Recent Trends in Coal Regions in the Western Balkans and Ukraine

The European Commission’s Joint Research Centre recently released a report on the use of solid fossil fuels in the Western Balkans and Ukraine.

The report was presented during the meeting of the Initiative for Coal Regions in Transition in the Western Balkans and Ukraine on Monday 25 October 2021.

Building on a series of reports identifying coal-related employment at risk in the EU, the JRC has found that between 29 000 and 64 000 direct jobs are at risk in the coal mines and power plants of the Western Balkans and Ukraine by 2030.

The study also provides a picture of coal production in the Western Balkans and Ukraine, which is equivalent to 20% of EU production. Basing their projections on national energy strategies, JRC authors found that thousands of jobs will be at risk in these regions because of the energy transition.

The Western Balkans and Ukraine together represent two-thirds of the number of direct jobs in the European coal industry. The report finds that the coal industry in these regions accounts for 138 000 direct jobs – 96 000 jobs in Ukraine alone – accounting for around 89 500 jobs in mining and 48 500 jobs in coal-fired power plants. The authors also estimate an additional 132 000 indirect jobs related to the coal activities analysed.

With 47 hard coal mines, Ukraine hosts by far the biggest mining industry, but with a very low productivity satisfying only 54% of the country’s coal demand, Ukraine is also the largest importer of coal. With just two open-pit mines, Serbia – the largest and most efficient producer considered by the study – produces 43% more coal than Ukraine with less than a quarter of its workforce.

The Western Balkans and Ukraine have a significant share of power generation from coal, though decreasing in recent years, on which they are highly dependent. Coal power plants in the Western Balkans and Ukraine are older and less efficient than in the EU. While the EU fleet averaged 35 years old in 2018, that of the Western Balkans and Ukraine was 44 years old.

In terms of productivity, whereas EU plants average an employment intensity of 0.4 jobs per MW, this rises to 1 job for the Western Balkans and 2 jobs per MW for Ukraine: put together an average employment intensity four times that of the EU.

The experience of already completed transitions away from coal in Europe and in the rest of the world shows the importance of designing and implementing a planned process, supported by measures aimed at alleviating socioeconomic consequences while promoting the development of new, future-oriented economic activities and job opportunities.

Strong from the experience in the EU, the Commission teamed up with different international partners to deliver a similar support to coal regions in the EU’s close neighbourhood: in the Western Balkans and Ukraine. This is how the new Initiative for coal regions was launched in December 2020 in order to facilitate the process of just energy transition across coal regions in Ukraine and the Western Balkans, and help them be more ready for the energy transformation in the forthcoming years.

The international partners involved in the Initiative include the World Bank, the Energy Community Secretariat, the European Investment Bank, the European Bank for Reconstruction and Development, and Poland’s National Fund for Environment Protection and Water Management (NFOSiW) and the College of Europe-Natolin.

The Initiative supports coal regions in transition in the Western Balkans and Ukraine through knowledge exchange, peer-to-peer learning visits, technical assistance, access to a global learning academy for coal regions, and financial assistance for transition projects.

Specifically the coal region-to-region exchange programme is an opportunity for regions to start direct, one-to-one dialogues, connect with different stakeholders, learn from each other and transfer knowledge. The possibility to explore peers’ experiences and reflect on their own challenges – including those related to socio-economic aspects of the transition and the developments, will help to accelerate coal regions’ clean energy transition.

In the framework of the Initiative for coal regions in transition in the Western Balkans and Ukraine, the World Bank, together with the Energy Community Secretariat and the support of the Commission, just launched the Western Balkans Coal Regions in Transition Public Perception Survey. The objective of the survey is to understand awareness, perspectives and expectations of citizens living in these coal regions related to the concept of Just Transition, including those related to job opportunities.

Last year another JRC report on clean energy technologies in coal regions - with the focus on opportunities for jobs and growth - found that the deployment of clean energy technologies in more than half of EU coal regions could offset job losses induced by the transition by creating up to 460 000 jobs in total by 2050.

The reports finds a remarkable potential for renewable energy technologies in the EU coal regions. For instance, the maximum technical potential in these regions for wind energy alone (821 GW) could provide almost five-times the 2017 installed capacity of the technology in the EU (~169 GW).

Clean energy investments in coal regions can benefit from the availability of infrastructure, land, skills and industrial heritage already in place. These investments should not only focus on the deployment of additional renewable energy capacity but also create employment opportunities to ensure a fair transition for affected regions and communities.

As members of the Energy Community, the Western Balkans and Ukraine are bound to implement core EU energy legislation. The 21st EU-Ukraine Summit in 2019 updated the energy annex of the Association Agreement, moving Ukraine closer to progressive integration with the EU energy market. The Guidelines for the Implementation of the Green Agenda for the Western Balkans were fully endorsed in the Sofia Declaration at the Western Balkans Summit of 2020, committing the region to working together with the EU towards net zero by 2050.

The Commission is now progressing fast in preparing funding instruments to back the Just Transition Platform and the Initiative for Coal Regions in Transition in the Western Balkans and Ukraine, while keeping the political dialogue going.

The first allocation of funds, foreseen already in 2021, will provide direct support to economies in the region by kick-starting the Economic and Investment Plan, while at the same time continuing to take forward the key principles of our enlargement policy.

Decarbonisation and energy transition are a key objective of the Economic and Investment Plan for the Western Balkans, including the focus on renewable energy, the just transition from coal and the renovation wave. The Plan aims to unleash the untapped economic potential of the region and support governments in their endeavours to integrate the economies of the region more closely.

Related Content

JRC report: Recent trends in coal and peat regions in the Western Balkans and Ukraine

Initiative for Coal Regions in Transition in the Western Balkans and Ukraine

JRC report: Clean energy technologies in coal regions

The Western Balkans Coal Regions in Transition Public Perception Survey.