CLIMATE CHANGE
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DIGEST

JUNE 2023

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FEED-IN TARIFF

• The Guaranteed Buyer at one of the auctions in April for the first time realized the volume of electrical energy as in pre-war times under bilateral contracts
• "Guaranteed Buyer" received only 6 applications for temporary exit from the balancing group
• Payments for electricity from renewables amounted to 56.3% in April

BIOGAS

• Ukraine has adopted a state standard for biomethane
• Construction of more than 30 biomethane plants is being considered in Ukraine

ENERGY POLICY MAKING

• The Parliament has adopted a draft law on guarantees of the origin of "green" electricity in the first reading

REBUILDING AND INTERNATIONAL AID

• EBRD and Italy cooperating to support energy security in Ukraine
• Ukraine and Germany launch a joint project to equip critical infrastructure with renewable energy sources
• The first solar power plant with a capacity of 0.783 MW was launched in Kirovograd region
• DTEK Renewables launches the first stage of Tiligulska wind farm in Mykolaiv region

CROSS-BORDER ELECTRICITY TRADE

• “Ukrenergo” modernized the power transmission line between Ukraine and Poland
• Ukraine suspends cross-border electricity trade with EU

The Guaranteed Buyer at one of the auctions in April for the first time sold the volume of electrical energy as per pre-war times under bilateral contracts    

In April 2023, the state-owned enterprise held 10 auctions for the sale of electric energy, including 3 auctions with supply on working days, and one thematic with the sale of solar energy. The total volume of sales is 350,584 MWh. In most auctions the capacity of sold electricity was between 13,000 up to 30,000 MWh, but on April 10, The Guaranteed Buyer managed to sell more than 200,000 MWh for the first time in a year.

The last time such volumes of electricity were sold in one auction was before the start of a full-scale invasion, namely in January 2022. At this auction on January 13, 322,550 MWh of electricity was sold.

At this recent auction, block bids were placed, which provides for the execution during the settlement period (hours)/several consecutive settlement periods (hours) of a day of delivery, indicating the corresponding period of release/selection and days - "working"/"non-working"/"all". In this case, the sale was made for daytime hours (08-20, 09-19, 10-18, 11-17) and the realization of the goods was 100 %. The volume of realization is 226,145 MWh of electric energy with average price 2,795.94 UAH/MWh.

In May, the largest volume of electricity since the beginning of 2023 was sold at "green" auctions, namely 591,690 MWh.

For comparison, in the same period last year in 2022, 268,910 MWh were sold.

In recent months, the amount of electricity that we can offer to the market has significantly increased. This isseen in the weighted average selling price in May 2023 reaching UAH 2,677.77/MWh.

Payments for electricity from renewables amounted to 56.3% in April    

The level of payments to renewable energy companies has not exceeded 60% for three months in a row, and even less in the first 10 days of May - 49.9%.

The highest figure for January - 91% - is irrelevant, as most wind farms are under occupation, and solar generation was minimally operational, so payments were not high.

Meanwhile, NPC Ukrenergo, which has had a deficit transmission tariff since the beginning of the year, is expected to continue to increase its debt to Guaranteed Buyer for renewable energy services. 
In just one month, it increased by UAH 2.2 billion and reached UAH 18.2 billion.

Ukraine has adopted a state standard for biomethane

The state enterprise UkrNDNC has adopted a national standard for biomethane injection into gas networks, both distribution and main ones. The document details the technical characteristics of biomethane for supply to the network. It has been developed following the EU requirements by specialists from the Regional Gas Company.

The new standard complies with the basic EU technical standard used to define the requirements for biomethane quality and the content of chemical compounds in it. From now on, DSTU EN 16723-1:2023 Natural Gas and Biomethane for Use in Transport and Biomethane for Injection in the Natural Gas Network has become a part of Ukrainian legislation. It will be used to issue technical specifications for the connection of biomethane plants to gas distribution networks.

The SE UkrNDNC has approved this state standard. All network operators can use it in their work. This is important in terms of market development and technical improvement of procedures and regulations, which has always been one of the critical objectives of RGC as a production and technology company.

Combining biomethane quality requirements with the European standard is an essential step towards creating conditions for biomethane exports to European countries and further integration of gas markets. Biomethane is a sustainable decarbonized form of energy. Thus Ukraine, which is at the beginning of its market development, should lay the foundation for its development following the EU standards.

The standard was developed by the Technical Committee for Standardization of Ivano-Frankivsk National Technical University of Oil and Gas (IFNTUOG), involving specialists from Zhytomyrgaz JSC and the Technical Committee of RGC. The document will come into force on November 1, 2023.

Construction of more than 30 biomethane plants is being considered in Ukraine 

The Gas Transmission System Operator of Ukraine is ready to provide biomethane transportation services. Currently, more than 10 companies have applied to GTSOU, which is considering the construction of the 31st biomethane plant with a capacity of 225 million cubic meters per year, GTSOU said during the committee hearings. 

According to Dmytro Lipp, Head of the GTSOU, it is important to unify regulatory requirements for biomethane with EU countries and eliminate domestic restrictions on its export. This applies to both the harmonization of customs formalities for the movement of biomethane across the border and the issuance of guarantees and certificates of origin that will be recognized both in the domestic and foreign markets.

Ukraine and Germany launch a joint project to equip critical infrastructure with renewable energy sources

On 23 of May, Ukraine and Germany reported upon launching the Renewable Energy for Sustainable Ukraine (R2U) project for Ukrainian communities. This is the first stage of implementation of the agreements signed in Kyiv by Ukrainian Energy Minister Herman Halushchenko and German Vice Chancellor Robert Habeck to deepen the German-Ukrainian energy partnership with a focus on green recovery and rebuilding of Ukraine's energy sector.

The project will select up to 20 communities to conduct energy audits of critical infrastructure buildings for further equipping them with renewable energy sources. The project is designed for 18 months and costs about €2 million.

The details of the project launch were discussed during the online presentation by Deputy Minister of Energy of Ukraine Yaroslav Demchenkov, representatives of the R2U project, GIZ Ukraine, and other involved organizations.

The first solar power plant with a capacity of 0.783 MW was launched in Kirovograd region

The region's first photovoltaic solar power plant with a capacity of 0.783 MW is in the village of Ivanivka, Novoukrainsky district, and is already generating electricity.

The plant can generate 1.3 MWh of electricity, which will be supplied to the grid, the press service of the Kirovohrad Regional State Administration reported.

The plant is capable of supplying electricity to the entire Novoukrainskyi district. The SPP covers an area of 2.7 hectares. The amount of investment exceeds UAH 25 million.

The design capacity of DTEK Tiligulska Wind Farm (four stages) is 500 MW and 83 wind turbines. The company plans to build the wind farm to its planned capacity.

The projected annual electricity production of the fully completed wind farm will be 1.7 billion kWh, which is enough to supply electricity to 900,000 households. The wind farm will reduce CO2 emissions by 1.7 million tons per year.

On 22 of May, Tiligul wind farm offered 5,040 MWh baseload power capacity, period of supply May 25-31, 2023. 
The offer is for 30 MW of base load for May 25-31. The starting price is 3500 UAH/MWh.