31.07.2025
The Ukrainian energy sector is undergoing the most profound period of challenges and transformations in its history of independence.
Since the beginning of the full-scale invasion, the energy sector has become not only a target for attacks but also a critical foundation for economic and humanitarian resilience.
That is why the sector’s recovery is not merely a technical or financial issue. It is a strategic choice that will determine the country’s future.
Air strikes have forced the entire energy system to operate under constant threat. Operator crews, contractors, and technical specialists are all working in unison to localize and repair damage and restore critical infrastructure facilities.
Thanks to the development of emergency procedures, automation, the establishment of local repair bases, and support from international partners, it has been possible not only to sustain the system but also to lay the foundations for a new, more flexible architecture.
This resilience is shaping new managerial approaches—where each participant has a clear area of responsibility, and the state and business work as partners.
The development of distributed generation is becoming a key strategic direction. One of the latest examples is Odesa, where six cogeneration units are being installed through close cooperation between donors and local authorities.
Four of them have already been delivered and are being commissioned. Upon completion of all work, the cogeneration units will supply electricity and heat to one million residents, even during a blackout.
Such solutions are no longer an exception but a trend that is spreading to industrial zones, communities, and agricultural enterprises.
Simultaneously, the role of storage systems, hybrid solutions, and local load management is growing—concepts that seemed like a distant future just a few years ago. Today, they have become a common technical necessity.
Solar power plants (SPPs) continue to demonstrate the highest growth rates. According to estimates, the technical potential for SPP capacity in Ukraine is 36 GW, while the economically feasible potential is 30 GW.
By the end of 2023, installed capacity reached 8.5 GW, with most of this growth driven by households and small businesses.
The demand for autonomy and energy independence has fundamentally changed consumer behavior. In 2024-2025, the focus has shifted from generation to energy storage. This confirms a new market maturity that goes beyond the “feed-in tariff” and focuses on self-sufficiency, efficiency, and a new quality of consumption.
Wind generation in Ukraine is developing more slowly—only 1.7 GW of installed capacity against a potential of 16 GW.
The main reason is the location of promising sites in frontline regions. However, even under these conditions, equipment is being repaired, repowering (the renewal and modernization of equipment) is being planned, and new projects are being launched in the central and western regions.
Once the situation stabilizes, an annual capacity increase of 0.5-1 GW is expected. But this requires a systemic solution to one of the sector’s most painful problems: debt.
The debt to renewable energy (RES) producers has already exceeded UAH 22 billion. According to official data, Ukrenergo owes the “Guaranteed Buyer” over UAH 16 billion.
The years 2022 and 2024 remain particularly problematic, with payments covering only 63.9% and 87% of obligations, respectively.
These figures are not just statistics. They represent lost investor confidence, halted projects, and postponed auctions. Some market participants are already abandoning the “feed-in tariff” mechanism and moving to trade on the day-ahead and intraday markets, taking on pricing and imbalance risks.
Such changes indicate the beginning of a new stage of development—one that is more market-oriented and flexible, but also more demanding in terms of guarantees and rules of the game.
In June 2025, for the first time in a year and a half, Ukraine became a net exporter of electricity: exports amounted to 237,000 MWh, while imports were nearly 204,000 MWh.
This is a starkly different situation compared to June 2024, when exports were zero and imports exceeded 800,000 MWh.
From July 1, export capacity to EU countries increased from 650 MW to 900 MW. Exports are no longer limited to daytime hours—Ukrainian generation is entering the European market at night and during the morning peak.
This is not only new revenue for companies but also an important resource for preparing for winter. However, for this trend to be sustainable, it requires not only generation and surplus but also infrastructure, interstate lines, and export rules synchronized with ENTSO-E.
In July 2025, an official screening of Ukrainian legislation in the energy sector began in Brussels.
Ukraine is proposing to expand cooperation with ACER, connect to the Union Database, and participate in shaping EU energy policy.
This is not just a bureaucratic process—it is preparation for new obligations and opportunities. The European Commission has already positively assessed Ukraine’s progress in the gas, electricity, and market reform sectors.
However, it also emphasizes the need for greater stability, transparency, and liberalization.
We are entering a phase where collaboration, not just technology, will define the future of the sector. Without open dialogue between business and the state, there will be no capacity growth, new investments, or integration with Europe.
Debts, restrictions, and a lack of instruments can all be overcome when market participants speak with a single voice. We must not wait for the challenges to disappear. We must consolidate, propose solutions, and take part in shaping the new energy architecture.
For companies that remain in Ukraine, working and investing, this is a chance to be not just witnesses to change, but its drivers. We believe in the country’s new energy. But it cannot exist without trust, transparent rules, and a fair partnership.
About the author:
Vadym Lytvynenko, Executive Director of NVP ENERGO-PLUS LLC. Born on October 25, 1975.
