Economy

Subsidized gas for power plants hinges on supplies, grid status – Ukrainian ministry

Subsidized gas for power plants hinges on supplies, grid status – Ukrainian ministry

Ukraine's Ministry of Energy is discussing with representatives of gas-fired power generation the possible resumption of discounted natural gas supplies for electricity producers, but any decision will depend on the amount of gas accumulated ahead of the heating season and the overall situation in the power system during the season, First Deputy Energy Minister Artem Nekrasov said.

"The decision [on discounted gas for electricity producers operating gas-fired generating units] will depend on gas storage volumes ahead of the heating season and on the overall situation in the power system," he said during the 6th Energy Law Conference, organized by the Ukrainian Bar Association in partnership with Sokolovsky & Partners Law Firm in Kyiv several days ago.

According to Nekrasov, the issue is regularly discussed by a working group with representatives of the gas generation sector that meets at the Ministry of Energy every two weeks.

At the same time, he suggested that "many issues will be addressed online."

"It is difficult to predict how the heating season will unfold. We have several scenarios. Depending on which one materializes, the appropriate decision will be made," Nekrasov said.

As reported, on March 30, 2026, the government adopted Resolution No. 403, which shortened the period during which electricity producers at thermal power plants, combined heat and power plants (CHPs), gas turbine units (GTUs), and gas piston units (GPUs) in nine power-deficit regions are eligible to receive natural gas at the discounted price of UAH 19,000 per 1,000 cubic meters, moving the deadline from December 1, 2026, to September 30, 2026, while also expanding the eligibility criteria.

Specifically, eligible facilities must have been commissioned no earlier than December 1, 2025, rather than simply being newly built, as stipulated under the previous resolution (No. 222 dated March 6, 2022, as amended).

The same resolution also abolished the provision allowing CHPs generating electricity in cogeneration and condensing modes, as well as heat producers generating electricity using GTUs and GPUs, to purchase gas at UAH 21,000 per 1,000 cubic meters.

Earlier, under Resolution No. 308 dated March 9, 2026, the Cabinet of Ministers abandoned plans to set a discounted natural gas price of UAH 16,000 per 1,000 cubic meters for electricity producers that do not generate heat.

As a result, starting April 1, only CHP plants and combined-cycle gas turbine (CCGT) facilities operating exclusively in frontline regions (Chernihiv, Sumy, Kharkiv, Dnipropetrovsk, Donetsk, Zaporizhia, Kherson, Mykolaiv, and Odesa regions) and commissioning CCGT units for the first time after December 1, 2025, are eligible to purchase gas at the discounted price of UAH 19,000 per 1,000 cubic meters.

Following the adoption of Resolution No. 403, the Association of Critical Infrastructure Operators (ACIO) urged the government to remove the restrictions on access to discounted gas for electricity producers in order to prevent cogeneration projects across Ukraine from becoming economically unviable and shutting down.

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