On 25 October 2024, UWEA Board members gathered in Kyiv in a hybrid format to discuss issues critically important for the industry, to exchange views on resolving the current problems on the market, and to align some strategic directions of UWEA’s activity for the coming years. Thus, in particular, the following issues were raised during the meeting: the functioning of the Commercial Risk Guarantee Fund; stimulating electricity consumers to conclude corporate PPAs; the effectiveness of state policy regarding the development of renewables and wind energy in particular; the current status of the development of the small-scale and offshore wind energy markets in Ukraine; as well as the launch of a market for wind projects with refurbished wind turbines.
Andriy Konechenkov, Chairman of the UWEA Board, opened the meeting by presenting the latest industry news and changes in legislation, the current state of settlements with wind electricity producers and the Association’s achievements over the first 3 quarters of 2024. “I am glad to report that our Association is actively developing and expanding. As of today, UWEA unites already 95 companies and, taking into account the membership applications that are currently under consideration, is approaching a full 100 member companies. I want to thank all the companies that choose UWEA and stay with us for years. This motivates us to be even more active and effective”.
A separate item on the meeting’s agenda was the renewal of the UWEA Board’s composition. “We strive to ensure in the Board not only the maximum representation of the key operator companies and wind farm developers, but are also gradually approaching gender balance in our composition”, noted the UWEA Board Chairman, presenting the new Board member – Nataliia Hutarevych, senior lawyer at the company Sayenko Kharenko, which is one of the founders of UWEA. Ms Hutarevych joined the Board to replace Nazar Cherniavskyi, who represented the law firm on the Board over the last two years.
A replacement also took place with regard to LLC “Wind Farm”. From now on, the company will be represented on the Board, instead of Yurii Zhabskyi, by Oleksandr Molyboh, the company’s chief power engineer. However, Yurii Zhabskyi remains an honorary guest of further Board meetings.
Finally, Ruslan Soichuk, LLC “Windkraft Ukraine”, temporarily left the Board.
UWEA extends its sincere gratitude to Mr Cherniavskyi, Mr Zhabskyi and Mr Soichuk for their active work as part of the Association and wishes them good health and more successful wind energy projects.
We are glad to welcome Ms Hutarevych and Mr Molyboh to the Board. We look forward to fruitful and interesting cooperation!
On 23 October 2024, a Memorandum of Partnership and Cooperation was signed in Kyiv between UWEA and the Institute of General Energy of the National Academy of Sciences of Ukraine. With this Memorandum, the parties cemented their aspiration to direct joint efforts towards the effective and balanced development of Ukraine’s energy complex, its “green” transformation and post-war recovery. Both organisations agreed to spread the practice and experience of using wind energy, to research modern wind energy technologies and to work towards building up the potential of the national wind energy industry.
Andriy Konechenkov, Chairman of the UWEA Board: “The modern wind energy sector today needs, among other things, a high-quality scientific view and approach. Especially regarding the planning of the effective integration of wind generation into Ukraine’s overall power system and the building up of the national wind energy industry. That is precisely why broad cooperation with various institutions of the National Academy of Sciences of Ukraine has always been welcomed by our Association. I am convinced that the partnership with the Institute of General Energy of the NAS of Ukraine will not be limited exclusively to the provisions of the signed Memorandum, because both parties have both the professional and the technical resources to implement diverse projects and ideas. In particular, the Institute possesses a powerful material and technical base for carrying out systematic analysis and forecasting of the development of energy and energy consumption, as well as the monitoring and diagnostics of the technical state and the environment of energy systems and facilities, which may be extremely interesting for the further development of the industry”.
Vitalii Babak, director of the Institute of General Energy of the NAS of Ukraine: “The signing of the memorandum of cooperation between our Institute and the Ukrainian Wind Energy Association is an important step on the path to the development of renewable energy in Ukraine. Wind energy is one of the key components of the energy transition that we strive to implement in our country, given the climate challenges and the need to reduce dependence on traditional energy sources. Our cooperation will make it possible to combine the scientific potential of the Institute and the practical experience of the association, which will contribute to the development of new technologies, the conduct of research and the implementation of innovative solutions in the field of wind energy. I am confident that through joint efforts we will be able to contribute to the sustainable development of the industry and increase Ukraine’s energy security”.
UWEA is glad to see the Institute of General Energy of the NAS of Ukraine among the community of its reliable partners and hopes for fruitful cooperation for the benefit of Ukraine!
