The challenge of green transition in the national Recovery and Resilience Plans of southern and eastern EU countries

After analysing the NRRP green transition targets in 11 southern and eastern European countries, we found that country-by-country analyses are needed to compensate for information gaps at the European level.

Published On: July 3rd, 2024

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Two and a half years before the National Recovery and Resilience Plans come to an end, we have analysed the progress of national plans in 11 countries, specifically when it comes to the green transition. We started by taking stock of the investment areas, resources allocated, and interventions completed. We then tried to verify – when possible – the impact of the plans on green transition targets in the respective countries, on the one hand by analysing the (not really comprehensive) data published by the EU and member states, and on the other by conducting interviews with governmental and non-governmental actors involved in and affected by the implementation of the national plans.

This project consists of one overall study (this one) and four other analyses of individual countries. It was conducted by Openpolis, together with partners of the European Data Journalism Network: Dennik N for Slovakia, Miir for Greece, and Eurologus for Hungary.

NRPs and the green transition

Implementation of the Recovery and Resilience Facility will draw to a close in late 2026. The program, introduced by the European Union in 2021, enabled member states to access Next Generation EU funds. The intention was to foster Europe’s economic and social recovery following the Covid pandemic.

Each country has its own National Recovery and Resilience Plan (NRRP), with respective resources, measures (investments or reforms) and deadlines (milestones and targets). The areas of intervention are various: from jobs to education, from health to infrastructure. While states have relative freedom to choose how much to invest in which areas, there are very specific criteria that must be met to access the funds. Among these, a focus on the environment and ecological transition is central.

This decision is in line with the policies and objectives put in place by the EU in recent years. Think, among others, of the European green deal. Moreover, as additional support for the green transition, and in response to the energy crisis caused by the Russian invasion of Ukraine, the EU introduced REPowerEU in 2022. These are additional resources and interventions – which countries can include in their NRRPs – targeted specifically at energy development. The goal is to support energy production from renewable sources and increase European independence from Russian energy imports.

Differences between member states

The resources and objectives made available by the EU have different relevance for different member states. For some, the NRRP constitutes a unique opportunity for economic and social development. This is especially true for southern and eastern European countries, which have the highest percentages of NRRP funds in relation to their respective gross domestic products (GDP).

The highest shares are recorded in Greece, Croatia, Spain, Romania, Italy, Portugal, Poland, Bulgaria, Lithuania, Hungary and Slovakia. Historically, these are socioeconomically disadvantaged countries compared to those in northern and central Europe. They also faced the challenge of the pandemic with extra difficulty. It is in these member states that the NRRPs should have the greatest impact, and this is why we decided to focus on them to review the progress of national plans on the environmental and energy fronts.

Areas of intervention

All 11 countries under consideration meet the 37% quota of NRRP funds to be devoted to the ecological transition. Some, far exceed it: in first place is Hungary, which devotes 67% of its national plan resources to climate and environment goals. Hungary is followed by Bulgaria, another country that devotes more than half of its funds to green transition (57%). Slovakia and Poland are close behind with 48% and 47% respectively.

When breaking these resources down to individual areas, the results show that five countries (Greece, Poland, Bulgaria, Lithuania and Hungary) devoted the highest share of funds to renewable energy development, four to energy efficiency (Croatia, Spain, Portugal and Slovakia) and two to sustainable mobility (Romania and Italy).

It is difficult to say with certainty why states decided to invest more in one goal than another. However, we can make some assumptions. For example, it is interesting to note that Poland, Hungary and Lithuania have allocated more than half of their resources for the green transition on the development of renewable energy. The first two rank last among EU member states in terms of renewable energy consumption. They therefore have an incentive to invest more in the sector, in line with European objectives.

The state of play

Beyond the initial snapshot, it is important to understand how implementation of the national plans is actually progressing, with respect to meeting deadlines for green transition measures, and the allocation of resources by European institutions. The situation varies widely from state to state.

