Renewable energy

Implementation indicators

  • National Renewable Energy Action Plan

    National Renewable Energy Action Plan

    Ukraine submitted its NREAP as well as all three Progress Reports on the implementation of the Renewable Energy Directive to the Secretariat. In 2018, Ukraine reached a 7,01% share of energy from renewables, still below the trajectory of 9,1%.

  • Quality of the support schemes

    Quality of the support schemes

    Administratively set feed-in tariffs (FiTs) are granted since 2009. Following a settlement of a dispute mediated by the Secretariat’s Dispute Resolution and Negotiation Centre, a Law on Restructuring Feed-in Tariffs was passed in July 2020. Its implementation is pending. Auctions are yet to be implemented although envisaged by legislative amendments adopted in December 2019.

  • Integration to the grids

    Integration to the grids

    Guaranteed access and gradual balance responsibility for large renewables producers in compliance with the acquis was introduced in the new Electricity Market Law, and revised by the Law on Restructuring Feed-in Tariffs in July 2020. Offtake of electricity under the FiT regime is an obligation for the state-owned Guaranteed Buyer, which suffers from liquidity problems.

  • Administrative procedures and guarantees of origin

    Administrative procedures and guarantees of origin

    The existing national measures only partially comply with Directive 2009/28/EC as not all administrative procedures are transparent, streamlined and expedited at the appropriate administrative level. There is no single administrative body.

  • Renewable energy in transport

    Renewable energy in transport

    In April 2020, the draft Law on amendments to legislative acts on the mandatory use of liquid biofuels (biocomponents) in transport was registered in the Parliament, however, it did not pass first reading. The current share of renewables in transport is 2,2%.

State of compliance

In the reporting period, a dispute between investors and the State almost triggered a wave of arbitrations against the country. The dispute was resolved by a memorandum and the law on restructuring of feed-in tariffs (FiT), which applies not to all investments though. Implementation remains a challenge and is made more difficult by an inappropriate electricity market design.

All three sectorial targets (electricity, heating and cooling, transport) and the overall 2020 target, are far from being reached. Following the adoption of the Law on Ensuring Competitive Conditions for Electricity Production from Alternative Energy Sources in April 2019, Ukraine adopted an order on auctions for the distribution of support quotas and standard electricity purchase agreements between the Guaranteed Buyer and the entity company eligible to take part in the auctions. The scheme foresees that auction volumes will be determined based on the defined quotas for wind, solar PV and other renewables. However, no volumes have been set so far.

Due to a liquidity crisis caused by a significant increase of renewables investment under the FiT scheme, the memorandum signed between the Government and renewables investors in June 2020, negotiated under the auspices of the Secretariat’s Dispute Resolution and Negotiation Center, foresees reform of the FiT regime. In July 2020, the Verkhovna Rada adopted a corresponding law on the restructuring of FiTs.

Under the new Law, plants with installed capacity of 1 MW or higher will become fully balance responsible by the end of 2022. The Law also introduces a compensation mechanism for curtailment, State financing for renewables and exemption for certain large industries from paying the renewables surcharge.

Ukraine adopted a secondary act on guarantees of origin in 2013. However, the State Agency on Energy Efficiency and Energy Saving as the designated body has failed to implement an electronic system compatible with the European Energy Certificate System.

During the next reporting period, Ukraine should introduce a functional market-based renewables support scheme. The electronic system for guarantees of origin should be established without further delays.