Green Economy Transition in Ukraine: Decoupling, Structural Breaks, and Post-Socialist Constraints

Article DOI: https://doi.org/10.57017/jaes.v21.4(94).15

Author(s):

Oleksandr ZHURBA Department of Economics and Competition Policy State University of Trade and Economics, Kyiv, Ukraine
Olha HAPIEIEVA Navoi State University of Mining and Technologies, Navoi City, Uzbekistan
Serhii YAREMCHUK Kyiv National University of Economics named after Vadym Hetman, Kyiv, Ukraine
Nina PETRUKHA Department of Management in Construction, Kyiv National University of Construction and Architecture, Kyiv, Ukraine
Serhii PETRUKHA Department of Transport and Logistics West Ukrainian National University, Ternopil, Ukraine

Abstract:

This paper evaluates green economy implementation in Ukraine during 2005–2024 and benchmarks its performance against Poland and Romania as post-socialist EU comparators and Germany as an advanced EU benchmark. Using data from the State Statistics Service of Ukraine, the World Bank, and Eurostat, the study applies the Tapio decoupling model and OLS regression with structural-break indicators. The results indicate that Ukraine achieved only weak decoupling between economic growth and CO₂ emissions. Improvements in energy efficiency and renewable energy deployment remained limited relative to the selected comparator countries. The analysis identifies statistically significant structural breaks coinciding with the 2014 and 2022 conflict periods, indicating changes in the relationship between economic activity and CO₂ emissions.

The findings indicate that the green transformation in Ukraine is not only limited by the technological disconnect, but also by institutional and structural legacies of the socialist legacy. The policy implications include the necessity to align reconstruction to the EU environmental standards, enhance the carbon pricing mechanism, and assist the industrial regions with the help of the well-developed just transition framework.

Copyright© 2026 The Author(s). This article is distributed under the terms of the license CC-BY 4.0., which permits any further distribution in any medium, provided the original work is properly cited.

Article’s History: Received 25th of July, 2026; Revised 31st of August, 2026; Accepted 17th of September, 2026; Available online: 30th of September, 2026. Published as research article in the Volume XXI, Fall, Issue 4(94), 2026.

How to cite:

Zhurba, O., Hapieieva, O., Yaremchuk, S., Petrukha, N., & Petrukha, S. (2026). Green Economy Transition in Ukraine: Decoupling, Structural Breaks, and Post-Socialist Constraints. Journal of Applied Economic Sciences, Volume XXI, Fall, 4(94), 1393 – 1411. https://doi.org/10.57017/jaes.v21.4(94).15

CRediT Authorship Contribution Statement: Zhurba, O.: Conceptualization, Methodology, Formal analysis, Writing – review & editing. Hapieieva, O.: Data curation, Software, Visualization, Writing – review & editing. Yaremchuk, S.: Methodology, Formal analysis, Writing – original draft, Writing – review & editing. Petrukha, N.: Conceptualization, Data curation, Writing – original draft, Writing – review & editing. Petrukha, S.: Software, Visualization, Formal analysis, Writing – review & editing.

Funding Statement: This study received no specific financial support.

Data Availability Statement: The data supporting this study are derived from publicly available sources documented in Appendix A, Table A1. Source links and access information are provided in the methodology and reference list.

Ethical Approval Statement: This study relies exclusively on publicly available secondary and aggregate data and does not involve human participants, personal data, animal subjects, or experimental interventions. Therefore, ethical approval was not required.

Software Disclosure: All statistical analysis was conducted using R version 4.3.2. Key packages used include: dynlm for time series regression, lmtest for diagnostic tests, sandwich for heteroskedasticity-consistent standard errors, and strucchange for structural break testing. Decoupling calculations were implemented in base R with custom functions.

References:

Allam, Z., Bibri, S. E., & Sharpe, S. A. (2022). The rising impacts of the COVID-19 pandemic and the Russia–Ukraine war: energy transition, climate justice, global inequality, and supply chain disruption. Resources, 11(11), 99. https://doi.org/10.3390/resources11110099

Anastasiou, A., & Zaroutieri, E. (2023). Energy poverty and the convergence hypothesis across EU member states. Energy Efficiency, 16(5), 38. https://doi.org/10.1007/s12053-023-10113-9

Ang, B. W. (2005). The LMDI approach to decomposition analysis: A practical guide. Energy Policy, 33(7), 867–871. https://doi.org/10.1016/j.enpol.2003.10.010

Bernykov, V., Bilousko, T., Bilousko, R., Pitel, N., & Starovoyit, V. (2025). Green Technologies and Their Contribution to a Sustainable Global Economy in 2020-2025: A Literature Review. Futurity Economics & Law, 5(1), 161-178. https://doi.org/10.57125/FEL.2025.03.25.09

Borozan, D. (2024). European institutional quality and carbon emissions: Convergence club analysis. Structural Change and Economic Dynamics, 71, 646-657. https://doi.org/10.1016/j.strueco.2024.09.013

Breusch, T. S. (1978). Testing for autocorrelation in dynamic linear models. Australian Economic Papers, 17(31), 334–355. https://doi.org/10.1111/j.1467-8454.1978.tb00635.x