“The situation with debt on the renewables market still remains critical”, drew attention Andriy Konechenkov, Chairman of the UWEA Board, speaking at the European Business Association’s Energy Day 2024. As of September 2024, the debt of JSC NNEGC “Energoatom” to the SE “Guaranteed Buyer” (GarPok) amounts to UAH 12.4 billion, and GarPok, in turn, owes universal service suppliers UAH 12.3 billion. The situation with the debt to producers of electricity from renewable energy sources is especially complex, as it still exceeds UAH 35.8 billion.
As UWEA has repeatedly reported, the chain of debts to renewables producers begins with NPC Ukrenergo, which owes GarPok about UAH 29 billion for the service of ensuring an increase in the share of electricity production from alternative energy sources, due to the insufficient level and incomplete payment of the electricity transmission tariff by other market participants (the current level of the tariff is UAH 528.57/MWh). The Acting Chairman of the Board of NPC Ukrenergo, Oleksii Brekht, recently stated that the company strives to achieve a break-even tariff for 2025 through, in particular, its increase to UAH 780.41/MWh, which could become one of the measures to resolve the protracted debt crisis, provided it is paid in a timely and complete manner by market participants.
UWEA supports the intentions of the national TSO to adopt an economically justified transmission tariff in 2025. According to our calculations, to cover the forecast costs of the PSO for renewables, as well as to cover the tariff deficit for 2022–2023 in the amount of UAH 7 billion, the necessary size of the tariff should be at least UAH 710/MWh. Although even at such a size, it will be difficult for NPC Ukrenergo to repay its existing debts to the SE “Guaranteed Buyer” in full.
However, at present it is expected that the transmission tariff for 2024 should also be in deficit. It is forecast that, for the PSO costs for renewables alone, the tariff is short by UAH 6–8 billion. That is, this deficit will be established after verification in 2025 and, accordingly, should also be included in the 2025 tariff or in subsequent periods. “It is now very important to end the trend of the deficit transmission tariff, since this will continue to lead to its even greater growth in order to cover endless debts. UWEA hopes that the NEURC will make a balanced decision and provide NPC Ukrenergo with stable financing”, comments Andriy Konechenkov on the situation.
UWEA also once again calls on the Cabinet of Ministers of Ukraine, the Ministry of Energy of Ukraine, the Ministry of Economy of Ukraine and the NEURC to continue working on finding financial sources and ways to improve the liquidity of the electricity market. One of them could be, in particular, the involvement of Ukrainian banks in providing targeted financing to JSC NNEGC “Energoatom”, which is currently being actively discussed in the information space.
Although various options for restoring payment discipline on Ukraine’s electricity market are being considered at the level of the relevant state market participants, in particular at the level of NPC Ukrenergo, the real results of the adopted measures will be visible only with the active participation of all market participants, including private business. The debt crisis is a common challenge that extends to the entire market – to distribution system operators, the TSO, the SE “Guaranteed Buyer” and renewables producers – and therefore its resolution requires an open and transparent discussion between the government and business.
Moreover, today the debt crisis also leaves a negative imprint on other market instruments that are being introduced to improve the market environment. For example, by creating a situation in which the SE “Guaranteed Buyer” looks financially unreliable, renewables producers are not interested in participating in such long-awaited auctions. This, in turn, threatens the state with the non-fulfilment of the goal of building 6.1 GW of onshore wind energy projects by 2030, which is envisaged by the National Renewables Action Plan, not to mention the start of the implementation of offshore wind projects, which are also declared by this National Plan.
“Supporting the liquidity of the electricity market today is a matter of the country’s energy security and energy independence, as is the further development of “green” decentralised generation, which depends on market conditions and which is regularly declared at the level of the Government. We expect that the Government will move from declarations to actions and create attractive conditions for attracting new investment into the renewables sector”, notes Andriy Konechenkov, Chairman of the UWEA Board.
On 10 October 2024, at the Embassy of the Kingdom of the Netherlands in Ukraine, the official presentation of the Report “Legislative changes to stimulate the development of the wind energy sector in Ukraine” took place, which was developed by the Ukrainian Wind Energy Association (UWEA) within a special project aimed at analysing the gaps in the current legislation and proposing comprehensive changes to ensure the effective development of wind energy in Ukraine. The legislative changes proposed for adoption cover the environmental, construction, land, technical and other aspects of the development of a wind energy project in Ukraine.
The project was implemented with the financial support of the Netherlands Enterprise Agencyof the Ministry of Economy and Climate Policy of the Netherlands (RVO) with the participation of leading law firms in the field of energy law, namely LCF, Asters, INTEGRITES, Dentons, ARZINGER, as well as the company DTEK Renewables. All of these companies are members of UWEA.
