The Institutional and Behavioral Model of Eco-Oriented Public-Private Partnership within Ukraine’s Sustainable Development System
Ilchenko S. V.

Ilchenko, Svitlana V. (2025) “The Institutional and Behavioral Model of Eco-Oriented Public-Private Partnership within Ukraine’s Sustainable Development System.” The Problems of Economy 4:75–84.
https://doi.org/10.32983/2222-0712-2025-4-75-84

Section: Economics and national economy management

UDC 339.97:656.01:574.4

Abstract:
The aim of the article is to examine the theoretical and methodological foundations for the formation of environmentally oriented public-private partnerships (eco-PPPs) as an institutional mechanism for Ukraine’s sustainable development, taking into account behavioral models of interaction between the State and the private sector. The article substantiates the relevance of moving from a purely financial perspective on PPPs to an integrated approach that combines economic feasibility, environmental effectiveness, and trust in the context of post-war recovery and European integration. The author analyzes the current state of eco-PPP implementation in Ukraine based on twelve projects in the sectors of transport, energy efficiency (ESCO/EPC), thermal energy, waste management, and municipal infrastructure. For each project, key parameters are systematized: the level of State support, environmental requirements, institutional trust, risk of non-compliance, and expected investor return. The synthesis of empirical data showed that initiatives combining significant government support with a high level of trust under moderate risk have the highest likelihood of stable implementation. Environmental requirements do not reduce investment attractiveness when compensatory mechanisms are in place, such as EPC standards, backing from international financial institutions (for example, EBRD Green Cities programs), transparent selection procedures, and professional municipal management. The methodological foundation consists of logical-structural and comparative analysis combined with empirical generalization, with an emphasis on the behavioral-institutional interpretation of decisions by private investors and government bodies. The scientific novelty lies in the development of a comprehensive behavioral-economic approach to evaluating eco-public-private partnerships, integrating trust, risk, government support, and environmental requirements into a single analytical framework without excessive quantitative complexity. The practical significance lies in the possibility of using the proposed approach as a basis for the national “Green PPP Framework” system, which entails standardizing environmental criteria, establishing transparency standards, and introducing basic tools for guaranteeing and monitoring socio-environmental effects.

Keywords: public-private partnership, environmental efficiency, sustainable development, government support, behavioral model, risks, institutional model.

Tabl.: 2. Formulae: 4. Bibl.: 22.

Ilchenko Svitlana V. – Doctor of Sciences (Economics), Professor, Leading Researcher, Department of Infrastructure Development, SO "Institute for Economics and Forecasting of NAS of Ukraine" (26 Panasa Myrnoho Str., Kyiv, 01011, Ukraine)
Email: ilchenko.svit@gmail.com

