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24 October, 2013 18:12   ▪  

Financial Times: Improving Ukraine's energy-wasteful housing stock is one way to get away from Russia's grip

Instead of buying much gas from Russia and paying high price for that, Ukraine may get efficient and use less gas, Roman Olearchyk in his article for FT blog beyondbricks says.

“Luring in multi-billion-dollar investments from the world’s top energy companies – such as Royal Dutch Shell, Chevron, ExxonMobil, Eni and EDF – to explore the nation’s potentially vast hydrocarbon reserves is one long-term solution. In the interim, the country is looking to diversify supplies from the EU. But there’s another way: get efficient, and use less gas in the first place,” Olearchyk claims.

As he admits, Ukraine consumes several times more fuel in relation to GDP than neighbouring Poland and other EU countries. Both industry and domestic users could become more efficient.
For now leaders in this effort have been the country’s vast industrial giants, starting with billionaire-owned metallurgical factories that have cut annual gas consumption from 9.6bn cubic metres in 2005 to 4.8 bcm last year.

READ ALSO: After Gas

Attention is now turning to boosting energy efficiency in one of the economy’s most wasteful sectors – household heating and hot water systems designed and built in Soviet days, Olearchyk reports.
‘Ukraine’s energy ministry revealed that nationwide gas consumption was down 7.7 per cent year-on-year to 32 bcm in the first eight months of this year. Imports – mostly from Russia – decreased by a whopping 29.7 per cent during this period to 15 bcm, though they were expected to increase as winter approaches,” he claims.

According to the European Bank for Reconstruction and Development, “Ukraine has one of the largest housing stocks in Europe (over 10m buildings) and it is desperately wasteful. Poor condition of the housing stock means that the energy wasted by utility companies and the government subsidies paid to these and to domestic users, together total 12bn hryvnias ($1.5bn) or about 1 per cent of GDP.”


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