The Just Transition in the European Union

27 January 2025

By Linus Mehl, Student Research Assistant for the European Chair for Sustainable Development and Climate Transition, Sciences Po

The European Union’s ambitious climate goals, encapsulated in the European Green Deal, aim to achieve climate neutrality by 2050. This strategy marks a transformative shift toward decarbonizing the European economy, phasing out fossil fuels, and promoting cleaner technologies. While these goals are vital for addressing the climate crisis, they come with profound economic and social implications. A just transition has therefore emerged as a critical framework for ensuring that the costs and benefits of the green transition are equitably distributed across workers, communities, and vulnerable populations.[i]

What is the Just Transition?

The roots of the just transition concept lie in labor movements of the 1980s, when trade unions in energy-intensive industries began advocating for workers’ rights and job security amidst growing environmental regulations.[ii] Over time, the concept expanded to address broader questions of economic, social, and environmental justice in the transition toward low-carbon economies.[iii]

Today, a just transition encompasses four key dimensions of justice:

Distributional Justice focuses on the fair allocation of the costs and benefits of decarbonization. This includes ensuring that vulnerable groups—such as low-income households and workers in fossil fuel sectors—are not disproportionately burdened.[iv]
Restorative Justice seeks to repair past and ongoing harms caused by economic transitions, addressing issues like job loss, environmental damage, and regional decline.[v]
Procedural Justice emphasizes inclusive and transparent decision-making processes, ensuring that affected stakeholders—workers, local communities, and marginalized groups—have a voice in policy design and implementation.[vi]
Recognitional Justice highlights the importance of acknowledging diverse social and economic realities, particularly those of historically disadvantaged or marginalized groups.[vii]

By combining these dimensions, the just transition framework provides a more holistic and equitable approach to achieving sustainability while safeguarding social cohesion.

The EU’s Approach to the Just Transition

The European Union has made the Just Transition a cornerstone of its climate policy through the Just Transition Mechanism (JTM). Introduced as part of the European Green Deal, the JTM aims to alleviate the socio-economic impacts of decarbonization, particularly in regions and sectors most affected by the energy transition. The mechanism consists of three key pillars:

The Just Transition Fund (JTF): This fund supports the diversification of local economies, worker reskilling, and investments in clean energy projects in carbon-intensive regions. It focuses on small and medium-sized enterprises (SMEs), environmental rehabilitation, and job creation in emerging low-carbon sectors.
InvestEU: This instrument mobilizes private and public investments to foster sustainable infrastructure and economic development, with a specific focus on territories identified in Territorial Just Transition Plans (TJTPs).
The EIB Public Sector Loan Facility: This facility finances public sector projects that may not be commercially viable but are essential for regional recovery and long-term development. It combines grants from the European Commission with loans from the European Investment Bank (EIB).[viii]

These financial tools are complemented by initiatives such as the Just Transition Platform, which provides technical assistance, policy guidance, and capacity-building support to stakeholders, and the Social Climate Fund (SCF), aiming to address energy poverty by combining green investments with temporary direct income support for vulnerable households.

Mapping Progress: Evolving Just Transition Policies in the EU

The European Union’s emphasis on just transition has evolved significantly since the European Green Deal was introduced. In 2019, an analysis of National Energy and Climate Plans (NECPs) revealed that just transition objectives were unevenly addressed across member states.[ix] Only seven countries, including Spain, Ireland, the Netherlands, Germany, Czechia, Slovakia and Greece had implemented or planned concrete policies, often narrowly targeting coal-dependent regions such as Upper Nitra in Slovakia or Western Macedonia in Greece. Spain stood out as the sole member state with a comprehensive national just transition strategy, supported by institutional innovations like the Just Transition Institute. Most other member states approached the issue reactively, focusing on investment-based measures such as regional economic diversification and worker reskilling, while broader eco-social policies—such as energy poverty alleviation and income support—were largely absent.[x]

Since then, the EU’s Just Transition Mechanism (JTM) and the introduction of Territorial Just Transition Plans (TJTPs) have driven a more structured response. By 2023, all 27 member states had referenced “just transition” in their updated NECPs, reflecting its rising prominence in national climate strategies. Yet, disparities persist: while some countries have made strides in integrating just transition principles into broader policy frameworks, others continue to adopt narrow, sector-specific approaches. Preliminary findings from a forthcoming working paper suggest that significant gaps remain in areas such as policy scope, governance frameworks, and stakeholder inclusivity. The forthcoming analysis further provides a detailed mapping of these trends, examining the extent to which just transition policies address distributional, procedural, restorative, and recognitional justice. It also highlights how member states are responding to the structural and social challenges of the green transition, identifying innovative practices, persistent gaps, and emerging opportunities.

