Description

The European Neighbourhood and Partnership Instrument (ENPI), is the main financing tool for provising assistance to Ukraine, and aid delivery to Ukraine and other EU neighbourhood countries will increasingly rely on their national systems through the progressive focus and use of mechanisms such as budget support.  In the case of Ukraine, budget support has been pioneered to take place in the energy sector of the country. The EC Budget Support programme to the energy sector of Ukraine is the first of its kind in Ukraine and in ENPI countries, and follows the signing of the Financing Agreement by the EC and the Ministry of Economy in September 2008.

In accordance with the agreement, an Energy Sector Budget Support (ESBS) programme worth €82 million to the Ukraine Government is to be disbursed in two tranches – fixed and variable. The fixed tranche has been disbursed (€23 million in December 2008 and another €17 million in September 2009). The second, variable, tranche of €42 million is conditional upon the attainment of results under a list of performance indicators, each of which is accorded a unit weight, whilst for many of the variable tranche indicators there are additional sub-indicators. The decision for payments under the variable tranche will in principle be made by the end of 2011.

The objectives of the Technical assistance project to the ESBS of Ukraine:

  • assist the EC and the beneficiary in monitoring progress and reporting against these performance  indicators
  • provide capacity development to MoFE for managing, implementing, monitoring and reporting the budget support programme
  • assist in the fulfilment of performance indicators, and more generally, to support Ukraine in its implementation of its Energy Strategy, by providing necessary assistance, skills, knowledge, procedures and systems that will ensure the detailed and practical development, application and monitoring of the necessary policies, legislation, regulations, rules and activities for energy strategy implementation.

The specific actions that are planned to be undertaken within the TA project to the ESBS of Ukraine, to ensure that the objectives are achieved, include:

  • capacity building to the Ministry fo Energy and Fuel (MoFE) of Ukraine and effective transfer of knowledge and skills to MoFE and other beneficiaries and stakeholders, in order to, inter alia, establish and manage the monitoring system for budget support
  • review existing data collection and reporting systems, and design and implement new systems as appropriate
  • support to the ESBS Joint Monitoring Group (JMG)
  • design and organisation of appropriate training, workshops, study tours etc
  • provision of ad hoc assistance for fulfilling the ESBS performance indicators
  • provision of specialist assistance to develop and refine Ukraine’s Energy Strategy and to develop sub-sectoral programmes within the framework of the energy strategy
  • carry out studies in areas related to the fulfilment of the indicators for the ESBS programme
  • recommend and draft legislative provisions and changes consistent with the EU energy acquis
  • assistance regarding the formulation of bankable projects for the modernisation of Ukraine’s gas transit network
  • assistance in preparing the loan packages for particular fundable gas transit projects
  • assistance to the JMG with the preparation of the external mid-term evaluation of the ESBS programme
  • ensuring communication and visibility of the programme and its actions

 

Client

EU

Start Year
2010
End Year
2011
Country (ies)
Ukraine
Sector(s)
Service(s)