“What are the problems in the renewable energy market and what was solved in 2024?”, – WRITE: epravda.com.ua
In 2024, the renewable energy sources (RES) continued to develop, despite the challenges related to energy terror and the need to ensure uninterrupted power supply. According to the results of 2024, the following areas are distinguished: the creation of politicians and RES development plans at the state level and the practical development of the RES sector in the market. Often, these directions did not intersect. During 2024, a number of important state strategic documents were adopted: – National Energy and Climate Plan for the period up to 2030; advertising: – National Renewable Energy Action Plan for the period up to 2030 and its implementation plan; – strategy of development of distributed generation for the period up to 2035 and approval of the operational plan of measures for its implementation in 2024-2026; – Concept of implementation of “smart networks” in Ukraine by 2035. Advertising: these documents are focused on increasing the capacity of production with RES, for example, fixing that the total volume of electricity production with RES will increase to 43894 GW • h in 2030 (7 , 2 GW of solar power plants and 5 GW of active consumers, 6,214 GW of wind generation and more than 1 GW of offshore generation, biogeneration 876 MW, geothermal generation – 40 MW). National plans and strategies enshrine the need to strengthen the role of distributed capacity, as well as stimulate the construction of offshore generation and the introduction of low and medium capacity solar and wind and wind installations. In 2025, the plan of measures for the implementation of Ukraine’s energy strategy for the period up to 2050 is expected. Read also: Hope for the sun. As renewable energy, Ukraine will mostly approve strategic documents for the implementation of certain markers in accordance with Ukraine’s international obligations. The results and challenges of the RES sector 2024 for the RES sector can be considered successful: a register of origin guarantees, pilot “green” auctions. The results of the auctions showed that the mechanism needs reform, work on what is already being underway. Created conditions for the development of distributed RES -generation (introduced tax benefits for the import of equipment, simplified conditions for accession, etc.) is a partially regulated problem with unbalances for manufacturers with RES, which have contracts with SE “Guaranteed Buyer” (hereinafter – guaranteed buyer); The tariff for electricity transmission services has been approved, which can provide payments with a guaranteed buyer 100% in 2025. Long -term auctions for providing auxiliary services were conducted. The RES sector begins to take an active part in various market segments, in particular, it is a balancing market and a auxiliary market with active use of energy storage technologies. Changes in hybrid attachments, power reservation for wind farms, licensing at the installed power without attachment to connection capacity, etc. have been introduced. The calls of the RES sector are and remain: debt repayment to RES manufacturers by a guaranteed buyer. The debt of a guaranteed buyer to manufacturers from RES at the end of 2024 is about UAH 27.6 billion with VAT, the debt of PJSC “NEC” Ukrenergo “to the guaranteed buyer – UAH 22 billion from VAT. The risk of changing the RES support mechanism. Price restrictions in the electricity market. Among the ways of solving it is necessary to revise or cancel Price CAP, to approve economically reasonable tariffs and to constantly revise them in accordance with market realities, to increase responsibility for non -fulfillment number, at the expense of foreign financing, which, in turn, is provided in compliance with corporate governance reform. Numerous working groups were created on the basis of different state bodies during the year, but from noticeable steps to overcome the debt crisis, only the approval of the economically sound tariff for Ukrenergo has been implemented, and the rest of the initiatives have not yet been fulfilled. Expectations and plans for 2025 2025 should be the year of implementation of plans and hope that strategic documents will coincide and help the development of the RES sector in reality. The RES sector confirmed that it could develop in a market without a “green” tariff. Currently, there is a significant factor in influencing the development of new RES projects that partially replace the destroyed thermal blocks. There are no tools in the Ukrainian market to guarantee the return of raised funds, namely, corporate PCAs – essentially long -term contracts with consumers to buy electricity with certain price guarantees. Previously, such a guarantee for the new projects was an agreement with a guaranteed buyer for the sale of electricity at the “green” tariff. It was expected that such a function would begin to perform “green” auctions, but the existing mechanism did not aroused interest in investors. The distrust of creditors is substantiated and related to the existing issues of debts in the electricity market and the imperfection of its regulation by state bodies. To confirm the importance for lenders of long -term contracts, there are results of the AUCSIONS of Ukrenergo for the purchase of auxiliary services, which will be guaranteed to order from the winners for 5 years. In view of this in 2025, it is necessary to focus on: – creating tools for guaranteeing the return of attracted funds (changing the mechanism of “green” auctions, increasing the quota of support, introduction of a non -state fund of guaranteeing the minimum price for the RES Projects with the support of MFIs); – association of electricity markets of Ukraine and EU; . – ensuring stability in support mechanisms that the state guarantees investors. The debt crisis in 2024 the electricity market again faced significant debt: – debt of SE “Guaranteed Buyer” to manufacturers from RES at the end of 2024 is about UAH 27.6 billion from VAT. . – debt of PJSC “NEC” Ukrenergo “to the guaranteed buyer – UAH 22 billion with VAT. Among the ways of solving it is necessary to revise or cancel Price CAP, to approve economically reasonable tariffs and to constantly revise them in accordance with market realities, to increase responsibility for non -fulfillment number, at the expense of foreign financing, which, in turn, is provided in compliance with corporate governance reform. Numerous working groups on the basis of different state bodies were created during the year, but from noticeable steps to overcome the debt crisis, only approval of the economically sound tariff for the transfer for Ukrenergo, and the rest of the initiatives still have been implemented Not brought to the end. Auctions for the distribution of support quotas: the first results of a significant crisis of trust that arose from unresolved debt issues clearly demonstrated the first auctions for the distribution of support quota of the Autumn 2024. Auction results: – Auction for 11 MW of solar generation did not take place (there were no participants). – Auction for 11 MW (biomass/biogas) played