On October 30, 2018, Bioenergy Association of Ukraine together with the Ukrainian Association for Renewable Energy, the Ukrainian Wind Energy Association, the Association of Solar Energy, and the Ukrainian Hydrogen Council held a press conference on the need for urgent changes in the green energy stimulation system of Ukraine. Profile associations signed a memorandum of understanding, which sets out a consolidated position on the transition to a tender mechanism for stimulating the industry, reducing green tariffs, and encouraging small power generation from clean sources.
Head of the Board of the "Bioenergy Association of Ukraine" Georgiy Geletukha in his speech during a press conference, noted the following:
"By 2030, the law is known, but for projects with a long payback period this is not enough. If we now begin to build a bio-biological plant or a biogas plant, then after their commissioning, at least 2 years later, there will be less than 10 years of the guaranteed validity period of the “green” tariff. This situation contributes to the uncertainty of investors and banks in the recoupment of projects. Therefore, the state proposes to conclude contracts for the purchase of electricity with its producers from renewable energy sources for 20 years, but at the same time investors agree to go to the auction and bargain for lowering the price of such electricity.
Now we have a contradiction when increasing electric power from the sun and wind simultaneously increases the production of electricity from coal in order to provide system regulation and additional electricity needs during rush hours. We believe that players in the RES sector should enter the market for peak load coverage.
According to the Energy Strategy of Ukraine until 2035, the total share of renewables will be 25%, and in heat - 40%.
If this is translated into numbers, we get 24 thousand MW of thermal power, mainly on biomass. If at least half of these capacities will be in the district heating and industry, it will give 12 thousand MW of installed heat capacity. Assuming that 6 thousand MW of heat within these capacities will be produced in cogeneration mode, then at the same time more than 2 thousand MW of electricity from biomass will be produced.
Therefore, we do not support the theses that are being heard now about the need to build 3,000 MW of gas maneuvering capacity. At least where to get 2 thousand MW of electric capacities on biomass, I showed you. I predict that biogas plants will also make a significant additional contribution.
In practice, the operation of a CHP plant on biofuels may look like this: at night, the bio-heating system fills the storage tank with hot water, and during peak hours it will be able to work as much as possible to generate electricity, releasing heat from the storage tank to consumers. Similarly, a biogas plant due to a gasholder, which will allow biogas to accumulate at night, will be able to maximally generate electricity to the network during peak hours.
That is, there are technical solutions and opportunities, but it is necessary to interest the investor to invest in additional accumulating equipment (storage tanks, gas holders). In our opinion, for this it is necessary to provide tariff incentives for producers of electricity from renewable energy sources during their work at peak times. This will increase the share of generation from RES in the peak capacity market. There is such a point in the memorandum, and we support it. We hope that the authorities will take into account the proposals set forth in the memorandum in the final text of the Draft Law 8449".
Associations-signatories of the memorandum represent more than 80% of the renewable electricity generation market in Ukraine. This indicates that the majority of players and investors in the renewable energy market of Ukraine are aware of the need for changes in legislation and support the transition to the auction system to replace the current “green” tariff, which ends on December 31, 2029.
Eight draft laws on a new model of support for renewable energy through the introduction of auctions have been registered in the Verkhovna Rada of Ukraine (Draft Law N8449 of 07/06/2018 and seven alternative ones), and the main Draft Law has been under discussion and refined for several months now. Representatives of associations are concerned about the relatively long discussion will lead to a delay in changes in the system of stimulating the development of the electric power industry from renewable energy sources in Ukraine. Therefore, they came up with a single agreed position on behalf of the overwhelming majority of players and investors in the renewable energy market regarding future changes in legislation.
>>Read the full text of the Memorandum of Understanding between the Association "Ukrainian Association of Renewable Energy", the Public Union "Ukrainian Wind Energy Association", the Public Union "Bioenergy Association of Ukraine", the Public Union "Energy Association" Ukrainian Hydrogen Council "and the Public Union" Association of Solar Energy of Ukraine" (in Ukrainian)<<