The Nordic Environment Finance Corporation (NEFCO) will provide Ukrainian municipalities with loan financing of EUR 12 million to modernize water supply facilities, increase their energy efficiency and for wastewater treatment.
NEFCO and the European Union representative office in Ukraine announced the launch of an appropriate program to modernize the water supply system in Ukraine as part of the Neighborhood Investment Platform (NIP) on January 15.
As part of this program, NEFCO issued EUR 12 million for lending to Ukrainian local authorities. The EU contribution is EUR 5 million in grant assistance, and Sweden will provide technical assistance of up to EUR 1.5 million through the Swedish International Development Cooperation Agency (Sida).
As expected, water supply companies will finance part of the projects at their own expense.
“The water sector in Ukraine is in need of major investments to modernize the system, as little has been done after the collapse of the Soviet Union in the early 1990s. Tariffs do not cover the costs, and water utility companies, over 80% of them owned by municipalities, have found it hard to cope with the investments required. As a result, the performance of many of the utilities has become inefficient due to deteriorated infrastructure. A large part of the pipeline networks, pumps and water treatment and purification plants are worn out or do not meet the necessary standards,” NEFCO said on its website.
NEFCO is an international financial organization created in 1990 by the countries of Northern Europe. Its activities are related to financing practical activities that promote “green” growth.
