Lecture content:
- History of the development of solar energy in Ukraine
- Challenges and problems
- Prospects and conclusions
- Active links (NPA, standards, resources)
- Glossary
- Questions for self-testing
1. History of the development of solar energy in Ukraine
The first solar power plants for their own needs in Ukraine began to appear in the early 2000s. They worked with a charge controller, but the equipment was extremely expensive. For example: one 100-watt solar panel cost hundreds of dollars.
Over the past 20 years, the situation has changed dramatically: the cost of panels and components has decreased more than fivefold. The starting impetus for the development of solar energy in the private sector was the adoption of legislation on the “green” tariff. In 2014, a state program was launched that allowed households to build solar power plants with a capacity of up to 30 kW.
At that time, the tariff for private systems up to 10 kW was about 30 euro cents per kilowatt-hour. But despite the favorable tariff, the payback period for the equipment remained quite long – 7-8 years. Therefore, for most users, it was not a very attractive investment.
Development after 2014
The development of renewable energy after 2014 was due to changes in legislation and the desire to diversify the energy sector.
With the beginning of the full-scale invasion, the emphasis shifted: the main thing was not so much the opportunity to earn money on the sale of electricity, but rather ensuring backup power and autonomy. In total, solar power plants with a total capacity of over 1.5 GW were built in Ukraine.
The “green” tariff will be in effect until 2029, its level is 15.5 euro cents per kilowatt-hour. Households receive payment for surpluses exceeding their own consumption. This stimulated the mass installation of 30 kW stations: the more generation, the more surpluses and higher incomes.
Today we are facing a serious problem – a delay in payments under the “green” tariff.
This is due to the fact that energy companies and distribution system operators, to which private consumers are connected, do not have sufficient financial resources to make payments. They themselves do not receive funds from the Guaranteed Buyer State Enterprise, and, accordingly, cannot make payments.
A few years ago, in 2021, the situation was different. Then payments were made regularly, and the payback period for equipment for solar stations was only 3–4 years. Today, everything has changed. Due to regular power outages, especially in the summer, when thermal and nuclear generation are stopped for repairs, interruptions occur.
Even during periods of high solar generation, the solar power plant cannot always work. Why? Because Ukraine still lacks a modern control, dispatching and so-called “smart grid” system. As a result, entire districts are often disconnected, and then the solar power plant simply does not work.
Thus, not only the electricity generation itself is lost, but also the return on investment. And this directly extends the payback period of the equipment, making it less attractive to private investors.
Cost of equipment and connection
Today, the cost of 1 kW of installed capacity is from $500 to $600. This depends on the inverters, panels, installation and complexity of the connection. Added to this are the connection costs, which depend on the power of the household’s electricity grid.
The popularity of the self-production mechanism is growing. It must be said honestly: the “green” tariff was not perfectly thought out from the very beginning. But it performed an extremely important function. It was thanks to the “green” tariff that the solar energy market actually started in Ukraine.
What did it give?
- Solar energy became available to a wide range of users.
- A whole solar energy industry was formed.
- New jobs appeared, new specialties emerged.
- Companies specializing in the design, installation and maintenance of solar power plants began to be created.
- Opportunities for investment projects that previously seemed unattainable have opened up.
Thus, even despite its shortcomings, the “green” tariff became the impetus that allowed Ukraine to enter the modern renewable energy market.
2. Challenges and problems
Over time, problems began to appear. The fact is that in Ukraine a limit of 30 kW was set for private solar power plants. At first glance, this looks good, but if you compare it with real needs, it is too much. After all, the average household consumes approximately 7–8 thousand kWh per year. And a 30-kilowatt solar power plant can produce 30–40 thousand kWh per year – that is, 4–5 times more than the house itself consumes.
At the same time, 85% of this generation falls on the warm period of the year – from March to October. That is, most of the electricity produced is not used for its own needs, but is exported to the network. For the investor, this is good – there is a profitk. But for networks – not so much. After all, electricity is not consumed at the place of generation, but goes to the medium-voltage network. This creates losses in the lines and causes an increase in voltage in the distribution networks. In fact, this nullifies the key idea of distributed generation.
