Climate Change Programme
What projects are funded by the Climate Change Programme?
The third section of it regulates trading in emission allowances (ETS) and Kyoto units, including the assigned amount units (AAUs). In order to create a separate programme for the collection of funds received from the sale of emission allowances and for the financing of mitigation of climate change projects, a special programme for climate change has been established as provided for in Article 10 of this Law.
In the context of the implementation of the Republic of Lithuania Law on amending Articles 2, 9 and 10 and Articles 1 and 2 of the Law on Financial Instruments for the Management of Climate Change, the special programme on climate change is called the Climate Change Programme (hereinafter the Programme) from 1 January 2019.
The Programme account will include funds received for the transferred AAUs and allowances auctioned, voluntary funds and economic fines collected from natural and legal persons.
The funds of the Programme are used in the following areas:
- energy consumption and efficiency improvement projects (e.g. renovation of multi-apartment buildings, renovation of private houses, renovation of buildings);
- projects to promote the use of renewable energy sources and the introduction of environmentally friendly technologies (e.g. installation of biofuel boilers or solar power plants, purchase of vehicles, creation of ecological infrastructure);
- implementation of development cooperation projects in developing countries by transferring Lithuanian technologies and experience (e.g. solar power plants in Armenia, Sakartvelo, Moldova and Malaysia);
- for public information and education, advice on the most relevant climate change issues (e.g. 100 questions on the release of the Climate Change Book);
- measures for climate change mitigation and adaptation to climate change and;
- implementation of the plan of measures for the implementation of the National Strategy for Climate Change Management Policy;
- administration of the Programme funds and financing of the management of the greenhouse gas register.
The Government of the Republic of Lithuania has authorised the Ministry of Environment to manage the funds of the Climate Change Programme.
The process of preparing an estimate of the use of Programme funds:
The Programme funds are used in accordance with the estimate of the use of the Programme funds approved every year, the draft of which is prepared by the Ministry of Environment. The draft annual estimate is discussed with the National Climate Change Committee and the Committee on Environment Protection of Lithuania Parliament. It will identify the investment areas of the Programme and the amount of funds allocated to them. Following the approval of the annual estimate, a plan detailing the annual estimate, which determines the distribution of funds received under the Programme to specific funding instruments and other funding conditions, is approved. From 2021 the estimate of Programme will be approved by the Government of the Republic of Lithuania.
Project financing in Lithuania
The funds of the Climate Change Programme are used in accordance with the annual estimate of the use of the Programme funds, the draft of which is prepared by the Ministry of Environment. It will identify the investment areas of the Programme and the amount of funds allocated to them. Once the annual estimate of the Programme funds has been adopted, a plan outlining the annual estimate, setting out the allocation of funds between specific financing instruments and other financing conditions, will be approved. Following the adoption of the estimate and the annual plan, the Environmental Project Management Agency (EPMA) will publish calls for tenders under the financing instruments provided for in that year.
The Climate Change Programme will finance projects implemented by legal and natural persons in relation to mitigation of climate change (quantitative reduction of GHG emissions) and adaptation to climate change. Examples of funded projects include modernisation of multi-apartment buildings, renovation of private houses and projects for the installation of solar power plants on the roofs of kindergartens, schools, foster homes, etc.
The EPMA is the body responsible for publishing calls for project applications (registration forms), receiving and evaluating project applications (registration forms), supervising the implementation of projects and making payments to beneficiaries. The EPMA website publishes information on the possibilities to support natural and legal persons.
