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EU4Energy supports the development of energy performance contracting and ESCO business in Belarus

EU4Energy Governance commenced an activity together with Gosstandart’s Department for Energy efficiency of Belarus to support the development of a legislative and regulatory framework for energy service companies. The first meeting of the Inter-Ministerial Working Group established to discuss key directions for the draft legislative proposals, took place 20 November 2018 in Minsk. Members of the group include representatives from the Department for Energy Efficiency,  Ministry of Energy, Ministry of Economy, the Ministry of Antimonopoly Regulation and Trade and the Ministry of Housing and Communal Services. The meeting was also attended by representatives of the business community and international financial institutions.

EU4Energy experts presented European and international examples of applying energy performance contracting in practice, identifying the main barriers to the energy services market development in Belarus and finally presenting two possible scenarios that Belarus could pursue. Both scenarios require a different level of amendments to the existing legislative, institutional and financial frameworks. As observed by the meeting participants, the “slow motion” scenario requires more efforts and a longer timeframe in comparison with the “fast run” scenario proposing the establishment of the state-owned Super ESCO responsible for the overall coordination of EPC contracts until the development of a robust legislative framework. 

It was noted by meeting participants that although many attempts to encourage the initiation of ESCO markets in developing countries have not been very successful, some recent experiences demonstrate how governments can help by promoting simple business models by facilitating ESCO financing, making legislative, regulatory, and policy changes and creating demand in the public sector. All this is possible in Belarus but requires a determination to make the necessary arrangements and/or changes to make the model operational and adapted to the specific Belarusian situation.

This technical assistance activity is part of EU4Energy, an EU-supported initiative providing technical assistance to countries of the Eastern Partnership that seek to approximate areas of their energy sectors with best practices in the European Union. In addition to Belarus, the Energy Charter Secretariat also collaborates with Armenia and Azerbaijan.