That is why in Europe they gradually abandoned the “green” tariff for private solar power plants. There, the main emphasis is on stations for own consumption.
In Ukraine, in order to ensure the future development of home solar energy after 2029, a mechanism for self-production was introduced.
This became especially important during the Russian-Ukrainian war. Some private solar stations switched to panels with the possibility of autonomous power supply. These are small installations with a capacity of 5–12 kW (single-phase or three-phase, depending on the connection). They partially cover the household’s needs for electricity, and in case of outages they can provide backup power.
But there is a nuance here: one of the key elements of such systems is storage batteries. And this immediately means additional costs. Today, the full cost of a solar system with a storage tank is about $1,500 per 1 kW of installed capacity. This significantly increases the investment burden on the consumer.
Disadvantages of the “green” tariff for grid-connected solar power plants.
Despite the fact that solar power plants have become more affordable and efficient, they have a serious drawback: they cannot operate during a power outage. If there is no voltage in the network, the plant simply turns off.
Some inverter manufacturers are trying to partially solve this problem and offer the so-called “reserve outlet”. It can power small consumers with a capacity of up to 2 kW. But, to be honest, this is more of a marketing “trick” than a real solution. Generation through such an outlet is unstable, and you should not seriously count on it.
The second drawback of grid-connected stations in Ukraine is irregular payments under the “green” tariff during the war. In fact, many private solar power plants today generate electricity into the grid for free.
If you look at the experience of Europe, the situation is different there. For example, in Germany, the cost of electricity exceeds 30 euro cents per kilowatt-hour. But they usually do not pay for generation into the grid there. Often there is not even a net metering mechanism. Instead, net billing is introduced or the emphasis is placed only on own consumption. That is, the owner of the solar station tries to consume his electricity himself as much as possible, and not sell it into the grid.
Many countries also have programs to compensate for the cost of systems with energy storage. This is an important point: such programs allow you to provide backup power, guarantee the continuity of power supply even in the event of outages, and also reduce the payback period for investments.
In Ukraine, for now, they have stopped at preferential lending programs. This, of course, helps, sometimes even interest-free loans are available. But there is a nuance here: such loans can only be used through certified equipment suppliers. And this immediately increases the cost of the system.
Modern scenarios for the use of solar power plants
Today, we can distinguish three main scenarios.
The first is completely autonomous systems. They are equipped with batteries and provide complete independence from the grid. Such systems are the most expensive and are used in specific cases: remote base stations of mobile operators, farms, military units.
The second is hybrid systems. This is a combination of solar power plants, batteries, wind turbines and diesel or gas generators. They allow you to guarantee the reliability of electricity supply when it is unstable, but it is still possible to work with the grid.
The third is grid-connected solar power plants. They can operate on a “green” tariff, sell surplus electricity to the grid, or use a self-generation mechanism in the netbilling format.
Electricity Cost: Ukraine vs Europe
In Ukraine, electricity for household consumers today costs approximately 4.32 UAH (≈10 euro cents/kWh), and for businesses — over 10 UAH (22–25 euro cents/kWh).
In Europe, the situation is the opposite: electricity there is often twice or even three times more expensive. Therefore, even without “green” tariffs and loans, it makes sense to install solar power plants with energy storage. There are also state subsidy and financial incentive programs for households.
Challenges in Ukraine
- War and destruction of infrastructure. Damage to solar power plants or batteries can lead to accidents – short circuits, electric arcs, dangerous leaks.
- Delays in payments under the “green” tariff. This worsens the financial situation of investors.
- High voltage in networks. If one transformerp in the village, 3-5 stations of 30 kW are connected, which increases the voltage and makes the power supply unstable. Previously, inverters were even reconfigured “at your own risk” so that they continued to work, but now they definitely require the installation of voltage relays.
Solution Search: Digital Power Huawei
Huawei is working on new solutions to stabilize the operation of solar power plants:
- the inverter can be configured to generate a little less – and this will reduce overvoltage;
- reactive power control is also possible to control the voltage in the network.
Such innovations make the operation of the stations more reliable.
