EU allocates EUR 30 mln grant for heating projects in Ukrainian communities
The European Commission has allocated a EUR 30 million grant under the Ukraine Facility program to finance projects to restore and modernize heating systems in Ukrainian communities, Oschadbank announced on Thursday.
The grant will complement the EUR 200 million in financing that the European Investment Bank (EIB) has provided in 2025 through three state-owned banks for projects in municipal heating, energy efficiency, and renewable energy: EUR 50 million each to Ukrgasbank and Oschadbank, and EUR 100 million to Ukreximbank.
Ukrgasbank and Oschadbank have already joined the EU grant financing agreements, and Ukreximbank is expected to join soon.
The funds can be used, in particular, for the restoration and modernization of heating networks; it will support the development of decentralized generation; the construction of small combined heat and power plants; the installation of solar panels with energy storage systems; heat pumps and thermal batteries; and improving the energy efficiency of public buildings.
"This grant will help municipalities ensure a reliable heat supply to households and essential services and enhance their resilience despite ongoing challenges," noted EIB Vice President Karl Nehammer.
Municipalities, communities, local businesses, and government bodies across Ukraine will be able to apply for financing through Ukrgasbank, Oschadbank, and Ukreximbank.
Oschadbank CEO Yuriy Katsion stated that the grant component for heat supply projects can cover up to 50% of eligible costs. According to him, as of August 1, 2026, Oschadbank’s share of the municipal lending market exceeded 64%.
The EIB has been operating in Ukraine since 2007. Following Russia’s full-scale invasion in 2022, the bank stepped up its financial support to help strengthen the country’s resilience and rebuild its infrastructure. Since then, the EIB has provided EUR 4.5 billion in financing to Ukraine.