A significant portion of the funds earmarked for EU climate objectives and the green transition may have been misused, according to a new report by the

European Court of Auditors. The report also reveals that some projects labeled as "green" were not as environmentally friendly as initially claimed.

The European Court of Auditors found that billions from the EU's Recovery and Resilience Facility (RRF), established in 2020 to support economic recovery after the pandemic, may have been misallocated. This fund was intended to prioritize climate action and the green transition, with at least 37% of the budget dedicated to these areas.

The European Commission had reported success, stating that 42.5% of the funds, or approximately 275 billion euros, had been allocated to climate-related initiatives. However, the auditors now dispute this, estimating that 34.5 billion euros less was spent on green projects than reported.

The Court of Auditors highlighted that several projects had minimal connection to the green transition. One such project involved digitizing water supply systems through an IT initiative, which was categorized as a climate action project despite its limited environmental impact.

Moreover, some projects were less environmentally friendly than presented. For example, funding was granted to a hydropower plant with pump storage that led to water pollution, despite the lack of a thorough environmental assessment.

The auditors concluded that the EU's system for assessing projects' climate contributions was too vague, resulting in inflated claims and misallocated funds.

In response, the European Commission defended its position, reiterating that over 42% of the budget had been allocated to green projects and asserting that its methodology was sufficiently precise. Photo by Spielvogel, Wikimedia commons.