Shift towards Low-Carbon Economics, according to the Head of the Delegation of the European Union to Ukraine, Ambassador Jose Manuel Pinto Teixeira, require a great political will. His announcement was made within the frameworks of the Second European-Ukrainian Energy Day, which took place in Kyiv on May 31 – June 1, 2011. The Forum was organized by European-Ukrainian Energy Agency (EUEA) and Conference House Company. Official Partner – SCM Company. Partners: Universal Bank, Concern "Saint-Gobain (owner of the «ISOVER» brand), Arzinger LF, Alfa Laval company. General Air-Carrier – Ukrainian International Airlines (UIA). Partners of “Financing of bioenergy projects” Section: Landesbank Berlin AG (LBB) and Agency of Renewable Resources (FNR). Besides the event was supported by: GFA Consulting Group, Federal Ministryof Food, Agriculture and Consumer Protection (BMELV) and State Agency on Energy Efficiency & Energy Conservation of Ukraine.
Mr. Ambassador reminded that according to the European Energy Strategy until 2020, increasing of energy efficiency in Europe will allow reducing the annual payments for electricity up to 200 billion euro. “In order to maintain a strong energy market in the future, Ukraine should fulfill its duties within the frameworks of Energy Community, to join the Initiative of Extractive Industry Transparence, and to increase energy efficiency by implementation of mechanisms aimed on energy consumption sector. New Energy Strategy of Ukraine requires new energy policy”, says the head of EU delegation.
Domestic Authority representatives are agreed with European colleague. Thus, Government will encourage energy efficiency through pricing motivation of consumers. This statement was proclaimed by Deputy Minister of Energy and Mines Vladimir Makukha. According to him, this process is already being implemented in all key sectors of the Ukrainian energy. Besides financial optimization of prices, wide attraction of investments is expected. In the sphere of electroenergetics, privatization of generations and distribution companies is planned, as well as avoiding cross-subsidies and the transition to a new model of the energy market. In the nearest time the Government planning to adopt specifications of Ukrainian energy strategy updates, which was created in 2006 and will operate until 2030.
Head of the State agency for energy efficiency and energy conservation Nikolai Pashkevich said about the nearest activities in plans of Energy Strategy. “I think that until autumn we will provide a road map that would show which areas need to be upgrade to fully accept investments in to green electroenergetics”, - promised Mr. Pashkevich. Thus, according to the official, Ukrainian Energy System is not really ready to the functioning in it of large number of renewable electricity sources, the addition investments are necessary for networks development.
Andre Kuusvek, Director of EBRD Ukraine said about investments. He noted that to increase the level of investment attractiveness of Ukrainian green technology market, it is necessary to develop tariff methodology of full compensation of investment costs, to conduct reforms on energy market, taking into account bilateral contracts aimed on necessary competition, and, for sure, actively develop projects and technologies for alternative energy. EBRD already working with such kind of projects, the bank received 37 applications on financing the wind, small hydro and bio energy. Also Mr. Kuusvek mentioned that to encourage projects of alternative energy it is necessary to cancel the rule of 30% “local content” in the project cost. “In long term prospect for Ukraine it is not so important who is the direct investor, or what is the percentage of the equipment produced in the domestic market, the important thing is availability of offer and choice”, - said the banker.
“I am absolutely convinced that Ukraine can save energy and improve the competitive ability” - continued the Swedish Ambassador to Ukraine Stefan Gullgren. Diplomat shared with Swedish experience of energy market reformation. Sweden needed 20 years to significantly reduce the use of traditional sources in favor to alternative ones. Recommendations for our country in this sphere Mr. Ambassador concluded in three priorities: to make energy saving the main priority on the highest political level; to ensure functioning of existing legislation and make adjustments when it’s necessary to ensure that energy efficiency is constantly stimulated; and finally to make sure that the legislation confined to specific mechanisms that will help to achieve the confidence of investors. It is well-known that Sweden initiated the creation of 100 million Euro fund for financing energy saving infrastructure projects in Ukrainian cities. The Fund is administrated by EBRD and unfortunately its using is impossible now because of existing legislation. “For example now we have very specific problem with Budget Code of Ukraine, which does not allow us to use those 100 million euro, which we collected”, complains Ambassador.
