Energy Club appeals to MFA regarding pressure on energy suppliers: artificial price caps threaten Ukraine’s international obligations

21.11.2025

The Energy Club business community has officially appealed to the Ministry of Foreign Affairs of Ukraine calling for intervention in the situation regarding public procurement of electricity. Mass lawsuits filed by the Prosecutor’s Office against suppliers—based on outdated regulations and ignoring wartime realities—pose a threat to energy security and contradict the state’s European integration course.

The Core Problem: Market Reality vs. Administrative Pressure

The appeal was prompted by the systemic practice of the Prosecutor’s Office, which is mass-challenging supplementary agreements to electricity supply contracts for state institutions. Law enforcement officials interpret any price increase exceeding 10% as a violation of the law, ignoring Cabinet of Ministers Resolution No. 1178, which allows for price adjustments in line with market fluctuations during martial law.

In its letter, Energy Club provides analytics demonstrating the absurdity of such restrictions:

• Market Volatility: Prices on the Day-Ahead Market (DAM) are dynamic. For instance, in 2024, price spikes reached 62% in certain months.
• The War Factor: Infrastructure shelling (specifically citing the massive attack on October 10) provokes deficits and immediate price surges that are impossible to predict at the time of contract signing.
• Unprofitability: By forcing suppliers to keep prices artificially low while procurement costs (tariffs of Energoatom and Ukrenergo) rise, the state is pushing businesses toward bankruptcy.

International Aspect and Threat to EU Integration

Energy Club emphasizes that administrative interference in pricing directly violates EU legislation that Ukraine has committed to implementing. Specifically, this contradicts Regulation (EU) 2019/943 and Directive (EU) 2019/944, which require free pricing and the creation of conditions for investment attractiveness in the sector. Violating these principles could lead to the unbalancing of the energy system, which is integrated with the European ENTSO-E network.

“Establishing non-profit tariffs or administratively undercutting prices constitutes a violation of the fundamental principles of the European energy market. This creates a critical risk not only for market participants but for the energy security of the state as a whole,” states the Energy Club appeal.

Double Standards

The appeal highlights a paradoxical situation: the Prosecutor’s Office, acting as a service customer, signs supplementary agreements with significant price increases itself, while simultaneously suing other market participants for similar actions. An analysis of the Prozorro system revealed cases where regional Prosecutor’s Offices increased electricity prices in their own contracts by 30%, 40%, and even over 70%. This indicates selective justice and the absence of a unified legal position.

Business Demands

Energy Club calls on the MFA, as the body supervising the implementation of international treaties, to initiate a review of this issue at the Cabinet of Ministers level. The goal is to halt unlawful pressure on businesses, align the actions of control bodies with European norms, and ensure stable electricity supply for critical infrastructure facilities.