The Ukrainian law ‘On National Energy and Utilities Regulatory Commission’ establishes NEURC as the Collegial Regulatory Body responsible for regulating, monitoring, and supervising the energy and utility markets. Therefore, monitoring the electricity market is one of the key functions of the Regulator.
USAID Energy Security Project and NEURC jointly studied the level of concentration in the electricity market, and the ESP experts provided their findings and recommendations on this matter. Specifically, ESP recommended mitigating the consequences of market power and devising algorithms that help calculate the key indicators of concentration in particular market segments and for particular major market participants. These algorithms enable NEURC to determine some key indicators, such as the shares of particular market participants, Herfindahl-Hirschman Index (to determine volumes in the Day-Ahead Market), and Residual Supply Index (RSI), and Pivotal Supply Index (PSI) in the Day-Ahead Market – all critical tools for use in detailed market analysis.
The newly purchased dedicated Tableau Software provides algorithms that help NEURC to calculate the indices mentioned above. The software was purchased with support from USAID ESP. This software quickly processes large datasets of market segments. Since late September 2021, these calculations have been published by NEURC to show the results of regular monitoring to estimate the level of concentration in the electricity market. It is an excellent example of the practical support from ESP that supports the daily activities of the Regulator.
These monitoring findings are published on the Regulator’s website and available to all interested parties. This data enhances market transparency and supports the regulatory market analysis that will employ reliable measured indicators based on generally accepted international practices.
Real-Time Monitoring of Electricity Market |
| Main / Real-Time Monitoring of Electricity Market / Market Liquidity / Market Concentration / Shares of particular market participants by |
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Real-Time Monitoring of Electricity Market |
| Main / Real-Time Monitoring of Electricity Market / Market Liquidity / Market Concentration / Herfindahl-Hirschman Index |
Real-Time Monitoring of Electricity Market |
| Main / Real-Time Monitoring of Electricity Market / Market Liquidity / Market Concentration / Residual Supply Index (RSI), and Pivotal Supply Index (PSI) |
The data targets various audiences, including government agencies and institutions such as the Parliament – in particular Verkhovna Rada Committee for Energy, Housing and Utilities Services – Antimonopoly Committee of Ukraine, National Energy and Utilities Regulatory Commission, National Securities and Stock Market Commission, etc. The data helps various stakeholders trace the impact of the legislation in this field, which has already been adopted. It helps to develop new regulatory documents that will assist in the reduction the level of market concentration and help improve a competitive environment. Market participants may find the data useful in enhancing their market strategies. The data can be useful for various international organizations in this field, such as Energy Community Secretariat, EU Delegation to Ukraine, particularly the Support Group for Ukraine, European Bank for Reconstruction and Development, and other international partners.
In the mid-and long-term perspective, retail market participants will benefit from better-quality regulatory supervision of the electricity market as enhanced and fair competition in the wholesale market will positively impact prices and services for end-users.