{"id":789778,"date":"2025-12-16T15:28:12","date_gmt":"2025-12-16T13:28:12","guid":{"rendered":""},"modified":"2025-12-16T17:44:15","modified_gmt":"2025-12-16T15:44:15","slug":"finansuvannya-yak-golovnyj-element-dekarbonizatsiyi-chomu-bez-pidtrymky-investytsij-zelenyj-perehid-nemozhlyvyj","status":"publish","type":"post","link":"https:\/\/new.eba.com.ua\/en\/finansuvannya-yak-golovnyj-element-dekarbonizatsiyi-chomu-bez-pidtrymky-investytsij-zelenyj-perehid-nemozhlyvyj\/","title":{"rendered":"Financing as the cornerstone of decarbonisation: why the green transition is impossible without investment support"},"content":{"rendered":"
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\n\t\t\t\t\t\t\t\t\t\t\t\t\t\n\n\t\t\t\t\t\t\tStanislav Zinchenko<\/span>\n\t\t\t\n\t\t\t\t\t\t\tChairman of the Committee on Industrial Ecology and Sustainable Development of the European Business Association, Director of GMK Center<\/span>\n\t\t\t\t\t<\/div>\n\n\t\t\t\t\n\t<\/div>\n\n<\/div>\n
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In public discussions at the level of ministries, experts, and advisers from international partners, economic decarbonisation is often reduced to conversations about climate change, ambitious emission reduction targets, and the \u201conly correct\u201d design of climate regulation modelled on the EU. Proponents of this approach argue that Ukraine must move in the same direction as the European Union, with all climate and economic policy instruments subordinated to the goal of reducing greenhouse gas emissions.<\/p>\n

This approach is highly one-sided and fails to take sustainable development objectives into account. Achieving climate goals cannot come at the cost of economic contraction, deindustrialisation, declining living standards, or the collapse of infrastructure. Frankly speaking, illegal logging, declining forest cover, and emissions from ageing vehicles in cities contribute more to CO\u2082 emissions growth in Ukraine than industry does.<\/p>\n

The need to reduce greenhouse gas emissions is an important framework for public policy in both the EU and Ukraine. However, the key challenge lies in financing. How should the green transition be funded? Where will the money come from?<\/strong> Without clear answers to these questions, any decarbonisation strategy risks harming Ukraine\u2019s economy.<\/p>\n

It must be acknowledged honestly: decarbonising production is extremely costly.<\/strong> Transitioning the steel, cement, and chemical industries to low-carbon technologies requires investments running into billions of euros. According to preliminary estimates, decarbonisation projects for Ukrainian steel producers alone would require around \u20ac12 billion in total.<\/p>\n

Even wealthy EU countries, with developed financial markets and access to cheap credit, have encountered difficulties. Green projects are being postponed, revised, or suspended. This is an important signal for both the world and Ukraine: if Europe is struggling, the challenges for a country at war are many times greater.<\/p>\n

Decarbonisation without a pragmatic approach will inevitably lead to deindustrialisation.<\/strong> When emission reduction requirements outpace businesses\u2019 financial capacity and technological development, companies are forced to scale back production or shut down altogether. Ukraine has already experienced this in the 1990s, and repeating such a scenario is unacceptable. Between 1990 and 2023, industrial output in Ukraine, including construction, declined by 80%. During wartime and post-war recovery, it is critically important to preserve industry as the backbone of the economy, providing jobs, exports, tax revenues, and foreign currency earnings. This is not only about survival under current conditions, but also about Ukraine\u2019s ability to recover after the war and integrate into the European economy on equal terms.<\/p>\n

Ukraine\u2019s green transition cannot be built on the logic of simply introducing environmental restrictions and increasing carbon charges in the hope that compliant, low-emission production will emerge automatically. Such an approach would lead to entirely different outcomes, Ukraine risks losing its domestic industry.<\/p>\n

That is why climate strategies should focus not on debates over carbon pricing levels, not on the technical parameters of emissions trading systems, and not even on formal CO\u2082 reduction targets. The central issue is where the funding for decarbonisation will come from<\/strong>. Without clearly defined sources of finance, all other elements lose their meaning.<\/p>\n

According to an analytical review by the Ministry of Environmental Protection and Natural Resources, the investment required to implement the Nationally Determined Contribution (NDC) plan for 2021\u20132030 was estimated at \u20ac102 billion. These are pre-war estimates and are currently being revised, but the figures still amount to tens of billions of euros.<\/p>\n

To attract financing on this scale, Ukrainian companies need access to cheap, long-term loans<\/strong>, similar to those available to EU companies through the European Investment Bank and other institutions. Grants and direct subsidies<\/strong> from European funds<\/strong> are also required, along with tax incentives<\/strong> that reduce the investment burden during the implementation of green projects. Without such support, large industrial companies simply will not be able to begin the green transformation.<\/p>\n

Existing international support instruments, including the Ukraine Facility, are primarily geared towards small and medium-sized enterprises rather than large industry, where decarbonisation projects typically start at \u20ac1 billion. Investments of this magnitude require a fundamentally different financial architecture, specialised funds, guarantees, insurance mechanisms, and risk-sharing frameworks involving the state, donors, and business. Large companies are the biggest employers, taxpayers, exporters, and customers of SMEs; therefore, genuine decarbonisation must focus on key enterprises in the industrial and energy sectors.<\/p>\n

Any Ukrainian climate strategy must, above all, be a strategy for financing the green transition<\/strong>. Without this, climate policy risks becoming a hazardous economic experiment with negative social consequences.<\/p>\n

First, it is necessary to identify the funds that can be mobilised, along with their sources and instruments. Only then should targets be set in line with available financing. Only by defining clear sources of funding can decarbonisation serve the economy, making it more modern, competitive, and resilient.<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

In public discussions at the level of ministries, experts, and advisers from international partners, economic decarbonisation is often reduced to conversations about climate change, ambitious emission reduction targets, and the \u201conly correct\u201d design of climate regulation modelled on the EU. Proponents of this approach argue that Ukraine must move in the same direction as the […]<\/p>\n","protected":false},"author":33544,"featured_media":700047,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"inline_featured_image":false,"footnotes":""},"categories":[15564,15563,15574],"tags":[],"class_list":["post-789778","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-lobbying-news-en","category-main-news-en","category-news-and-articles-from-association-en"],"_links":{"self":[{"href":"https:\/\/new.eba.com.ua\/en\/wp-json\/wp\/v2\/posts\/789778","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/new.eba.com.ua\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/new.eba.com.ua\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/new.eba.com.ua\/en\/wp-json\/wp\/v2\/users\/33544"}],"replies":[{"embeddable":true,"href":"https:\/\/new.eba.com.ua\/en\/wp-json\/wp\/v2\/comments?post=789778"}],"version-history":[{"count":0,"href":"https:\/\/new.eba.com.ua\/en\/wp-json\/wp\/v2\/posts\/789778\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/new.eba.com.ua\/en\/wp-json\/wp\/v2\/media\/700047"}],"wp:attachment":[{"href":"https:\/\/new.eba.com.ua\/en\/wp-json\/wp\/v2\/media?parent=789778"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/new.eba.com.ua\/en\/wp-json\/wp\/v2\/categories?post=789778"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/new.eba.com.ua\/en\/wp-json\/wp\/v2\/tags?post=789778"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}