On 7 February 2025, the President of Ukraine Volodymyr Zelenskyy signed the Law of Ukraine No. 4213-IX “On Amendments to Certain Laws of Ukraine in the Field of Energy and in the Field of Heat Supply Regarding the Clarification of Provisions Related to the Operation of Martial Law in Ukraine” (registration number No. 9381), which defined some long-awaited provisions for the market.
In general, the Law introduces changes to such issues as abuse on the wholesale electricity market, the disclosure of insider information, fines for violations, the import of electricity, the status of cogeneration installations, licensing, active consumers, “green” auctions, etc. However, one of the important provisions for the market in this Law was the definition of the capacity reservation service.
All the key provisions for the market:
- The reservation service. A service provided by the transmission system operator (NPC Ukrenergo or the TSO) for reserving technical solutions regarding the connection scheme of the customer’s generating capacity for a period of up to 2 years, which is available for wind energy installations with a capacity of 20 MW and above.
- The reservation fee. €5 per 1 kW of reserved capacity, paid within 20 days to an escrow account. Non-payment leads to the termination of the reservation agreement. If a connection agreement is signed, the reservation fee is credited as part of the connection fee.
- Technical connection conditions. The validity period may be extended to 6 years by an additional agreement. An extension after 3 years is possible subject to the approval of the design documentation, payment for connection and receipt of the construction documentation, with some particularities.
- Prepayment for connection. A mandatory prepayment of €10 per 1 kW of ordered capacity. Payment is made in two parts: 50% within 30 days, 50% within 12 months.
- Installed capacity. The total installed capacity of a facility may exceed the capacity agreed with the TSO or DSO at the connection point, provided that the instantaneous output of capacity into the grid does not exceed the limit set under the agreement with the TSO or DSO.
- Construction of the linear part. Customers may design and build the linear part of the connection for capacities over 1 MW. The costs are included in the total fee for non-standard connection.
- “Green” auctions. The share of the quota that a business entity may claim to participate in an auction, either independently or with a common ultimate beneficial owner, has been increased to 50%.
- Monetary obligations. During martial law, the enforcement of monetary obligations is suspended. This applies to electricity market participants listed on the website of the NEURC.
- Debt repayment. Surplus income from dispatching activity in 2023 and 2024 is directed to repaying the debts of the TSO and covering costs. According to the estimate of NPC Ukrenergo, this is approximately UAH 12–13 billion for debt repayment.
UWEA extends its gratitude to the Verkhovna Rada Committee on Energy and Housing and Communal Services for considering and supporting the adoption of these provisions, and to the President of Ukraine for signing this Law. The definition of the capacity reservation service, as well as the direction of funds to repay debt on the electricity market, is an important step towards improving market conditions and increasing the investment attractiveness of the market during martial law.
