The discussions were held on the proposals from business representatives of the Sectoral Working Group on Energy, established under the Ministry of Economy of Ukraine, organized by the Kyiv School of Economics, and moderated by KPMG Ukraine as part of the work on the Ukraine Facility Plan. More than 130 registered participants took part in the work of the group, which offered 45 proposals for policy changes, with 32 of them recommended for potential implementation.
Creation of the sectoral working groups is one of the activities under the Good Governance Fund Project “Economic Hub: Sound PFM Policies and Vision for Growth,” which is supported by the UK government (UK Aid). The project delivery partners are Abt Britain and Kyiv School of Economics.
The proposed policies were related to the improvement of legislation in the field of energy and the investment climate, European integration of the Ukrainian market, simplification of the implementation of projects for the construction of generation facilities, in particular renewable energy sources, and further liberalization of the energy market.
Most of the proposals received were in the areas of the development and expansion of renewable energy (24), electricity transportation (6), and general generation (6).
More than half of the proposals have already been fully or partially integrated into the Implementation plan for measures in the energy strategy, such as the gradual increase in partially self-sufficient systems, the expansion of maneuvering and high-maneuvering capacities, simplification of the procedure for conducting an assessment of the impact on the environment and placement, etc.
“The energy sector plays a crucial role in the economy. The development of the energy complex, reconstruction, and implementation of new technologies will determine the progress of other industrial sectors and the achievement of “green” transition goals. The work of the group will help to build a balanced model and form a comprehensive strategy for industry development in the future,” said Deputy Minister of Economy of Ukraine Oleksii Sobolev.
The development of the sector will be enhanced by the opportunity for investors to receive financing through the EBRD, EIB, and other international financial institutions. To facilitate this, the Plan includes a special investment instrument for covering risks in priority sectors, in the amount of EUR 8 billion. It is expected that this will attract more than EUR 30 billion of investments to the Ukrainian economy.
“The results of the sectoral group’s work indicate that a constructive dialogue between the government and business is already taking place. Businesses are providing substantive and reasoned recommendations that address both urgent challenges and innovations for further development. After three expert discussions, 32 out of 45 proposed policies were submitted to the Government for possible implementation,” said Maksym Fedoseienko, Head of Strategic Projects at KSE Institute.
During the group’s work, business representatives and state enterprises submitted 190 proposals for investment projects with a total budget of $58.4 billion. The proposals are mostly related to the expansion of wind energy generation, modernization and development of the electrical grid, and the development of solar and hydrogen energy in Ukraine.
While the format of the Ukraine Facility Plan does not foresee investment projects, their analysis is important for identifying priority sub-sectors for development. The relevant proposals will be submitted to the Ministry of Energy of Ukraine for consideration and may be included in the long-term sectoral development strategy.