30.09.2026
Ukraine needs to focus on substantiating the actual emissions of its electricity generation to make use of its low-carbon electricity potential in trade with the European Union. This was the position set out by Oleksii Orzhel, Head of the Kyiv Office of the Energy Community Secretariat, during Energy Club’s online discussion “CBAM, Electricity and the Competitiveness of Ukrainian Industry” on 29 September 2026.
His presentation focused on the practical conditions for moving from default emissions values to verified actual values, cooperation with European verifiers, and the removal of barriers to cross-border trade. He addressed these issues in the context of the Energy Community’s task of integrating Ukraine’s market into the single European energy market.
Orzhel noted that Energy Community mechanisms allow energy market integration to advance before a country joins the EU. At the same time, he argued that CBAM creates additional difficulties for that process because it affects the economics of electricity trade.
Referring to the Secretariat’s analysis of Balkan countries, he cited a decline of approximately 25% in electricity imports from those markets into the EU, despite price signals supporting such flows. He presented this as an example of barriers that need to be discussed with the European Commission. He clarified that an equivalent analysis had not been carried out for Ukraine because access to the necessary data was limited during the war.
Orzhel identified the application of default emissions values as a particularly sensitive issue for Ukraine. To illustrate the financial impact, he cited an estimated additional burden of up to €70 per MWh in an example using a coefficient of 0.9 and his assumed carbon price. This was an estimate of the costs of importing electricity into the EU under those assumptions, with implications for the commercial attractiveness of supplies.
At the same time, he stressed that Ukraine’s power system is changing rapidly. Damage to industrial facilities, changes in consumption and shifts in generation affect the electricity balance. In his assessment, nuclear and renewable generation could play a greater role, making it especially important to substantiate the low-carbon characteristics of the electricity produced.
“We really need to place a very strong emphasis on verification,” Orzhel said.
He identified cooperation between Ukrainian specialists and organisations accredited in Europe as one practical route. According to Orzhel, the Energy Community’s work includes examining opportunities for Ukrainian experts to act as employees or subcontractors of European verifiers. He linked this approach to the need to account for wartime risks while ensuring that Ukrainian enterprises’ data can be assessed.
“Let’s build a verification system,” Orzhel urged during the subsequent discussion, linking that work to preparations for substantive dialogue with the European Commission.
He also outlined issues being addressed in dialogue with European institutions. These include the treatment of emergency, technical and operational flows between transmission system operators. He explained that work on the relevant changes is intended to account for the specific nature of these operations in applying CBAM. He was referring to anticipated regulatory decisions whose implementation depends on the completion of EU procedures.
Another area identified by Orzhel was the possibility of substantiating electricity characteristics where intermediaries are involved in the trading chain. He cited Ukraine’s Guaranteed Buyer and the contractual chain for renewable electricity supplies as an example. In his explanation, developing this approach could help substantiate actual emissions values for the relevant transactions.
An important clarification concerned electricity guarantees of origin. Orzhel stressed that this instrument should not be treated as equivalent to emissions evidence for CBAM purposes. He pointed to the instruments’ different objectives and differences in the time granularity of the data they use.
“These are separate instruments that were created for a different purpose,” he explained.
He also reported on the Energy Community’s work towards mutual recognition of guarantees of origin. He expressed hope that the relevant decisions would advance, while stressing that the development of this market has value in its own right and does not, by itself, resolve CBAM compliance requirements.
Discussing possible special arrangements for Ukraine because of the war, Orzhel called for realistic expectations about timing. In his assessment at the time of the discussion, the relevant regulatory process had not yet been launched at European Commission level. He noted that the European cycle for preparing and adopting such decisions can take a year or more, so the rapid application of an exemption should not be treated as a guaranteed outcome.
In the closing discussion, Orzhel outlined a possible change in Ukraine’s electricity balance: lower industrial consumption could create situations in which electricity exports become more important. He stressed the need to prepare for such changes and coordinate the work of the government, generators and other market participants.
Among the practical priorities, he identified verification of generation at nuclear power plants under Ukrainian control and work on substantiating the relevant emissions values within the Guaranteed Buyer’s contractual portfolio. In his view, this could help Ukraine realise the export potential of low-carbon electricity and secure much-needed financial resources.
Orzhel also linked the development of such supplies to potential benefits for European buyers. He argued that proper emissions verification and the reduction of CBAM-related barriers could expand electricity supply and help ease price pressures in the EU market.
“That would be a win-win. We should try to make it happen,” he said, emphasising Ukraine’s and the European Union’s shared interest.
