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ICU to build recycling plant in Zhytomyr

One of Ukraine’s largest investment funds, Investment Capital Ukraine, is to build the largest plant for recycling solid household waste in Ukraine, the firm announced in a press release on July 26.

The ICU-funded plant will be built within one year in Zhytomyr – a city about 140 kilometers west of Kyiv – with the total investment in the project being 7-10 million euros. The plant is expected to process about 82,000 tons of waste annually.

“After the implementation of the project in Zhytomyr we are considering the possibility of building such plants in other cities of Ukraine,” ICU Managing Partner Konstantin Stetsenko is quoted as saying in the press release.

While ICU, an asset management and private equity firm with close ties to Ukrainian President Petro Poroshenko, is planning to build a plant, Ukraine’s only operating waste incineration plant, Enerhiya, stopped accepting waste on July 22 in Kyiv as it has been transferred from Kyivenergo, the capital’s energy and electricity supply monopolist, owned by Ukraine’s richest man Rinat Akhmetov, to municipal enterprise Kyivteploenergo.

The plant recycles about 25 percent of the city’s municipal solid waste and can provide about 300 buildings with heating and hot water.

Waste problem

But for Ukraine’s 42-million-or-so population, there are simply not enough waste-processing plants to cope with the amount of waste they produce. As a result, Ukraine has already accumulated 36 billion tons of garbage in landfills, according to Ostap Semerak, Ukraine’s minister of Ecology and Natural Resources.

Only five percent of Ukraine’s household waste is recycled in Ukraine. On average, Ukraine produces about 10 tons of waste per person every year, while the amount in the European Union is half that, the minister said.

“This is according to official data. In fact, the real situation is probably even worse,” Semerak said.

Given those alarming figures, Ukrainian lawmakers decided back in November 2017 to start looking for solutions and adopted a resolution entitled “The National Strategy for Waste Management in Ukraine until 2030.”

According to the strategy, Ukraine will aim to significantly reduce the disposal of household waste in landfills – from the current 95 percent to 30 percent in 2030. To achieve this goal, the country will need to launch 800 new waste-recycling plants and 20 waste-incineration plants.

“Indeed, it’s very positive that the Ukrainian government finally launched a National Waste Strategy last year,” Matthias Vogel, the head of French waste management company Veolia Ukraine, told the Kyiv Post. “So far, unfortunately, theoretical approaches have not yet turned into tangible projects.”

Cheap route

One simple reason cities don’t process waste is that it’s cheaper just to take waste to dumping sites and bury it.

“Cities (in Ukraine) cannot (afford to) pay for recycling. All over the world, this service costs 30-130 euros per ton, depending on the depth and method of processing,” said Igor Tynnyi, a member of Ukrainian Prime Minister Volodymyr Groysman’s Innovation Council.

Investment climate

In addition, Ukraine has done very little to create the appropriate conditions to attract investors to the industry.

“Investors who are ready to create a garbage processing industry from scratch, and give the country 30,000-40,000 jobs and clean the environment, expect from Ukraine clear laws and honest taxes (in return),” Tynnyi said.

Moreover, despite Ukraine’s intentions to make large-scale changes in the treatment of waste under the strategy, some experts are skeptical the plans can be implemented.

According to Olena Koltyk, the director of development at the Ukrainian Association for Renewable Energy, the strategy is nonobligatory, and will simply remain a statement on intention if no legislation is adopted to create better conditions for investors.

“There are a number of draft laws (on waste management) that have not been considered in parliament over the past two years,” Koltyk said.

“On the other hand, some alternative waste recycling laws are being developed, but nobody has yet seen any proposals, nor any models for how it will work,” she said.