On this front, Hungary offers a unique case compared to other countries. Despite the fact that the Hungarian plan was approved in its original version in December 2022, and in an amended version in November 2023, the country does not appear to have met any deadlines to date, either for the ecological transition or any of the other policy areas. As a result, again according to the commission’s official data, Hungary is yet to receive a single tranche of the total resources earmarked for its NRRP, excluding the pre-funding for the REPowerEU chapter. The allocation of these tranches is in fact tied to meeting deadlines.

As György Folk of Eurologus explained to us, the stalemate is caused by disputes between the Hungarian government and the EU over issues related to the rule of law in the country. In fact, the European institutions made the transmission of funds to Hungary conditional on the achievement of a series of actions designed to ensure the independence of the judiciary, and protect the financial interests of the European Union with anti-corruption measures and increased transparency in public procurement. So far, the Hungarian government has been reluctant to implement these measures.

As anticipated, Hungary did receive at least some funds: the 919.6 million euro targeted for pre-financing the REPowerEU energy chapter. This is a significant sum, and it also exceeds the total amount that some countries have already received, in addition to the pre-financing for Repower, and one or more payments for the green transition.

In second and third place are Poland and Spain, with 7 and 6.6 billion respectively. Both received less than half the funds given to Italy.

Focusing on the resources received for the green transition, the gap between Italy and the other countries is even wider: the 15 billion that Italy received is three times more than what Spain received (5.2). In contrast, the picture changes when looking only at REPowerEU pre-funding.

Common indicators

To assess the progress of national recovery and resilience plans, the European institutions have defined a set of common indicators for each of the pillars of the NRP, including green transition. Countries are required to collect this data and submit it twice a year to Brussels. The environmental and climate indicators chosen are as follows:

  • savings in annual primary energy consumption, compared with 2019 figures;
  • additional installed operational capacity for renewable energy, compared to 2019 electricity generation capacity;
  • infrastructure for alternative fuels, calculated as refuelling and recharging points per 100,000 cars in 2019;
  • population benefiting from measures against floods, fires, and other natural climate disasters, calculated as a percentage of the 2019 population.

All these indicators are cumulative, so they can only increase over time. We have focused on the latest available update, i.e. the second semester (June-December) of 2023.

Of the 11 countries considered, Hungary and Bulgaria do not report any data for any of the four common ecological transition indicators. For Hungary this is certainly due to the stalemate on the implementation of the national plan, which we have already discussed. In the case of Bulgaria, we can assume that, having met only 3% of the ecological transition deadlines (four out of 139), there is still no data to monitor for these indicators.

It is noteworthy how useless this tool is for evaluating the impact of the NRRPs on green transition.

The obstacles to evaluating the NRRPs

There are multiple problems with the common indicators: first of all, the values for each indicator for the total of the EU countries involved use different units of measurement than those used for each individual state. For example, the total savings in annual primary energy consumption across the EU are calculated in millions of euros, and not as a percentage of the 2019 figure. The same happens in different ways with the other 3 indicators, making it impossible to compare individual countries and European averages, which would be useful to evaluate the progress of national plans.

There is also no explicit quantitative target to be achieved for each indicator once the recovery and resilience mechanism is concluded in 2026. It is therefore difficult to get an idea of how much progress has been made, of how far the national plans have come or still have to go in terms of the NRRPs’ impact on green transition.

From a non-institutional perspective, how should we monitor the progress of the NRRPs on green transition? To date, it is impossible to do so at the overall level, considering all the countries involved. Some assessments can be carried out on a country-by-country basis, clearly depending on how much and which data is public and accessible.

It is precisely with this objective in mind that in the coming weeks we will publish in-depth national studies for Italy (Openpolis), Greece (Miir), Slovakia (Dennik N) and Hungary (Eurologus).

In addition to collecting national data and information, all partners conducted interviews with local government and non-government actors connected to NRRPs  implementation. The aim is to shed light on, and attempt to understand, at least in part, whether these national plans are achieving the desired effect on the green transition.

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