Ukraine seeks foreign investors in $18 bln renewables market: Bloomberg

“We must press forward, developing those resources is essential to energy independence,” she said. “Incentives for foreign investment in renewable power are attractive in this process.”

Ukraine needs foreign investors to help it reach its target in a market worth about EUR 16 billion ($18 billion), she said.

Foreign direct investment in the country is recovering, rising to $904 million in the second quarter from $352 million in the first, according to the National Bank of Ukraine. That compares with a net outflow in the first half of 2014 as the conflict with Russia escalated. Ukraine’s ambitious target for renewable energy reflects the need to cut Ukraine’s dependency on Russian gas for heat and power, said Kovaliv in an interview.

Ukraine’s earliest onshore wind and solar projects counted on loans from development banks including the European Bank for Reconstruction and Development. Kovaliv said Ukraine is offering added inducements for clean energy investors alongside feed-in-tariffs, including exemptions on VAT and import duties that expire in 2019.

Ukraine is focusing its clean energy policy on bioenergy, including pellet-fired thermal power, in a drive to reduce 10 billion cubic meters of gas in power generation by 2020, according to a February statement of the State Agency for Energy Efficiency. The gas-saving target, outlined in a National Renewable Energy Action Plan, is equal to a quarter of the nation’s total gas consumption of 42 billion cubic meters in 2014. Reaching the target rests on a significant expansion of foreign investment.

Read alsoSwedish company to build plant for biofuel production in Dnipropetrovsk regionThe nation has about 3,650MW in thermal power capacity from biomass, according to the state agency. Ukraine can set aside about 4 million hectares of agricultural land for energy crops without any risk to agriculture for biomass, the agency said.