*4.2. Influence of State Regulation on the Process of Decarbonisation/Adaptation in the Region*

The state's influence on the management of innovation development in the region is currently significant. At the same time, the state plays the role of facilitator in the initial stages of regional development and later transfers these functions to the relevant institutions of innovative development. It should be noted that the state and executive authorities are among the stakeholders in the processes of decarbonisation and adaptation, and assessing the feasibility and possible consequences of their regulation requires the creation of hybrid model complexes that combine climate modelling, energy modelling, economic modelling and investment in the development of certain technologies and directions. Currently, we can discuss two groups of models for different stakeholders because they all need to consider climatic factors in their activities. The first group assesses the scale of climate change and how humanity can adapt to it (adaptation scenarios), and the second group examines how to resist climate change itself (decarbonisation scenarios). At the same time, each group of stakeholders is concerned with specific questions (Table 3).

Approaches to modelling different sectors of the economy are universal, but owing to the focus of research on energy issues, we consider modelling tools focused on the energy sector. Such models can be divided into two major categories: top-down and bottom-up (Figure 7, Table 4), as well as integrated related models.

The methodological gap in approaches to the implementation of decarbonisation has stimulated the emergence of hybrid-related approaches that combine the technological clarity of upward models with microeconomic realism and the macroeconomic feedback of downward models. The linking of models was achieved through iterations with feedback between models.

It should be emphasised that the list of integrated models of decarbonisation currently used in the EU in the energy sector includes several examples, such as: PRIMES, GAINS, GLOBIOM-G4M, PROMETHEUS, CAPRI and POLES. These integrated models have a variety of targets in methodology, time horizons, sectoral coverage and input–output data.


**Table 3.** The main stakeholders of the decarbonisation process. Adapted with permission from [31]. Copyright 2018, United Nation.

**Figure 7.** The classification of decarbonisation models focusses on the energy sector. Reprinted with permission from [42]. Copyright 2009, Boehringer, C.; Rutherford, T.

An analysis of the possible application of models of the decarbonisation of Ukraine's economy in the projected postwar period of development makes it possible to state the need for an integrated approach and the use of hybrid models.

After all, models of rigid bonding are ill-suited for modelling in crisis and force majeure conditions, which are the conditions for the recovery of an economy destroyed by hostilities. Soft binding often provokes interference, namely, differences between the results of energy flow models, prices and technologies within a particular region. Noise control is difficult because most useful sets of common measurement points are non-exclusive.

## *4.3. Applied Models of Decarbonisation of Energy-Intensive Sectors*

In recent years, Ukraine has begun to implement a model of regional development for fair transformation.

According to the Concept of the State Target Program for Fair Transformation of Coal Regions of Ukraine for the period up to 2030, approved by the Resolution of the Cabinet of Ministers of Ukraine dated 22.09.2021 № 1024, the concept of "fair transformation" is interpreted as "a model of regional development to all residents, including workers who will be affected by the process of abandoning fossil fuels (liquidation of production facilities, closure of coal mining enterprises, etc.)" [32].


**Table 4.** Advantages and disadvantages of decarbonisation models.

In this context, the formation of a national Green Deal is a critical priority for Ukraine. A national feature of this area is environmentally harmful coal. Ukraine has historically formed certain socio-economic clusters around the coal regions—Donetsk, Luhansk, Dnipropetrovsk, Lviv-Volyn and Transcarpathian basins. However, the reduction in the share of coal energy should be gradual based on the formation of an appropriate alternative to this type of economic activity, using the experience of China, the Czech Republic, Germany and Poland in terms of diversification in the industry. Global examples of the harmonious transformation of coal regions demonstrate the strategic course of events and significant impact on the economy. Therefore, for Ukraine, which is fairly new to the process of coal industry transformation, these processes should be reflected and adjusted in the national Green Deal.

Difficulties with the transition to a decentralised electricity market in Ukraine are both objective (regulatory) and locally subjective.

The Ukrainian situation requires urgent action at the highest level of government. Thus, the Government of Ukraine announced the creation of four revival funds for the restoration of property and infrastructure, economic transformation, debt service and repayment, and support for affected businesses [45]. The proposed funds combine two trends: national, to obtain funds for development through the relevant state institution, and European, to obtain funding through the relevant fund.

In addition, Ukraine has negative or neutral trends in the development of alternative energy and energy cooperation, provoked by the instability of the regulatory environment, the passivity of the business environment and public awareness of the existing benefits of the green energy market. The fragmentation and imperfections of the current legal framework worsen the situation.

Simultaneously, developed agriculture in Ukraine can and should become the basis for the development of bioenergy. The energy cooperative movement is currently in its infancy in Ukraine [46].

The flexibility and variability of cooperative organisational and legal forms determine the convenience of their use. Thus, an energy cooperative can unite energy producers or consumers or act in both roles simultaneously to produce and consume energy (that is, the cooperative prosumer) or to accumulate (aggregate) energy from other producers [47].

Renewable energy, as a new technology, needs to implement appropriate support mechanisms: political, legislative and economic [48,49]. The models represented in this study, using the apparatus of mathematical logic, can be interpreted as follows: to achieve the goal of developing mechanisms for the implementation of renewable energy at the regional and local levels (development of mechanisms for the implementation of renewable energy at regional and local levels), a set of ten organisational, economic, fiscal, institutional and regulatory measures was applied (Table 5).

These measures belong to many methods for the effective stimulation of investment inflow to renewable green energy (methods of effective stimulation of investment inflow to renewable green energy).

**Table 5.** Correspondence of mechanisms to support renewable energy and their formalised presentations.


In this case, the formalisation of the conceptual and analytical model of integrated support mechanisms for the implementation of renewable energy has the following form (Formula (3)), and definitions of terms in the formula are given in Table 5.

*Devre* <sup>≈</sup> *Lawen* <sup>∪</sup> *Estar* <sup>∪</sup> *Esmand* <sup>∪</sup> *Finres* <sup>∪</sup> *Esstate* <sup>∪</sup> *Loanspre f* <sup>∪</sup> *Depac* <sup>∪</sup> *Pubsup* <sup>∪</sup> *Invsub* <sup>∪</sup> *Taxex* <sup>∈</sup> *METHODge* (3)

> where *Devre*—achieving the goals of developing mechanisms for the implementation of renewable energy at the regional and local levels; *METHODge*—methods for the effective stimulation of investment inflow to renewable green energy.

> It should be noted that some of the measures to stimulate the mechanisms of renewable energy have already begun to be implemented under current conditions in Ukraine. For example, the announced onset of tax reform will certainly contribute to the effective implementation of the proposed conceptual and analytical model. In addition, the revolutionary step of connecting the Ukrainian energy system to the European ENTSO-E system will ensure the stable operation of the Ukrainian energy system in wartime and in the postwar period, as well as the development of energy generation and investment.
