Challenges of green construction in Ukraine at the stages of regulatory implementation and practical realization

Abstract

The article examines the current state and prospects of green building development in Ukraine in the context of international experience and economic incentive mechanisms. The study highlights the growing importance of environmentally oriented construction as a response to the challenges of climate change, urban environmental degradation, increasing energy dependence and the need for sustainable urban transformation. Unlike EU countries, where LEED, BREEAM and national sustainability standards are supported by financial incentives such as tax benefits, subsidized loans, grant programmes and fast-track permitting procedures, Ukraine lacks a comprehensive system of state support. This absence makes green projects economically less attractive than traditional construction, extends payback periods and reduces investor interest.
The article presents a comparative analysis of incentive models implemented in Copenhagen, Berlin, Warsaw and London and includes an applied economic modelling case for a 10,000–25,000 m² development in Kyiv. The modelling results show that the implementation of grants, reduced-interest financing and tax reductions may shorten the investment payback period from 13 to 8–9 years and significantly increase project profitability. Based on international practices adapted to Ukrainian conditions, the paper proposes a set of economic and regulatory mechanisms, including tax reductions, concessional lending, land and planning incentives, and the introduction of a national certification standard and the “Green Fast Track” system. The study concludes that green construction should be regarded not as an additional financial burden, but as an economically justified tool for enhancing competitiveness, improving environmental performance and accelerating post-war recovery. A systemic state policy can enable Ukraine to increase the share of certified green projects to 10–15% within five years and integrate into the European sustainable development framework.