Transition to self-consumption
Due to the war in Ukraine, there has been a transition from large grid-connected solar power plants to smaller power systems for own needs. Most of the electricity is consumed directly in the household, and not exported to the network. That is, there is practically no export.
Batteries help to balance the consumption schedule and at the same time reduce the load on the distribution networks.
3. Prospects and conclusions
Positive dynamics.
Despite the difficult circumstances, the solar energy market for private households in Ukraine is developing in a positive direction. Although the state does not currently provide adequate financing, subsidies or rebates, many consumers are investing their own funds to achieve energy independence.
Official statistics.
According to data, 1.5 GW of solar power plants have been built in Ukraine. However, the real figure is higher and reaches approximately 2 GW – due to the fact that some private solar power plants are not registered either under the “green” tariff or under the self-production mechanism. The reason is simple: people do not want to deal with paper bureaucracy, so they provide their own electricity supply themselves.
In total, about 60,000 home installations have been installed.
Benefits for households.
- Solar power plants reduce dependence on centralized power supply.
- They provide an opportunity to significantly save on electricity.
- The most effective for private users today are hybrid systems and standalone solar power plants with batteries.
Consumer behavior.
It is interesting that when there are no power outages, people are less interested in installing battery solar power plants due to longer payback periods. At the same time, during regular outages, demand increases sharply.
Legislation.
Ukraine has a fairly liberal approach: permits for the installation of household solar power plants are not required. There are only requirements for land plots, technical passport and capacity within the limits set by law.
Main obstacles.
- High cost of equipment and connection.
- Lack of government subsidies or large-scale subsidy programs.
- Difficulty in centralizing small projects.
Possible incentives.
- Government subsidies and interest-free loans.
- A model involving energy service companies that can install solar power plants for free: consumers simply pay the company for the energy consumed, and after the equipment pays off, they receive the installation at their disposal.
Service life of solar panels.
- Average service life — 25–30 years.
- In Ukraine, there are examples of panels operating since the early 1990s — over 40 years.
- There are various studies: some panels work without degradation, some fail earlier than expected.
- Modern technologies (after 2015) are much more stable, and 25–30 years of operation can be predicted under proper operating conditions.
Used equipment.
If there are no alternatives, it is advisable to accept as a gift panels that have already been in operation for 10 years. They can continue to work, in particular in municipal institutions, provided that there is no need to pay income taxes or installation. It is important to consider transportation: microcracks during transportation can accelerate degradation.
Solar energy remains an important tool for energy independence for private households. The challenges are associated with the high cost of equipment, unstable payments under the “green” tariff, and problems in the networks. But at the same time, it is an industry with great potential, which provides savings, creates jobs and helps to form energy sustainability.
Active links
- Law “On Alternative Energy Sources” (Vidomosti Verkhovnoi Rada of Ukraine (VVR), 2003, No. 24, Art. 155): https://zakon.rada.gov.ua/laws/show/555-15#Text
- Law “On the Electricity Market” (Vidomosti Verkhovnoi Rada of Ukraine (VVR), 2017, No. 27-28, Art. 312): https://zakon.rada.gov.ua/laws/show/2019-19#Text
- Law of Ukraine “On Energy Saving” (Vedomosti Verkhovna Rada of Ukraine (VVR), 1994, No. 30, Art. 283) https://zakon.rada.gov.ua/laws/show/74/94-%D0%B2%D1%80#Text
- Directive (EU) 2018/2001 (RED II) on renewable energy sources
https://zakon.rada.gov.ua/laws/show/984_039-18#Text - Directive 2009/72/EC concerning common rules for the internal market in electricity
https://eur-lex.europa.eu/legal-content/EN/ALL/?uri=celex%3A32009L0072 - National Energy Strategy of Ukraine until 2050 (draft)
https://www.mev.gov.ua/reforma/enerhetychna-stratehiya-0 - SE “Guaranteed Buyer” — information about the “green” tariff
https://www.gpee.com.ua - International Energy Agency (IEA): Solar Energy
https://www.iea.org/energy-system/renewables/solar-pv