Ukraine: A Milestone Law on the Energy Efficiency of Buildings Adopted

On 22 June 2017, a milestone law “On the Energy Efficiency of Buildings” No. 2118-VIII (the “Law”) was passed by the Parliament. It sets forth a new regulatory framework for energy efficiency that will apply to the majority of the buildings in the country. The framework correlates with the standards set out by the EU Directive 2010/31/EU on the energy performance of buildings. The Law is effective since 23 July 2017, however, certain provisions (for example, the ones related to mandatory energy efficiency certification) will come into effect even later – on 01 July 2019.

The Law appears to be the Government’s attempt to tackle one of the main problems of Ukraine’s energy sector – its energy inefficiency: households waste 60% of energy or USD 3 bln annually through the inefficient use of energy resources. Please find below an overview of the most important novelties introduced by the Law.

Energy Efficiency of Buildings

The Law establishes the minimal requirements for the energy efficiency of buildings in Ukraine and also implements a mandatory certification system. These compliance and mandatory certification requirements shall be applicable to all buildings, except for the following types:

1. buildings used for industrial and agricultural purposes, energy facilities, warehouses and buildings used for the purposes of transportation, communication and defense;
2. individual residential houses, garden cottages and summer houses (except for cases where state support was granted to perform thermal modernization or if such buildings are certified voluntarily, at the request of their owners);
3. buildings for religious services and meetings;
4. cultural heritage sites and buildings; and
5. standalone buildings with a heating area of less than 50 sq.m.

The Cabinet of Ministers of Ukraine is expected to elaborate on the detailed list of such buildings within six months of the Law coming into force.

The Ministry of Regional Development, Construction and Housing of Ukraine shall provide more detailed information on the minimum requirements for the energy efficiency of buildings and the methodology for determining the energy efficiency level, with due considerations being given to the requirements of the respective EU legislation and the acts of the Energy Community.

The energy efficiency level of the buildings that are subject to commissioning may not be lower than the minimum standards, effective and applicable as of the date when construction work was commenced.

Certification of the Energy Efficiency of Buildings

Certification of energy efficiency shall be mandatory for the following categories of buildings starting from 01 July 2019:

1. buildings with CC2 (medium) and CC3 (high) categories of consequences (construction complexity) assigned to them;
2. state-owned buildings with a heating area exceeding 250 sq.m that are often frequented by visitors and where all of the premises are occupied by the state authorities;
3. buildings with a heating area exceeding 250 sq.m, and where all of the premises are occupied by the municipal authorities (if thermal modernization is carried out); and
4. buildings that are undergoing thermal modernization which is financed by the state in order to increase their energy efficiency level up to the established minimal requirements.  

Certification of the buildings’ energy efficiency shall be performed by a certified energy auditor at the expense of the building owners, HOAs (homeowners associations), managing associations of the multi-family buildings, or state authorities (in compliance with the applicable regulations).

Certification of buildings other than those listed above is not mandatory, but may be performed at the owner’s request and expense. The energy efficiency certificate shall be included in the project and design documentation and shall be valid for 10 years, unless cancelled earlier (where a new certificate was issued).

The Ministry of Regional Development, Construction and Housing of Ukraine will adopt a standard form for the energy efficiency certificate, set out the procedure for its compilation and also approve the procedure according to which the energy auditors shall perform the certification services.