It became known why electricity is being sent “into the ground” in Ukraine during daytime hours
20 March 22:36
Ukraine’s energy system is facing a significant imbalance in electricity production and consumption, which is causing multimillion-dollar losses for the state. This was stated by Andriy Gerus, Chairman of the Verkhovna Rada’s Energy Committee, during a meeting of the Committee.
What is the reason for the imbalance?
The reason for the problem is that Ukraine is actively building solar power plants that produce energy mainly during the day.
This leads to an uneven supply throughout the day: in the morning and evening, there is not enough power, which leads to restrictions for consumers, especially industrial ones, and in the afternoon, there is too much, which forces the introduction of generation restrictions.
“It is the most unhealthy situation and the most financially inefficient, because every week we pay tens of millions of hryvnias for electricity that goes straight into the ground,” Gerus said.
When did the problem escalate?
The problem became more acute in early March, especially on the 7th and 8th, when significant warming led to a decrease in electricity consumption by about 2 GW, and cloudless weather contributed to the active production of electricity by solar power plants. At that time, the heating season was still in progress, which meant a high base of traditional generation (nuclear, thermal, and hydroelectric power plants).
How much does the state pay producers for electricity?
According to the feed-in tariff and the terms of take-or-pay contracts, the state is obliged to pay producers for the electricity they could not supply to the grid due to restrictions. In the period from April to October 2024, the cost of such paid but not consumed electricity reached UAH 954 million.
Gerus predicts that the situation will only get worse in 2025.
He believes that the state’s pricing policy creates the wrong incentives for investors who continue to build solar power plants rather than invest in other types of generation or energy storage systems.
“When a consumer or investor looks at such a market, they think: it probably makes sense for me to continue building solar panels, because together with grid tariffs, I get a good price and I will have a payback period of less than five years. And with this market, when prices are quite high in the afternoon and not super high in the evening, it makes no sense to bother with something more complicated to deliver some energy storage, to build some gas generation. If this trend continues, we will come to a point where we will have huge generation restrictions at lunchtime. Maybe not in six months, maybe in a year and a half,” Gerus said.
