JTF to mitigate effects of reduced peat energy use

The Ministry of Economic Affairs and Employment requests opinions on the proposed programme, regional transition plans and environmental report of the Just Transition Fund (JTF).

The Fund mitigates the socio-economic and environmental effects that decarbonisation causes to regional economies and employment in the EU, said the ministry in a press release on Monday.

In Finland, funding will be directed at the reform of the economic structure and measures to support employment in areas most affected by the reduction in the use of peat for energy.

The JTF belongs to a package of measures, which the European Union has created to achieve its carbon neutrality target by 2050. In Finland, the Fund aims to halve the energy use of peat by 2030. This objective is based on the Government Programme.

In addition to the proposed programme, comments are also requested on regional transition plans that have been drawn up under the leadership of regional councils and ELY Centres.

However, the Fund’s measures are not limited to peat regions, as the adverse effects of reducing the use of peat could extend to a larger geographical area.

The plans have been drawn up for South Karelia, South Ostrobothnia, South Savo, Kainuu, Central Ostrobothnia, Central Finland, Kymenlaakso, Lapland, Ostrobothnia, North Karelia, North Ostrobothnia, North Savo and Satakunta.

The municipalities of Punkalaidun, Virrat, Parkano and Kihniö in the Pirkanmaa region are also included in the plans.

The employment impact of peat industry in Finland is about 2,500 man-years. The considerable reduction of the peat energy sector will have significant direct and indirect effects on regional economies and employment. The plans focus on diversifying the regional industries and adjusting the sector’s workforce. In particular, funding would be directed at jobs in the green economy, new green technology solutions and related new business opportunities.

Measures for the retraining and reemployment of workforce would primarily be targeted at those who have lost, or are at risk of losing their jobs in the peat sector, particularly young people. The funding would also be used to develop the skills and competence of peat industry operators in wood harvesting and peatland restoration, for example, in order to create new business.

The programme proposal, transition plans and the environmental report will be added to Innovation and Skills in Finland 2021–2027, the EU regional and structural policy programme, which the European Commission approved on 5 May 2022.

The public funding of the Just Transition Fund, including EU and national funds, will total about EUR 600 million.

The ministry requested comments on the proposal by 8 August 2022.