Standing on the rooftop of a 16-storey residential apartment building in Ukraine’s capital Kyiv, Valerii Pyndyk pointed to several rows of solar panels.
Pyndyk hopes the installation – one of the first of its kind by residents in Kyiv – will help about 1,000 families living in the building get through what could prove Ukraine’s most difficult winter since the start of Russia’s invasion.
“The idea was born when we had electricity cut-offs in summer. We – the housing association board – realised that if we had blackouts in summer, then in winter they will not be shorter but longer,” said Pyndyk, 49, who heads the association.
The two previous winters of the war were already challenging, but Russia has now intensified its attacks on Ukraine’s energy infrastructure, with at least 11 major missile and drone strikes since March.
About half of Ukraine’s generating capacity was knocked out and distribution networks were also damaged.
In Kyiv, daily blackouts of eight hours are common and people plan their days around when power is scheduled to be available, including waiting in cafes for elevators to work if they live near the top of high-rise buildings.
Some residents and businesses have rushed to install new generating capacity in an attempt to access energy independently of the central energy system.
“Overall in Ukraine there is a steady trend towards energy independence, starting from small (consumer) clients and ending with business,” said Serhiy Kovalenko, CEO of Yasno, a leading energy supplier.
Analysts said strategies included more electricity imports from Ukraine’s Western neighbours, purchases of generators and alternative energy sources including solar panels, batteries and small gas turbine generators.
Yasno, which supplies electricity and gas to more than 3.5 million consumers and up to 100,000 businesses, provides options that include solar panels and accumulating batteries and inverters.
“Demand is very high,” Kovalenko told Reuters. “This autumn we installed up to eight megawatts, next year we will install up to 30-35 megawatts.”
Eight megawatts is enough to supply around a dozen enterprises in this case, the company said.
Russia has damaged or destroyed all of Ukraine’s thermal and hydropower plants.
In monetary terms, total damage to Ukraine’s energy sector exceeds $56 billion, including $16 billion in direct physical destruction and over $40 billion in indirect financial losses, according to estimates from the Kyiv School of Economics.
The country has to rely increasingly on nuclear generation, which makes it difficult to balance the amount of electricity on the grid, especially during peak morning and evening hours when retail consumption jumps.
Ukraine has tried to defend its energy system by building protective structures, setting up mobile drone-hunting groups and working with partners to bring in more air defence systems.
But it still lacks sufficient resources to protect facilities across the country.
After each Russian strike, the government, energy companies, engineers and Ukraine’s partners scramble to recover and rebuild what they can. Winter weather can complicate matters.
“If we have a cold winter, consumption will be much more than last winter. Last winter, maximum consumption was 18 gigawatts (GW), so this year we think that if it is cold… it will be 19 gigawatts,” said Olena Lapenko, general manager for energy security at a Kyiv-based think-tank, DIXI group.
Once the lights go off, the immediate fix for many is to turn on the generators.
“We need this electricity… to bake bread, to make croissants, cakes… We took a lot of steps to be ready – we bought powerful generators,” said Stanislav Zavertailo, co-owner of Honey confectioneries and Zavertailo pastry shops in Kyiv.
As his team refuelled an industrial generator at their production site, Zavertailo said electricity was driving up costs.
“One kilowatt-hour is five to six times more expensive than the usual one.”
Generators work better for small- and medium-sized enterprises and offer only a temporary solution, analysts said.
Looking for ways to help bigger businesses, the government agreed with Ukraine’s central European neighbours to increase imports to 2.1 GW at any given time from Dec. 1. But imports are also expensive, said Lapenko.
Dozens of financial programmes supported by Kyiv’s Western allies have been launched to shift Ukraine’s energy mix to a cleaner and more sustainable model. Legislative changes were also introduced to simplify equipment purchases and imports.
Solar panels have started to appear on roofs of private houses, residential buildings, schools, hospitals and other public buildings.
Pyndyk said the cost of the installation on his building was about 950,000 hryvnias ($23,000) and that the government and Kyiv municipality had offset about two-thirds of that amount.
He and his residents plan to install more panels on other buildings next year.
Official data showed that about 1.5 GW of new solar generation has been installed. But given Ukraine’s needs and the scale of wartime damage to energy infrastructure, such changes are only the beginning.
“This problem is not only a challenge for this winter. Coal generation is outdated and we need to change something,” said Lapenko of DIXI group.
“This is the prospect for three, four or five years to replace what was destroyed and gradually replace that outdated generation.”
