ABOUT THE DIRECTION FOR A SECOND READING DRAFT LAW ON ENERGY FUND

21.05.2017

Association of Energy Auditors in Ukraine is a specialized organization which has been actively operating in energy efficiency sector since 2008 – is appealing to you not to accept in the second reading the Draft Law on Energy Efficiency Fund (registration number 5598 dated 26.12.2016).

Association of Energy Auditors in Ukraine strongly recommends having the Energy Efficiency Fund instrument, but certainly not in the form of the structure and functionality offered by the Government and Ministry of Regional Development. There are three main reasons not to accept the Draft Law as it is now:

1. Unacceptable and unnecessary is the closed form of the Fund as a legal entity which provokes the long list of problems and risks to the method and quality of using the funds, therefore the threat of corruption activities of the Fund (such as separate balance, separate account, director and supervisory board where you can not get online finance data and other technical information, as well as it is not possible to obtain operational information from the State Property Fund).

2. Unacceptable is the incapable and inefficient model of Fund management and allocation of significant resources. The Supervisory Board of 5 persons, fully dependent on the CMU without special skills and experience will allocate billions of UAH – this is inadmissible!

3. Inability to control cost-effectiveness for energy efficiency programs and projects – there are no criteria and mechanisms for assessment of achievement as actually there is no clear indication of the gained results and evaluation methods; the mechanisms of technical and financial offices (key organizational structures) are not described at all!

Key proposals and amendments to the bill in terms of articles and conclusions and justification are given in the table attached.

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