New report: Ukraine advances electricity market integration reforms while emergency measures continue to shape energy markets   

The Energy Community Secretariat’s Q1 2026 Ukraine Energy Market Observatory Report shows that, while short-term crisis management remained central to energy policy, Ukraine also made important progress on legislative alignment with the EU electricity acquis and reforms supporting future market integration. The report identifies four key developments shaping Ukraine’s energy market reform trajectory in and immediately after the first quarter of 2026: 

1. Ukraine adopted major legislation advancing EU electricity market integration 

A key development was the adoption of Law No. 4834-IX in April 2026, partially transposing the Electricity Integration Package. The law represents a step toward Ukraine’s future integration with the EU internal electricity market, although the initiation of the market coupling process will depend on verification by the European Commission, together with the Secretariat, that all  legal acts have been fully transposed and that measures conflicting with EU law have been repealed or amended. Significantly, the law also puts in place the legal basis for designating the NEMOs, the market operators needed for future participation in EU electricity market coupling. 

2. Emergency measures continued to support system stability but affected market predictability 

 Ukraine maintained a strong focus on crisis management in response to continued damage to energy infrastructure and power system constraints. Temporary measures included obligations for selected state-owned companies to procure imported electricity during the autumn-winter period, simplified procedures for connecting distributed generation, and temporary derogations from certain electricity distribution quality standards. Electricity market operations were also shaped by frequent changes to wholesale price caps on the day-ahead, intraday and balancing markets. While intended to support imports and system stability during periods of deficit, frequent changes to market rules may affect regulatory predictability and market participants’ planning. 

In the gas sector, the extension of the ban on exports of domestically produced gas constitutes a breach of the fundamental pillars of the Energy Community Treaty. 

 Finally, the reform of public service obligations remains essential for Ukraine’s energy market liberalisation. While these measures continue to play an important role under wartime conditions, their current design affects market functioning, financial liquidity and price signals. The Secretariat calls for clear roadmaps to gradually liberalise electricity and gas markets after martial law, alongside targeted protection for vulnerable consumers. 

3. Renewable energy framework strengthened, but implementation challenges remain 

Law No. 4777-IX, adopted in February 2026, introduced positive changes to Ukraine’s renewable energy framework. These include the introduction of a market premium mechanism for renewable energy support, extended auctions for support quotas until 2034, incentives for combined solar and storage projects, and provisions on guarantees of origin. 

The report also notes delays in moving to a more transparent way of financing renewable energy support. Ukraine had planned to remove the renewable energy surcharge from the electricity transmission tariff so that support for renewable producers acquired from July 2026 would be financed through a clearer, separate mechanism. However, new provisions allow the wider costs of government-mandated energy support measures to remain within the transmission tariff until 2030. This could make the system less predictable for market participants and slow the implementation of renewable energy support reforms. 

4. NRA independence  

Delays in reforms aimed at strengthening the operational and financial independence of Ukraine’s national regulatory authority, NEURC, remain a concern, as does the need for integrating more transparent and objective criteria when selecting NEURC Board Members. In this regard, amendments to the Law on NEURC should be adopted without further delay. Without progress on regulatory independence and governance, Ukraine’s broader market integration reforms risk being weakened at the institutional level.