Presentation by Yuliya Kovaliv
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Transcript of Presentation by Yuliya Kovaliv
INVEST Ukraine
Open for U
Yuliya Kovaliv
30 March, 2016
Energy sector: Challenges
0,11 0,13 0,13
0,20
0,32
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0,05
0,10
0,15
0,20
0,25
0,30
0,35
Germany Romania Poland China Ukraine
Energy intensity of GDP, 2014 Extremely high energy intensity of GDP
Only 60% of energy resources produced domestically
Households:
Household gas bills didn’t reflect modern reality
Part of utility bills based on normative, rather than actual consumption
Industry and infrastructure:
Obsolete equipment and technology
High losses in power lines, hot water and central heating Households Infrastructure Industry
Drivers of inefficiency
Gas tariffs increased to cut out waste and eliminate pressure on state finances
0,73
1,18
3,6/7,19
0
1
2
3
4
5
6
7
8
2010-Apr 2014 2014-Mar 2015 from Apr 2015
Household gas tariff evolution (UAH/m3)
14,3 13,2 10,6
8,4
7,2
6,6
0,75
0,61
0,5
0
5
10
15
20
25
2013 2014 2015
Natural Gas Consumption For Heating (bcm)
Public enteties
District heating companies
Individual housholds
-10%
-16%
23.4
21.1
17.7
Market-based tariff schedule till 2017 adopted
New Electricity Market Law
Seeking competition and diversification
Privatization of regional power generation plants in 2016 (incl. Centrenergo 7,67 GWt)
Potential projects:
Reconstruction of Northern and Dnipro Energy transmission system (€150m KFW loan)
Construction of 6 Dnister hydropower stations with total capacity of 390 MWt
Construction of Kaniv hydropower plant
Power generation and transmission
4
45,24%
48,15%
5,66%
54,77%
39,43%
Power generation structure by source*
Coal & Gas
Nuclear
Hydro
Renewables 7M2015
7M2014
Required Investments in Energy Efficiency in Residential Sector
65
630
1 224
1 924
2 274
2 624 2 624 2 624 2 624 2 624 2 624 2 624 2 624 2 624 2 624 2 624
14
140 272 428 505 583 583 583 583 583 583 583 583 583 583 583
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030
Загальний обсяг необхідних інвестицій, млн євро
Державна підтримка, млн євро
2015-2030 • €35 billion of investment, including • €7,7 billion of Government support
Total volume of investment required, € mln
Government support (subsidy), € mln
€ 8,7 billon by 2020
25% of buildings
Goal of Program
3 billion cbm
annual natural gas savings in 2020
12 billion cbm
annual natural gas savings in 2030
6.5 mln individual houses
80 ths multi-dwelling buildings
First steps in Energy Efficiency of Residential Buildings
Loan Reimbursment Mechanism
private house/ separate flat
multifamily house
70% of the principal
30% of the principal
20% of the principal
40% of the principal
for the recipients of subsidies on utilities (since 27.08.15)
for energy-efficient equipment and materials
for non-gas boilers purchase
for energy-efficient equipment and materials
894 UAH million N
ov-
14
Dec
-14
Jan
-15
Feb
-15
Mar
-15
Ap
r-1
5
May
-15
Jun
-15
Jul-
15
Au
g-1
5
Sep
-15
Oct
-15
No
v-1
5
Dec
-15
Jan
-16
State EE Program Dynamics Total loan amount, UAH mln
304,4 UAH million
80 ths loans
70% of the principal
for the recipients of subsidies on utilities (since 27.08.15)
Budget of State EE Program in 2016
Reimbursed in 2014 - 2015
Net savings (≈50% of initial value)
Energy Efficiency of public bodies’ buildings
700 million cbm
annual natural gas savings
Program description
100k public bodies’ buildings are to be renovated
4.4 Bln EUR
Investments needed
The new Directive 2012/27/EU (Oct-25, 2012) on energy efficiency requirement to renovate at least 1% of the central public bodies’ buildings annually (for Energy Community members).
Renovation is consistent with EU requirement
Ukraine selected “Shared savings” ESCO agreement model
Before ESCO During ESCO (< 10y) After ESCO
Public body’s energy spending Net savings (10-20% of savings)
ESCO payment (80-90% of savings)
Legal framework and next steps
The Concept of Energy Efficiency Fund “Turning Subsidies to Investments in Energy Efficiency“ («S2I»)
State budget of Ukraine
S2I
Consumers Energy Efficiency
Projects
Funding
Subsidies
International Donors
Steps done
• Developing of guidelines for Contracting Parties (on public purchasing procedures etc.)
• Creation of incentives for ESCO-market development (Bank involvement etc)
• Information campaign (Spring -2016)
1st step: Parliament
2nd step: Government
Next steps
• EPC Procurement • Long-Term Budget Guarantees for Private
Investor
• Sample Energy Saving Performance Contract was adopted on Oct 21, 2015
Financial Institutions
Loans funding and return
Preferential loans and their return
Government
Subsidies reduction (budget economy)
Grants
Political and economic reasons for subsidies reduction