06.02.2026
Ukraine’s energy system entered the war with a model that had been shaped over decades and proved vulnerable to new challenges. What seemed stable and clear before 2022 now requires not just restoration, but a complete rethinking.
This was discussed during the Energy Freedom talk show by Energy Club, featuring Oleksandr Sigal — a renowned Ukrainian scientist in the field of thermal power engineering and fuel combustion processes, Candidate of Technical Sciences, Head of the Laboratory of Thermophysical Processes in Boilers at the Institute of Engineering Thermophysics of the National Academy of Sciences (NAS) of Ukraine, co-founder and Director of the Institute of Industrial Ecology, Laureate of the State Prize of Ukraine in Science and Technology (2004), and the author and developer of over 50 inventions.
His speech focused on the logic of Ukraine’s future energy system — taking into account the war, climate change, and real economic constraints.
One of the key points raised was the management disconnect between the electricity and heat supply sectors that existed prior to the full-scale invasion. Back then, large-scale generation was hardly connected to heat production. Today, however, with the exception of nuclear and some renewable energy, almost the entire energy complex produces marketable heat, and failing to utilize it means direct economic losses.
Another fundamental shift is the growing role of cogeneration and trigeneration. Climate change is shortening the heating season but simultaneously creating a new challenge — a sharp increase in the demand for cooling in summer. Summer peaks in electricity consumption are becoming more severe than winter ones, changing the very logic of energy planning.
Oleksandr Sigal also outlined the strategic dilemma Ukraine finds itself in: between security, ecology, and economy. Distributed generation increases resilience to attacks but makes energy more expensive. Fulfilling all environmental commitments is correct from a climate perspective but risky for the economy’s competitiveness. In other words, the cheap electricity that industry relied on for decades will no longer exist.
A separate issue is the lack of an answer to a basic question: what kind of economy does Ukraine want to build after the war? Without this, it is impossible to design an energy complex, as it is created not for a year or two, but for at least decades ahead.
Among the main points voiced by Oleksandr Sigal:
These and other issues — from the potential of alternative energy sources and the role of centralized heating to the concept of microgrids, waste utilization, and energy price forecasts — became the basis of an extensive interview by the Energy Club media department with Oleksandr Sigal. In it, he explains in detail why there are no simple solutions for the Ukrainian energy sector and what steps might be realistic in the coming years.
– Oleksandr Isakovych, you mentioned that before the full-scale invasion, the energy sector existed separately from the heat supply. Now you claim that almost all generation, except for NPPs and RES, produces industrial heat. Does this mean the era of “pure electricians” is over, and the future belongs exclusively to cogeneration?
– It would be incorrect to say that we won’t be able to use, for example, solar energy if a large coal-fired thermal plant is built somewhere. But it is quite clear that energy savings lie in the synergy of thermal and electrical generation. And there can also be cold supply, considering climate change and global warming.
– You cited figures: an agrarian country needs 35 billion kWh, an industrial one — over 50 billion kWh. Which model are we moving towards now? Aren’t we building an energy system for an economy that no longer exists?
– We are moving towards a purely agrarian model. Today, our entire industry is effectively destroyed. However, we aren’t building any energy system yet. For now, we are just patching it up. But what will we build after the war? It all depends on what kind of country we want to have. If we want the most backward country in Europe, we build an agrarian one. However, we will fight for at least an agrarian-industrial one. No one talks about an industrial country anymore because, unfortunately, no one will let us build it. It won’t just be Europe and America against us, but the whole world, including China.
– You voiced the concept of “energy islands” based on 330/110 kV or 110/35/10 kV substations. This sounds like an ideal solution for security. But who should own such an “island” — Ukrenergo, the Oblenergo, or the municipality? How can this be managed technically so the “island” doesn’t “go dark” when disconnected from the external grid?
– Let’s start with the fact that the very phrase “energy island” is slang. It is inherently incorrect, so I immediately ask the question: what kind of energy island? Electrical or thermal? For example, I have a cogeneration machine. It can produce heat for two or three neighboring houses, while the electricity can be distributed to an entire micro-district. So where are the boundaries of the island?
Therefore, in my opinion, the term “energy island” should be replaced with a more appropriate one: microgrid.
The thing is, for some reason, we believe — I don’t know why or where this came from — that installing a cogeneration machine at some boiler house creates an “energy island.” Although in reality, an “energy island” and the installation of this machine have nothing in common. You can install a machine and even connect it to the grid, but it will stop working the moment the electricity disappears in the grid.
Because when these machines are given to us, especially for free, the first thing that kicks in is our “grabbing reflex.” When asked: “How much do you need? What capacity machine?”, we say: “Well, what can you give? Can you give 2.5 MW? Give us 2.5 MW!”
And when we install a 2.5 MW machine at a boiler house with an electrical load of 300 kW, we can even sell electricity while the grid is working. But the moment the grid stops working, we disconnect this machine from the grid and must load it to at least 40% of its capacity — roughly speaking, 1.0 MW. But we only have 300 kW. So how do we ensure the “island” doesn’t go dark when disconnected from the external grid? By choosing equipment according to the load. That is, if in this case we asked for a 0.5 MW machine, it would work. But we took what was given — 2.5 MW. This means we need to provide it with a load. For example, if we install two more electric boilers at that boiler house, 300 kW each, that’s 0.6 MW of power. If we turn them on when there is no light — meaning there is a load — the machine won’t shut down.
