Business news from Ukraine


Myronivsky Hliboproduct (MHP) has announced the start of construction of a 25 MW Battery Energy Storage System (BESS) in Ladyzhyn, Vinnytsia region, this year.
According to a press release by MHP, the agricultural holding began implementing a conceptual project for the construction of the Energy Storage in Vinnytsia region as part of the creation of the energy cluster MHP Energy Hub. The implementation of energy projects of the agricultural holding is carried out by PrJSC MHP Eco Energy, which is an electricity supplier and a management company of the largest biogas energy producers in Ukraine.
“The first step of MHP Eco Energy is announcing a tender for the development of a feasibility study for connecting BESS to power grids, with the possibility of using Smart Grid Technologies in the future,” MHP said.
According to MHP, the implementation of the project for the construction of BESS with a capacity of 25 MW in Ladyzhyn will begin in 2020 and will take place in four stages: the first one of 5 MW/5MWh, the second of 5 MW/5 MWh (the total capacity of 10 MW/10 MWh), the third of 5 MW/5 MWh (the total capacity of 15 MW/15 MWh), the fourth one of 10 MW/10 MWh (the total capacity of 25 MW/25 MWh).
“Ukraine needs to reduce its dependence on “dirty” energy and very quickly upgrade its energy infrastructure through the use of Energy Storage and Smart Grid in order to remain economically competitive and energy independent. The accumulation of energy will allow us to have a power supply that will be available 24/7. Energy storage plays an important role in creating a more flexible and reliable system of operation of power grids,” MHP noted.

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Ukraine may save $5-6 billion on energy imports in 2020 due to a 50-60% reduction in prices for energy products, which account for 20% of the country’s imports, NBU Deputy Governor Dmytro Sologub has said.
“Our balance of payments shows that there are both positive and negative influence factors in our current account. First of all, this is a fall in oil prices, energy products, which account for 20% of our imports, compared to $12 billion in 2019. A fall in oil prices, a decrease in gas demand may lead to the fact that this year we will save $5-6 billion,” he said at an online briefing on Friday.
Sologub said that the epidemiological situation has led to a reduction in tourist travel.
“Last year, tourist trips of Ukrainian citizens amounted to $8 billion, and we can also expect a significant reduction,” Sologub said.
According to him, the National Bank expects a slight decrease in food prices, which account for more than 50% in Ukrainian exports. To date, the fall in food prices is much lower than for energy.
“As we understand it, even in a crisis, especially when sitting at home, people will consume food and this is the last thing they will refuse. Therefore, we expect that the demand for our export products will preserve, and if it decreases, then insignificantly,” the banker said.
He said that now there is a decrease in money transfers to the country from Ukrainian citizens working abroad. The National Bank expects that the reduction in the indicator will also be less than in energy products.
“Most likely, this influence will be temporary, as economic recovery in Poland, the Czech Republic, Italy will lead to the resumption of remittances,” he said.



EU4Energy has launched a project of technical assistance for Ukraine to implement EU Regulation 347/2013 for the development of energy infrastructure, according to the website of the Energy Community Secretariat.
“On March 10, EU4Energy launched a technical assistance project to assist Ukraine in the transposition of Regulation (EU) 347/2013, which aims to facilitate investments in energy infrastructure,” the report on the website of the agency reads.
“Representatives of the Ministry of Energy and Environment Protection of Ukraine and Energy Community Secretariat experts discussed ways to put the new project in motion. The draft legislation will be developed with EU4Energy assistance by the end of April 2020 and is to rely on the findings of the legal analysis of the current regulatory framework of Ukraine developed by the Secretariat’s experts in 2019,” according to the document.
“The Regulation prescribes establishing a national competent authority, setting procedures for the permitting process and defining the methodology and criteria to be used for evaluating investment in electricity and gas projects and the risks incurred by them,” it says.

