Monitoring of Ukraine’s National Energy and Climate Plane (NECP) – Q4 2024

In the fourth quarter of 2024, the implementation of the National Energy and Climate Plan (NECP) showed progress, particularly under the dimensions of decarbonization, energy efficiency, and internal energy market. Key areas in the reporting period were the update of the climate policy framework and the transport strategy, testing new mechanisms to support renewable energy sources (RES), expanding financing for energy efficiency measures, and tools to increase the resilience of the energy system.

KEY DECISIONS AND EVENTS:

• Adoption of the framework Law “On the Basic Principles of State Climate Policy”, which has set a long-term goal for achieving climate neutrality by 2050, thus ensuring alignment with the EU-wide climate goal.
• Approval of a new version of the 2030 National Transport Strategy, which broadly outlines the direction of policies and measures necessary to ensure the decarbonization of the transport sector. For a detailed overview, see the “Special Topic” section.
• Approval of the Action Plan for Just Transformation of the Lviv Coal Microregion with the estimated funding needs at 10.1 billion UAH.
• The first auctions for guarantees of origin for electricity from RES and pilot auctions for the allocation of support quotas. Despite the fact that the latter auctions showed limited effectiveness, the government determined annual support quotas for electricity producers from RES for 2025 and subsequent years.
• The government has determined the procedure for filling the National Database of Energy and Performance Characteristics of Buildings with information, and has also approved the Procedure for monitoring the achievement of energy saving target in public buildings (renovation to meet at least the minimum energy performance requirements).
• Start of concessional lending through the State Fund for Decarbonization and Energy Efficient Transformation – by the end of 2024, 10 projects (159.8 million UAH) were financed.
• Entry into force of the Law “On Minimum Stocks of Oil and Petroleum Products” and adoption of a significant part of the by-laws. Start of market participants’ accreditation in the reporting system.
• Continuation of the successful practice of long-term auctions for ancillary services, which will contribute to increasing the Unified Power System flexibility and the development of distributed generation.
• New mechanisms to support biomethane, in particular, the National Energy and Utilities Regulatory Commission (NEURC) simplification of the procedure for connecting biomethane facilities to gas networks.
• A significant (app. 25%) increase in funding for the National Research Foundation of Ukraine. Approval of the 2030 Digital Innovation Development Strategy (WinWin), which includes tasks and measures in the field of green transition.

Monitoring is performed on the basis of public sources of information, but may also include requests for information, consultations or other methods (as noted separately). The assessment of the NECP implementation is carried out on the basis of qualitative and quantitative indicators for all 145 policies and measures. All indicators are assessed in two aspects – the status of implementation and the status of progress (for policies and measures in the process of implementation). A detailed description of the scale, as well as the assessments by indicators with relevant comments, can be viewed in the assessment table for Q4 2024. In addition to assessing the indicators, the experts also take into account decisions and events that directly relate to the NECP and/or may have a significant impact on its implementation.