The development of distributed energy generation and strengthening of the country’s energy security were the focus of a meeting with businesses, state and regional authorities in Kyiv on 4 June 2024.

The event, initiated by the Ministry of Economy, brought together representatives of the Ministry of Economy, the Ministry of Energy, the Ministry of Environmental Protection and Natural Resources, Ukrenergo, the National Bank, regional administrations, the Federation of Employers of Ukraine, industry associations, banks and enterprises.

The aggressor’s attacks on electricity facilities resulted in the loss of up to 9 GW of capacity and a significant electricity shortage. The development of distributed generation and backup power supply can accelerate the restoration of the country’s power capacities and at the same time ensure greater resilience of the electricity system. This includes both alternative generation and balancing capacities, such as small biofuel power plants, highly manoeuvrable gas-fired power plants, energy storage systems, etc.

As it was noted during the meeting, the Government seeks to create the most favourable conditions for businesses implementing distributed generation projects. For example, the timeframe for issuing and approving technical specifications for grid connection has been shortened, the number of documents required for this purpose has been reduced, and unnecessary regulatory instruments, such as environmental impact assessment, have been cancelled. A draft law is being prepared to exempt imports of power generation equipment from taxation.

Access to financial resources needed to implement distributed generation projects was among the main issues raised by the businesses during the meeting.

“One of the tools that has proven itself very well and that the state can offer to business is concessional lending under the 5-7-9 programme. The Government is currently drafting a decision to expand this programme to include distributed generation projects. This is up to UAH 150 million in loans on favourable terms, which is sufficient for small projects. At the same time, we will work with our partners from the EBRD and the European Investment Bank to quickly attract funds from the Ukraine Facility for energy recovery,” Deputy Minister of Economy Oleksii Sobolev noted.

It was noted at the meeting that municipal authorities can implement their local projects to increase the existing energy capacity of district heating companies through public-private partnerships.

The participants of the meeting also touched upon the issues of war risk insurance, solutions that would allow commercial banks to lend more actively to distributed generation projects, etc.