Now the international investors have some doubts and hesitations concerning Ukraine, reliability of its partnership, concerns relating to transparency of the market. Head of International Secretariat of the Extractive Industries Transparency Initiative (EІTІ) Jonas Moberg, proclaimed that Ukraine should independently determine the depth of the application of international standards of transparency: “The Initiative should have a Ukrainian measurement, it should not be imposed”. EITI standards today have been implemented by 35 countries of the world as standards of openness and transparency.
All the international experts mentioned the critical necessity of energy market transparency. Mrs. Astrid Manroth, Senior Energy Specialist, World Bank Ukraine sees this criterion as a first step in reformation of energy industry. She noted that new strategy of bank activity in Ukraine considers energy efficiency as a overriding priority along with increased transparency (implementation of EITI standards) and the improvement of management efficiency sector.
Head of EUEA Mr. Dave Young supported his colleague and explained that if Ukraine will be able to open its own domestic market and provide such needed transparency, great prospects will open for the country, including the ability to export energy to Europe. Mr. Wolfram Rehbock, Senior Partner, Arzinger law firm; Member of the Board, EUEA, said about features and problems of integration of Ukraine to the energy Community. Mr. Rehbock told “problems creates opportunities”, that’s why the level of competitiveness, which will increase after joining of Ukraine the Energy Community will lead the effectiveness of work, new technologies, stimulation of favorable investment climate and the best prices, which in turn would only strengthen the competitiveness of the domestic economy. “The market should be open for international investments. Network expansion and joining of new players will enable Ukraine to export green power” - said Wolfram Rehbock.
During the second Conference day, opening the panel discussion devoted to the issues of financing the green projects, regional manager of International Financial Corporation Elena Voloshina, said that Ukrainian Companies underestimate the potential of energy efficiency on about 45%. During the session, international financiers and bankers shared their national experiences, said about implemented banking products, financial methods in segment of investment into alternative energy source projects.
Examples of such projects were presented on two parallel Case studies, devoted to the isuues of energy efficiency and energy saving in sectors of Construction and Housing, as well as projects of using alternative energy sources. Interesting and working projects were presented by General Director of ТIS Eco Company, member of Board EUEA Victor Savkiv (Landfill biogas); Dr.Johann Harter, COO, Activ Solar (First solar energy project in Ukraine); Mr. Yuriy Davydov, CEO, OJSC “Creativ Group” (Pellets Production in Ukraine); Mr. Eberhard Nacke, Head of Product Strategy, Claas KGaA mbH (Biogas in agriculture); Mr. Nikolai Troitsky, General Manager, Saint-Gobain Construction Products Ukraine; Member of the Board, EUEA (Energy consumption in buildings, projects implemented in Ukraine); Alexander Mazurchak, first deputy head of the Kiev City Administration (energy efficiency projects in Kiev); Mr. Zinoviy Fitel, Deputy mayor, Ivano-Frankivsk city (Complex solution for district heating: the way to move forward), etc.
In general, the Second European-Ukrainian Energy Day was attended by around 250 experts and top managers of leading companies, representatives of nonprofit organizations, governments, donor agencies and others from 13 countries (Austria, Bulgaria, Czech Republic, Israel, Norway, UK, Germany, Sweden, Greece, Latvia, Turkey, Poland, Russia), and about 70 journalists of national and international Mass-Media.
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Media-Partners of the Second Europena-Ukrainian Energy Day:
General PR-Partner – PRT Communication group
General media partners: Invest Gazeta, Gazeta Delo
Business media-partner – Delovaya Stolitsa newspaper
Legal media-partner – Yuridicheskaya Gazeta
Communicational media-oartner – ESG group
General TV-partner - UBR
Official TV-partner – First Business Channel
Official media-partners: BNE and “Vlast Deneg” magazine
Specialized media-partners: “Alternativmoye Toplivo” magazine and CleanTech magazine
Media patronage Interfax-Ukraine
Vedua-partners: “General director” magazine, EurActiv.com and EmergingMarkets.me
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