Secretariat reviews the decision on setting price caps in the electricity market of Ukraine 

The Secretariat’s Ukraine Energy Market Observatory assessed the Resolution No 1126 of 27 June 2023 (Resolution 1126) of the National Energy and Utilities Regulatory Commission (NEURC) on setting price caps for the electricity spot market in Ukraine.

By its decision, the NEURC increased the price cap and decreased the price floor on the day-ahead and intraday markets from 4000 UAH/MWh to 5600 UAH/MWh (07:00-19:00), 7200 (19:00-23:00) and for floor from 2560 UAH/MWh (07:00-23:00) and 1380 UAH/MWh (00:00-07:00) to a single value of 10 UAH/MWh. In the balancing market, the price cap changed from 120% to 125% of day ahead market price,  while the price floor remained unchanged.

The Secretariat welcomes this step towards further liberalisation and concludes that its further revision is an indispensable condition for the full integration of the Ukrainian electricity market with the European Union’s. Convergence with the European power markets and prices will also allow for imports from other Contracting Parties and Member States and hence improve the security of electricity supply in Ukraine. The Secretariat recommends that a strategy for further price caps liberalization is developed, to reflect the sequence of markets and include an automatic mechanism for adjustment of the price caps based on a transparent methodology.