Summary decarbonization monitoring ІV quarter of 2024

The DiXi Group think tank prepares quarterly analytical reviews of Ukraine’s decarbonisation policies. The Decarbonisation Monitoring Q4 2024 records the main events and trends in three areas that are key to the decarbonisation of Ukraine’s economy: 1) RES and Energy Efficiency, 2) Climate and Environment, and 3) Subsoil Use. The document also contains an analysis of the best international practices that may be relevant and applicable in Ukraine in the respective areas to provide a basis for the development and improvement of national strategies and legislation in the field of energy policy, environmental protection and sustainable development of Ukraine.

We propose you a Summary analyzing the main events and initiatives that took place in this area in October-December 2024.

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In Q4 2024, Ukraine saw important changes in the renewable energy and energy efficiency sectors. The government has simplified permitting procedures for small solar and wind power plants, expanded financial support for alternative energy sources, and promoted the development of energy-efficient building standards. It also made decisions on auctions for the allocation of renewable energy quotas and financing of energy projects in the water supply sector. Other initiatives include the approval of a national database of building energy performance and support for the development of NZEB standards for buildings in Ukraine. To further develop the sectors, it is important to take into account international experience and implement the following steps:

• improve permitting procedures for small-scale renewable energy sources, in particular, reduce the number of required approvals and permits, which will make it easier for households and small businesses to install solar and wind power plants
• introduce a simplified connection of rooftop SPPs following the example of Portugal and Spain. This practice will help reduce project implementation time and reduce bureaucratic obstacles for consumers;
• adapt the REPowerEU approach, recognising renewable energy projects as having a higher public interest, which will reduce the time required to obtain permits and connect to the grid;
• use the best practices of EU countries, in particular Austria, the Czech Republic, Portugal and Spain, where effective initiatives have already been implemented to accelerate RES development;

Q4 2024 saw significant changes in environmental policy and climate regulation. The Ministry of Environmental Protection and Natural Resources approved an order canceling the technological emission standards for a number of gas plants, developed an implementation plan for the Environmental Security Strategy for 2025-2027, and updated waste management rules. The Verkhovna Rada adopted a law on state climate policy, which provides for the achievement of climate neutrality by 2050. It also developed measures on integrated permits, emissions trading, and support for businesses to implement the best available technologies. It is important to ensure the effective implementation of these changes, which is why it is recommended to:

• shorten the timeframe for implementing the law on state climate policy, in particular with regard to financing climate measures;
• define clear indicators for assessing the implementation of climate programmes and strengthen control over their implementation;
• increase coordination between state authorities, the government, and local self-government bodies to align climate and energy goals and ensure the effective implementation of climate policy;
• introduce economic incentives to attract investors and businesses to climate initiatives;

In Q4 2024, Ukraine saw changes in legislation on the use of natural resources. On 18 December, Law No. 4154-IX was adopted, which updates the National Programme for the Development of the Mineral Resource Base until 2030. The State Service of Geology and Subsoil initiated new rules for registering geological surveys, determining the initial cost of special permits and holding auctions. The government has also established export quotas for strategic resources and signed a memorandum of cooperation with the United States in the critical minerals sector. For the effective implementation of the changes, it is recommended to

• assess Ukraine’s needs for critical raw materials and define quantitative indicators of the programme’s implementation;
• study the dependence on imports and develop mechanisms to control supply risks.
• Integrate circular economy principles to increase the share of recycled materials;
• Promote interagency cooperation to establish resource recycling and recycling of

  critical materials;

• introduce economic incentives for businesses engaged in the reuse of raw materials;