Lack of private sector funding halts Ukraine’s energy system repairs – DTEK
Ukraine’s energy system, battered and bruised by Russian military attacks since October 2022, has seen lagging repairs due to slow policy and a lack of private sector financing, stated DTEK CEO Maxim Timchenko.
Timchenko spoke during a press debriefing on the state of Ukraine’s grid infrastructure and what’s needed to ensure that systems come back online, blackouts are stopped and the country can get back to its plans for being an energy transition key player.
Private sector financing, stated Timchenko, is a key priority. He called on international funding bodies to make more private sector financing available.
To date, the public energy sector – represented namely by Ukraine TSO Ukrenegro – has been receiving most international support and funding, which Timchenko calls a blow to efficiency.
“It’s time to speak more about concrete things, no longer just political messages. The private [sector] is more efficient than state companies, not only in crisis situations but also in recovery. 60-65% of the [energy] sector is privately owned. But none of this gets private funding because of policy making. State budget and policy-making takes months, not weeks… It simply doesn’t work…
“As of today all support goes to state-owned [companies] but those in the private sector are [neglected]. We are discussing with government [and Ukrenegro] but financial organisations and donors have selected only state-owned companies.
“This support should be accessible [as soon as possible] for the next Winter season.”
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An evolving energy conflict
As if to illustrate the state of affairs in the war-torn country, Timchenko – while speaking on the efforts of their Polish partners to bring in high KV lines, hoped to secure 1GW cross border transmission capacity – was interrupted by the high pitch urgency of a bomb siren and a Ukrainian intercom, calling for the CEO of the country’s largest energy company to retreat into a bomb shelter.
The January 14th missile attacks on two DTEK Thermal Power Plants (TPPs) dealt the latest blow to the country’s energy system. The country’s grid has lost 50 to 60% capacity; one TPP went offline and the other is under repairs.
These attacks, which have been occurring since 10 October 2022, include over 170 missile attacks, rockets and kamikaze drones which, according to BBC reporting, consist of explosives on the tip and are designed to “loiter over a target” until instructions are received to attack.
The January 14 attacks marked the 26th terrorist attack on DTEK facilities and to date Russian forces have attacked and damaged 11,000 pieces of DTEK TPP equipment, causing the blackouts to hit 5-6 million people across the country.
Russia’s focused strikes on the country’s energy infrastructure have shifted from targets on grid infrastructure to generation capacity.
As such, the utility’s strategy to cope is also shifting.
30 by ‘30
The utility is currently in discussion with the Ukrainian government on increasing its import and export capacity from a current 600MW to 1.5GW.
During the World Economic Forum’s (WEF’s) Annual Meeting in Davos, DTEK Group presented its “30 by 2030 initiative” – their aim to have 30GW of renewable capacity online by 2030.
This is hoped not only as a way to keep the clean lights running, but also to gain import and export leverage.
In announcing the plan, Timchenko commented: “30GW of renewables would mean Ukraine [reaches] 50% of renewables share in its capacity mix. And we could export 15GW of clean energy to the EU in electricity and green hydrogen.
“This is our vision of the Ukrainian energy sector by 2030, with Ukraine becoming the main exporter of clean energy to the EU and making a significant contribution to Europe’s post-war energy security system.”
And for this, what is needed most is international support, “we are appealing to international companies to join the coalition…to help us build back greener.
“Any restoration and recovery process in Ukraine’s energy must have a European perspective and should be based on new green power generation, accelerating [the] energy transition across the EU.”