only 2 MW. – Auction for 88 MW of wind generation also did not take place. The main causes of failure are limiting the quota for one participant (up to 25% of the declared quota), the imperfection of support mechanisms, in particular the mechanisms of the market premium, for which the investor has to pay funds with a guaranteed buyer in the case of electricity selling at a price higher than the auction price, lack of insurance risks as well as retrospective changes that have undermined the market. Most of the obstacles can be eliminated by regulatory settlement of the question that is actually planned in 2025. The market hopes to increase the share of the quota to which the participant is entitled to 50%, to establish a mechanism for determining the annual quota on the basis of international and national obligations of the state, the development of legislative changes aimed at coordinating the timing awards to the auction price on the conditions of implementation of this mechanism assigned to the use of a market premium to support the “green” tariff, the introduction of benefits for consumers who buy electricity from producers with RES (lack RES). According to the decree of the Cabinet of Ministers of Ukraine dated 29.11.2024 №1195-p “Some issues of auctions for the distribution of support quotas for 2025 and the establishment of support quotas for 2026-2029” quota for 2025 is 330 MW (33 MW of SES, 250 MW Well, 47 MW – others). The auctions will be held in March, April, May 2025, and therefore the time to amend the legislation is critical, which should encourage the acceleration of work in this direction, in order to eliminate the disruption of auctions this year. Positive shifts in the electricity market in 2024 at the same time, it is possible to distinguish a number of positive shifts in the electricity and RES, which took place in 2024: 1) launch of long -term “Ukrenergo” auctions Services from regulation reserves that allowed participants to enter into five -year contracts and thus attract funding for the creation and modernization of energy accumulation systems. The first auction under the new procedure took place on August 15, 2024 and a 99 MW capacity was displayed. In this auction, the energy accumulation systems – fast and maneuverable installations capable of executing the dispatcher command in 15 seconds – were able to participate in this auction. Under the terms of the first auction, the contract is concluded for 5 years with delaying the provision of the service up to one year. There was considerable interest in the auction in the market, all capacity was realized at the prices acceptable to Ukrenergo and in 2025 we are finally expecting balancing power on the market. 2) Issuing the origin of electricity with RES, an important step for the market was also the launch of the Register of Guarantees of Electricity, made from renewable sources. The first bidding of the guarantees on which PJSC “Ukrhydroenergo” and SE “Guaranteed Buyer” were offered guarantees of origin at the price of 13 UAH for a guarantee of 1 MW. Within the framework of the auction, there was a realization of guarantees of origin, but it is obvious that for the full functioning of this mechanism it is necessary both internal stimulation of demand and international recognition of Ukrainian guarantees of origin. In order to stimulate internal demand, it is necessary to consider granting the right to reduce the payer of environmental tax in the tax accounting of the amount of emissions of CO2 by the number of generated or acquired guarantees of origin; to introduce the use of environmental value provided in the guarantees of origin to determine the amount of emissions reduction in determining the size of environmental tax; Provide normatively fixed quotas for the share of electricity with RES, confirmed guarantees of origin, in portfolios of electricity suppliers. In order to international recognition of Ukrainian guarantees of origin, it is necessary to develop a separate normative regulation on the conclusion of bilateral agreements on mutual recognition of guarantees of origin and acceleration of membership in AI-Hub. 3) Tax and customs privileges Law No. 3853-IX exempted many equipment for the production of electricity from RES, and Law No. 3854-IX-from import duty. Such changes in complex with updated rules for “active consumers” (Law No. 3220-IX) contributed to the mass installation of solar panels for their own needs. At the same time, wind energy equipment has not completely included in the benefit list, which has a negative impact on the potential development of the wind sector; The market is waiting for the adoption of the Bill No. 11455, which provides for the solution of this problem. A certain progress was also achieved in the export of biomethane after the adoption of Law No. 3613-IX, which simplified customs clearance procedures and provided for the mandatory availability of a certificate of sustainability. Although there are still questions about the environmental tax on biogenic CO2 and high requirements for the heat of combustion, the development of the biomethane sector is generally intensified and demonstrates the prospect of further integration into the European market. 4) the calculation of unbalances for unbalances, after changing the formula of calculations, manufacturers from RES note a significant improvement in the situation and fair amounts of responsibility. However, in this context, the issue of settlement of unbalances for the period until 08.09.2022 remains open. At the same time, it seems that in 2025 the courts will still put a point in this dispute, indicating that the illegal legal act, which was recognized as a decision NERCEP on the establishment of the previous formula of calculation of unbalances is not used. Continuation of reforms remains critical for attracting new investments and building persistent “green” capacities. The market places hopes for the urgent adoption of legislative changes, which will improve the conditions for conducting auctions for the distribution of support quotas and will provide a transparent determination of their annual volume. At the same time, a separate law is expected to regulate the features of offshore wind power and will fully realize the potential of marine wind projections. Equally important are the creation of a minimum price guarantee fund that will not buy electricity from manufacturers, but will only provide market risks insurance by maintaining Bankability Projects, as well as maintaining the likelihood of a cash register of VAT after 2026. Particular attention requires the acceleration of the process of mutual recognition of Ukrainian guarantees of origin abroad, which will allow them to export them to the European market, as well as further improvement of biomethane support mechanisms. In practice And it is these steps, together with the resolution of debt issues, can become key to raising significant funds in the industry, avoiding regular disruptions in auctions and consolidating the interest of strategic investors in Ukraine’s renewable energy. Co -authors: Olga Savchenko, partner of Altelo Yuk