17:40 13.10.2021

Government has very strong desire to work on climate agenda – EU Delegation to Ukraine

6 min read
Government has very strong desire to work on climate agenda – EU Delegation to Ukraine

Interview of Chloé Allio, Head of Section Operations – Economic Cooperation, Energy, Infrastructure and Environment, EU Delegation to Ukraine, for Green Deal Portal

Author: Sergey Shestak

 

- The EU Delegation has recently visited Ternopil to open the EU Sustainable Energy Week, focused on the thermal modernization of buildings. Why has the EU determined energy efficiency as a flagship initiative, as you call it, which would contribute to facilitation of the green transition in Ukraine? There are also a lot of other spheres where CO2 emissions are more significant.

- Europe will not be able to become a climate-neutral continent by 2050 without Ukraine. We are in the same boat, on one planet, and therefore it is very important to us to support Ukraine in its aspirations to reduce CO2 emissions. We decided to invest over EUR 100 million in the Energy Efficiency Fund in Ukraine, as we can see a number of key benefits in this area.

First, it can contribute to increase Ukraine’s energy independency. A decrease in gas consumption, primarily in the residential sector, will reduce the need to purchase foreign gas.

Second, Ukrainian citizens will be able to save considerably on utility bills and increase their expenses on other needs to improve quality of life.

Third, of course our goal is to reduce CO2 emissions in Ukraine, including in the process of heating the buildings.

Furthermore, heating in the residential sector accounts for 60% of all energy losses, which is equivalent to UAH 80 billion per year.

- In what other areas could you provide financial assistance to Ukraine to speed up the country’s transformation as a part of the decarbonization process?

- We support Ukraine in all aspects of the green transformation. The EU has already invested over EUR 300 million in projects in green transition areas such as energy efficiency, energy, agriculture, forestry, transport, environmental protection and climate change.

This includes EU support provided through blending mechanisms with international financing institutions which already allowed to finance around EUR 700 million investment in Ukraine. In addition, through the European Fund of Sustainable Development (EFSD and future EFSD+), we have signed guarantee agreements with international financing institutions as de-risking mechanisms, where the EU budget is guaranteeing a portfolio of investment including in Ukraine.

Through our projects, we provide expert assessment and technical assistance to support the reforms in Ukraine and transpose EU laws and regulations into the Ukrainian legislation, as provided by the Association Agreement between Ukraine and the EU. We also see that the Ukrainian government is developing the Ukraine Green Deal concept at the inter-ministerial level. We closely interact with Deputy Prime Minister Olha Stefanishyna and her team of deputy ministers within the framework of the focused dialogue on European Green Deal/Ukraine green transition.

- Is the dialogue with the government progressing well?

- We are engaged in a very comprehensive dialogue that has intensified since its launch in February. During the first meeting in May we covered a rather wide range of issues – from energy efficiency, climate governance, coal transition, industrial alliances, forestry, to hydrogen. For the second meeting in September, we decided to continue these discussions but also to have more in-depth discussions on some topics, in particular environmental reforms and the legislation that needs to be adopted in the areas of waste management, industrial emissions, air pollution, biodiversity and also in the area of environmental control. On the latter, it is very important that environmental inspectors have access to companies and can verify that these companies meet environmental standards.

During this second meeting, it was agreed to create a platform on green transition financing, where we will be able to discuss policy and finance, and coordinate the involvement of different donors and international financial institutions in the financing of Ukraine’s green transformation. It is important to reflect how to best mobilize private investment and government financing, together with donors’ support.

Overall, our focused dialogue is progressing well and we are going further into details.

- As we know, the EU encourages Ukraine to develop milestones to reach climate neutrality by 2050, which is 10 years ahead of the earlier announced term. It has been also pointed out in the joint statement following EU-Ukraine Summit… Could you explain this?

- We welcome the efforts of the government in setting more ambitious goals to achieve climate neutrality by 2060. 2050 is the decarbonisation target set by the EU to be consistent with the objectives of the Paris Agreement. The message that we wanted to convey is that while starting to implement the measures aimed at decarbonisation, you can discover an even greater potential for emission reduction, which can accelerate achievement of decarbonisation goals.

- In your opinion, what is the biggest flaw of the Ukrainian government in addressing the climate issues?

- We are building a frank and constructive dialogue with the Ukrainian government and we see that the Cabinet of Ministers has a very strong desire to work on the climate agenda. The ‘Ukraine Green Deal’ concept being developing based on Ukraine’s updated Nationally Determined Contribution, is new, but we see a strong potential for shaping sectoral decarbonisation goals and for closer interaction with the industry.

The government needs to develop implementation plans on how to achieve these goals. At the same time, many reforms are still needed in various areas of the green transition, starting with environmental legislation. As is the case with many laws in Ukraine, effective implementation is also key.

However, we can see that the government is set on reforms and we are ready to offer technical support on our part, involving also EU experts. I believe that exchange of experience and expertise is a very important aspect of our future success.

- But it is less important than the financial one…

- Green transition is a difficult path and we try to share the best European practices and help Ukraine. The issue of green transition financing will be discussed within the new platform that will be launched under the umbrella of our dialogue to facilitate both policy and financing coordination. Ukraine’s green transition will not be financed only from public funds (national or international), it will also come from private investment. Investment in modernization of productive capacities is needed in Ukraine and will be part of the green transformation. The green economy also offers business opportunities for Ukrainian companies to integrate into European and international value chains as the demand for green products is increasing. We see that many companies in Ukraine are willing to take this path.

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