The annex to Lutsk SEAP is a catalog of investment projects (hereinafter – the Catalog). Information is provided in the Catalog in terms of municipal sectors:

1) heat energy generation, transportation, supply and consumption;

2) outdoor lighting;

3) water supply and sewage;

4) transport;

5) alternative energy; and

6) greenery planting, etc.

For each municipal sector, a list of project proposals is suggested. All financial indicators of the projects are evaluated in view of the 15-year planning horizon. To assess the financial flows of the projects, the forecast on prices for energy and energy services was used, also amount of investments and economic performance indicators are presented for each project proposal. The catalog includes those projects and measures that have maximum economic, climatic and/or social effect.Investment projects in the transport sector will have the greatest impact on reducing CO2 emissions – 12.2%. The second place belongs to implementation of the energy efficiency measures in the sector of residential buildings (7.3%). Reconstruction of the heat supply system will give a contribution of 2.9%. Effect from introduction of the alternative energy sources (AES) is 1.1%, and reconstruction of the existing green areas of the city, renewal of vegetation in the common use areas etc. – 0.7%. The lowest contribution to reduction of CO2 emissions is made by the projects in the solid waste management sector (0.1%).

It is proposed to use 8 financial sources for financing of the Sustainable Energy Action Plan. Among them: the municipal budget, funds of the communal utilities, private investors and concessioners, city residents. It is also proposed to use non-traditional sources of project financing: grants and patronage. In the sources of SEAP financing, the largest portion belongs to the municipal budget (41%), borrowings (31%), private investments (including funds of the patrons – 25%). Insignificant portion (3%) – own funds of the communal utilities.

The Chart with distribution of financing by sectors is presented below. Total amount of investment projects financing in 2015-2025 will be UAH 2,104 mln.

Financing of SEAP Projects and Programs in 2015-2025 (UAH mln)

 

HEAT SUPPLY 

Total funding envisaged for 11 proposed projects is UAH 371 mln., average payback period – 4.8 years.

Heat energy production for the needs of heating and hot water supply in Lutsk is primarily provided by the heat generating utility “Lutskteplo”. It also operates the district and de-centralized heating systems of the city. The utility provides heating services to 67.5% of residential and public buildings of the city with total space of 2,401,576 m². Aggregated heat capacity of the boiler houses is 496.74 Gcal/h, connected capacity – 264.42 Gcal/h. Number of installed boilers – 180, of which 40% are in operation for more than 20 years. Total length of the heating networks in two-pipe measurement is 137.7 km, of which 70% are in dilapidated and emergency condition.

The projects included in the catalog of investment projects provide for increased efficiency of heat energy production, reduction of losses in the course of heat generation and transportation, which will lead to reduction of CO₂ emissions. They include: replacement of the boilers in the district heating system with more efficient ones; construction of new and reconstruction of existing boiler houses; reconstruction of central heat substations and heating network pipelines; automation of the heat generation, transportation and supply systems and plants; natural gas substitution with alternative energy sources, use of the landfill gas; installation of heat energy meters; reconstruction of the heat supply systems through merger of the local heating networks from the boiler houses and transition to new energy sources.

CU “Lutskteplo” is in the final phase of signing a contract on receipt of Euro 10 million loan and Euro 4 million grant from EBRD. 11 projects included in SEAP will be financed from this loan. It is expected that the grant will finance installation of the individual heat substations in 200-250 residential multi-apartment buildings (out of 600 included in SEAP).

In case of implementation of all measures in the heat generation and transportation sector, it is possible to achieve reduction of CO₂ emissions by 21,568 t/year or 2.94% of the baseline. Total reduction of energy consumption is expected in the amount of 6,624 th. m³ of natural gas and 7,296 MWh of electricity a year.

 

ALTERNATIEV ENERGY SOURCES (AES)

Total funding envisaged for 7 proposed projects is UAH 142.5 mln., average payback period – 5.3 years.

Share of heat energy production with the use of alternative energy sources (AES) is insignificant in Lutsk (less than 0.2% as of 2014). There are five boiler houses on solid fuel in the city. Total installed capacity – 0.655 MW, of which 0.29 MW was commissioned in 2014. Other AES types are not used for heat production. None of them can be used for substitution of the conventional energy sources to a considerable extent. They are present in the SEAP catalog of investment projects only in the form of pilot and demonstration projects. Among all AES types, the highest potential belongs to biomass which can be used for production of heat energy and electricity, thus substituting natural gas and coal.

In case of implementation of all alternative energy projects, it is possible to achieve reduction of CO₂ emissions by 7,957 t/year or 1.08% of the baseline. Total reduction of energy consumption is expected in the amount of 84 MWh of heat energy (in the sector of public buildings), 4,335 th. m³ of natural gas and 3,000 MWh of electricity.

