Experts from DiXi Group, together with the municipalities of Zhytomyr, Kalush, and Nizhyn and members of the ANEW-LIFE consortium, are working to identify the most suitable financing mechanisms for implementing green energy projects under the ANEW-LIFE project, “Addressing the Needs of Clean Energy Transition Willingness of Ukrainian Cities Leveraging Innovative Financing Examples and Measures.”
At the current stage of the project, DiXi Group is responsible for the demonstration, monitoring, and future replication of project results.
As part of this work, DiXi Group experts are assessing a broad range of financing mechanisms that could support the implementation of the selected energy interventions.
These include:
Grant financing – non-repayable funding provided by international donors or public support programmes, enabling municipalities to implement projects without creating additional debt obligations;
Loan programmes – borrowed capital provided by commercial banks or international financial institutions to support larger-scale investments under defined repayment conditions;
Energy Service Contracts (ESCOs) – a mechanism under which a private partner finances energy-efficiency measures and recovers its investment through the energy savings achieved;
Blended finance models – combinations of grants, loans, public funds, and private investment that help balance risks and improve the financial viability of projects;
Power Purchase Agreements (PPAs) – long-term contractual arrangements under which an investor finances the development of an energy generation facility, while the off-taker commits to purchasing the electricity produced under agreed conditions over an extended period.
At the same time, the project team is not seeking to identify a single financing solution that would fit all municipalities. Instead, the focus is on selecting financing models that best match the technical characteristics of each intervention, the municipality’s institutional capacity, and the available funding opportunities.
“Our role is to work together with municipalities to analyse different approaches and determine which option will be the most effective in each specific case, rather than offering a ready-made solution. This collaborative process of identifying and adapting solutions is one of the project’s key outcomes,” said Victoria Kovalenko, General Manager of Sustainable Development at DiXi Group.
This approach not only helps develop effective financing solutions for the three pilot municipalities but also creates practical models that, once tested and validated, can be replicated in other communities across Ukraine and cities throughout the European Union.
Exploring the Potential of Power Purchase Agreements
As part of its contribution to the project, DiXi Group has also undertaken a preliminary assessment of the Power Purchase Agreement (PPA) mechanism. The model was introduced during consultations as one of the financing approaches widely used across European Union countries to support renewable energy development.
During the initial consultations, DiXi Group experts were positively impressed by the level of preparedness demonstrated by the participating municipalities. Representatives of Zhytomyr, Kalush, and Nizhyn showed a strong understanding of contemporary energy financing approaches and expressed interest in exploring the potential application of PPAs within their communities.
The ongoing consultations are aimed at identifying financing solutions that best correspond to the specific characteristics of each project and municipality. The ultimate goal is to develop practical and scalable approaches that can contribute to the broader deployment of sustainable energy solutions both in Ukraine and across Europe.
The ANEW-LIFE project is funded by the European Union and implemented by an international consortium of partners from Ukraine and EU Member States.
