Greece’s unjust transition

06/08/2022

Greece’s unjust transition

In one of Europe’s most beleaguered regions, Greece’s ‘Just Transition’ away from coal is providing neither the clean energy nor the jobs it promised

On a weekday morning in March, a handful of downcast men hanging around a café offer the only sign of life in the village of Akrini. Nestled in the foothills of a mountainous mining region in Northern Greece, once-thriving Akrini is fast becoming a ghost town.

Over the last decade, fifteen shops have closed. So many families have left that the local authority is considering closing the local school. The men who slowly sip coffee on weekday mornings are unemployed, eking out a living from informal loans, casual work and pensions shared by elderly relatives.

Akrini is in decline because of lignite, the brown coal that for decades powered Greece’s economy. In 2019, after years of criticism for continuing to burn the notoriously polluting fossil fuel, Greece, under the new government of Kyriakos Mitsotakis, announced a complete phase-out by 2028.

For residents of Akrini and the surrounding region of Western Macedonia, where mining formed part of the economy as early as Roman times, the news was a shock. Mitsotakis had visited the area on the campaign trail, promising cheering crowds that lignite would not be outlawed overnight.

Instead, the government is now offering a ‘Just Transition’, a programme to revive the regional economy through investment in ground-breaking clean energy technology. Three years on, a report by Greek investigative journalists from The Manifold, supported by SourceMaterial, has found little evidence that the plan is working.

The country’s largest lignite plant, Ptolemaida V, is set to be converted to another fossil fuel: natural gas. Ambitious plans to produce ‘green’ hydrogen from solar energy have stalled before a single job was created.

Despite a struggle to replace dirty energy with clean, the government recently brought forward the phase-out date by three years to 2025, with natural gas now set to pick up the slack. For 35-year-old Apostolos, one of the men killing time at the café, that means, at best, he might receive the occasional short-term contract from local power companies in terminal decline. He too is thinking about getting out of Akrini before it is too late.

“You don’t wait for something to end before you look ahead,” he says.

Job losses

With a population of nearly 300,000, Western Macedonia now has the highest unemployment rate in the mainland of the European Union—only the French territory of Mayotte near Madagascar, and the Spanish outpost of Ceuta in North Africa, have higher—and unlike other parts of Greece which are now bouncing back from the financial crisis of a decade ago, GDP here is falling.

Local experts believe that the situation is about to get much worse.

“We are heading towards a collapse,” says Evangelos Karlopoulos, who led a research group that since 2019 has warned of the region’s over-dependence on lignite.

Karlopoulos’s work predicts that the shift away from lignite in Western Macedonia will lead to the loss of more than 20.000 jobs. The economy would need to grow an improbable 23 per cent just to retain employment at the current level.

Meanwhile, analysts consulted by The Manifold say that they are worried the government may be seriously under-estimating the threat: the state transition plan puts potential job losses at just half of Karlopoulos’s estimate.

According to the most conservative independent projections which have been seen by The Manifold, every job in the region’s lignite industry sustains another 3.5 jobs elsewhere in the economy. The government put that figure at just 1.8, meaning the domino effect sparked by the end of lignite could be far worse than authorities are prepared for.

Perhaps the most glaring failure is White Dragon, a flagship renewable hydrogen project that formed a cornerstone of the national Just Transition plan and won the backing of West Macedonian authorities.

By producing clean-burning hydrogen using solar power, White Dragon was intended to be far more than just an energy project. Electricity and heat from the scheme would heat greenhouses and cool giant data centres across Western Macedonia, both rebooting traditional sectors and turning the region into a hub for hi-tech giants, as hydrogen exports brought in bumper revenues.

Insufficient funding

But the future of White Dragon was thrown into doubt in June when the European Union rejected its bid for recognition as a ‘project of common interest’ after it failed to secure sufficient funding.

While two solar power parks have opened in Western Macedonia, it remains unclear what concrete plans are in place to achieve the twin goals of the Just Transition: cleaner energy and jobs.

In Germany, during a lignite phase-out, new jobs were created when old ones vanished. Greece, however, has failed to offer former miners any alternative work, says Karlopoulos.

“I’ve attended meetings, online seminars and committees but since 2019 I have not seen a single job opening in Western Macedonia,” he said.

Much of the government 1.6 billion euro fund for the Just Transition is earmarked for remote Greek islands which are currently dependent on burning oil for their electricity. But unlike in Western Macedonia, the change is not likely to have a significant impact on their economy – if anything, it will help them save money.

Meanwhile, Western Macedonian officials say they remain in the dark about how much help they will get. So far, financial tools such as the ‘Recovery and Resilience Fund,’ which the government says will further the Just Transition, have not addressed unemployment and are targeted only at ensuring minimum resale values of land from abandoned lignite mines. The development ministry’s ‘Territorial Plan for Western Macedonia’ provides for just 2,000 new jobs, a fraction of the amount needed. Moschos Moschous, president of the Spartacus trade union, which represents many lignite workers, foresees a bleak future—an entire region abandoned and forgotten as the lignite industry dies.

Alongside the mines themselves, he says that their fifty canteens are now doomed to close, as well as the countless small contractors who are forced to sell at the trucks they bought with their life savings at huge losses.

In his own village of Voskohori Kozani, some 10kms southwest of Akrini, there was always a buzz as workers gathered each Saturday to gossip and unwind. “Now you can barely muster a quartet for a game of cards,” he says.

Picture: Amyntaio lignite mine in Northern Greece, Creative Commons