Breusch, T. S., & Pagan, A. R. (1979). A simple test for heteroscedasticity and random coefficient variation. Econometrica, 47(5), 1287–1294. https://doi.org/10.2307/1911963

Chow, G. C. (1960). Tests of equality between sets of coefficients in two linear regressions. Econometrica, 28(3), 591–605. https://doi.org/10.2307/1910133

Cetin, E. (2025). Feasibility of Space Mining: Economic, Legal and Environmental Analysis. Mining, Metallurgy & Exploration, 1-20. https://doi.org/10.1007/s42461-025-01436-5

Eitan, A., Marko P. & Hekkert, M. P. (2023). Locked in transition? Towards a conceptualization of path-dependence lock-ins in the renewable energy landscape. Energy Research & Social Science, Volume 106, 103316. https://doi.org/10.1016/j.erss.2023.103316

Fedirets, O., Terekhov, Y., Vytvytska, U., Zhuk, O., & Zhang, J. (2025). Economic assessment of the impact of green technologies on the sustainability of natural resources. International Journal of Sustainable Development and Planning, 20(9), 4013–4023. https://doi.org/10.18280/ijsdp.200930

Filho, W. L., Fedoruk, M., Eustachio, J. H. P. P., Splodytel, A., Smaliychuk, A., Małgorzata, I., Szynkowska-Jóźwik, I. (2024). The environment as the first victim: The impacts of the war on the preservation areas in Ukraine. Journal of Environmental Management, Volume 364, 121399. https://doi.org/10.1016/j.jenvman.2024.121399

Gerten, C., Boyko, D., & Fina, S. (2022). Patterns of post-socialist urban development in Russia and Germany. Frontiers in Sustainable Cities, 4, 846956. https://doi.org/10.3389/frsc.2022.846956

Golod, V., & Drobotiuk, O. (2025). Tracing the path of Sino-Ukrainian relations: from the post-Soviet era to the Russo-Ukrainian war. Journal of Contemporary China, 34(155), 797-818. https://doi.org/10.1080/10670564.2024.2449029

IEA. (2025). Ukraine’s Energy Security. International Energy Agency. https://www.iea.org/reports/ukraines-energy-security

Kaczmarek, J. (2022). The balance of outlays and effects of restructuring hard coal mining companies in terms of energy policy of Poland PEP 2040. Energies, 15(5), 1853. https://doi.org/10.3390/en15051853

Kašauskaitė, R. (2025). Social Entrepreneurship and Institutions: A Cross-Country Analysis with Insights for Post-Socialist Societies.https://studenttheses.uu.nl/handle/20.500.12932/49578

Khan, M. A., Zahir, S., Othman, N. S., & Awan, A. M. (2025). Exploring the synergies between natural resources, technological innovation, and fiscal and monetary policies for promoting environmental sustainability in ASEAN countries: MA Khan et al. Environment, Development and Sustainability, 1-30. https://doi.org/10.1007/s10668-025-06263-8

Khurshid, A., Hongbin, Y., Cifuentes‐Faura, J., & Saleem, S. F. (2025). Does corporate social responsibility and environmental governance drive green innovation? Corporate Social Responsibility and Environmental Management, 32(1), 58-70. https://doi.org/10.1002/csr.2942

Kilinc-Ata, N., Xavier, B., & Bhat, M. A. (2026). Decoupling economic growth and CO2 emissions: a geopolitical comparison of the EU and GCC energy transitions. Quality & Quantity, 1-30. https://doi.org/10.1007/s11135-026-02572-w

Kldiashvili, M. (2024). Green Finance Instruments for Sustainable Infrastructure in Transition Economies. Law, Business and Sustainability Herald, 4(4), 4-22. Retrieved from https://lbsherald.org/index.php/journal/article/view/76

Kougias, I., Taylor, N., Kakoulaki, G., & Jäger-Waldau, A. (2021). The role of photovoltaics for the European Green Deal and the recovery plan. Renewable and Sustainable Energy Reviews, 144, 111017. https://doi.org/10.1016/j.rser.2021.111017

Kropelnytska, S., Yekimov, S., & Aleksandrovych, O. (2025). Barriers and opportunities for entrepreneurship development in Ukraine: Towards a sustainable and resilient economic future. Journal of Vasyl Stefanyk Precarpathian National University, 12(2), 116-130. https://doi.org/10.15330/jpnu.12.2.116-130

Maniu, I., Costache, C., & Dumitraşcu, D.-D. (2021). Adoption of green environmental practices in small and medium-sized enterprises: Entrepreneur and business policies patterns in Romania. Sustainability, 13(9), 4968. https://doi.org/10.3390/su13094968

Nazarkevych, I., & Sych, O. (2023). Taxation as a tool of implementation of the EU Green Deal in Ukraine. Regional Science Policy & Practice, 15(1), 144-161. https://doi.org/10.1111/rsp3.12596