During President Volodymyr Zelenskyy’s visit to the U.S., representatives from PJSC Ukrnafta, the state-owned energy trader Energy Company of Ukraine (ECU), and Gas Transmission System Operator of Ukraine (GTSOU) LLC met with U.S. companies to discuss preparations for the upcoming 2024/2025 heating season, according to Oleksandr Kamyshin, the president’s strategic adviser.
“We, along with the president, had a meeting with U.S. companies to prepare our energy sector for winter. Three Ukrainian companies attended: Ukrnafta, ECU, and GTSOU. Each of them is working on significant projects in energy generation,” Kamyshin wrote on his Telegram channel.
According to him, the Ukrainian companies aimed to establish business-to-business relationships with the U.S. industry.
Kamyshin mentioned that there was a “productive dialogue” with U.S. energy corporations, financial institutions, U.S. Deputy Secretary of State for Energy Resources Geoffrey Pyatt, and Deputy Secretary of State Richard Verma.
Later, Pyatt tweeted that he had a very fruitful separate meeting with Kamyshin following the energy sector roundtable with Zelenskyy.
“The U.S. and international partners are committed to ensuring Ukraine’s energy security, especially this winter,” he wrote.
Earlier, Verma reported discussing private sector investment in Ukraine’s defense capabilities with Kamyshin.
U.N. nuclear agency chief Rafael Grossi met Ukrainian energy officials on Tuesday before a planned visit to the Russian-occupied Zaporizhzhia nuclear plant, part of efforts to prevent a wartime nuclear catastrophe.
Grossi, the director of the International Atomic Energy Agency (IAEA), arrived in Ukraine a week after visiting the Kursk nuclear power station in Russia and warning of the danger of a nuclear accident there.
On his latest visit to Ukraine since Russia’s invasion in February 2022, Grossi met Energy Minister German Galushchenko, as well as Petro Kotin, head of state nuclear power company Energoatom, and Oleh Korikov, acting head of Ukraine’s State Nuclear Regulatory Inspectorate.
The IAEA was “fully committed to safety & security of (Ukrainian) nuclear sites, with (a) presence at each,” Grossi wrote on X alongside photos showing him and Ukrainian officials holding talks.
He said they were “exchanging (views) on our support to Ukraine’s NPPs (nuclear power plants) ahead of my ZNPP visit.”
Grossi said on X on Monday that he was on his way to the Zaporizhzhia nuclear power plant (ZNPP) “to continue our assistance & help prevent a nuclear accident.”
Ukrainian President Volodymyr Zelenskiy said he would meet Grossi after the IAEA chief visits the country’s nuclear plants.
The ZNPP in southeastern Ukraine, Europe’s largest nuclear power plant, fell to Russian troops soon after Moscow’s full-scale invasion and is not operating now.
Both sides have frequently accused each other of shelling the plant. Moscow and Kyiv both deny the accusations.
Zelenskiy and Dutch Prime Minister Dick Schoof on Monday visited the city of Zaporizhzhia, which lies across the Dnipro River to the northeast of the plant.
Zelenskiy also said that at this stage of the war, it is not possible for Ukraine to take back control of the plant.
“It is safer for Ukraine to control the Zaporizhzhia plant, but so far, from the point of view of the battlefield, I do not see such possibilities, and those that probably exist, they are dangerous,” Zelenskiy said.
Russian news agencies reported on Monday that a high-voltage power supply line at the plant had automatically disconnected, but the plant’s needs are supplied by another line. There was no reason given for the automatic disconnection.
Ukraine said Russian attacks had damaged one of the two external overhead lines connecting the plant to the Ukrainian power grid on Monday. Russia did not immediately comment on this assertion.
Russia says the Kursk nuclear plant visited by Grossi last week has been repeatedly attacked by Ukrainian forces that are just 40 km (25 miles) away since Ukraine carved out a slice of Russian territory in a cross-border attack this month.
Grossi said after visiting the Kursk nuclear plant that it was extremely fragile because it had no protective dome and that the “danger or possibility of a nuclear accident has emerged near here.”
Ukraine’s foreign ministry on Thursday denounced what it said were Russian efforts to “accuse Ukraine of alleged provocations against nuclear safety”.
It said Russia had intensified a “disinformation campaign to distract attention from its own criminal acts at the Zaporizhzhia nuclear power plant.”
In a statement, it described such accusations as “cynical” following attacks on energy infrastructure that forced Ukraine to disconnect several nuclear power units from the grid last week.
The situation in the Ukrainian energy system next week will be perceptibly more difficult compared to the current week, said the Chairman of the Board of the NEC Ukrenergo Volodymyr Kudrytskyy.
“Next week will be more difficult for the energy system, because the heat wave will return and we will have a reduced capacity of nuclear power plants, if compared to the current week,” he said in an interview with Ukrayinska Pravda on Friday.
