- Germany, the EIB and Ukraine have announced a €20 million grant for the Renewable Energy Solution Programme to boost the energy independence Ukrainian municipalities.
- The grant supports hospitals and schools across Ukraine, aiding renewable energy implementation as part of green reconstruction.
- Announced at COP28, the grant is being provided by the International Climate Initiative (IKI) to EIB Global’s IKI Fund, which was set up in partnership with the German government to foster green investments.
On the sidelines of a COP28 event organised by the German-Ukrainian Energy Partnership, Germany’s Federal Ministry of Economic Affairs and Climate Action (BMWK), the European Investment Bank (EIB) and Ukraine’s Ministry for Restoration agreed on the intention to sign a €20 million grant for the Renewable Energy Solution Programme (RES). This grant will enhance renewable energy in Ukrainian municipalities and foster energy independence in public institutions.
With this contribution, the government of Germany intends to support the transition of energy systems and green reconstruction in line with the goals of the Paris Agreement and Ukraine’s path towards the European Union. It will be another important building block in longstanding German-Ukrainian cooperation in the International Climate Initiative (IKI) and the German-Ukrainian Energy Partnership.
This initiative will support municipalities in synergy with existing EIB framework loans in order to leverage additional funds for climate action, such as the Ukraine Public Building Energy Efficiency (UPBEE) Programme (a €300 million EIB framework loan for thermal renovations in Ukrainian communities), and two recovery programmes — the Ukraine Early Recovery Programme (UERP) and Ukraine Recovery Programme (URP) — worth a total of €540 million and targeting territories recently liberated in Ukraine. In addition, plans are in place for the RES Programme to support similar EIB framework loans in the future.
Following the retrofit of the buildings, which substantially reduces energy consumption, the integration of renewable energy in public buildings is the next important step. The RES Programme is designed to provide renewable energy components in public buildings like schools, hospitals and kindergartens. It will integrate solar energy systems, biomass energy solutions and geothermal heat pumps. Battery storage will also be installed in order to increase the resilience of the buildings in locations where the grid is vulnerable. The RES Programme will thereby improve the energy autonomy of critical public buildings and ensure operational continuity even during power cuts caused by Russian attacks on energy infrastructure.
Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH will provide the technical assistance and advisory services needed for the successful deployment of the programme, in particular because many municipalities in Ukraine lack the resources necessary to develop projects and the related documentation. GIZ has been working with Ukraine in fields such as renewable energy and green reconstruction for nearly 30 years.
EIB President Werner Hoyer said: “In our role as the EU climate bank, we see the Renewable Energy Solutions Programme as an important step for the reconstruction of Ukraine. This initiative, supported by the German government, ensures that essential public buildings are both energy-efficient and equipped with renewable energy solutions, fostering Ukraine’s resilience and energy security.”
Robert Habeck, Federal Minister for Economic Affairs and Climate Action (BMWK) said: “With this contribution from the International Climate Initiative (IKI), we are supporting Ukraine’s efforts to promote decentralised renewable energy solutions for a secure and climate-neutral energy provision for Ukrainian citizens. Not only are such solutions an essential contribution to the decarbonisation of the energy system and, it is also an important contribution for the reconstruction of Ukrainian energy infrastructure due to the ongoing Russian aggression. By our support we will also inspire further action, add to a more resilient energy system and secure energy supply to critical infrastructure. I truly believe that the transformation to climate neutrality can be engrained in all reconstruction efforts and I admire Ukraine’s resilience and determination to climate and energy transition in the face of the military threats.”
Deputy Prime Minister for Restoration of Ukraine and Minister for Communities, Territories, and Infrastructure Development Oleksandr Kubrakov said: “This key agreement signifies another step in our collaboration with the European Investment Bank and the German government, a path dedicated to fortifying Ukraine’s energy security against the backdrop of Russian war. Orientation towards a green energy transition is a strategic move to reduce overall energy dependence. Public buildings consume a significant amount of energy for lighting, heating, cooling, and electronic devices. The integration of renewable energy brings several benefits: it ensures continuity of services, cost savings, reduced emissions, enhanced sustainability and reduced exposure to price volatility. The focus of this cooperation is clear: together with our EU partners we want to boost Ukraine’s resilience, rebuild the country, support communities and cities in a more sustainable and greener way than ever before.
Background
Germany and Ukraine are cooperating in the framework of the German-Ukrainian Energy Partnership and the International Climate Initiative (IKI). Germany has provided over €200 million to support Ukraine’s energy sector in the last year alone. Ukraine is a priority country with which the International Climate Initiative (IKI) maintains particularly close cooperation. IKI is currently funding 16 projects in Ukraine with a total approved budget of €293 million, of which eight are bilateral projects (total budget: €74.3 million) and eight are regional/global projects (€218.7 million for all participating implementing countries). The focus of IKI's commitment in Ukraine is on an ambitious climate policy and energy cooperation. Due to the effects of the Russian war of aggression against Ukraine, existing project activities have been adapted to the crisis situation and the portfolio will increasingly focus on Ukraine's requirements for green reconstruction. Since 2022, IKI has been implemented by the Federal Ministry for Economic Affairs and Climate Action (BMWK) in close cooperation with the Federal Ministry for the Environment, Nature Conservation, Nuclear Safety and Consumer Protection (BMUV) and the Federal Foreign Office (AA).
Since the start of Russia’s full-scale invasion of Ukraine in 2022, the EIB has offered immediate relief to Ukraine, disbursing €1.7 billion of financing since 2022 and helping to finance emergency repairs to the country’s ravaged infrastructure. The EU bank also provided a €4 billion credit line to support the integration of refugees from Ukraine in EU countries. Through the EU for Ukraine initiative and its fund, the Bank remains committed to stepping up its activities in Ukraine, in line with the mandate given by EU leaders and in close cooperation with the European Commission, the European Parliament, EU Member States and international partners.
The International Climate Initiative (IKI) Fund was established in November 2019 under the EIB’s Partnerships Platform for Funds, aiming to catalyse investments dedicated to mitigating greenhouse gas emissions and adapting to the effects of climate change in developing countries. The IKI Fund seeks to do this by providing financial instruments and technical assistance to public and private sector beneficiaries, as well as advisory services to central banks and financial institutions. It currently supports three initiatives funded by the International Climate Initiative: the Jordan Energy Efficiency Initiative, the Universal Green Energy Access Programme and the Greening Financial Systems Programme, and the upcoming Renewable Energy Solution Programme (RES) for Ukraine, which will provide investment grants.