Sweden will scale up support for the development of district heating in Ukraine

Managing Director Magnus Rystedt, NEFCO and Ambassador of Sweden Martin Hagström signing the agreement of the new programme. Photo: NEFCO

A new Swedish funding programme for the development of long-term sustainable district heating systems in Ukraine was announced today at the Nordic Green to Scale seminar in Kyiv. The aim of the new Sweden-Ukraine District Heating Fund is to demonstrate how Ukraine could benefit from modern and energy-efficient district heating with a significant share of production based on renewable and waste heat sources, ultimately meeting EU requirements. Sweden is providing support in the total amount of EUR 10 million, of which EUR 6 million is directly invested into the Fund and EUR 4 million will be allocated to technical assistance during the implementation of the program, to help municipalities prepare the projects in the best possible way.

Currently, a major part of the district heating systems in Ukraine is outdated, energy-consuming and inefficient. By the end of 2017, about 46 percent of the households needed state subsidies to cope with the rising heating costs. The announced support programme is based on experience and lessons learnt from the implementation of the DemoUkrainaDH project, launched in 2012 with an aim to support municipalities in Ukraine through co-financing of environmentally sustainable and energy efficient demonstration projects in the Ukrainian district heating sector. Six demonstration projects, successfully implemented in Vinnytsia, Zhytomyr, Oleksandria, Kamyanets-Podilsky, Poltava, and Ivano-Frankivsk showed tangible results – up to 30% in gas savings, 20-50% electricity savings and a significant reduction of CO2 emissions (around 45%). New support facility foresees 4-5 more cities to be included in the program.

“I am very glad to announce the continuation of Swedish support to district heating in Ukraine. This is an area where we have a lot to share, having gone through decades of modernization of our district heating systems. I have also visited several of the ongoing projects, and I am very impressed with the results that NEFCO and our Ukrainian partners have achieved, so far”, said Martin Hagström, Ambassador of Sweden to Ukraine.

The focus of the new funding programme is on the creation of district heating systems large enough to enable effective use of renewable and waste heat sources with low environmental and climate impact, as well as improved district heating services enabling the customers to control their heat consumption based on their needs. This, in turn, will also result in improved indoor climate and hot water supply.

Senior Adviser Ronny Nilsson at NEFCO believes there is a large potential to scale-up already tested district heating solutions.
“The ongoing DemoUkrainaDH programme focusing on small-scale demonstration projects since 2012 have already shown significant savings in the production, distribution, and consumption of energy and water. The most important now is to establish demonstration projects that make a real difference for Ukrainian district heating companies and the Ukrainian district heating sector as a whole.”

More information
Ronny Nilsson, Senior Adviser, NEFCO
ronny.nilsson [at] nefco.fi, tel. +358 10 618 06 42

Maria Lypiatska, Communications Officer, Embassy of Sweden in Ukraine
mariia.lypiatska [at] gov.se, tel. +380 67 217 72 33

About Sweden’s Reform Cooperation with Ukraine
Sweden is a longstanding partner to Ukraine. Since 1995, Sweden has invested significant political, financial and human resources in the country. Between 2014 – 2020, the overall reform cooperation with Ukraine encompasses 175 million euro. That makes Sweden the 7th largest donor in the country. Current support portfolio includes seven areas of cooperation – inclusive economic growth, public administration reform including public finance management and decentralization, gender equality, environment and energy efficiency, free and independent media, civil society support, peacebuilding, and recovery, including humanitarian aid. Read more at https://bit.ly/2LTiWMO

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