The Government has amended the conditions for the second stage of the competitive tender for the construction of new generation capacity in Ukraine. In particular, it increased the total capacity to be offered through the tender from 1,322 MW to 1,505 MW. This was announced by First Deputy Prime Minister of Ukraine – Minister of Energy Denys Shmyhal.

According to him, the changes are linked to the expansion of the regional lot for Dnipropetrovsk Region by 183 MW. The primary objective is to strengthen the reliability of electricity supply in the Dnipro energy hub, minimize risks in the frontline region, and provide additional reserve capacity for the power system.

Under the updated conditions, the second stage of the tender envisages the construction of:

• 872 MW in Sumy, Kharkiv and Poltava regions;
• 250 MW in Kyiv and Cherkasy regions;
• 283 MW in Dnipropetrovsk Region;
• 100 MW in Odesa Region.

Denys Shmyhal also noted that, by order of the Ministry of Energy, a Commission for the Competitive Tender for the Construction of Generating Capacity has been established. The First Deputy Minister of Energy has been appointed Chair of the Commission and will approve its composition in the near future.

The Minister recalled that the first stage of the tender was completed at the end of last year. The total capacity of projects guaranteed by businesses amounted to 78.1 MW. For the second stage, the Ministry of Energy incorporated proposals from the business community and updated the rules. Each facility must now provide at least 10 MW of guaranteed capacity and be equipped with a second level of physical protection. The successful bidder will also assume the obligation to construct the required capacity within clearly defined timeframes, while the state will provide the necessary incentives and conditions.

“We expect the entire planned volume of capacity to be commissioned by the end of 2027. This will become one of the key elements in the development of distributed generation and will contribute to the creation of a new architecture of Ukraine’s energy security,” Denys Shmyhal emphasized.

It should be recalled that participants will benefit from a support mechanism under which, for five years after commissioning, payments of up to €0.2792 per kWh will be provided for the service of ensuring the development of generating capacity. Support will be granted through a market premium mechanism when electricity prices during deficit morning and evening peak hours, as determined by Ukrenergo, fall below the price per MWh established through the tender.

Tender proposals may be submitted within three months following the publication of the tender documentation. Construction of the new generation facilities is expected to begin by the end of November.

The updated tender conditions also provide for:

• compliance of installations with technical requirements for balancing Ukraine’s power system;
• a guaranteed equipment service life of at least 20 years or 100,000 operating hours;
• a guaranteed electricity sale price for owners of newly built facilities;
• simplified qualification and financial requirements for participants to enhance competition and attract more investors.