 

WATER SUPPLY AND SEWAGE

Total funding envisaged for 25 proposed projects is UAH 65 mln., average payback period – 2.1 years.

The district water supply system covers 81% of the city population, the sewage system – 77%.

Water supply, sewage and treatment of wastewater received from the households and industrial consumers, state and commercial companies is performed by CU “Lutskvodokanal”. Total length of water pipelines is 314.5 km (168.2 km in unsatisfactory and emergency condition).

The sewage system consists of 207.2 km of networks and collectors, 19 sewage pumping stations (one of which is being disassembled) and treatment facility with installed capacity of 120 th. m³ a day. The municipal sewage system is incomplete and segregated. The scheme is de-centralized. Length of main collectors is 56.9 km, of street networks – 79.2 km, of internal block networks – 71.1 km. The outdated and emergency collectors have length of over 82.43 km. 30% of total length of gravity collectors are in the most emergency condition.

The projects included in the catalog of investment projects are aimed at: (1) optimization of water-intake system with bringing efficiency coefficient of the pumps to 75% and improved specific energy consumption; (2) modernization of pumping equipment; 3) reconstruction of water pipelines; (4) disconnection of low-debit and hydraulically inefficient well holes; (5) introduction of technological water intake schedules; (6) automation and dispatching of all well holes in the water intake system; (7) modernization of pumping equipment at the sewage pumping stations.

In case of implementation of measures in the water supply and sewage sector, it is possible to achieve reduction of CO₂ emissions by 5,302 t/year or 0.72% of the baseline. Total reduction of energy consumption is expected in the amount of 4,571 MWh of electricity.

 

TRANSPORT

Total funding envisaged for 12 proposed projects is UAH 528 mln., average payback period – 7 years.

Most of the cargo and passenger transportations in Lutsk are conducted by electric transport (trolleybuses), buses, passenger cars, cargo road and rail vehicles. The trolleybus transportation is carried out by CU "Lutsk Electric Transport Company." Total length of the trolley network is 109.15 km, the number of traction substations – 9. The operating length of trolleybus lines is 276 km. The bus network covers 67 streets and avenues, with 330 public transport stops. Since 2008, due to reform of the public passenger transport sector, the number of small capacity passenger city buses was significantly reduced on the routes of the city.

The main problems in the municipal transport sector include: lack of an effective comprehensive system of traffic organization, significant crowding of the city central part with traffic; duplication of the trolley routes with the bus routes; permanent reduction in the number of trolleybuses and their replacement with the buses; lack of parking spaces in the downtown area; absence of the comprehensive automated system for transport management; increasing share of private vehicles on the background of decline in the share of municipal public passenger transport in the structure of fulfilled transportation work. The transport sector of the city will require in 2016-2025 UAH 528.1 million.

The projects included in the catalog of investment projects are aimed at: procurement of new trolleybuses, improvement of the trolleybus trolley system, replacement of the buses with trolleybuses, etc. The city is also planning to arrange the junctions and streetlights, introduce the paid parking areas, automated system for transport management, construct the junctions with underground pedestrian crossings, the draw-ins for public transport stops on the routes of common use, create the developed cycling infrastructure. Many of these projects can be implemented together with the private investor on the terms of public-private partnership. Thus, the new types of business and jobs will be created, and the city will receive more developed and Europe-oriented transport system and improvement of the environmental situation.

One of the priorities in the transport infrastructure development is increase of the share of environmentally friendly transport, primarily, trolleybuses. The city authorities plan to improve the trolleybus trolley network, upgrade the rolling stock and replace part of the buses with trolley buses on the city routes. Total amount of investments required for this project is estimated at $ 10 million. Unfortunately, such projects in the conditions of current tariffs for internal city transportation have low financial indicators: the payback period is about 15 years, IRR – 8%. Perhaps, partial co-financing from the city and the Regional Development Fund, as well as favorable credit conditions will allow to implement this much needed project for the city.

In case of implementation of measures in the transport sector, it is possible to achieve reduction of CO₂ emissions by 89,833.8 t/year or 12.23% of the baseline. Total reduction of energy consumption is expected in the amount of 25,872 t of gasoline, 3,279 t of diesel fuel and 89,834 MWh of electricity.

 

OUTDOOR LIGHTING

Total funding envisaged for 5 proposed projects is UAH 57 mln., average payback period – 8 years.

