The Decarbonisation Fund may become a powerful instrument, but all depends on the revenue
Daryna Kulaha, DiXi Group Junior Analyst, analysed the initiative to create the Decarbonisation Fund in Ukraine.
In November 2020, the Energy Ministry came up with an initiative to create the Decarbonisation Fund with the support from the Ukrainian-Danish Energy Center and the State Agency for Energy Efficiency and Energy Conservation. The Fund is expected to provide support to projects concerning modernisation of generating enterprises and heat networks, domestic waste processing, public and personal electric transport, bioenergy and other. A portion of carbon dioxide emission tax is going to be the main source of the Fund’s revenues. Also, the draft law 4347 on the establishment and revenues of the state decarbonisation fund was submitted to the Verkhovna Rada on 9 November.
Overall, the Energy Ministry’s proposal is essentially a step in the right direction, because it actually has the purpose of spending the greenhouse gas emission charge specifically on reducing emissions of those very greenhouse gases, thus performing a stimulating role in the transition to the “green” economy.