1Council Implementing Decision (EU) 2024/2149 of 6 August 2024 on establishing the satisfactory fulfilment of the conditions for the payment of the first instalment of the non-repayable financial support and of the loan support under the Ukraine Plan of the Ukraine Facility

Context

The requirement for step 10.1 described in the step description of the CID annex is:

Adoption of the Ordinance of the Cabinet of Ministers of Ukraine on approving the Integrated National Energy and Climate Plan to establish national climate neutrality objectives and ensure appropriate planning after duly taking into account the recommendations from the Energy Community. The plan defines targets to be achieved by 2030 on: – GHG reductions, including through market-based carbon pricing mechanisms; – the share of renewable sources in gross final consumption of energy; – the energy saving in final energy consumption.

Step 10.1 is the sole step in the implementation of Reform 1 of chapter 10 (Energy sector).

Evidence provided

1. Summary document duly justifying how the step was satisfactorily fulfilled in line with the requirements set out in the Annex to Implementing Decision (EU) 2024/1447;

1. Copy of the Adoption of the Ordinance of the Cabinet of Ministers of Ukraine No 587-p of 25 June 2024 on approving the Integrated National Energy and Climate Plan of Ukraine;

1. Copy of the adopted Integrated National Energy and Climate Plan of Ukraine;

1. Recommendations of the Energy Community Secretariat on Ukraine’s draft Integrated National Energy and Climate Plan, as published on the Energy Communities’ website;

1. Written comments of Ukraine Government on the Recommendations of the Energy Communities Secretariat as published on the Ministry of Economy’s website.

Analysis

The justification and substantive evidence provided by the Ukrainian authorities cover all constitutive elements of step 10.1.

The Cabinet of Ministers of Ukraine adopted Ordinance No 587-p on the approval of the Integrated National Energy and Climate Plan (hereinafter INECP) for Ukraine on 25 June 2024. The adopted INECP summarises the scope of the document, highlighting its strategic relevance as an instrument to coordinate and plan energy and climate policies as well to ensure Ukraine’s development and economic recovery. Given the comprehensive set of objectives and strategies set up in the document, the INECP is also expected to contribute to the national climate neutrality objective by 2050. Considering the unprecedented level of war-related uncertainties and given the exposure of the energy and climate policies set up in the INECP to such uncertainties, the Ordinance on the approval of the INECP also establishes a deadline for the INECP to be updated by December 2025.

On the basis of the Regulation (EU) 2018/1999, as a contracting party of the Energy Communities, Ukraine submitted a draft of the INCEP to the Energy Community Secretariat (EnCS) and they provided their recommendations to the Ukraine’s INECP.

The INECP was adopted after having duly taken into account the EnCS’ recommendations. The adopted version integrates and implements a significant part of the recommendations. This includes the commitment to establish a monitoring and implementation system to support the implementation of the INECP and coordinate its future revisions. In addition, Ukraine has provided preliminary comments and motivations to all the EnCS’ recommendations. For each recommendation, Ukraine indicates whether it has: i) addressed and integrated them in the adopted INECP; ii) partially addressed them; iii) not addressed them. For those recommendations that were only partially or not addressed, Ukraine motived the reasons for doing so, and published them on the website of the Ministry of Economy.

The INECP defines targets to be achieved by 2030 on: i) greenhouse gas reductions, including through market-based carbon pricing mechanisms; ii) the share of renewable sources in gross final consumption of energy; iii) the energy saving in final energy consumption. The adopted INECP defines targets to be achieved by 2030. In particular, the INECP identifies the following national objectives and targets:

A reduction of Ukraine’s total GHG emission by 2030 compared to 1990 emissions levels by 65 %. The INECP also reports the assumptions behind the estimates on the reduction of GHG emissions, to be achieved also by carbon pricing mechanisms.

Achieve 27 % share of renewable energy sources in the total final energy consumption by 2030.

Primary energy consumption no exceeding 72,224 Mtoe and final energy consumption – 42,168 Mtoe.

Commission Assessment: Satisfactorily fulfilled

Step 10.15

Name of the step: Adoption of the Strategy for thermal modernisation of buildings until 2050 and the Action PlanRelated Reform/Investment: Adoption of the Strategy for thermal modernisation of buildings until 2050 and the Action PlanFinanced from: Loans

Context

The requirement for step 10.15 described in the step description of the CID annex is:

Adoption of the act On Approval of the Strategy for Thermal Modernisation of Buildings until 2050 and Action plan for the Strategy by the Cabinet of Ministers of Ukraine, aimed at introducing market-based financial instruments and incentives, containing a roadmap with policy measures, including those aimed to support the introduction of nearly-zero energy building.

