New RES investments are on track in Western Macedonia

Commissioner Elisa Ferreira, responsible for Regional and Urban Policy, Paloma Aba Garrote, Director of CINEA (European Executive Agency for Climate, Infrastructure and Environment) and Giorgos Kasapidis, Regional Governor of the Greek Region of Western Macedonia are in the happy position to announce that the “Socio-Economic Transition of Western Macedonia” project officially entered into force on October 27, 2023 with the signing of a Grant Agreement by all parties.

This is the first project supported under the new Public Sector Loan Facility (PSLF), which together with the Just Transition Fund and InvestEU’s Just Transition scheme forms the Just Transition Mechanism (JTM).

The project will support financing of EUR 80.7 million of sustainable investments, helping Western Macedonia transition away from carbon-intensive activities such as lignite mining and burning it in coal-fired power plants. As part of the agreement, PSLF is offering a grant of €14.5 million, which the European Investment Bank (EIB) is supplementing with a €58 million loan.

The project will send a positive message about the region’s ability to stimulate the economy and deliver a just transition. The initiative coordinated by the region of Western Macedonia brings together 15 projects in six municipalities (Argos Orestikos, Kozani, Kastoria, Florina, Eordaia and Kastoria), to achieve the common goal of reducing inequalities between people and places within the region by:

• strengthening the economic diversification of the region,
• increasing the energy efficiency of public infrastructure and reducing energy costs,
• upgrading of cultural and touristic infrastructures,
• improving health infrastructure,
• upgrading intra-regional road connectivity and strengthening road safety.

The project is in line with the Territorial Just Transition Plan of the Western Macedonia Region which will support a Just Transition after the closure of the lignite industry and improve regional infrastructure in the fields of energy, transport, health, culture and tourism.

Commissioner Elisa Ferreira, responsible for Regional and Urban Policy said:

“I commend the Region of Western Macedonia for obtaining the first grant awarded by the Public Sector Loan Facility (PSLF) under the Just Transition Facility. This is our moment to be part of a generational change and mobilize all available resources to ensure that the climate transition happens in a fair way, leaving no one and no place behind.”

CINEA Director Paloma Aba Garrote said:

“I am very pleased to see the first grant agreement under the Public Sector Loan Facility come to life. The West Macedonia Socio-Economic Transition Project was selected to help the Region meet its development needs in its transition from carbon-intensive activities and contribute to Europe’s overall Just Transition to a climate-neutral economy. I look forward to hearing about the progress of the project over time and the successful results achieved for the benefit of all citizens.”

The Regional Governor of Western Macedonia Giorgos Kasapidis stated:

“The opportunity given to the Region and the Municipalities of Western Macedonia to implement necessary projects co-financed by the EU with a grant from the Just Transition Mechanism is very important. In particular, at the beginning of the process of creating the new productive model of our region, in the post-lignite era, projects in the fields of energy upgrading, transport, health, culture and tourism can make a decisive contribution to improving the quality of citizens’ lives and tackling unemployment, strengthening social cohesion and – at the same time – achieving the EU’s low-carbon economy and energy efficiency targets. I would like to thank all my partners and the people of the European Investment Bank who ran the process and all those who contributed to the successful outcome of this effort, the head of the investment group in Greece and Cyprus of the European Investment Bank Mr. Ioannis Kaltsa, the ministers Mr. Christos Staikouras, Mr. Theodoros Skylakakis and Mr. Ioannis Tsakiris, as well as the Prime Minister Mr. Kyriakos Mitsotakis himself for the support and quick handling of the necessary actions. At the same time, I would like to particularly thank the Deputy Minister of National Economy and Finance, Mr. Nikos Papathanasis, who in February 2023 signed the 25-year loan agreement with the relevant ministries for the first project supported by pillar III of the Just Transition Mechanism”.

Regarding the project of the socio-economic transition of Western Macedonia:

This project was selected in April 2023 as one of the projects to receive an EU grant from the Public Sector Loan Facility (PSLF), which is a blending instrument under the Just Transition Mechanism (JTM), combining grants from the European Commission and loans from the European Investment Bank, to support public sector actors in the most affected regions of Europe to meet their development needs in the transition to a climate neutral economy.