List of references in article

Abdullah A. & Khadaroo I. (2020). The trust-control nexus in public private partnership (PPP) contracts. Journal of accounting and public policy, 6(39), 106768. https://doi.org/10.1016/j.jaccpubpol.2020.106768
Carter B. Casady, Cepparulo A. & Guiriato L. (2024). Public-private partnerships for low-carbon, climate-resilient infrastructure: insights from the literature. Journal of cleaner production, 470, 143338. https://doi.org/10.1016/j.jclepro.2024.143338
Chunling L., Memon J. A., Thanh T. L., Ali M. & Kirikkaleli D. (2021). The impact of public-private partnership investment in energy and technological innovation on ecological footprint: the case of Pakistan. Sustainability, 18(13), 10085. https://doi.org/10.3390/su131810085
Construction of the road lighting network Highway M-03 Kyiv–Kharkiv–Dovzhanskyi within the city limits of Poltava https://panorama.in.ua/en/projects/construction-of-the-road-lighting-network-highway-m-03-kyiv-kharkiv-dovzhanskyi-within-the-city-limits-of-poltava/
EBRD. GrCF2 W2 – Kyiv District Heating. https://www.ebrd.com/home/work-with-us/projects/psd/50839.html
EBRD. Ukraine. GrCF2 W2 – Khmelnytskyi Solid Waste Project (under green cities framework ii window 2). https://www.ebrd.com/home/work-with-us/projects/psd/50729.html
EBRD Green Cities. (2020). Lviv Green City Action Plan. https://ebrdgreencities.com/assets/Uploads/PDF/Lviv-GCAP-Final-ENG-merged_May2020.pdf
Fleta-Asin J. & Munoz F. (2024). Risk allocation schemes between public and private sectors in green energy projects. Journal of environmental management, 357, 120650. https://doi.org/10.1016/j.jenvman.2024.120650
Ilchenko S. V. (2025). Lohistychna chutlyvist eksportu v umovakh liberalizatsii transportnykh posluh [Logistics sensitivity of export under the conditions of transport services liberalization]. Efektyvna ekonomika, 8. https://doi.org/10.32702/2307-2105.2025.8.2
OECD multi-level governance studies. (2018). Subnational public-private partnerships. Meeting infrastructure challenges. https://www.oecd.org/en/publications/responding-to-the-infrastructure-challenge_9789264304864-en.html
OECD public governance reviews. (2024). Harnessing public procurement for the green transition. Good practices in OECD countries. https://www.oecd.org/content/dam/oecd/en/publications/reports/2024/06/harnessing-public-procurement-for-the-green-transition_ef16c8d4/e551f448-en.pdf
Partnerships Bulletin. Kaidatski ochysni sporudy, Dnipro [Kaidatsky wastewater treatment plants, Dnipro]. https://www.partnershipsbulletin.com/article/1935676/ukrainian-city-preparing-pilot-wastewater-ppp
PPP Agency Ukraine. “Olvia” Specialized Seaport Concession. https://pppagency.gov.ua/project/olvia-specialized-seaport-concession/
PPP Agency Ukraine. “Kherson” Specialized Seaport Concession. https://pppagency.gov.ua/project/kherson-specialized-seaport-concession/
Tang Y., Liu M. & Zhang B. (2021). Can public-private partnerships (PPPs) improve the environmental performance of urban sewage treatment?. Journal of environmental management, 19, 112660. https://doi.org/10.1016/j.jenvman.2021.112660
Tipu W. A., Mughal Y. H., Kundi G. M., Nair K. S. & Thurasamy R. M. (2024). Enhancing the sustainable performance of public-private partnership projects: the buffering effect of environmental uncertainty. Buildings, 12(14), 3879. https://doi.org/10.3390/buildings14123879
Ukrainian Chornomotsk port terminals (2025). https://cfts.org.ua/news/2025/09/03/zapuscheno_konkursniy_protses_schodo_kontsesi_terminaliv_v_portu_chornomorsk_84150
UNDP. UNDP and Business Development Fund introduce ESCO-fund to support sustainable development and energy efficiency. https://www.undp.org/ukraine/press-releases/undp-and-business-development-fund introduce-esco-fund-support-sustainable-development-and-energy-efficiency
Wang X., Yin Y., Deng J. & Xu Z. (2023). Influence of trust networks on the cooperation efficiency of PPP projects: moderating effect of opportunistic behavior. Journal of Asian architecture and building engineering, 4(22), 2275–2290. https://doi.org/10.1080/13467581.2021.1972002
World Bank Group. (2019). Preparing, procuring and implementing climate-smart PPPs. https://ppp.worldbank.org/climate-smart/climate-smart-clean-technology-ppps/preparing-procuring-and-implementing-climate-smart-ppps
World Bank Group. (2019). Guidance on PPP contractual. https://ppp.worldbank.org/sites/default/files/2021-03/Guidance%20on%20PPP%20Contractual%20Provisions_2019%20edition.pdf
Zhang W., Wand Y., Li E., Zhang C., Li H. & Hada S. (2025). Evolutionary mechanism of trust for public-private partnership projects with public participation. Buildings, 3(15), 391. https://doi.org/10.3390/buildings15030391