Facilitating a just transition for Ukraine’s coal regions

Project description

Title: Supporting structural change in Ukrainian coal regions
Commissioned by: German Federal Ministry for Economic Affairs and Climate Action (BMWK)
Country: Ukraine
Lead executing agency: Ministry of Energy of Ukraine, Ministry for Communities and Territories Development of Ukraine
Overall term: 2021 to 2024

Context

A number of coal mines in Ukraine are set to cease operations in the coming years. Around 40,000 people are currently employed in state-owned mining companies, many of them in sectors linked to the coal industry.

The labour market and economic structures in the five coal regions and 25 cities and districts are also geared to the needs of the mining sector on which they depend. The ongoing armed conflict in eastern Ukraine and environmental problems such as soil degradation and water shortages are further aggravating the situation in the Donetsk Basin.

The plan is to use strategies for a just transition and green recovery to drive structural change, which will give new impetus for growth and development.

Objective

Ukraine ensures that structural change in the context of the coal phase-out is socially and economically viable, energy-efficient and ecologically sustainable.

Approach

The project supports a dialogue on structural change in Ukraine using analyses and information exchange formats from Germany. It also advises the Government of Ukraine and the centre responsible for coordination on establishing a strategic and legal framework for structural change.

The project assists the two pilot regions of Chervonohrad (western Ukraine) and Myrnohrad (eastern Ukraine) in ensuring that mine closures are safe and environmentally sustainable. The aim is to develop a comprehensive methodology that can be applied in other regions as well. To this end, the project works with local stakeholders to find other ways of using former coal mines and to draw up plans to give the workforce and communities new opportunities. It also encourages fresh ideas on establishing new economic sectors and providing training.

In addition, the project advises the Government of Ukraine on setting up a national financing facility as a trust fund to which international donors can contribute. The fund will help the country to cope with structural change and provide social security. The project is also developing a comprehensive communication strategy aimed at gaining public acceptance for the transition.

Last update: January 2022