Scaling Multi-Family Houses Thermal Modernisation: Municipal Quarter Approach

Download the document

Since 2019 there have been several attempts to launch thermal modernisation programmes for Multi-Family Houses (MFH) based on a more centralised, "top-down" approach. This was tried for two reasons: 

1. retrofitting standardised Soviet apartment buildings in entire neighbourhoods is expected to substantially lower unit costs due to scale efficiencies; and
2. local municipalities are relatively close to affected homeowners and their associations; they play a central role in city planning and implementation, and they can synchronise thermal modernisation programmes with modernising and rescaling local district heating systems.

The 2023 Long-Term Strategy for the Thermal Modernisation of Buildings until 2050 (LTMB) highlights the role of buildings for Ukraine's energy security, decarbonisation and EU integration. It establishes a long-term framework for the systematic renovation of housing and public facilities. However, the LTMB can only be implemented in practice if MFH thermal modernisation moves from today's project-by-project niche to a genuine mass-scale process. This also requires addressing MFHs that have not established a home-owner association (HOA). Despite having established the legal form of home-owner associations and developed a legal framework for complex thermal modernisation of MFHs, roughly 80% of the MFH stock remains outside the main HOA-based grant mechanism and is not covered by state-supported thermal modernisation programmes. Without a shift from isolated pilot projects to mass-scale, district-type approaches, Ukraine risks locking in another generation of inefficient buildings and missing its energy, climate and EU integration targets.

Against this background, large-scale rehabilitation of the national housing stock is likely to be financed primarily in the post-war period, with substantial donor contributions and a stronger role for municipalities. For such investments to succeed, new approaches to MFH rehabilitation are needed that address existing administrative and institutional obstacles such as a proposal for a "Municipal quarter approach" presented in this paper.