Chairman of the Management Board of National Power Company (NPC) Ukrenergo Vitalii Zaichenko has said that he expects high investor interest in participating in the largest competition in Ukraine’s history for the construction of 1.5 GW of new generating capacity.
“Covering 1.5 GW is probably very ambitious, but there will definitely be interest in the competition. We are already feeling it now,” Zaichenko said in a comment to Energoreform on the sidelines of the “Decentralization 2.0: Strengthening Power System Resilience Together” event, organized by Ukrenergo in Kyiv.
He noted that he primarily relies on Ukrainian investors, and Ukrenergo is doing everything to attract them to participate. Regarding technologies, the NPC expects peak and semi-peak gas generation the most.
During his speech at the event, Zaichenko indicated that according to NPC estimates, investments of EUR 7 billion will be required in the coming years for the development of new generation. He noted that the state cannot provide such investments on its own and is counting on the private sector.
According to him, the recently announced largest competition for the construction of 1.5 GW of new generation in energy-deficient regions, which is being conducted under a transparent mechanism, is one of the tools for attracting such investments.
In general, as Ukrenergo sees it, the future power system will consist of 13 GW of nuclear power plants, 6 GW of thermal power plants (TPPs) and combined heat and power plants (CHPs), 4 GW each of hydroelectric power plants (HPPs) and pumped-storage power plants (PSPPs), 2 GW of energy storage systems, and 21 GW of wind plus solar power plants.
“Our goal is a modern, decentralized, decarbonized, resilient power system,” emphasized the chairman of the NPC management board.
As he noted, investments in energy today are the key to energy security in the future.
“It is not only about restoration. We have a unique chance to build a new energy sector—more modern, flexible, and resilient. What this system will be like in 5-10 years depends on our decisions today,” Zaichenko stressed.
As reported, in the competition for 1.5 GW of generating capacity, Kyiv and Cherkasy regions receive a quota of 250 MW; Sumy, Kharkiv, and Poltava regions combined get 872 MW; Dnipropetrovsk region gets 283 MW; and Odesa region receives 100 MW.
Ukrenergo, among other things, pointed out that the minimum service life of each energy facility must be at least 20 years or 100,000 operating hours, and new energy units must meet technical requirements that should simplify the balancing of the Integrated Power System (IPS) of Ukraine. In addition, the capacity of the facilities must be at least 10 MW.
The commission for conducting the competition for the construction of 1.5 GW of new generating capacity, headed by First Deputy Minister of Energy Artem Nekrasov, announced a meeting for potential participants on July 29. The competition documentation is available on the NPC website.
First Vice Prime Minister and Minister of Energy Denys Shmyhal stated on Tuesday, July 7, that the government is starting the next stage of the competition for the construction of over 1.5 GW of new generation. According to him, the competition commission has officially approved the rules and requirements for participants, and potential investors now have 20 days to submit their comments and proposals. The government expects that the entire capacity volume planned for the second stage of the competition will be put into operation by the end of 2027.
The total capacity of projects guaranteed by business as a result of the first stage of the competition, which ended late last year, is 78.1 MW. According to its rules, Ukrenergo was to compensate for capital investments in the construction of such facilities. For the second stage, the rules were updated: winners will receive support through a market premium mechanism in cases where the price of electricity during morning and evening peak load hours is lower than that determined in the competition – up to 27.92 euro cents per 1 kWh.
As Ivan Yuryk, a member of the Ukrenergo management board, explained during a separate session at the “Decentralization 2.0” event, during the autumn-winter period, the support time will be seven hours per day, and in the spring-summer period, it will be five hours. According to him, the company thus motivates investors to operate during the time of day when additional capacity is most needed by the power system.
He added that calculations made by the company’s specialists show a three-year payback period of projects for investors, but taking into account the requirement for mandatory installation of level-two protection at new energy facilities, the period of guaranteed price support for producers is set at five years.
Yuryk pointed out that one of the important conditions of the competition is the possibility for projects that were started earlier and are currently at the design stage or already under direct construction to participate. This should significantly accelerate the commissioning of new generating capacities. In total, 20 months are given for this after the winners of the competition are determined.
