Keeping warm……with a 700% increase in gas prices

Imagine you were told that from next month onwards, your utility prices - water, electricity and gas - would go up. Imagine also, that you live in a country where the temperatures during winter months drop to sub-zero, and gas for heating is a critical necessity. Further, do imagine that the stated price increase for gas will be between 500 – 700%, with the promise that it will go up even beyond these levels in future.

How would you cope? Ukrainians don’t have to imagine such a scenario, they will have to live with it.

Gas from Ukraine’s eastern neighbour has been described as a drug that has the country hooked and suffering. Years of vested interests, bad policies, distortions and corruption have come to a head with the war and the resultant economic crisis. Reform measures, partly dictated from outside the country, has resulted in a drastic increase in prices of utilities.

Is there a silver lining in all of this? Yes, that would be a focus on energy saving, in a country that is deemed to be one of the least energy efficient in the world. Residences are one of the main causes of energy loss, and the cumulative improvements in energy efficiency at homes, would have a positive effect for Ukraine.

A Kiva borrower insulated and implemented other energy saving measures in her home, Belaya Tserkov, Central Ukraine[/caption]

Kiva’s field partners are adapting existing loan products to focus on home energy saving, and Kiva’s lending community will have a chance to support Ukrainian households coping with this sudden and huge price rise. Specialist input from organizations like the Institute of Energy Efficiency based in Kiev will help Kiva Field partners and borrowers use their funds to get maximum ‘returns’ – optimum warmth with lower energy consumption.

Old Soviet era windows in my Kiev apartment

Modern steel-plastic-glass windows, energy efficient

Over time home energy saving measures will aid the transition towards Ukraine’s energy independence.

About the author

Charles Selestine

Hailing from eastern Malaysia, Charles has travelled extensively in the course of his studies and work. As a means of understanding and absorbing values from different cultures, he has worked in seven countries and speaks six languages. Most of his career has been within financial services, garnering multi-functional experience in wealth management. Combining his keen interest in social finance and Islamic finance, Charles researched Islamic Microfinance as an investable asset class, as part of his Master’s course. Most recently, Charles served as a Senior Product Manager with the Private Banking division of Barwa Bank, one of four Islamic banks in Qatar. He holds an MA in Islamic Banking Finance and Management from the University of Gloucestershire, and a B Com (Finance) from Loyola College, University of Madras. His wide range of qualifications include certifications in Islamic Finance and Investments.