Weekend Read: Keeping Ukraine’s lights on

Share

From pv magazine 06/23

The Ukrainian solar power industry has sustained huge losses during the 15 months of fierce hostilities that have followed Russia’s invasion, including almost daily barrages of rocket strikes, kamikaze drone attacks, and artillery shelling.

Some 13% of Ukraine’s solar generation capacity is in territories controlled by Russian forces while around 8% is considered damaged or completely destroyed. This is according to reports from Oleksiy Orzhel, the recently appointed chairman of the Ukrainian Renewable Energy Association, who has cited official statistical data.

The position is not new for Orzhel, who had already served as chairman for the association before 2019 but left the office to serve as Ukrainian energy and environment minister. He resumed in the role at the renewables association in February after his successor as chair, Oleksandr Kozakevych, joined the armed forces to defend his country on the battlefield.

Working in the renewable energy sector has particular importance for Ukraine since clean power helped the country to survive the cold, dark nights of the last winter, Orzhel said – recalling times when outages lasted for many hours, sometimes days, and it seemed that the stability of the energy grid hung by a thread.

At the time of writing, Ukraine was preparing for its long-awaited military counter-offensive, the importance of which for the future of the country was hard to overestimate. The big push was also being anticipated by solar project owners whose assets remained in the hands of Russia.

“We hope that the Ukrainian counter-offensive will begin soon and that it will be carried out with the least destruction of renewable energy facilities,” said Orzhel. “At the moment, the stations near the front line in the unoccupied territories suffer the most from constant artillery shelling.”

High hopes

That hope seems more than justified since there are already examples of how solar plants have resumed operation in the liberated territories. For instance, Ukraine’s largest power generation company, DTEK, has recently put the 10 MW Trifomovskaya plant back into operation at 50% generation capacity. The solar plant is located in the Kherson region.

When the western bank of the Dnypro River was retaken by Ukrainian forces, the Trifomovskaya solar project was a sorry sight. Many solar panels were damaged and a proportion of the power generation equipment required replacement.

Moreover, the plant has no opportunity to fully resume operation since the local energy grid is also degraded. Before the local substation was repaired, the project could supply only the output from 2 MW of its generation capacity to the grid.

However, there was never a doubt about whether to put the plant back to work. The threat of electricity shortages in Ukraine has not passed. Alexander Selishev, general director of the utility’s DTEK RES renewables arm, says: “Our task is to ensure that the country and consumers, under the conditions of the energy terror [tactics] of the enemy, receive more green electricity.”

Several other solar plants have resumed operation in the Kharkiv and Kherson regions, though it would be wrong to say that this process went entirely smoothly.

“At the same time, investors whose plants have suffered from shelling or have been occupied and looted cannot replace the destroyed equipment and resume operations at full capacity,” Orzhel said, explaining that, under the current law, replacing equipment with different technical characteristics will result in a revision or loss of feed-in tariffs and this, in turn, will lead to problems with creditors.

Popular content

“It is simply impossible to find identical equipment to replace the damaged one – often its production has already been stopped in favor of more modern equipment,” Orzhel said, adding site owners want government agencies to act more promptly to address this challenge since the current impediments make rebuilding solar plants a tricky task.

Second wave

In the meantime, the past few months have seen a surge in demand for solar power from industrial customers. Oleksandr Loboda, director of Ecosphere Energy, a Vinnytsia-based company engaged in designing, building, and maintaining solar plants, told pv magazine that the demand comes primarily from two types of company.

“The first are those who have already invested in stations to sell electricity to the grid,” he said. “They understand this business and opportunity well and want to continue investing. The second includes manufacturing enterprizes with significant electricity consumption and their motivation is to reduce the cost of purchasing electricity from the grid.”

During the first quarter of 2023, Ecosphere Energy received 10 requests to calculate the parameters of solar plant construction – as many as during all of last year, according to Loboda.

Other industry insiders agree that demand has bounced back. For example, Cherkasy-based company Solar Garden estimates that demand collapsed to zero in March 2022. Now, the company is on track to sign three contracts for solar plant construction while six more are under evaluation, said director Serhii Pronenko.

Solar demand is being primarily driven by energy independence fears. Ecosphere’s Loboda says that launching a plant to sell electricity to the energy grid takes around a year. Establishing power generation capacity requires from one month to four months and the rest of the time is needed to make it through the bureaucracy. Building a solar plant to meet self-consumption requirements, however, is simple and can secure substantial benefits.

Ukrainian businesses pay, on average, roughly UAH 5.50/kWh ($0.15) of electricity. During outages, this figure jumped nearly twofold, making the rationale behind investing in alternative power generation sources as clear as ever. Last summer, Cherkasy-based building company Dobrobut installed a solar plant to meet its energy requirements. With an investment of $18,000, the business managed to cut its electricity bills by 20%, Valery Didenko, a co-owner of the company, told the local press. Dozens of companies across the country have trodden the same path.

Matter of survival

Establishing solar power capacity for Ukrainian businesses is not about saving money on electricity bills, however; the main goal is to survive.

“Anyone who wants to keep their business alive builds autonomous power sources,” said clean energy association chair Orzhel. “After the difficult winter of 2022/2023, with the shelling of energy infrastructure, most companies were not provided with electricity and were forced to stop working completely or work according to the electricity supply schedule. The absence of electricity for a long time, in fact, means stopping technological processes and [results in] the death of the business.”

This is helping drive the decentralization trend in the Ukrainian energy industry. Orzhel said that the winter missile attacks were aimed primarily at centralized generation and power supply facilities, such as grids and substations.

Ukrainians are trying to adapt to that tactic in a number of ways. They are bringing generation closer to customers and scaling down solar plants to such an extent that the cost of hitting them would be higher than the potential damage.

It is too early to say, however, that the solar industry is experiencing a boom in demand, admitted Ecosphere director Loboda, who added, “The main task of 2023 is not to lose what has already been achieved in the past, pre-war years; first of all, these are people, such as designers and builders. The trends give hope for the fulfilment of this task.”

This content is protected by copyright and may not be reused. If you want to cooperate with us and would like to reuse some of our content, please contact: editors@pv-magazine.com.