Neuweg, I., Petkova, N., Michalak, K., & Oharenko, Y. (2023). Review of environmental taxation and environmental expenditure in Ukraine. OECD Environment Working Papers, No. 231. https://doi.org/10.1787/921319bc-en

Newey, W. K., & West, K. D. (1987). A simple, positive semi-definite, heteroskedasticity and autocorrelation consistent covariance matrix. Econometrica, 55(3), 703–708. https://doi.org/10.2307/1913610

Niță, D., Stoicuța, N., Nițescu, A., Isac, C., & Dobre-Baron, O. (2025). The impact of the transition to a green economy on Romania’s economic growth. Energy, Sustainability and Society, 15(1), 19. https://doi.org/10.1186/s13705-025-00520-4

Pavlov, K., Pavlova, O., Holovchak, M., Rutkowski, M., Karkovska, V., Kornatka, A., & Dziurakh, Y. (2026). Assessment of the Effectiveness of Managing Ukraine’s Energy Transition: An Indicator Analysis and Comparison with Selected European Union Countries. Energies, 19(1), 150. https://doi.org/10.3390/en19010150

Petlenko, Y. (2024). Financing green energy for enhancing energy security in Ukraine. Financial and Credit Activity: Problems of Theory and Practice, 2(55), 161-179. https://doi.org/10.55643/fcaptp.2.55.2024.4299

Pimenow, S., Pimenowa, O., & Rembisz, W. (2026). Circular economy pathways for critical raw materials: European Union policy instruments, secondary supply, and sustainable development outcomes. Sustainability, 18(2), 562. https://doi.org/10.3390/su18020562

Pimenow, S., Pimenowa, O., Sitnicki, M. W., Dluhopolskyi, O., & Zieliński, M. (2026). Energy use, costs and economic resilience of EU agriculture: The role and potential of CAP eco-schemes in reducing energy intensity. Energies, 19(4), 1016. https://doi.org/10.3390/en19041016

Roberts, K., Pantea, M.-C., & Dabija, D.-C. (2023). Education-to-Work Transitions in Former Communist Countries after 30-Plus Years of Transformation. Social Sciences, 13(1), 25. https://doi.org/10.3390/socsci13010025

Roudometof, V. (2026). Religion and Nationalism in the Orthodox Religioscape: Southeastern and Post-Soviet Europe in Historical Perspective. Social Sciences, 15(2), 101. https://doi.org/10.3390/socsci15020101

Sala, D., Bashynska, I., Pavlova, O., Pavlov, K., Chorna, N., & Chornyi, R. (2023). Investment and innovation activity of renewable energy sources in the electric power industry in the south-eastern region of Ukraine. Energies, 16(5), 2363. https://doi.org/10.3390/en16052363

Krustok, I., Gladkykh, G., Leshchyshyn, B., Tšerkašina, E., & Silva, J. P. (Coords.). (2025). National comprehensive green transition assessment report for Ukraine. Green Agenda for Armenia, Georgia, Moldova and Ukraine / Stockholm Environment Institute.

Shpak, N., Kuzmin, O., Melnyk, O., Ruda, M., & Sroka, W. (2020). Implementation of a Circular Economy in Ukraine: The Context of European Integration. Resources, 9(8), 96. https://doi.org/10.3390/resources9080096

Shchepetylnykova, L., & Oleksiyenko, A. V. (2024). What comes after post-Soviet? Towards a new concept of de-Sovietization in higher education and research. International Journal of Educational Development, 106, 103014. https://doi.org/10.1016/j.ijedudev.2024.103014

Sokil, O. (2024). Accounting and Analytical Support for the Assessment of Fiscal Policy and Sustainable Development of Ukraine. Oblik i Finansi, 105, 30-42. https://doi.org/10.33146/2307-9878-2024-3(105)-30-42

Szép, T., Tóth, G., & Labelle, M. C. (2022). Farewell to the European Union's east-west divide: Decoupling energy lifts the well-being of households, 2000-2018. Regional Statistics, 12(3), 159-190. https://doi.org/10.15196/RS120307

Tapio, P. (2005). Towards a theory of decoupling: degrees of decoupling in the EU and the case of road traffic in Finland between 1970 and 2001. Transport Policy, 12(2), 137-151. https://doi.org/10.1016/j.tranpol.2005.01.001

Terekhov, Y., Tuerk, A., & Blaettner, D. (2024). Options of exporting hydrogen from Ukraine to the EU. International Multidisciplinary Scientific GeoConference, 4(2), 25–34. https://doi.org/10.5593/sgem2024v/4.2/s16.04

Zavadskykh, H., Safonik, N., Moroz, E., Alekseieva, K., & Honcharenko, I. (2025). Exploring the Potential of Circular Economy in Ukrainian Enterprises. https://doi.org/10.33002/nr2581.6853.080112

Ziemblińska, K., Urbaniak, M., Jinlong, H., Olejnik, J., & Kundzewicz, Z. W. (2025). Decoupling of economic growth and CO2 emissions in 11 European Union Member States in Central and Eastern Europe. Sustainable Energy Technologies and Assessments, 82, 104482. https://doi.org/10.1016/j.seta.2025.104482