions where the phase-out is causing significant change, a just transition process is necessary to reduce the negative effects and map the development of each region separately, depending on the possibilities available in that region. Considering that this process is very broad and expensive, funds are foreseen for financing the measures involved in the just transition process. These measures include developing Territorial Just Transition Plans supported by the Just Transition Fund, which finance small projects (EUR 5-10 million) that would enable the development of the region and contribute to establishing carbon-free alternatives.  

Right now, such a territorial plan for the just transition of Gorj County in Romania is in the final phase of consultation. As part of our activities for supporting the just transition away from coal in the Western Balkans, CEE Bankwatch Network carried out a series of meetings with various stakeholders in Gorj County to learn about their experiences and to share them with relevant stakeholders in affected regions here, including the Kichevo region. In this article, we’ll examine some of those experiences. 

Gorj County is home to several lignite mines and large lignite-fired thermal power plants with a total capacity of more than 1,000 megawatts. Understandably, citizens, municipalities, businesses and all other stakeholders in the region have not reacted positively to a transition that would drastically change their way of life.  

Still, considering that the transition to carbon-free alternatives is inevitable for all EU Member States, as well as for all candidate countries, the councils of all six Romanian counties that will be affected by the coal phase-out, including Gorj County, had the difficult task of planning the transition by drafting a Territorial Just Transition Plan. Speaking about his experience with drafting this plan, Alin Șipanu of the Gorj County Council pointed out that two years is a very short time to plan the just transition away from coal. However, with the right approach, it’s possible to prepare people for changes that will happen within the next 10, 20 or even 30 years, but still within many people’s lifetimes. 

Openness to the process from both the Gorj County Council and citizens came with the overall change in the energy sector, specifically overemployment in the administration of mines and power plants. The conclusion was that it is necessary to have a local strategy and a stable sustainability programme for the region.  

Șipanu identifies that one of the problems with tasking the county administration with developing a just transition plan is that this type of institution specialises in investing budget funds in large public interest or administrative projects like building roads, hospitals and schools. Projecting or encouraging the county’s economic development is not the council’s area of expertise. 

Seeing this problem, the Gorj County Council published a call for ideas from citizens, businesses and anyone interested in contributing. Council members were surprised to receive 340 different ideas, of which, after checking for possible funding through the Just Transition Fund, more than half were used in creating the programme. One of the main guidelines for creating the plan was seeking alternative approaches to developing businesses in the region; one of the examples mentioned was a small brick factory with solar panels on its rooftop. In addition to this guideline, when considering alternatives, the entire process was mapped out following the value chain concept. 

In describing how this approach was put into practice, the council first looked at the status quo. As it stands, the region’s main product is electricity. Considering that electricity produced from coal is no longer desirable for several reasons (including low profitability due to emissions-related taxes and the reduced availability of coal itself), if the region wants to continue producing electricity, it will have to be in the form of solar. One analysis showed that currently, the number of rooftop solar panels installed is very low. Calculating the available surface area, the council determined that there is such great need for solar panels that to meet the demand, it would be a good idea to build a solar panel factory.  

From here, the entire process was planned: the production of panels, including the development of personnel, training workers to install panels, encouraging the formation of energy communities with all the possibilities they offer, and finally selling locally generated electricity into the system. In addition, possibilities for installing energy-efficiency measures were taken into account; this is a job that workers in soon-to-be-closed mines and power plants could be reskilled to do. 

It’s also important to note that the Gorj County Council identified that businesses that are directly linked to power plants (transport, services, etc.) are not very interested in the transition. However, the council also noted that the number of businesses that could be developed and supported as part of the transition far outweighs the existing businesses that aren’t interested in changing. 

Overall, the council was pleasantly surprised by how many new ideas that could be financed appeared in the call. These are relatively small projects that can be financed through the Just Transition Fund (EUR 5-10 million per project). Șipanu also pointed out that smaller projects are more desirable as part of a territorial plan for just transition because they are easier to implement and have greater potential to enable economic diversity. Some of the fields identified as desirable are energy, agriculture, tourism and education. Ideas mentioned to the CEE Bankwatch Network team included: greenhouses combined with photovoltaic panels, green theme parks, solar panel production factories and building sector developments in the energy-efficiency field.  

In any case, while using the experience of Gorj County to plan the development of the Kichevo region and other regions in the Western Balkans, the options that would be possible at the local level need to be assessed. The size of the Kichevo region (or other Western Balkan regions) in comparison with Gorj should also be taken into account when considering how to apply this experience. Nevertheless, positive experiences from regions already implementing a just transition from coal are invaluable for a region that is only beginning the process, as they can open up possibilities to develop in a different direction.