Deputy Prime Minister for Restoration of Ukraine
Minister of Development of Communities, Territories and Infrastructure of Ukraine
Oleksandr Kubrakov 

Dear Mr. Kubrakov,

Razom We Stand expresses our deep gratitude to the Ministry for Communities, Territories and Infrastructure Development of Ukraine for its resolute stance on Ukraine's transition towards sustainable energy development, emphasizing the need implementation of energy-efficient technologies and decarbonization of our economy.

We respectfully call your attention to the pressing matter of taking urgent steps towards a sustainable energy transition in Ukraine’s recovery process. The practical implementation of the government's plans to increase the share of energy production from renewable sources by 2030 is crucial in achieving this goal. As the next five years are essential for the success of Ukraine's reconstruction, we strongly advise against investing in the restoration of old coal- and gas-fired capacities and increasing fossil gas production.

As per industry reports, nearly all thermal power generation facilities have suffered damage from targeted attacks committed by the russian terrorist state. Over 3 GW of generating capacity at combined heat and power and thermal power plants have been rendered non-operational, with some power units irreparable. 

Considering the vulnerability of centralized electricity and heat production facilities to hostile attacks and potential repetitive strikes, it is crucial to implement measures to diversify and decentralize the energy supply in Ukrainian cities.

On March 17th, Ukraine's President Volodymyr Zelenskyy signed the Law of Ukraine on the Development of Highly Efficient Cogeneration. This law, which was drafted by the State Agency on Energy Efficiency and Energy Saving and adopted by Parliament on February 24th, 2023, is a significant milestone towards achieving efficient heat and electricity production in Ukraine. Additionally, this law implements the requirements of Directive 2012/27/EU on energy efficiency, ensuring Ukraine's alignment with the EU.

The advancement of high-efficiency cogeneration technology has paved the way for better fuel utilization, resulting in notable fuel and energy resource savings and lower greenhouse gas emissions. As per COGEN Europe, this technology already supplies 12% of electricity and 16% of heat used for residential, industrial, and district heating in the EU. This translates to energy savings of roughly 30 billion m3 of gas annually, which surpasses Ukraine's gas consumption in 2021.

High-efficiency cogeneration offers several exceptional advantages. Decentralized electricity production is one such benefit, which is crucial in the current context of terrorist attacks perpetrated by russia. Additionally, cogeneration helps in balancing the irregularities of solar and wind generation, making it a technology of the future. In the long run, investing in highly efficient cogeneration facilities will aid in achieving climate neutrality, as they can operate using renewable gases such as biomethane and hydrogen.

Aside from repairing damaged TPP and CHP facilities and safeguarding them against future attacks, it is crucial to prioritize the advancement of high-efficiency cogeneration in both short-term infrastructure reconstruction plans for the upcoming winter season, as well as in long-term regional development strategies.

By implementing modern solutions based on high-efficiency cogeneration, combined with renewable energy sources, Ukraine can effectively restore the lost power generation capacity and enhance its energy security, while also ensuring accelerated integration into the EU. This transformation will also bolster the economy's competitiveness, especially in conditions of implementation of carbon border adjustment mechanism (CBAM) by the EU, and will support the implementation of the European Green Deal. Over the next ten years, this approach can lead to the complete replacement of coal generation and a comprehensive transformation of the energy system towards renewable energy sources.

In this context, we urge you as the Deputy Prime Minister for Restoration of Ukraine to join forces with other competent authorities and facilitate the following:

• Ensuring transparent and non-discriminatory conditions for connection to gas and electricity grids for high-efficiency cogeneration facilities, simplifying relevant procedures through digitalization.
• Implementing high-efficiency cogeneration projects as part of the renewal of urban heat supply systems, in accordance with European methodologies for their design.
• Ensuring an integrated approach to infrastructure design, incorporating electricity and gas networks, and heat supply schemes.
• Reducing specific energy consumption in the housing and communal sectors per unit area by at least half when implementing city reconstructions.
• Bringing heat tariffs to economically justified levels and creating conditions for attracting private investment in high-efficiency cogeneration projects.
• Developing a market for energy service contracts (ESCOs) to implement high-efficiency cogeneration projects for hospitals and other critical infrastructure facilities.
• Providing access to credit financing for high-efficiency cogeneration projects to meet energy supply needs of industrial and commercial facilities, such as manufacturing plants, logistics centers, shopping centers, hotels and other enterprises.
• Introducing direct bilateral long-term contracts for the purchase of fuel for high-efficiency cogeneration, including alternative fuels with guarantees of origin, particularly for biomass and biomethane.
• Localizing the production of equipment for high-efficiency cogeneration within Ukraine.
• Amending the Budget Code to allow for municipal guarantees to attract more debt resources for energy efficiency measures and cogeneration installation in communities.
• Improving the monetized subsidies mechanism for heating for the population.

As we were informed, the Ministry of Strategic Industries of Ukraine, in collaboration with the United Nations Industrial Development Program (UNIDO), has initiated the development of a 5-year Program for the Green Recovery and Development of Ukrainian Industry in the Post-war Period. The primary objective of this program is to encourage and support the establishment of domestic production of equipment for renewable energy and high-efficiency cogeneration.

It is important to stress that multiple international reports have identified Ukraine’s role as essential in accelerating the global energy transition. The Head of the International Energy Agency has emphasized that strategic implementation of renewable energy technologies throughout Ukraine and avoiding lock-in and stranded assets, associated with major fossil fuel infrastructure projects, can lead to the creation of a revitalized energy system that will serve as a global example of a successful energy transition.
 
We respectfully request information regarding the measures that have been implemented and/or planned within the areas of authority and competencies of the Ministry for Communities, Territories, and Infrastructure Development of Ukraine to address the challenges at hand.

To contribute to the conservation of natural resources, I kindly request that your response be sent via email to [email protected].

Best regards,

Svitlana Romanko
Director and Founder of Razom We Stand 
[email protected]