Rationale and design of the programme
The Social Climate Fund is a funding programme designed to contribute to a socially fair transition in the Union’s effort to reach climate neutrality by 2050. It aims to address the social and economic impact of the climate transition on vulnerable groups. Notably, it aims to tackle energy and transport poverty and counterbalance the rising costs of fossil fuels resulting from extending the scheme for greenhouse gas emission trading to additional sectors in the European Union.
A political agreement was reached between the Council and the European Parliament mid-December 2022. The adopted text was published in the Official Journal of the EU on 16 May 2023 and entered into force on 5 June 2023. The Regulation establishing the Social Climate Fund makes available funding to Member States for the period from January 2026 to December 2032 to tackle the social and distributional challenges and help finance investments in energy efficiency, new heating and cooling systems, and cleaner mobility. Overall, the aim is to address challenges linked to energy poverty for vulnerable households and micro-enterprises and support vulnerable transport users. In order to benefit from the available funding, Member States should submit their final Social Climate Plans to the Commission indicatively by 30 June 2025.
The climate transition necessitates an urgent and coordinated response both at the EU level and the national level. In order to address the social and economic impact of climate action at EU level and to cushion the increasing costs of fossil fuels on vulnerable groups. The Social Climate Fund provides support to Member States.
The European Union is implementing its commitment towards climate neutrality and taking coordinated action to accelerate the reduction of greenhouse gas emissions, while underlying the importance of considerations of fairness and solidarity and leaving no one behind. The Social Climate Fund is a bridging solution at European level to help Member States address the social and economic impact of introducing the emissions trading system for buildings and road transport on vulnerable groups in the medium-term. It will provide funding to Member States for a period from 2026 to 2032 and support a socially fair green transition.
As part of the European Green Deal, the Social Climate Fund will tackle the adverse impact of the climate transition on vulnerable groups. It will provide a coordinated response at European level to help vulnerable households, micro-enterprises and transport users counter the additional cost resulting from the extension of the EU Emissions Trading System on additional sectors. The Social Climate Fund will provide funding to Member States for structural support measures and investments directed towards vulnerable groups affected by the inclusion of greenhouse gas emissions from buildings and road transport. Ultimately, the Fund aims to enhance a socially fair transition towards climate neutrality.
The general objective of the Social Climate Fund is to contribute to a socially fair transition towards climate neutrality by addressing the social impacts of the inclusion of greenhouse gas emissions from buildings and road transport. To this end, the Fund aims at mitigating the adverse impact of the climate transition on vulnerable groups.
The specific objective of the Fund is to support vulnerable households, vulnerable micro-enterprises and vulnerable transport users, through temporary direct income support and through measures and investments intended to increase the energy efficiency of buildings, decarbonisation of heating and cooling of buildings, including through the integration in buildings of renewable energy generation and storage, and to grant improved access to zero- and low-emission mobility and transport. It will provide Member States with financial support with a view to achieving milestones and targets set out in Social Climate Plans.
Each Member State is expected to submit a Social Climate Plan detailing structural measures and investments it plans to implement between 2026 and 2032. Each disbursement is subject to the Member State’s satisfactory fulfilment of a set of milestones and targets, identified in relation to implementation of the Plan.
The Social Climate Fund provides non-repayable financial support (grants) to Member States to support the public investments and structural measures set out in the national Social Climate Plans.
The Social Climate Fund allows the Commission to disburse funds to support Member States in implementing structural measures and investments, which contribute to a socially fair transition towards climate neutrality by addressing the social impact of the inclusion of greenhouse gas emissions from buildings and road transport. The plan should help Member States reach the EU’s 2030 climate and energy targets and, ultimately, achieve climate neutrality by 2050. Moreover, the plan should be in line with the reforms and commitments included in Member States’ updated integrated national energy and climate plans, and also with the directive on energy efficiency, the European Pillar of Social Rights action plan, the cohesion policy programmes, the territorial just transition plans, the recovery and resilience plans, the Modernisation Fund and the Member States’ long-term building renovation strategies.
The structural set-up consists in the provision of non-repayable financial support (grants) to Member States. This will be generated on an exceptional and temporary basis through the auctioning of allowances under the emissions trading system. Notably, the fund will make available a maximum amount of EUR 65 billion for its implementation for the 2026-2032 period, and together with the mandatory co-financing from Member States it will mobilise at least EUR 86.7 billion.
The Social Climate Fund is implemented by the Commission in direct management in accordance with the financial regulation. The Recovery and Resilience Task Force (part of the Secretariat-General) and DG Climate Action work in close cooperation to steer the design and implementation of the Social Climate Fund.
The Social Climate Fund is a new Fund. There are no precursors for it in the 2014-2020 multiannual financial framework.
Programme website:
Relevant regulation:
- Regulation (EU) 2023/955 of the European Parliament and of the Council of 10 May 2023 establishing a Social Climate Fund and amending Regulation (EU) 2021/1060
Budget implementation and performance
Budget programming (million EUR):
No available data yet since the implementation of the Social Climate Fund will only start as of 2026.
Budget performance – implementation
Cumulative implementation rate at the end of 2023 (million EUR):
No information is available yet since the implementation of the Social Climate Fund will only start as of 2026.
Voted budget implementation (million EUR):
No available information yet since the implementation of the Social Climate Fund will only start as of 2026.
Contribution to horizontal priorities
Green budgeting
Contribution to green budgeting priorities (million EUR):
No available data yet since the implementation of the Social Climate Fund will only start as of 2026.
Gender
Contribution to gender equality (million EUR) (*):
| Gender disaggregated information: |
|---|
| N/A. |
No available data yet since the implementation of the Social Climate Fund will only start as of 2026
Digital
Contribution to digital transition (million EUR):
No available data yet since the implementation of the Social Climate Fund will only start as of 2026
Budget performance – outcomes
[notranslate]SCFWeb:budg_09:table[/notranslate]
No available data yet since the implementation of the Social Climate Fund will only start as of 2026.
Link to file with complete set of EU core performance indicators