Key Challenges and Critiques

Despite its progress, the EU’s approach to the just transition faces several challenges and criticisms. One major critique is that the Just Transition Mechanism focuses disproportionately on coal-dependent regions, particularly in Eastern Europe, where decarbonization efforts are expected to have the most visible and immediate impact. While these regions are undoubtedly vulnerable, this narrow focus risks overlooking other areas—such as industrial regions reliant on energy-intensive manufacturing—that may also experience significant economic disruption.[xi]

Another challenge lies in the lack of procedural justice. Studies have highlighted the limited involvement of local communities, workers, and civil society in decision-making processes. Without meaningful stakeholder engagement, policies risk failing to address the specific needs and challenges of affected regions, eroding trust and creating resistance to climate action.[xii]

Moreover, the EU’s strategy remains largely reactive. Current policies focus heavily on short-term compensatory measures, such as worker reskilling and economic restructuring, rather than addressing deeper systemic inequalities. Critics argue that a broader integration of eco-social policies—which combine environmental sustainability goals with social protections—is needed to ensure long-term success. Such policies would better address issues like energy poverty, income inequality, and access to green jobs, while creating a more inclusive and resilient transition.[xiii]

Looking Forward: A Holistic and Inclusive Just Transition

To achieve a truly just transition, the EU must adopt a more holistic approach that addresses both the structural and social challenges of the green transition. This involves:

Enhancing Procedural Justice: Policymakers must prioritize meaningful engagement with stakeholders, including workers, marginalized communities, and local actors, to ensure that decision-making processes are inclusive, transparent, and representative.
Expanding Eco-Social Policies: A comprehensive policy framework should link welfare systems to climate goals, addressing energy poverty, job displacement, and income inequality through targeted interventions such as energy vouchers, income support, and skills development programs.
Addressing Systemic Inequalities: Beyond short-term measures, policies must tackle the underlying socio-economic disparities that risk being exacerbated by the energy transition. This includes investing in green infrastructure, education, and public services in vulnerable regions.

The EU’s leadership in decarbonization provides a valuable model for other regions, but success will depend on its ability to balance environmental ambitions with social justice. By integrating holistic eco-social policies, enhancing participatory processes, and learning from regional experiences, the EU can ensure that no one is left behind in the journey toward a sustainable and equitable future. The just transition is not merely an economic or environmental imperative—it is a societal one, offering a path to climate neutrality that is fair, inclusive, and resilient for all.

[i] McCauley, D., & Pettigrew, K. A. (2022). Can Europe lead a Just Transition? Solidar.Org

[ii] Doorey, D. J. (2017). Just Transitions Law: Putting Labour Law to Work on Climate Change (SSRN Scholarly Paper 2938590). https://papers.ssrn.com/abstract=2938590

[iii] Abraham, J. (2017). Just Transitions for the Miners: Labor Environmentalism in the Ruhr and Appalachian Coalfields. New Political Science, 39(2), 218–240. https://doi.org/10.1080/07393148.2017.1301313

[iv] Menghwani, V., Zerriffi, H., Korkovelos, A., Khavari, B., Sahlberg, A., Howells, M., & Mentis, D. (2020). Planning with justice: Using spatial modelling to incorporate justice in electricity pricing – The case of Tanzania. Applied Energy, 264, 114749. https://doi.org/10.1016/j.apenergy.2020.114749

[v] McCauley, D., & Heffron, R. (2018). Just transition: Integrating climate, energy and environmental justice. Energy Policy, 119, 1–7. https://doi.org/10.1016/j.enpol.2018.04.014

[vi] Moesker, K., & Pesch, U. (2022). The just transition fund – Did the European Union learn from Europe’s past transition experiences? Energy Research & Social Science, 91, 102750. https://doi.org/10.1016/j.erss.2022.102750

[vii] Cuppen, E. (2018). The value of social conflicts. Critiquing invited participation in energy projects. Energy Research & Social Science, 38, 28–32. https://doi.org/10.1016/j.erss.2018.01.016

[viii] European Commission (2024). The Just Transition Mechanism: making sure no one is left behind, last accessed January 20, 2024. https://commission.europa.eu/strategy-and-policy/priorities-2019-2024/european-green-deal/finance-and-green-deal/just-transition-mechanism_en

[ix] Mandelli, M., (2022). Mapping eco-social policy mixes for a just transition in Europe. Working Paper 2022.15. Brussels: European Trade Union Institute (ETUI).

[x] ibid.

[xi] Schuster, A., Zoll, M., Otto, I. M., & Stölzel, F. (2023). The unjust just transition? Exploring different dimensions of justice in the lignite regions of Lusatia, Eastern Greater Poland, and Gorj. Energy Research & Social Science, 104, 103227. https://doi.org/10.1016/j.erss.2023.103227

[xii] Pavloudakis, F., Karlopoulos, E., & Roumpos, C. (2023). Just transition governance to avoid socio-economic impacts of lignite phase-out: The case of Western Macedonia, Greece. The Extractive Industries and Society, 14, 101248. https://doi.org/10.1016/j.exis.2023.101248

[xiii] Cigna, L., Fischer, T., Abuannab, E. H., Heins, E., Rathgeb, P. (2023). Varieties of Just Transition? Eco-Social Policy Approaches at the International Level. Social Policy and Society, 22(4), 730–746. https://doi.org/10.1017/S1474746423000192 ;
Crespy, A., & Munta, M. (2023). Lost in transition? Social justice and the politics of the EU green transition. Transfer: European Review of Labour and Research, 29(2), 235–251. https://doi.org/10.1177/10242589231173072