Project financing in developing countries
Since 2014, the Ministry of Environment has provided support for bilateral development cooperation projects related to climate change. The decision to focus on bilateral support was determined by the policy of the Lithuanian Government. Bilateral support is more effective and beneficial to both parties, not only by helping to exchange Lithuania's experience and establish valuable contacts in cooperation, but also by creating an environment that allows the use of public finances to attract private sector investment in low-carbon technologies through bilateral cooperation projects that transfer technology to developing countries. Various Lithuanian (private and public) entities that intend to implement projects of mitigation and adaptation to climate change in developing countries are eligible for this bilateral support. Every year, the Development Cooperation and Humanitarian Aid Commission of the Ministry of Environment approves the project concept, and based on the approved concept, the Environmental Project Management Agency announces a project tender and selects the best projects. Examples of funded projects include projects for installation of solar power plants in Georgia (Sakartvelo), Malaysia and Mali.
Estimate of the Climate Change Programme 2020
The measures provided for in the 2020 estimate are proposed by the relevant ministries and included in the Republic of Lithuania's National Energy and Climate Plan 2021–2030 (http://am.lrv.lt/uploads/am/documents/files/KLIMATO%20KAITA/Integruotas%20planas/Final%20NECP.pdf), designed to implement Lithuania's targets for the reduction of greenhouse gas emissions.
The estimate of the use of the Programme funds is approved annually by the order of the Minister. Prior to that, the draft annual estimate is discussed in the National Climate Change Committee, presented at a meeting of the Government of the Republic of Lithuania and discussed at a meeting of the Committee on Environment Protection of Lithuania Parliament. The estimate of the use of the Programme funds indicates the investment areas of the Programme and the amount of funds allocated to them.
€50 million of the total amount of the Programme funds is for the energy efficiency: of which, €10 million is for the renovation (modernisation) programme of multi-apartment buildings, for the renovation of old apartment buildings; €5 million is to support partial renovation of apartment buildings by renovating indoor heating and hot water systems; €5 million is proposed to be allocated for the renovation (modernisation) measure of individual houses, by reaching at least class B; €12 million is allocated for the new facility – renovation (modernisation) of the buildings of private legal entities (enterprises); €5 million is allocated for the renovation (modernisation) of public buildings in order to reduce the borrowing limits of municipalities and to encourage the implementation of the facility; and €13 million for the implementation of energy efficiency measures of private legal entities in accordance with energy audit reports.
€109.6 million was allocated for the use of renewable energy sources (RES) and projects for the introduction of environmentally friendly technologies: for the implementation of RES in public and residential buildings (kindergartens, schools, hospitals, foster homes, etc.) – €15 million; €14 million for the use of renewable energy resources in public and industrial buildings of private legal entities, engineering structures for other purposes (landfills, sewage treatment plant buildings), replacing the use of fossil fuels; €2 million for the use of solar energy technologies, heat pumps and heat storage facilities for heat generation, hot water production and/or electricity production in renovated (modernised) apartment buildings not connected to the district heating system, in order to achieve zero greenhouse gas emissions; €3 million for renewable energy sources (i.e. heat pumps: air-water, ground-water, water-water; use of biofuel boilers) in one- or two-apartment private residential houses, to replace fossil fuel heating equipment; €5 million for promotion of public transport and other alternative less polluting mobility measures for natural persons (low-emission phase II); €5 million for the promotion of the purchase of electric vehicles for private individuals; €20 million for the renewal of the urban and suburban public vehicle fleet; €15 million for the integrated measure for the promotion of green transport and infrastructure; €10 million for the promotion of low-emission technologies in companies participating in the EU Emissions Trading Scheme; and €1.6 million for the implementation of development cooperation projects (in the area of climate change) in developing countries.
€7 million is allocated for the climate change adaptation measure – regulated drainage (installation of smart drainage on the site to replace the current drainage system). Regulated drainage operates at different intensities: in cases of excess humidity, the drainage operates in the normal mode, and when the minimum drainage rate is achieved, the runoff is stopped, and moisture is retained in the soil. During dry plant vegetation periods, the system can help reduce plant stress due to the lack of moisture. The leakage of biogenic substances into surface water bodies is contained due to drainage.
The budget of the Climate Change Programme will contribute to the implementation of Lithuania's greenhouse gas emission reduction targets and will help to implement the measure of adaptation to climate change.