Andreas Helbl – General Director of iC consulenten Ukraine, member of EUEA, provided an interview to UATV about EE in Ukraine
Video interview: video link
EE in residential sector – financial instruments
Energy efficiency trend is moving apace in Ukraine. That is vividly illustrated by the number of instruments for energy efficiency support implemented recently in Ukraine. The most high profile are ‘warm loans’ and Energy Efficiency Fund.
Since October 3, 2014 State Agency on Energy Efficiency introduced the ‘warm loans’ program, developed for condominiums and population. The program provides compensation of costs for energy efficiency measures from the state budget in the following sizes:
• 20% of the loan amount (but not more than 12 thousand UAH) for purchasing non-gas / non-electric boilers for individuals;
• 35% of the loan amount (but not more than 14 thousand UAH) for the purchase of energy-efficient equipment / materials for individuals – owners of private houses;
• 40% of the loan amount (but not more than 14 thousand UAH per one apartment) for condominiums / housing stock, as legal entities, for general construction activities.
4 state banks are authorized to issue “warm” loans within the program, namely: PrivatBank, Oschadbank, Ukrgasbank and Ukreximbank.
In addition, the local programs which provide additional compensation (from local budgets) for “warm” loans continue to operate. For example: the city of Mykolaiv is included in the TOP-3 city-regional centers in terms of co-financing of “warm” loans, having allocated the total amount of UAH 8 million in 2018 for these purposes, the Kyiv Region allocated UAH 5 million, Dnipro allocated 1.25 million UAH. You can find detailed information about local ‘warm loans’ programs at the Interactive Map: http://saee.gov.ua/uk/programs/map.
In 2018, condominiums show a growing interest in energy-efficient measures compared to previous years. In June this year more than 300 condominiums used “warm loans” in the amount of UAH 90 million, which is almost 5 times higher than last June. In total, since the beginning of the program in October 2014, its participants were paid 2.1 billion UAH compensations for “warm loans”.
The monitoring of the results of the program demonstrates how much the condominiums’ demand for “warm loans” has increased as well as their confidence in the effectiveness of the mechanism of co-financing of the energy saving measures.
Energy Efficiency Fund
The Energy Efficiency Fund was established in January 2018. The Fund’s governing bodies are: Supervisory Board and Management Board. The Energy Efficiency Fund of Ukraine is a new tool for implementing state-owned energy modernization projects, both at the level of households and at the level of legal entities. The work of the Fund is regulated by the legislation of Ukraine, and its budget is formed at the expense of the State budget and funds from international partners. 1.6 billion UAH were allocated to the Fund in this year’s Ukrainian state budget. On April 21, 2018 in Washington, the European Union, the International Finance Corporation, a member of the World Bank Group and the German Government signed an agreement to create a multi-donor fund for co-financing the Ukrainian Energy Efficiency Fund as well as the agreement on the allocation of € 50 million was signed.
The Fund will provide funds for the implementation of thermo-modernization projects, the introduction of effective monitoring and control systems, the establishment of effective heating, cooling systems and equipment, the replacement of existing systems and equipment by more efficient ones. The form of the provision of funds will be a partial reimbursement of the cost of energy efficiency measures for individuals and legal entities.
EE in public sector
The essence of the concept of the energy service is that energy-efficient measures in the buildings of budget institutions (schools, kindergartens, hospitals, universities, etc.) are implemented by private investors – energy service companies (ESCOs), and payment is made exclusively at the expense of economy (reduction of consumption costs for communal services and energy carriers) achieved as a result of the implementation of energy-efficient measures.
In Ukraine, for 9 months of 2018, 177 ESCO-contracts were signed for a total of about 180 million UAH through the ProZorro electronic procurement system. During this time, 515 ESCO-tenders were announced in 35 cities of Ukraine. The State Department of Energy Efficiency emphasizes that the data indicated that the need for ESCO-companies to insulate budget institutions is growing rapidly and the market is developing. So from now this is the task of local authorities to present potential ESCO objects in the budget sphere to investors.