Step 10.15 is the first step in the implementation of reform 7 of the chapter 10 (Energy sector). It is followed by steps 10.16 due in Q3-2026 that aims to adopt the legal acts on setting minimum energy efficiency performance levels for buildings and 10.17 due in Q1-2027 that aims to adopt the legal acts on the requirements for energy labelling and eco-design as mandatory minimum criteria during public procurement.

Evidence provided

Summary document duly justifying how the step was satisfactorily fulfilled in line with the requirements set out in the Annex to Implementing Decision (EU) 2024/1447;

Copy of the Order No 1228-P of the Cabinet of Ministers On Approval of the Strategy for Thermal Modernisation of Buildings until 2050 and the related Action Plan from 29 December 2023;

Copy of the Strategy for Thermal Modernisation of Buildings until 2050 as an attachment to the Order No 1228-P from 29 December 2023;

Copy of the Action Plan related to the Strategy from 29 December 2023.

Analysis

The justification and substantive evidence provided by the Ukrainian authorities cover all constitutive elements of step 10.15.

The Cabinet of Ministers of Ukraine adopted the Order No 1228-P from 29 December 2023 on the Approval of the Strategy for Thermal Modernisation of Buildings until 2050 and the Action Plan related to the Strategy. The Strategy for Thermal Modernisation of Buildings until 2050 (hereinafter Strategy) and the Action Plan (hereinafter Action Plan) are attachments to the approved Order No 1228-P.

The Strategy includes various sections on the introduction of market-based financial instruments and incentives. It states that for the creation of a favourable market environment for thermal modernisation, active Small and Medium-sized Enterprises working in the sector of thermal modernisation should be supported through partial state guarantees and reimbursement of part of their interest costs. The local production of energy efficient equipment in Ukraine for the energy efficient renovation of houses should also be supported.

The adopted documents contain a roadmap with policy measures, including those aimed to support the introduction of nearly-zero energy buildings. The Action Plan, as an Annex to the Order, outlines the roadmap with policy measures to describe the concrete steps of the implementation of the Strategy for the Thermal Modernisation of Buildings until 2050. It defines deadlines, responsible institutions, and the status. The Action Plan outlines all steps in the period of 2024 to 2026 for the implementation of the Strategy.

The Strategy states that the Programme for support of Thermal Modernisation of Buildings until 2050 should ensure the promotion of nearly-zero energy buildings (hereinafter NZEBs). Furthermore, the Strategy mentions the increase in the number of buildings with close to zero energy consumption buildings as one of its purposes. In the Action Plan, NZEBs as an objective is referred to in five priority directions as follows:

the approval of regulatory requirements as well as monitoring and indicators of number of buildings for measures supporting NZEBs;

the creation of a portfolio of exemplary thermal modernisation projects with public access including items with NZEB designs;

the increase of numbers to support NZEBs, as part of the Energy Efficiency Fund;

the support of training and re-training of engineers and designers in the field of thermal modernisation including skills for the construction of NZEBs.

Commission Assessment: Satisfactorily fulfilled

Step 12.8

Name of the step: Adoption of the strategic document on Mine Action for the period up to 2033Related Reform/Investment: Deming of land and water areasFinanced from: Loans

Context

The requirement for step 12.8 described in the step description of the CID annex is:

Adoption of the legislative act on the approval of the strategic document on Mine Action for the period up to 2033 (the Act of the Cabinet of Ministers of Ukraine or the President of Ukraine). The legislative act focuses on these main areas:

management in the field of Mine Action;

support of the efficiency of Mine Action operators;

prevention of accidents;

comprehensive assistance to victims;

innovations;

gender balance and representation;

development of the private market;

effective and transparent coordination with donors;

forming the system of prioritisation of tasks in mine action.

Step 12.8 is the only step under Reform 6 of the chapter 12 (Agri-Food sector), concerning the demining of the land and water areas. The step is linked to the two steps (12.9 and 12.10) of Investment 1 of the same chapter which require a combined amount of at least EUR 150 million of investments in demining of agriculture land in the State Budgets 2024-2027. At least EUR 75 million of it shall be budgeted by 2025.

