Funding for Czech coal regions is not transparent, organizations say

The Czech funding programme for coal regions is not transparent, and there is a risk that the money will not be used effectively, say the Centre for Transport and Energy and Transparency International. They say the state is making hasty decisions about which projects to support in order to spend all the available money, without properly assessing their real benefits. The organizations say this is also increasing the programme’s corruption risks. The Czech Ministry of the Environment (MŽP) has yet to respond to CTK’s request for comment.

The Just Transition funding programme, which allocates money from European funds to support the development of so-called coal regions, was launched last autumn. The money is going to the Moravian-Silesian, Karlovy Vary and Ústí nad Labem regions, which are grappling with the transformation of regional economies long tied to coal mining. Around CZK 41 billion has been allocated to Czechia under the programme. The Ministry of the Environment has so far announced calls for proposals worth CZK 30.2 billion, while the regions have applied for more than CZK 20 billion to date.

However, the organizations say the selection of projects to receive support has so far been non-transparent and rushed. They say the ministry has not yet made sufficiently clear which projects are eligible for funding. The first funding call is due to close as soon as this December. The organizations also say the regions’ potential for transformation is unclear, as much important information about them is not publicly available.

„The main problem with preparing the fund is that its planning was rushed and carried out without consulting civil society. This is increasing not only corruption risks, but also the danger that the funds will not be used effectively or in line with strategic objectives,“ said Transparency International director Ondřej Kopečný.

He criticizes the state for lacking a long-term strategy for dealing with the end of coal use.

According to Zuzana Vondrová of the Centre for Transport and Energy, the programme’s main focus is right, but its implementation in Czechia fails to address a number of key issues. „If the transition is to be fair, we need to tackle the causes of social instability while providing the strongest possible financial and legislative support for shared and renewable energy, including decarbonized heating,“ she said. In her view, major mistakes were made at the very start of the programme’s preparation, when it was still being overseen by the Ministry for Regional Development.

The organizations also noted that the programme was originally intended to support small and medium-sized enterprises primarily, but Czechia is allocating up to half of the earmarked money to large strategic companies. They say this is not necessarily a bad thing, but projects and their selection must be transparent and effective. Transparency International says concerns that large companies would receive the money and then use it to pay for their remediation programmes have not materialized so far. Most of the selected projects have been run by public institutions rather than private entities.