Ukraine to reduce green tariffs for domestic solar power

The Ukranian Parliament (Verkhovna Rada ) is considering reducing the existing green tariff for solar energy and other renewables.

At present, Ukraine has two different green tariffs for solar energy. The first, which is set at the rate of €0.46 per kilowatt hour, is applied to solar power plants built before April 1, 2013, while the second is applied to facilities that were built later and is set at €0.339 per kilowatt hour.

According to the Rada’s plans, the tariff may be reduced to €0.235 per kilowatt hour and will be applied only to those power plants that were built after July 1, 2014. At the same time, another option involves the reduction of the tariff for the already existing solar power plants with the capacity of more than 10 MW.

According to a Verkhovna Rada spokerperson, the reduction of the tariff will not have any negative impact on the profitability of the plants, as in recent years the costs associated with building new solar power plants in Ukraine has significantly decreased.

Some local analysts in the solar power field have already criticized the state plans. According to Andrew Olenyuk, a lawyer at Clifford Chance, the reduction of the green tariff by the Ukranian government violates existing rules for the protection of foreign investments in Ukraine.

Olenyuk says the move may negatively affect the plans of foreign investors for further development in Ukraine despite the national government’s intention to continue support for projects in the field of solar power and other renewables.