The government plans to allocate only UAH 800 million in government support to energy efficiency projects.

It is expected that half of these funds will be remitted to the soon-to-be-created Energy Efficiency Fund, and the other half will be used to finance the government’s “warm loans” program. However, this amount is critically insufficient, as experts of DiXi Group Analytical Center, OPORA Public Network and Ecodia Center for Environmental Initiatives experts said at the briefing “Financing energy efficiency. Should we expect the improvement?”

The experts stressed that financing of the “warm loans” program already became an acute problem due to significant interruptions in reimbursement payments. Over the past year, public demand for government support of thermal insulation of buildings and other energy efficiency measures has sharply increased. It caused the lack of funds allocated from the budget for reimbursement of a portion of energy efficiency loans by the government. As a result, on several occasions did banks suspend payments to individuals, waiting for months for the program to resume. The lack of financing was especially felt by AABCs, which are capable of implementing building modernization projects and show the saving of 25 to 60 percent of heat even today. Unfortunately, beginning from August they were left without the government support at all, and the next year, only UAH 23 million was allocated for AABCs.

“The budgeting for the next year proves that this program is obviously outside the government’s priorities”, OPORA Public Network’s Housing, Utilities and Energy Program Coordinator Tetiana Boiko believes.

As for financing of the Energy Efficiency Fund, the government additionally counts on EUR 50 million (UAH 1.7 billion) which the European Commission promised to provide in 2018.

“This support is extremely important, but at the same time, it cannot be the sole and the biggest source of the Fund’s revenues”, Ecodia expert Anna Akkerman believes.

In addition, experts say, the Energy Efficiency Fund, on which great hopes are placed regarding systematic and large-scale government financing of energy efficiency improvement measures, still doesn’t have draft base documents.

The charter and the regulation on the supervisory board still haven’t been drafted. This work obviously needs to be expedited and made more public”, the DiXi Group analyst Denys Nazarenko said.

The situation with subsides is equally dire: even though the allocations are bigger, they are still insufficient in the conditions of unreformed system of providing support. Including two increases, the government has allocated over UAH 71 billion this year, but the results of budgeting process obviously indicate a high probability of this situation repeating again the next year.

The inability of NCREUS to make decisions because of the absence of quorum may pose a separate threat to reforms in the energy efficiency sphere. In particular, the Commission is responsible for passage of a number of bylaws, including in the energy sector.

It is worth noting that according to expert estimates, UAH 140 billion must be invested very year to modernize Ukraine’s high-rise housing stock (19 million apartments) alone in 20 years.