USAID’s energy programming in Ukraine helps improve energy efficiency and decrease dependence on energy imports. To enhance energy security, the USAID Energy Security Project (ESP) is working on increasing domestic energy supply by promoting private investment in electricity generation from renewable energy sources (RES).

ESP’s RES strategy focuses on support to the Government of Ukraine, Parliament and other key stakeholders to improve planning and legislation for successful RES development. In addition, ESP is helping Ukraine fulfill its RES-related EU integration obligations, which are laid out in the Third Energy Package.

Strategic Objectives

  1. Assist Ukraine to fulfill its obligations to the EU on RES development.
  2. Decrease electricity costs in Ukraine by developing a well-planned, competitive RES-based electricity procurement program.
  3. Help Ukraine avoid high costs and technical problems related to RES development and integration of variable RES-based electricity into the grid.
With global prices falling and technologies improving, renewable energy has high potential to reduce Ukraine’s energy costs. Ukrainian coal-fired power plants and other thermal power plants have high generation costs; introducing transparent and competitive RES electricity auctions could leverage solar and wind power prices to bring down the overall cost of electricity generation.
Replacing Ukraine’s high-cost thermal generation with lower-cost renewable energy technologies requires a combination of auctions, renewable energy zones (an approach to harmonize transmission planning and generation development), and effective approaches to grid integration. To date, both renewable zones and grid integration have not been part of Ukraine’s national renewable program.

Activities

Planning a Sustainable Future

ESP is helping Ukrenergo determine a long-term least-cost electricity generation plan to meet future electricity needs while minimizing capital investments and operating costs. The plan will allow Ukrenergo to assess RES technologies and other available alternatives as it formulates a comprehensive strategy to ensure reliable and sustainable electricity for the next 20 years.

Integrating Renewables-based Electricity into the Grid

ESP is collaborating with Ukrenergo on a technical and economic integration plan to integrate more RES-based electricity into the national grid at economical prices. In addition to increasing sustainability, this plan will help Ukraine progress toward disconnecting from the Russian power system and enable integration with ENTSO-E in Europe.

Opening Markets for Competitive Procurement of Renewable Energy

Shortly after Ukraine approved the Auction Law in June 2019, ESP started developing an RES-based “green energy” electricity auction structure that meets legal requirements and maximizes benefits to the country. We are also working with the Ministry of Energy to develop an IT platform to conduct green energy auctions once they begin.