NEFCO provides loan for investments in energy efficiency in Zhytomyr

NEFCO and the city of Zhytomyr have today signed a loan agreement worth EUR 3 million aimed at implementing energy efficiency measures in 19 municipally-owned buildings, such as schools, day care centres and departments belonging to the Central City Hospital. 

In practice, the project will mainly focus at installation of individual heat substations, thermal insulation of roofs and facades as well as replacement of old windows with new energy efficient ones.

The project is co-financed by grant funds provided by the Eastern Europe Energy Efficiency and Environment Partnership (E5P) and the Swedish International Development Cooperation Agency (Sida) in addition to the city’s own funds. The technical assistance necessary for the project preparation and implementation was provided by the Swedish government. The project is also supported by the German development organisation GIZ. The overall budget for the investment is EUR 4.7 million and NEFCO is the implementing agency for the project.

“Given the difficult times Ukraine is going through, I appreciate even more than usual the possibility of signing this agreement. The project will solve only a small part of the problems that lay ahead of all local authorities in the country, but I believe it is an appreciated and clear signal that NEFCO’s ambitions to work in Ukraine remain. It’s a long term commitment,” says Ulf Bojö, Senior Investment Manager at NEFCO.

By implementing this project, the city of Zhytomyr will be able to reduce gas consumption in the buildings concerned by some 1.5 million cubic metres annually. This means that around 13,300 megawatt hours less heat has to be produced per year as a result of the investment. The environmental payoffs will also be substantial, with an annual reduction of CO2 emissions by some 2,700 tonnes.

This is already the third NEFCO-financed energy-efficiency project to be rolled out in Zhytomyr. In 2012, NEFCO financed a project to revamp Zhytomyr’s street lighting system and refurbish municipally-owned buildings with more efficient insulation systems and individual heat substations. The Swedish funding facility known as DemoUkrainaDH has also provided funds for a project aimed at upgrading the district heating system in Zhytomyr. DemoUkrainaDH combines grant funding from Sida with loans from NEFCO.

The loan and grant agreements between NEFCO and the City of Zhytomyr, together with the Funding Agreement between EBRD and NEFCO were signed today in Kiev in connection to NEFCO’s Board meeting. NEFCO’s loan portfolio in Ukraine currently comprises 45 active projects in a wide range of different sectors. In 2013, over 22 per cent of NEFCO’s lending was targeted to Ukrainian investments.

For more information, please contact:

For interviews in Ukrainian: Chief Investment Adviser Julia Shevchuk, + 380 50 358 3518

For interviews in Russian: Senior Investment Manager Ulf Bojö, mobile: +358 40 527 3699

For interviews in English: Communications Manager Mikael Sjövall, mobile: +358 50 3535 045

Footnote: NEFCO is an international financial institution established by the five Nordic countries: Denmark, Finland, Iceland, Norway and Sweden. NEFCO finances green growth investments and projects primarily in Russia, Ukraine and Belarus as well as climate projects across the world. NEFCO's main focus is to generate positive environmental effects of interest to the Nordic region.

The Eastern Europe Energy Efficiency and Environment Partnership - E5P - is a multi-donor fund of EUR 95 million managed by the EBRD designed to promote energy efficiency investments in Ukraine and other Eastern Partnership countries. The fund complements energy efficiency loans provided by financial institutions including the European Bank for Reconstruction and Development, the European Investment Bank, the Nordic Investment Bank, the Nordic Environment Finance Corporation and the World Bank Group. Contributors to E5P include the European Union, Sweden, Ukraine, USAID, Denmark, Norway, Finland, Poland, Estonia, Iceland, Lithuania and Latvia.