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The Ministry of Energy and Environmental Protection should be divided and the Ministry of Environmental Policy and Sustainable Development should be created, Chairwoman of the NGO All-Ukrainian Ecological League Tetiana Tymochko.
“The merger of the Environmental Protection ministry with the Energy Ministry, the enterprises under management of which are biggest polluters of environment, initially put the conflict of interest behind this and created the basis for abuse,” Tymochko said at a press conference at Interfax-Ukraine on Tuesday.
She said that since the merger of the Ministry of Ecology and Natural Resources in September last year with the Ministry of Energy and Coal Industry, very little attention has been paid to environmental issues.
“Only 10% of the employees of the merged ministry have their functional responsibilities of being involved in preserving wildlife,” the expert said.
At the same time, she drew attention to the fact that since the merger, most of the nearly three dozen directives on environmental obligations to the European Union were not considered by the ministry, and no draft legislative act was proposed regarding the preservation of the environment.
According to Tymochko, it is also alarming that in the report of the government on its activities submitted to the Parliament, in the Ministry of Energy and Environmental Protection section, only six out of 28 pages relate to environmental issues, the rest concern energy.
“The activities of the ministry in the direction of environmental protection are paralyzed,” Tymochko said.
The head of the environmental league pointed out the need to adopt a project to reform the environmental industry, developed by the environmentally interested public.
“This project was developed back in 2014, and is transferred to each new minister, prime minister and president. But the environmental sector is not being reformed at all, although the issue of its reform is very urgent. The basis for reform should be the separation of functions in all public bodies that are represented in the industry,” Tymochko said.
At the same time, according to another participant in the press conference, Chairman of the National Ecological Council of Ukraine Oleksandr Chystiakov, the environmental situation in the country is disastrous, and Ukraine currently occupies the fourth place in the world in terms of mortality from poor ecology.
According to him, for example, only a third of the effluents discharged into the water bodies of Ukraine last year were treated.
“Given the level of pollution of water bodies, the World Bank put Ukraine in 125th place in the world in terms of freshwater per capita,” Chystiakov said, quoting the data.
At the same time, he criticized the imposition of a moratorium on environmental audits of the business, which, he believes, contributes to the pollution of water by industrial effluents and the appearance of unauthorized landfills.
“There are already 35,000 illegal landfills in Ukraine, covering an area of over 14,000 square kilometers. This is more than the territory of Zakarpattia region,” the expert said.
Mykhailo Zakharchenko, the head of the public council at the State Environmental Inspectorate of Ukraine participating in the press conference, for his part drew attention to the inadmissibility of the fact that the head of the State Environmental Inspectorate has not been appointed based on the results of the competition for several months.
“The State Environmental Inspectorate has not been fulfilling its functions for more than four months, five candidates were selected for the post of head of the inspectorate at the competition, but so far no one has been appointed,” Zakharchenko said.
Mykhailo Romanyshyn, who entered into the Guinness Book of Records as a swimmer-record holder of the #Vplavdnipro project, who sailed 985 km along the Ukrainian part of the Dnipro River from the border with Belarus to the Black Sea, in particular, to draw attention to the state of the Dnipro River waters, believes that the issue of this river pollution requires very quick and competent response, otherwise the consequences will be devastating.
In addition, the participants in the press conference criticized the E-40 project (the project to create a shipping lane of more than 2,000 km long along the Vistula, Pripyat and Dnipro rivers to connect the Baltic and Black seas), as well as the fact that the Ministry of Energy and Environmental Protection did not oppose the government’s implementation of these plans. According to Chystiakov, the dredging of Prypiat will raise large volumes of radioactive substances, which are buried under a 60-80 cm layer of mud in the riverbed, and will entail serious pollution.
Tymochko also drew attention to the fact that the Ministry of Energy and Environmental Protection does not monitor the impact of military operations on the environment in the Donbas and does not state any position regarding the flooding of coalmines closed in Ukrainian areas that are not under the control of the Ukrainian government and the consequences of this for the country’s underground waters.

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The Ministry of Energy and Environment Protection is creating Ukrvuhillia state-owned enterprise. Corresponding order No. 13 of January 14, 2020 was posted on the website of the department. The document also approves the charter of the enterprise, and obliges the HR department to take measures regarding the appointment of the head of the enterprise.
The ministry said the decision to create Ukrvuhillia was made with the aim of eliminating the shortcomings of the current system of selling coal mined by state-owned coal mining enterprises, conducting a unified state policy regarding the extraction, processing and sale of coal, optimizing the structure of the procurement market, in particular imports, and creating a single platform for a rapid response to the problems of the coal industry.
The main idea of creating the enterprise is to ensure the proper and transparent functioning of the coal market, to protect Ukrainian producers from the influence of uncontrolled imports, as well as to sustainably meet the needs of domestic consumers in scarce grades of coal.

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The National Commission for Energy and Housing Utilities Regulation (NCER) has approved a preliminary decision on certification of PrJSC Ukrenergo as an independent operator of the electricity transmission system.
The corresponding document was adopted at a meeting of the regulator on October 7.
According to the previously published draft resolution, Ukrenergo by October 20 should exclude from the charter of the enterprise provisions that do not comply with the requirements of the law on the electricity market, as well as other regulatory documents regulating the energy sector.
The final decision on certification of Ukrenergo is possible after the company completes all the necessary measures specified in the preliminary decision, as well as after the Energy Community evaluates the preliminary decision.
“This is only the first step towards the certification of an independent operator. The preliminary decision will be sent to the Energy Community Secretariat, worked out, and we will expect an assessment of the document for its compliance with European law,” Oleksandr Formahei, a member of the commission, said.
As reported, in late May the NCER allowed Ukrenergo to work in the new wholesale electricity market under the old license until the company passes certification. The certification deadline is October 30, 2019, while Ukrenergo’s license is valid until this date.

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