Ukraine, Norway and Finland could pioneer green financing scheme

The State Agency of Ukraine on Energy Efficiency and Energy Saving together with the Nordic Environmental Finance Corporation (NEFCO) and experts from the Finland Ukraine Trust Fund is initiating the development of a concept for a new financial instrument in Ukraine, head of the agency Sergey Savchuk has said.

According to Savchuk, the fund will provide co-financing for new "green" energy projects and remove major barriers to the implementation of these projects, including a lack of collateral, demand for equity.

"Work on the fund will be another priority area of partnership between the Finnish Foreign Ministry, NEFCO and the state energy efficiency agency. Close cooperation between Ukraine and Finland was secured by the signing of a relevant memorandum in 2017," Savchuk said on his Facebook page.

"Our goal is to establish in Ukraine a reliable financial instrument for financing projects like Green Investment Group in the UK, DEG in Germany.”

The move follows Savchuk’s announcement at a press conference earlier this month that the population, budget and local heating companies can reduce gas consumption by five billion cubic meters (bcm) until 2022.

During the conference, he explained that gas consumption in 2018 by population, budget organizations, local heating companies decreased by 6 billion cubic meters compared to 2014. In particular, about 650,000 families already carried out measures for the thermal modernization of buildings.

"Our goal is to reduce consumption by another five billion cubic meters of gas per year until 2022 for all consumer categories,” Savchuk stated.

"Every year Ukraine saves about 1.2 billion euros without spending on gas imports.”