Romania and 11 other European Union states are asking the European Commission to extend one of the most important funding instruments for energy transition beyond 2030. Governments warn that giving up this support would slow down investments in clean energy and affect the competitiveness and energy security of the community bloc.
The request is included in a letter addressed to the European Commissioner for Climate Action, Wopke Hoekstra. According to Euronews, the document is signed by Croatia, Bulgaria, Czech Republic, Estonia, Greece, Hungary, Latvia, Lithuania, Poland, Romania, Slovakia, and Slovenia.
The 12 states argue that the Modernization Fund, created to help less developed economies modernize their energy systems, remains essential even after the current deadline set for 2030.
The 12 states request more funds and extension of the fund
The Modernization Fund has been operational since 2021 and is financed by revenues from the auctioning of carbon emission certificates within the European ETS system. For the period 2021-2030, the mechanism provides over 57 billion euros for investments in clean energy, energy efficiency, and infrastructure modernization.
In the letter, governments not only demand the extension of the fund beyond 2030 but also an increase in financial resources.
"We request the continuation and strengthening of the Modernization Fund beyond 2030, as well as a significant increase in the level of funding, in line with the growing challenges of the transition," the document states, sent ahead of the ETS system review scheduled for July 15.
The signatories argue that this mechanism allows less prosperous member states to undertake costly investments that would otherwise be difficult to finance, contributing to reducing dependence on imported fossil fuels.
Eastern countries say they need more time
The 12 states argue that the energy transition is more challenging in Central and Eastern Europe, where many economies remain dependent on coal, oil, and gas and have outdated energy infrastructure.
Poland is one of the most evident examples, as it still relies significantly on coal for electricity production and job maintenance. Similar situations exist in Romania, Bulgaria, Slovakia, and other countries in the region, which need substantial investments to modernize energy networks and develop renewable sources.
Governments claim that in the last five years, the Modernization Fund has proven its effectiveness by funding projects that would have been challenging to realize otherwise.
"In a period when many EU funding instruments are becoming increasingly complex and burdened with administrative tasks, this one offers a tested model for achieving climate and energy goals, while ensuring strong governance," the letter further states.
NGOs support the fund but demand elimination of funding for fossil fuels
Gligor Radečić, representative of the Bankwatch Network for Central and Eastern Europe, a non-governmental organization monitoring public investments and environmental policies in the region, agrees that Central and Eastern European states still need support to catch up with the rest of the Union.
However, he warns that governments in the region must give up opposing the elimination of funding for projects based on fossil fuels, waste incineration, and biomass.
"If the Central and Eastern European governments are truly committed to an authentic energy transition, they must stop opposing the exclusion of fossil fuels, waste incineration, and biomass from the fund. These have so far benefited from considerable support," he told Euronews.
The expert also warns that a potential weakening of the European Emissions Trading System (ETS) would reduce the revenues feeding the Modernization Fund and impact the EU's emission reduction objectives.
In recent weeks, Bulgaria, Czech Republic, Greece, Poland, Romania, and Slovakia have highlighted that their energy-intensive industries—such as steel, cement, aluminum, and chemical sectors—are under pressure from rising energy costs, geopolitical instability, and stricter carbon emission regulations.
G.P.