The U.S.-Ukraine Reconstruction Investment Fund has approved new investments aimed at increasing the resilience of Ukraine’s energy system and strengthening critical minerals supply chains. The fund’s decision is intended to contribute to the development of the energy infrastructure and critical minerals sectors.
Joint platform for mining projects
The fund will establish an investment platform together with Ukrainian company BGV Group Management. The platform is expected to create a diversified portfolio of early-stage projects in Ukraine’s mining sector.
The initial focus will be on deposits of rare earth elements, uranium, beryllium and zirconium. These projects are expected to significantly increase critical minerals production, create jobs and offer new opportunities to U.S. and Ukrainian companies as well as international investors.
The investment plan also covers the strengthening of reliable supply chains for critical minerals of strategic importance to the markets of the U.S. and its allies.
Energy hubs and battery storage
The fund will provide capital to a distributed combined heat and power generation platform and plans to build and operate local energy hubs to restore electricity and heating systems damaged by the war.
The fund also financed a battery energy storage system installed by Ukraine’s largest private energy company, DTEK, at six facilities across the country. The system, which has been commissioned, has the capacity to provide electricity equivalent to the two-hour consumption of approximately 600,000 households.
This capacity is intended to increase the resilience and stability of Ukraine’s energy system.
The fund’s previous steps
The new investments were approved approximately one year after the U.S. and Ukraine established the fund’s initial capital and began its operations. In March, the fund made its first investment in technology company Sine Engineering.
The U.S. International Development Finance Corporation and the Multilateral Investment Guarantee Agency signed a cooperation agreement in June to develop a political risk insurance system aimed at encouraging private-sector investment in Ukraine and supporting capital mobilization.
