Ukraine faces massive reconstruction needs in the aftermath of the Russian invasion. A reconstruction programme should be focussed on low-carbon technologies taking into account the cost reduction of green technologies, Ukraine’s climate policy obligations and EU accession perspective, elevated global fossil energy prices and price volatility, as well as energy independence from Russia.
Ukraine’s electricity sector will play a salient role in decarbonising the economy. A cost-optimal configuration of the power plant park in 2032 implies a complete replacement of coal-fired power generation by renewables and gas turbines. In the transition phase, around EUR 1.5 bn per year will be necessary to finance those new generation technologies.
Ukraine needs €47bn of additional investments to reach 2NDC emission targets. The €102bn figure often mentioned includes €55bn of regular investment unrelated to NDC. Ukraine’s investment need still is high, but not as high as often mentioned. Additionally, efforts must be undertaken to re-channel some of the €55bn into “green” projects. A carbon price would be a crucial instrument to achieve this.