climate related finance: challenges and examples in ukraine

Climate related finance: challenges and examples in Ukraine

MINISTRY OF ECOLOGY AND NATURAL RESOURCES OF

UKRAINE

July 11, 2016

ParisOECD

MINISTRY OF ECOLOGY AND NATURAL RESOURCES OF UKRAINE

Ukraine in International Climate Framework Ukraine is Annex 1 Party to UNFCCC

Ukraine is Annex B Party to Kyoto Protocol with special status of Economies in Transition

Ukraine has submitted INDC to Paris Agreement and in the process of ratification of Paris Agreement

Ukraine is a Contracting Party of Energy Community

Ukraine is a Signatory and Contracting Party of Energy Charter Treaty

Ukraine has singed Association Agreement between the European Union and the European Atomic Energy Community and their member states, of the one part, and Ukraine, of the other part


Ukrainian National Climate Policy Framework Law of Ukraine "State Environmental Policy Strategy of Ukraine till 2020" (adopted on 21 December 2010): optimization of the energy sector of the national economy by

increasing the use of energy sources with low carbon dioxide emissions by 2015 for 10% and by 2020 for 20%;

development of the basic policy framework for adaptation to climate change by 2015, development and phased implementation of a national action plan to mitigate climate change for the period to 2030;

raising of energy efficiency by 25% up to 2015 and by 50% up to 2020 relative to the base year by implementing energy and resource conservation in energy-consuming sectors;

increasing the use of renewable and alternative energy sources


Ukrainian National Climate Policy Framework (continued)

Green tariffs for electricity generated at the power plants with alternative energy (Law of Ukraine of 20 November 2012 “On Amending the Law of Ukraine "On Electricity“)

CO2 tax for stationary fuel combustion:o 0.22 UAH / tCO2 (approx. 0.022 Euro) starting 2011o 0.26 UAH / tCO2 (approx. 0.009 Euro) starting 2014

Renewable Energy National Action Plan committed to reach 11% of the energy consumption through renewable energy sources by 2020

Energy Efficiency National Action Plan with 9% target by 2020 ESCO legislation in municipal sector


Ukrainian National Climate Policy under development

State Climate Policy Concept by 2030 (developed by MinEcology) under approval process by GOU:

Goal 1. Institutional development and enhanced capacity in climate change policy with transformation to low emission development

Goal 2. Mitigation

Goal 3. Adaptation and resilience

Energy Strategy by 2030 under development by MinEnergy


Institutional Framework

Ministry of Ecology and Natural Resources of Ukraine is in charge of all climate policy development and implementation

State Agency for Energy Efficiency is in charge of energy efficiency and renewable energy policy development and implementation in municipal sector

Ministry of Energy and Coal Industry is in charge of power generation policy development and implementation and coal industry regulation

National Commission on Regulation in Energy and Communal Services Tariffs is in national independent regulator in all tariffs, including green tariffs

Inter-ministerial Commission on UNFCCC Implementation, chaired by Minister of Ecology and Natural Resources, is collegial body to consider and recommend for approval all climate related policies, reports and other regulations.


Ukrainian INDC Implementation

Draft State Climate Policy Concept development and under approval now by GoU with the view to implement provisions of Paris Agreement and Ukrainian INDCLow Emission Development Action Plan development process launched LEDS Technical Working Groups established with the aim to develop Low Emission Policy Catalog State Environmental Policy Strategy legislation in under revision Ukrainian ETS is under development according to EU-Ukraine Association Agreement Energy Strategy till 2030 is under development


Climate Related Finance in Ukraine

All climate related, multilateral and bilateral, finance in Ukraine consists of the following elements:• Technical Assistance or so called, capacity building and institutional

development finance • Project Investment finance – national, international, multinational • Project Crediting finance – national, international, IFIs • Grants – projects, R&D, institutional development.

Climate related financial mechanisms:- Green Investment Scheme - State Energy Efficiency Program for housing


International Climate Related Framework in Ukraine

International Financial Institutions in Ukraine (IFIs):- IBRD, IFC- EBRD, EIB- E5P International Donors in Ukraine:- USAID- GIZ- SIDA- CIDA- EU Delegation in Ukraine- Swiss Cooperation Office


International Climate Related Framework in UkraineInternational Funds working with climate-related projects

- NEFCO - Horizon Fund- CTF

National Funds with climate related projects- State Ecological Fund - Energy Efficiency Fund - under development

International and UN organizations- UNDP- UNIDO- GEF- OECD- GCF – eligibility issue


Climate Finance: opportunity and threats

Definition of climate finance, climate related finance and climate development finance should be developed and unified on international level

Coordination of all climate finance in Ukraine by managing ministry – MinEcology

Compliance of all climate finance with national sustainable development priorities

Monitoring of all climate finance and its contribution to GHG emission reduction

Adaptation finance should be combined with mitigation finance Role of PPP in climate finance should be enhanced with the view to

foster private entities role and build local capacity Technology development and R&D role within climate finance should be

enhanced Technology Needs Assessment mechanism access and recognition by

IFIs should be established CTCN access should be gained


Climate Finance: lessons learned

Kyoto Protocol Flexible Mechanisms lessons: JI - enhanced role of Monitoring Reporting and Verification Green Investment Scheme – legislation and regulation simplification

and enhanced transparency IFIs crediting mechanisms: Simplified legislation and softer regulation role Monitoring and Reporting enhanced role

Adaptation: Enhanced role of civil society Absent legislation and national adaptation goals

Thank y0u for attention!

Denys BashlykSenior expert

Climate Policy and Reporting Division


www.menr.gov.ua

http://www.menr.gov.ua/