Andriy Konechenkov, Chairman of the UWEA Board and the event’s moderator: “In close communication and interaction with real market participants, and with the support of our Dutch partners, we developed this Report, expecting that the introduction of the proposed changes to the industry’s regulatory framework will contribute to simplifying and accelerating the development of wind energy projects in Ukraine, to forming a transparent, competitive and, most importantly, predictable environment on the market, to achieving the renewable energy development goals set in the National Action Plan for Renewable Energy up to 2030, and, ultimately, to protecting and attracting private investment into Ukraine”.
Bram Romeijn, Attaché for Energy and Climate at the Embassy of the Kingdom of the Netherlands in Ukraine: “In the Netherlands there is a special attitude to wind energy. It is very important for our citizens. We believe that, under the current conditions of martial law, wind energy for Ukraine is a real solution; it is the diversification and decentralisation of its energy system. We see that the Ukrainian government also holds this position, so we are glad to make our contribution to the development of this sector. Improving the relevant legislative framework is what is critically important for investors right now”.
A welcoming address was delivered by Serhii Vlasenko, Deputy Minister of Environmental Protection and Natural Resources of Ukraine: “The presented Report is truly a very thorough study. We at the Ministry are currently analysing the part dedicated to legislative changes in EIA and SEA. The Ministry of Environmental Protection wholeheartedly supports the development of wind energy, because it is a “green” solution and generation that makes it possible to carry out the energy transition away from fossil fuels. For our part, we will be involved in implementing the recommendations proposed in the Report”.
In his speech, Yurii Shafarenko, Deputy Head of the Main Department of the Directorate for Economic Policy of the Office of the President of Ukraine, noted: “We at the Office of the President of Ukraine have also worked through the prepared Report and conceptually support the implementation of the legislative changes proposed in it. Today wind energy plays a key role for Ukraine, especially in the autumn-winter period, and therefore it is necessary to create the maximum possible incentives for the even greater development of this sector in Ukraine”.
“I want to thank the relevant Ministries for their support and readiness to continue working through our recommendations. Yesterday we also presented this Report to the First Deputy Prime Minister – Minister of Economy of Ukraine Yulia Svyrydenko and to Andriy Herus, the head of the Verkhovna Rada Committee on Energy and Housing and Communal Services. I am convinced that this Report, with a volume of 122 pages, can well become the basis thanks to which the investment climate of Ukraine’s wind energy sector will be significantly improved”, summed up the introductory part of the event Andriy Konechenkov.
As part of the second part of the event, the authors of the Report shared the key conclusions and recommendations developed based on the results of the analysis carried out.
The first to speak was Olena Sichkovska-Chornobyl, energy lawyer at UWEA and the German company Notus Energy, who also took on the role of project manager. In her speech, Ms Olena outlined the goal, objectives and results of the project and drew the guests’ attention to the issues covered by the Report, its structure and research methodology.
Anzhelika Livitska, partner at ARZINGER, comprehensively presented the proposals for legislative changes in the field of EIA and SEA.
Serhii Datsiv, senior lawyer at INTEGRITES, in turn, outlined the recommendations regarding the possibility of changing the designated purpose for land without conducting an EIA and regarding the agreement of the amount of damages subject to compensation.
Viktoriia Demydenko, counsel at Asters, presented the proposals regarding the siting, construction and maintenance of access roads, as well as obtaining the so-called aviation approval. Continuing Ms Viktoriia’s speech, the second representative of Asters at the event – Marta Halabala, counsel, covered with her speech the part of the Report dedicated to the allocation of cross-border interconnections for renewables and the export of electricity.
One of the most extensive parts of the Report, dedicated to extending the validity period of permit documents, in particular technical conditions for connection to the electricity grids, and the possibility of capacity reservation, was presented by Ivan Bondarchuk, partner at LCF. Additionally, his experience on this issue was also shared by Serhii Chaus, manager of the engineering department of DTEK Renewables, who also emphasised the need to change the outdated methodology for calculating power system operating modes.
Finally, Maksym Sysoiev, partner at Dentons, spoke in more detail about what the authors of the Report propose regarding the operation of energy storage facilities and the introduction of cable pooling technology, that is, the possibility of using one connection point to the electricity grid for installations of different types of renewables.
UWEA extends its gratitude to everyone involved in the development of this Report for their sincere aspiration to improve the Ukrainian wind energy market and make it more attractive for international investors and financial organisations.
