On April 30, 2024, the UWEA held the “Reclaiming the Wind: Legal Strategies For War Damage Recovery” webinar as part of its 2024 online series. Russia continues to target Ukrainian energy infrastructure with constant missile and drone attacks. Only in March-April 2024, the enemy damaged 80% of thermal power generation, leading to the loss of about 7 GW of IPS capacity. During that period, it was also reported that another wind turbine in the south of Ukraine had been damaged. In general, the World Bank estimated that the wind power industry has lost more than 50 million euros since the war began.
Andriy Konechenkov, Chairman of the UWEA Board: “71% of wind capacity is still in temporarily occupied territories, while there has been already known about 12 cases of damage or destruction to wind turbines. So, the importance of war damage recovery is growing for the market and UWEA has already discussed that more than once. Therefore, the uniqueness of this specific webinar is the opportunity to learn more about investment arbitration, as well as about “mass claims”, which are cheaper and more effective.”
One available way to compensate for losses caused by a full-scale war is to file lawsuits against the russian federation under the 1998 BIT between russia and Ukraine. It was also mentioned that prospective claimants can rely on the favorable precedents set by earlier investment arbitration cases arising from the occupation of Crimea, the so-called “Crimean cases” and the ECHR’s decision in Ukraine and the Netherlands v. russia on 25 January 2023.
So, the webinar focused on the current legal procedure for collecting funds from the russian federation as well as the peculiarities of filing such lawsuits, namely rights/violations that are relevant to arbitrations along with their duration and cost, and the possibility of filing mass claims. These and many other related issues were widely articulated by Maria Kostytska, Partner and Head of Arbitration at the Paris Office, Winston & Strawn LLP, under the moderation of Ivan Bondarchuk, member of the UWEA Board, Partner and Head of “Energy and Projects” Practice at LCF Law Group.
“For investors who lost wind farms in the temporarily occupied territories and who want to file arbitration claims against russia, the feasibility of investing several million euros in the arbitration process is a major dilemma. These funds are essential for the recovery and growth of their business, as well as for investing in new projects. Therefore, lawyers are actively looking for effective methods to reduce the cost of arbitration (such as mass claims) or for other external funding sources for processes,” lawyers stated.
Complex insurance against military and political risks is essential for further development of the national RE sector and safe “green” investments. The insurance programs offered by many IFIs, like MIGA, the US State Fund for International Development, EBRD, Bpifrance Assurance Export, and others, can be beneficial. In addition, on February 22, 2023, the Ministry of Energy of Ukraine and the State Property Fund issued a joint Order No. 57/342, which approved the Methodology for Determining Damage and Losses to Ukraine’s Energy Infrastructure Caused by russian Military Aggression.
