09:38 28.01.2021

American Chamber of Commerce asks Zelensky to take control over implementation of memo with 'green' investors

2 min read
American Chamber of Commerce asks Zelensky to take control over implementation of memo with 'green' investors

The American Chamber of Commerce in Ukraine asks Volodymyr Zelensky to take personal control over Ukraine's fulfillment of the memorandum obligations between the country's government and renewable energy investors, which were legislatively enshrined in 2020.

Such a request is contained in a letter from President of the American Chamber of Commerce Andy Hunder to the head of the Ukrainian state dated January 26.

"We ask you to take personal control over the implementation of the provisions of Law No. 810-IX and the fulfillment of obligations under the current legislation and refrain from taking decisions that undermine earlier agreements between the state and investors," the text of the letter said.

As Hunder recalled, on August 1, 2020, the law on the amendments to certain laws of Ukraine on improving the conditions of support for electricity production from alternative energy sources (No. 810-IX) came into force.

Adoption of Law No. 810-IX was aimed at improving the feed-in tariff's sustainability and electricity market liquidity by enshrining in law the provisions set out in the Memorandum of Understanding, signed on June 10, 2020 by the Cabinet of Ministers, the Energy Ministry, the National Energy and Utilities Regulatory Commission (NEURC) and renewable industry associations.

Inter alia, the provisions of Law No. 810-IX envisaged 20% co-financing from the state budget and issuance of government domestic loan bonds to cover the deficit in payments to renewable energy producers. However, none of these mechanisms was implemented either in the state budget for 2021 or using debt financing instruments.

"Accordingly, the American Chamber of Commerce members expected that the government will fulfill its obligations under the legislation and the memorandum by allocating at least UAH 9 billion from the attracted UAH 10.25 billion of credit funds to pay off 40% of the debt to renewable energy producers accumulated as of August 1, 2020 in the amount of UAH 22.4 billion. However, on January 16, 2021, the NEURC issued the Guaranteed Buyer an instruction to allocate not less than 50% of the funds received from Ukrenergo under the loans provided by state-owned banks for repaying other debts," Hunder said.

He said that such NEURC decision combined with a lack of actions by the government to implement Law No. 810-IX is a clear sign of Ukraine's unwillingness to fulfill its commitments to private investors.

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