Decarbonising Europe’s coal-reliant regions: the challenge of a “just transition”

Some countries are backsliding on climate commitments to be coal-power free, afraid of the impact on jobs and energy costs. How can nations such as Bulgaria overcome the social and economic challenges in coal-reliant regions?

By Alasdair Sandford

Bulgaria has not had the most auspicious of years in terms of its commitment to a green transition. In January 2023, lawmakers voted overwhelmingly to backtrack on plans for an early phase-out of coal-fired power plants. In the summer the Supreme Court authorised one such plant, the biggest in the Balkans, to continue operating despite emitting some of Europe’s worst pollution. The government was the last in the EU to submit its green transition plans to Brussels. The delayed phase-out means that no coal-burning power plant is scheduled to close before 2038. An awkward coalition of two rival blocs is in power after years of political crisis. It’s been assailed by protests from energy workers opposed to the transition, and the temptation to play the populist card is strong.

“In Bulgaria there is a popular myth: ‘it’s warmer when you use coal’,” says Lilly Stammler, chief expert at SOFENA, an NGO specialising in energy efficiency. “The message that goes to the people in most cases is that postponing this decision is a good thing for Bulgaria. So, a government which challenges the ‘evil powers’ to postpone is seen as being in favour of Bulgaria somehow.” “Unfortunately most coal in Bulgaria is actually lignite, with a low content of energy, it’s polluting, it’s taken from open-mining… but this is a local resource and with current technologies and existing coal fired plants the electricity is cheaper compared to other resources, particularly natural gas,” says SOFENA’s director Zdravko Georgiev. Cost is an important factor in a country which has the highest levels of energy poverty in the EU. Tens of thousands of jobs in coal-producing areas are dependent on the industry. Some 40% of Bulgaria’s electricity comes from coal, which is also exported to neighbouring countries, providing revenue and security.

Contrast Bulgaria’s energy convulsions with the resolute action taken by Ontario. Driven by health concerns over pollution, the Canadian province became the first North American government to stop using coal altogether. The proportion of coal-fired electricity fell from 25% in 2003 to zero by the end of 2014. Smog alerts, once commonplace, all but disappeared. “(Ontario) was the first domino in what effectively became a Canada-wide coal power phase-out”, says Nichole Dusyk, Senior Policy Advisor and Lead, Canada Energy at the International Institute for Sustainable Development (IISD). “Strong political leadership” lay behind the province’s success, she adds, along with the fact that plants were publicly-owned and that coal was not mined locally but imported, limiting the impact on jobs.

Across the Atlantic, the EU’s SITRANS project is tasked with replicating Ontario’s achievement, by actively supporting the green energy transition in the bloc’s coal regions. It promises a model that assesses the socio-economic impact, involves residents in decision-making, and aims to leave “no-one behind” in pursuit of a “just transition”. The EU’s Green Deal identified the coal phase-out as essential if climate targets are to be met. “There is an overall plan for decarbonisation… but every region has to adapt it,” says project coordinator Professor Yiannis Bakouros of the University of Western Macedonia. “We cannot take it as it is in Greece and go to Romania and say ‘do the same’. It doesn’t work at all. We have to adapt it because every region has its own advantages and disadvantages, they don’t have the same political system.” 

Four EU coal regions will feature as SITRANS “demo cases” to test the project’s models and approach: Silesia in Poland, Italy’s Sardinia, Greece’s Western Macedonia region, and Stara Zagora in Bulgaria – the country’s “energy heart” where power plants directly employ some 12,500 people, and an estimated 100,000 are affected by the transition. Genady Kondarev, Senior Associate for Central and Eastern Europe at the climate change think tank E3G, describes Europe overall as “already pretty green with a few notable exceptions”. Although Poland’s official coal phase-out date is 2049, he sees encouraging signs – with “a serious uptake” in renewable energy sources such as heat pumps, and previously hostile businesses now supportive. In Bulgaria however, resistance to change makes the transition particularly challenging. “Unlike other regions that are pretty good in jumping on the wagons of the new opportunities related to new technologies, Stara Zagora is still not catching up well,” Kondarev says. “I would be as direct as saying that there was a political firewall towards any messages that were coming into the region trying to ask the people ‘start gearing up, pay attention, this is a global wave, you can’t continue to exist as the only smoking stacks in and around the EU’.”

NGOs have also reported a lack of engagement among some Bulgarian authorities over energy transition. “I can confirm that at local level most of the municipalities were not active at all in this process,” says SOFENA’s Zdravko Georgiev, referring to one particular project he witnessed first-hand where “time was totally lost”. Even where the political will exists, authorities lack expertise, he adds. To help “influence our politicians” – Professor Bakouros’ words – and achieve a “just transition”, SITRANS aims to set up a “Just Energy Transition Observatory (JETO)”, to develop and monitor models based on results. The project coordinator envisages a 10-year operation, with all coal-producing regions invited to join and contribute their own data.

Bulgaria’s foot-dragging over its energy transition caused the country to lose €100 million in EU funds in 2022, and Kondarev believes Brussels may need to resort to further punitive action. “This notion that countries can perpetuate doing what they’re doing and then still get a piece of the pie that they were asking for should not always be the case. There has to be a bit of a stick, not only the carrot,” he argues. Canada’s experience offers a salutary lesson. After Ontario’s coal phase-out, poorly implemented pricing policies brought “a backlash against renewable energy” and “a less progressive government” that is still in power in the province, says Dusyk. “An important rationale for a just transition is that when you have a phase-out initiative you need to have the corresponding policies” concerning renewables, she adds. Despite the end of coal, the country overall is officially reported to be on track to miss its climate targets. Dusyk argues that without the phase-out, the situation would be even worse: “This is basically saving our skin”, she says. “It is really the most significant action that Canada has taken on reducing or mitigating climate change.

The EU Council’s conclusions on the bloc’s collective position for COP28 stress the need for a global phase-out of fossil fuels. Despite the significant challenges facing the EU, Bakouros is optimistic about the transition, citing a dramatic fall in the amount of coal-produced electricity in his native Greece compared to 20 years ago. “At that time the question was not how we replace jobs, how we develop something, change the production model of our region… The discussion was not about how to go forward but how to avoid this decarbonisation,” he says. “At that time there were a few people talking about the necessity of decarbonisation and everybody else was looking at them like an alien. Now it’s different.”