NEFCO signs new framework agreement with Ukraine

The Nordic Environment Finance Corporation, NEFCO and the Ukrainian government have today signed a new framework agreement, which acknowledges NEFCO’s status as an international financial institution operating in Ukraine. The signing of this landmark agreement will pave the way for new energy efficiency projects in the country. NEFCO has financed environmental projects in Ukraine since 2003. However, these financial arrangements have not included the framework agreement, and this has prevented NEFCO from financing ventures such as municipal energy projects in the country.

The signing of the framework agreement coincided with an international conference on energy efficiency, which was being convened in Donetsk, in South Eastern Ukraine. During the signing ceremony, the Ukrainian government was represented by Sergiy Iermilov, the head of the National Agency for Energy Efficiency, NAER, and NEFCO by managing director Magnus Rystedt and vice president Torben Vindeløv.

”We currently have over 70 projects in the pipeline in Ukraine, and many of them can now be implemented thanks to the new framework agreement, which opens up new possibilities for innovative environmental financing”, says NEFCO’s managing director, Magnus Rystedt.

NEFCO has so far approved 19 million EUR for financing 29 projects valued at 55 million EUR in Ukraine. The projects have mainly been in the energy, agricultural, industrial and banking sectors. Most of the projects have included technological measures to reduce energy consumption and the releases of carbon dioxide or other climate gases.

”We hope that this agreement will inspire Ukrainian municipalities and municipal enterprises to invest in energy efficient technologies by utilising the loans that we have provided.
Besides our financial investments, we are offering Ukraine the opportunity to utilise the environmental management experience available in the Nordic countries”, says vice president Torben Vindeløv, who is in charge of NEFCO’s lending operations in Ukraine.  

The Ukrainian loans currently account for 7.9 per cent of funds disbursed by NEFCO’s two financial instruments; the Investment Fund and the Nordic Environment Development Fund. Last year NEFCO’s board of directors approved eight loans for Ukraine. Some of the projects financed by these loans are directed towards the efficient processing of pig manure and biogas production as well as the installation and upgrading of energy-saving technologies on wood furniture manufacturing plants.  Some funds have also been directed towards the installation of new substations for district heating systems. In addition, NEFCO manages two carbon funds that are available for financing projects in Ukraine.

NEFCO is an international financial institution owned by the five Nordic countries that mainly finances investments and projects in Russia, Ukraine, Estonia, Latvia, Lithuania and Belarus, in order to generate positive environmental effects for  the Nordic region. NEFCO currently administers funds valued at some 353 million euros. The climate related projects financed by NEFCO last year reduced the carbon dioxide emissions by 1.5 million tonnes.  www.nefco.org

For more information, please contact:
Magnus Rystedt, Managing Director, NEFCO, +358 50 3296 224
Torben Vindeløv, Vice President, NEFCO, +358 50 520 7249
Mikael Sjövall, Communications Manager, NEFCO, +358 50 3535 045