The outdoor lighting networks of Lutsk are in the balance sheet of CU "Lutsk Electric Company – "Lutsksvitlo" (hereinafter CU "Lutsksvitlo") which is the only company in the city performing work on major, ongoing repairs and maintenance of the outdoor lighting networks. Total length of the networks is 372.7 km. Altogether, there are 9,421 light sources. The general condition of the outdoor lighting system is characterized by large above-norm electricity consumption, low lighting level in the city streets, squares and public gardens in the evening and at night. About 60% of lighting sources in the city do not meet the modern standards. Energy efficiency improvement can be achieved through more active installation of the energy efficient and reliable lighting fixtures, expansion and modernization of the automatic control system for outdoor lighting, replacement of the existing “naked” wires with more reliable self-retaining insulated wires.

The projects included in the catalog of investment projects are related to modernization of the outdoor lighting in the city. Key directions of the projects in this sector include: full replacement of the lighting fixtures with incandescent lamps with LED lighting fixtures with LED light sources; lighting fixtures with arc mercury lamps – with lighting fixtures with sodium discharge lamps and LED lighting fixtures, etc.

In case of implementation of measures in the outdoor lighting sector, it is possible to achieve reduction of CO₂ emissions by 3,458.1 t/year or 0.47% of the baseline. Total reduction of energy consumption is expected in the amount of 2,981 MWh of electricity a year.

 

PUBLIC BUILDINGS

Total funding envisaged for 15 proposed projects is UAH 111 mln., average payback period – 6.9 years.

One of the main consumers of heat in Lutsk are public buildings and residential buildings. Total heated space of the municipal public buildings is 1,095,581.1 m².

For fulfillment of SEAP tasks already before 2020, the city plans thermal modernization of 77 public sector buildings: schools, kindergartens and hospitals. In 2016, the USAID Project, on the basis of the conducted energy audits, has developed a business plan for the city, after reviewing of which NEFCO decided to give UAH 10.4 million loan to Lutsk. The city is preparing an application to E5P for receipt of UAH 5.2 million grant. Successful experience of the business plan implementation became a guarantee and the basis for further cooperation between the city and NEFCO. In the near future, its representatives will examine another 46 buildings of this sector. They will select from them the objects to be insulated according to SWEKO Project.

Most investment projects on thermal modernization of public sector buildings have quite attractive financial indicators. In general, the amount of investments in the sector of public buildings of Lutsk is estimated at over UAH 350 million.

In the SEAP catalog of investment projects, a lot of measures are proposed for the public buildings. They include: modernization of the heating systems with installation of the individual heat substations and balancing of the heating systems through installation of balancing valves, replacement of incandescent lamps with compact fluorescent lamps, heat insulation of the pipelines and stop valves in the heating and hot water supply systems, replacement of old doors and windows, heat insulation of external walls and roofs, etc.

Implementation of the project proposals in this sector will allow to reduce CO₂ emissions into atmosphere by 1,681 t/year or 0.68% of the baseline. Total reduction of energy consumption a year is expected in the amount of 17,389 MWh of heat energy and 134 MWh of electricity.

 

RESIDENTIAL BUILDINGS

Total funding envisaged for the projects is UAH 654 mln., average payback period – 4.5 years.

The total number of residential multi-apartment buildings connected to the district heating systems is about 1,500. Their total heated space is 2,582,599 m². In 592,273 m² of residential buildings the heat meters are installed, this is 22.9%. However, 70% of the district hot water supply customers are equipped with the hot water meters.

The main areas of the clean energy projects in the housing sector of the city are: installation of the building-level heat energy meters and individual heat substations with weather-based controls; reduction of non-productive losses of heat and other energy carriers in the buildings.

General reduction of CO₂ emissions in the residential (building) sector on the stage of heat consumption is 53,560 t/year or 7.29% of the baseline. Total reduction of energy resources consumption is expected in the amount of 117,458 MWh of heat energy and 164 MWh of electricity a year.

 

SOLID WASTE MANAGEMENT

Total funding envisaged for 2 proposed projects is UAH 3 mln.

One of these projects may be especially interesting for the investors – "Heat Energy and Electricity Generation with Use of Landfill Gas." It involves organization of the system for collection, transportation, treatment of landfill gas (3.2 million m³ of landfill gas a year with combustion heat up to 14,000 kJ/m³) and its use as fuel to produce heat and electricity. The project requires about $ 4 million of investments and has attractive financial indicators (IRR – 24%, NPV – UAH 22 million). Currently, the project feasibility study is under development.

Implementation of the project proposals in this sector will allow to reduce CO₂ emissions into atmosphere by 442 t/year or 0.06% of the baseline. Total reduction of energy consumption a year is expected in the amount of 139 t of diesel fuel.