Economy

Govt establishes conditions for construction of 1.5 GW of capacity, awaiting proposals from potential investors – Shmyhal

Govt establishes conditions for construction of 1.5 GW of capacity, awaiting proposals from potential investors – Shmyhal

The government is beginning the next stage of the tender for the construction of over 1.5 GW of new generating capacity and is seeking comments and suggestions from potential investors on the tender documentation, announced First Deputy Prime Minister for Energy Denys Shmyhal.

"The competition committee has officially approved the rules and requirements for participants. Potential investors now have 20 days to submit their comments and suggestions," he wrote on Telegram on Tuesday.

In his statement, Shmyhal noted that the competition envisages the commissioning of 1,505 MW of new, highly maneuverable generating capacity in the most energy-deficient regions – Kharkiv, Sumy, Poltava, Dnipropetrovsk, Odesa, Chernihiv, and Kyiv regions, and the city of Kyiv.

As previously reported, each facility must have a guaranteed capacity of at least 10 MW, be equipped with a second level of protection, be capable of operating in conditions of no voltage in the external network, and have a guaranteed service life of at least 20 years or 100,000 hours.

The Minister of Energy emphasized that the state will provide investors with a mechanism to compensate for potential differences in electricity prices during peak hours—morning and evening. The possibility of insuring against military risks associated with the destruction or damage of equipment is also being explored through a de-risking mechanism developed by the Energy Community Secretariat.

As reported, within the framework of the competition for new generating capacities, Kyiv and Cherkasy regions will receive a quota of 250 MW, Sumy, Kharkiv and Poltava regions together – 872 MW, Dnipropetrovsk region – 283 MW, and Odessa region – 100 MW.

First Deputy Minister of Energy Artem Nekrasov has been appointed head of the commission for conducting the tender for the construction of generating capacities.

Ukrenergo, among other things, drew attention to the fact that the minimum operating life of each energy facility must be at least 20 years or 100,000 operating hours, and new power plants must comply with technical requirements designed to simplify the balancing of the Ukrainian Unified Energy System.

The total capacity of projects guaranteed by businesses following the first stage of the competition, which concluded at the end of last year, is 78.1 MW. According to its rules, Ukrenergo was required to compensate for capital investments in the construction of these facilities. For the second stage, the rules were updated: winners will receive support through a market premium mechanism in cases where the electricity price during morning and evening peak loads is lower than the MWh price set during the competition—up to 27.92 eurocents per 1 kWh.

The government expects that the entire volume of capacity planned for the second stage of the competition will be commissioned by the end of 2027.

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