Evidence provided

1. Summary document duly justifying how the step was satisfactorily fulfilled in line with the requirements set out in the Annex to Implementing Decision (EU) 2024/1447;

1. Copy of the Order No 616-r of the Cabinet of Ministers On Approval of the National Mine Action Strategy for the period up to 2033 and approval of the Action Plan for 2024-2026 of 28 June 2024;

1. Copy of the National Strategy on Mine Action for the period up to 2033 as an attachment to the Order No 616-r of 28 June 2024;

1. Copy of the Action Plan for 2024-2026, as an attachment to the Order No 616-r of 28 June 2024.

Analysis

The justification and substantive evidence provided by the Ukrainian authorities cover all constitutive elements of step 12.8.

The National Strategy on Mine Action for the period up to 2033 was approved by the Cabinet of Ministers of Ukraine through the Order No 616-r from 28 June 2024. The Strategy has the following Strategic Goals: i) ensuring the clearance of territories from the risks of explosive objects for their safe and productive use; ii) reducing the impact of explosive objects on the life and health of the population; and iii) development of mine action management system.

The Strategy describes the management in the field of mine action. Strategic Goal 3 establishes a set of tasks to achieve this strategic goal. This includes the provision of the necessary capacity for executive authorities responsible for managing mine action as well as an implementation of an effective task prioritisation system in the field. It aspires to improve the coordination of mine action efforts at the local level and implementing effective communication between executive authorities and local self-government bodies at the national and sub-national level. In addition, it adds a unified information management system. Strategic Goal 2 covers an efficient coordination of risk awareness training.

The Strategy supports the efficiency of mine action operators. Strategic Goal 3 purposes the establishment of uniform certification procedures for operators and mine action processes. The introduction of innovations in the field as stipulated under Strategic Goal 1 will increase the efficiency of mine action operators.

The Strategy aims to prevent accidents. Strategic Goal 2 envisages to ensure public awareness of the geographical boundaries of areas that may pose a risk of explosive objects, including through effective marking of the respective territories. The goal intends to facilitate an efficient coordination of risk awareness training associated with explosive hazards. Strategic Goal 3 encompasses the implementation of mechanisms to prevent the engagement of individuals in work on hazardous areas outside established requirements, and determination of accountability in case of their involvement in such work.

The Strategy describes the mechanisms to ensure comprehensive assistance to victims. Strategic Goal 2 entails an adequate and accessible social protection for people affected by explosive ordnance, including through effective cross-sectoral coordination on the organisation of respective assistance, provision of appropriate and accessible social rehabilitation services and accessibility and barrier-free access to communities where such people live.

The Strategy focuses on innovation. Strategic Goal 1 aims at facilitating an environment conducive to innovation in the field of mine action. It stipulates the creation and/or functioning of an environment favourable for the introduction of innovation and production, and the implementation of innovative technologies that have proved their effectiveness.

The Strategy promotes gender balance and representation. Strategic Goal 1 aspires to ensure an adequate supply of human resources in the field by involving representatives of social categories and groups of particular interest to the state in professional participation in mine action activities. The strategy aims at the involvement of women, veterans, persons affected by explosive objects, and persons with disabilities.

The Strategy aims at developing the private market. Strategic Goal 1 envisages the stimulation of the mine action services market. Furthermore, it is aiming at facilitating an environment conducive to innovation in the field of mine action and provides conditions for the development of national production of goods for mine action and their service in Ukraine.

The Strategy focuses on an effective and transparent coordination with donors. Strategic Goal 3 proposes an effective utilisation of international technical assistance in mine action activities. Ukraine will introduce a mechanism to prioritise the needs for donor assistance in the field. The Strategy plans to ensure the transparency about the use of the assistance provided by introducing effective and sufficient mechanisms. Once introduced, the measure will help to prevent corruption and to comply with the responsibility to donors.

The Strategy puts the basis for forming the system of prioritisation of tasks in mine action. Strategic Goal 3 provides for the implementation of an effective task prioritisation system in the field. Strategic Goal 1 mentions the definition of criteria for removing lands of territorial communities from suspicion of the presence of explosive ordnance. The Action Plan accompanying the Strategy stipulates the adoption of a system of prioritisation of tasks in mine action in 2024.

Commission Assessment: Satisfactorily fulfilled