Only a quarter of the required $40 billion is available to implement the National Energy and Climate Plan

To achieve the goals set out in the National Energy and Climate Plan (NECP) for the period up to 2030, about $40 billion is needed. This amount was announced by the DIXI Group analytical center with reference to the words of Deputy Minister of Economy of Ukraine Andriy Teliupa.

The official emphasized that Ukraine submitted the first integrated report on the implementation of the NECP to the Energy Community Secretariat on time – on March 15, on a par with the EU countries, in compliance with all European regulations and legislation. The National Energy Plan is one of the conditions for the negotiation process and Ukraine’s accession to the EU.

The Ministry of Economy estimates that $40 billion will be needed for implementation in six main areas. The leading sources of funding are:

• Ukraine Facility program (about €9.3 billion in grants and loans under Pillar II);
• bilateral agreements;
• programs of international financial organizations;
• government initiatives.

Teliupa did not provide any information on possible agreements, programs or initiatives, as well as the estimated amounts that could be raised through them. Therefore, the question of more than 75% of the required funding is “up in the air”.

As a reminder, the NECP contains a number of decarbonization goals, namely

• reduction of greenhouse gas emissions by 65% compared to 1990 levels (which coincides with the ambitious goal stated in the Updated Nationally Determined Contribution of Ukraine to the Paris Agreement NDC2);
• achieving climate neutrality of the energy sector by 2050 and the entire economy by 2060;
• decommissioning of coal-fired generation by 2035;
• Reducing methane emissions by 30% by 2030 from 2020 levels;
• strengthening the adaptive capacity and resilience of social, economic and environmental systems to climate change;
• achievement of a 27% share of renewable energy sources in the structure of total final energy consumption in 2030 (in 2020, this figure was 9%);
• achieving a 35% share of RES in gross final energy consumption by 2030 in the heating and cooling sector, 25.4% in the energy mix, and 14% in transportation;
• achieving a 25% share of RES in total electricity production by 2030;
• reaching a share of alternative energy sources (RES and secondary energy resources) in heat production of 30% in 2025 and 40% in 2035;
• increasing the use of alternative fuels (biofuels or their mixtures with traditional fuels) and electricity (generated from both traditional and renewable sources) in the transport sector to 50% by 2030.