According to the NEC head, due to the massive shelling, the energy system has lost its reserve of strength and has become dependent on sudden changes in electricity consumption and weather, forcing it to balance by shutting down consumers.
“Our energy system, having lost more than 9 GW of capacity due to shelling, now has no reserve of strength. If earlier we had additional power plants that could be switched on promptly, we would overlap by switching on some hydro units or TPP units, now we simply do not have such a maneuver,” – explained Kudrytskyy.”
As previously reported, Energoatom announced that it would put a 1000 MW nuclear power plant unit under repair as part of a planned repair campaign in 2024. The company pointed out that, given this and the increase in electricity consumption in July, the generation deficit in the power system may increase.
Prime Minister Denys Shmygal noted that saving e/e will be part of Ukraine’s daily life in the coming years due to Russian attacks on the country’s energy sector.
Which energy companies were included in the Opendatabot Index?
According to the Opendatabot Index, the total revenue of the top 10 energy companies in Ukraine amounted to almost UAH 750 billion. Half of the top companies are state-owned, and 4 more belong to Rinat Akhmetov’s SCM Group. For the second year in a row, D.Trading, which is part of SCM Group, remains the leader.
According to the Opendatabot Index, the leaders of Ukraine’s energy sector earned UAH 745.87 billion last year. This is 8% more than the total revenue of these companies in 2022, which is UAH 688.45 billion.
This year’s ranking includes 5 state-owned companies and 4 companies belonging to Rinat Akhmetov’s SCM Group. Another company, Kyiv Oblast Energy Company LLC, is owned by Nelia Kostenko.
8 of the top companies are engaged in electricity generation and trading, and two more are engaged in gas trading.
D.Trading, which is part of SCM Group, has been the leader of the group for two years in a row. Last year, the company’s revenue increased by 15% compared to 2022: from UAH 144.18 billion to UAH 165.65 billion. At the same time, net profit increased by 30% in 2023.
Two other companies of Rinat Akhmetov managed to get the biggest increase in revenue. Thus, Kyiv Energy Services increased its revenue by 1.5 times, and Dnipro Energy Services by one third compared to 2022.
It is worth noting that Dnipro Energy Services received the largest increase in profits – 2.5 times – among all the companies included in this year’s Energy Index.
On the contrary, DTEK Zakhidenergo, the fourth company of SCM Group, decreased its revenue by 16% over the year. Last year, the company suffered a loss of UAH 164 million.
Overall, the total revenue of 4 companies owned by Rinat Akhmetov amounted to UAH 262.48 billion in 2023. This is 35% of the total revenue of the top 10 energy companies in the Opendatabot Energy Index.
The ranking of the best companies in the energy sector includes 5 state-owned companies, but only two managed to increase their revenue last year. Thus, Ukrhydroenergo increased its earnings by 30%, and NNEGC Energoatom – by 15%.
It is worth noting that Ukrhydroenergo received the largest net profit among the 10 companies in the Index in 2023 – UAH 17.3 billion. This is almost half as much as in the first year of the full-scale invasion. The revenue of state-owned Ukrenergo remained almost unchanged over the year, at over UAH 82 billion.
Two other state-owned companies involved in gas trading reduced their revenues in 2023 compared to 2022: Naftogaz of Ukraine by 4% and Naftogaz Trading by 9%. Both companies suffered losses in 2023, totaling UAH 10.29 billion.
The last place in the top is taken by Kyiv Regional Energy Company LLC, owned by Nelia Kostenko. The company increased its revenue by 29%, while its profit decreased by a quarter compared to the first year of the full-scale invasion.
https://opendatabot.ua/analytics/index-electricity-2024
The Energy Support Fund has managed to raise over EUR410m from 13 partner countries and international organizations as of April 9.
“The remaining amount is the announced contributions, which will soon be transferred by the sponsors,” the Ukrainian Energy Ministry said on Tuesday.
As the ministry noted, the special trust of partners has been secured thanks to the system of transparent distribution of funds. In particular, the Ministry of Energy has a working group on humanitarian aid, which considers requests from Ukrainian energy companies to purchase the necessary aid with the Fund’s resources.
The Fund financed the most urgent needs of Ukrainian energy companies, in particular, the purchase of generators, power transformers, circuit breakers, spare parts, technical means, materials, special equipment, fuel, means of physical protection of energy facilities.
“Most of all funds are distributed to meet the urgent needs of energy companies from frontline regions – Kharkiv, Mykolayiv, Sumy, Zaporizhzhya, Kherson, Odessa,” the Ministry of Energy said.
