2020 turned out to be difficult in the history of the renewable energy industry in Ukraine: record debts to producers of "green" energy, constant amendments to legislation and a reduction in the "green" tariff, the difficult financial situation of the State Enterprise "Guaranteed Buyer" and NEC "Ukrenergo", the Government's failure to fulfill state guarantees, undertaken within the framework of the signed Memorandum of Understanding and the adopted Law of Ukraine No. 810-IX, initiation by 47 MPs of Ukraine of constitutional proceedings against "green" tariffs and constant political pressure on the industry.
December 17, 2020, Chairmen of four leading industry associations: Andriy Konechenkov, Ukrainian Wind Energy Association, Artyom Semenishin, Solar Energy Association of Ukraine, Alexander Kozakevich, Ukrainian Renewable Energy Association, and Alexandra Gumenyuk, European-Ukrainian Energy Agency, in a joint press conference in Interfax-Ukraine, summed up the results of the functioning of the renewable energy market in 2020, the state of fulfillment by the state of its obligations to resolve the crisis in the renewable energy sector and predicted the development of the industry in 2021. Timur Bondarev, Founding Partner and Managing Partner of Arzinger Law Firm, highlighted the key events around the consideration of the Constitutional Court of Ukraine on the proposal of 47 people's deputies of Ukraine.
In his speech, Andriy Konechenkov, Chairman of the Board of UWEA, noted: “For 8 months, negotiations were going on between investors in renewable energy sources and the Government of Ukraine, the result of which was the signing of a Memorandum of Understanding and, subsequently, the adoption of Law of Ukraine No. 810-IX. Despite this, the market is still imbalanced, and the political decision-making process is rather chaotic and completely inconsistent. “Today” we reach agreements, voluntarily agree to reduce the “green” tariff, voluntarily lose profits and take on a number of other obligations, and “tomorrow” we again receive less for the generated electricity, wait for the repayment of colossal debts, actually fight for every necessary bill and bring in the Constitutional Court the constitutionality of the “green” tariff ”.
“From the perspective of the wind energy sector, the protraction of this market crisis results in colossal investment losses. Today, more than 5,000 MW of new wind energy projects have received construction permits and signed prePPA agreements with the Guaranteed Buyer State Enterprise only because everyone believed in improving the situation and the Government's responsibility to fulfill its obligations. Considering the duration of the wind energy project, when 1.5 years are needed only for the necessary wind measurements and environmental impact assessment procedures, further debt defaults, non-payment for generated electricity and other legislative and political upheavals undermine the financial liquidity of wind energy. Today, renewable energy investors think about litigation in international arbitrations more than about the implementation of new projects to support the Ukrainian economy and investment attractiveness, ”noted the Chairman of the Board of UWEA.
At the same time, the Heads of the leading associations unanimously concluded that 2021 remains difficult to predict. In their opinion, next year we can witness both a clear government position in favor of the renewable energy sector and see the continuation of the 2020 story. Only politicians today have to decide whether they will learn the lessons already learned or will make new mistakes.