German Government and EIB support Ukraine’s energy transition with €20 million grant

Announced at COP28, the grant is being provided by the 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 organized 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 to 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.  

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.”

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.” 

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.”

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