As for the owner of microgrids — we need to understand that these “islands” are parts of the energy system regardless, and today they have owners. That is, the grid cannot exist separately from the Oblenergo. If a microgrid is separated, it is a separate consumer. You can make an internal network for your house or an internal network for a boiler house. But the building will still be connected as a single entity to the Oblenergo.
– You demonstrated the generation structure of an energy microgrid (island): Gas Piston Unit (GPU) + biomass boilers + heat pumps. What is the price of a kilowatt of energy in such a system? Won’t “island” energy become “golden” for the consumer compared to nuclear?
– Today, everything we divide into parts is more expensive than the whole. If you divide it into four parts, it’s more expensive than the whole; into eight parts — even more expensive. There is a balance between security and economy. If we care about security by dividing the whole into parts, we have to pay more. There is no such thing as both safer and cheaper. You have to choose.
– You set a goal — reducing gas consumption by 3 billion cubic meters. How? Only biomass, or are there other reserves?
– No, there are different options. First, we need to stop heating the environment. In Western countries, for example in Germany, there is a fee for this: roughly speaking, if you emit temperatures above 60 degrees into the atmosphere, you pay for this resource. That is, you have to return money to the state in an amount for which you could buy the quantity of gas needed to produce that amount of heat.
Our exhaust gases in every chimney have a temperature of no less than 170 degrees. So we need to install heat exchangers and collect this heat — this is an obvious resource. If we had this fee for thermal energy emissions, then today many industrial enterprises that dump warm water into rivers would have a serious expense item. But they don’t want to deal with municipalities. Take a city like Kryvyi Rih for example. It’s a large industrial city where ArcelorMittal and other enterprises operate, emitting a large amount of thermal energy. But when the city asks: “Give us this energy to heat the residents,” they answer: “We don’t want to, we’d rather throw it away.” Why? Because then a situation arises: the city uses the heat of industrial enterprises and asks why it should maintain additional boiler houses, personnel for boiler maintenance, and so on. But when the enterprise has no orders and the technological cycle stops, the enterprise is accused of freezing half the city. Therefore, the company does not want to take this responsibility. And we do not have legislative provisions regarding capacity reservation.
– Your presentation mentions RDF (Refuse Derived Fuel). In Ukraine, people have been talking about this for 10 years, but there are still no plants. What do you think is hindering us: the lack of a waste processing tariff, the lobby of landfill owners? How does the Institute see the solution to this problem?
– Firstly, morphology gets in our way. Once we talked with representatives of Lviv who said: “We went to Poland, looked, the plant works great, tested it on waste, we will build the same way.” But in this case, “the same way” won’t happen. And I explained why “the same thing,” transported 100 kilometers across the border, won’t work. It’s about the composition of the waste, or morphological composition.
There are three main directions of waste management in the world. If the total household income is less than $1,000, a waste incineration plant is not profitable — only a landfill. Because the waste is mostly food and organic household waste. There is nothing to burn. If the total income is from $1,000 to $3,000, then it is profitable to build plants — there is a lot of plastic, and this burns. And the third option is over $3,000. Then it is unprofitable to burn waste; it is better to sort and recycle it. Therefore, in such cases, Europe does not build plants but launches recycling. Waste is sorted and separated into plastic, cardboard, etc. There is something to sort and something to produce from this secondary raw material.
That is, Europe is already moving away from waste incineration plants, but we haven’t grown into them yet; we fall short on income. Now our cities are somewhere at the level of this intersection point. That is, it is already profitable for us to build waste incineration plants.
– You cite an example that climate change requires a 12% increase in energy consumption for cooling per year. Does this mean that summer consumption peaks will soon become scarier than winter ones?
– We produce electricity with a total efficiency of about 90%. But of this, 40% efficiency accounts for electricity, and about 45-47% for thermal energy. This is cogeneration. If in winter we use this thermal energy for heating, in summer it is mostly thrown away. Thus, electricity becomes exactly twice as expensive. That is, if we didn’t sell this resource, it means the price went up. And so we need to think about how to sell this resource. In summer, you can sell “cold.” And given that we will have climate changes — we are already feeling it — this will be very relevant. Unfortunately, summer peaks in consumption have become worse than winter ones, and residents of Europe have already felt this — last summer in Germany and France, many people died due to incredible heat. That is, the process is gaining momentum, and one way or another we will have to produce not only heat but also cold. This is what we must focus on today: building heat and cold supply systems, producing not only heat but also cold.
– You quote global trends: Norway — greenhouses-fish-energy; Korea — fuel from plastic. But where is Ukraine’s place? Are we doomed to catch up and buy foreign technologies, or do we have our own developments?
– Currently, we are trying to start by building a new system. But first of all, we have to look at what new trends exist in the world in different countries. That is why I grouped them to some extent in my presentation. We cannot simply catch up with other countries’ technologies. We won’t succeed. We wouldn’t be able to do it even if we wanted to very much, unfortunately. This means that no one will sell us new, modern, and profitable trends, and we won’t want to take outdated ones anyway. Therefore, it is unlikely that we will be able to buy the most modern things in energy; no one will sell them to us.
– Does the Institute of Engineering Thermophysics of the NAS of Ukraine have developments that can be scaled?
– Yes, of course. First of all, I want to thank the National Academy of Sciences, which lately, albeit with small funding, has been implementing several important strategic projects, including distributed generation. That is, there is a desire to collect all the developments that exist in scientific institutions and use them for the development of the country. And this is very pleasing because, in reality, we need a closer connection between the energy sector and science.
Today, a situation has developed where neither the previous Minister of Energy nor the new one — nor Mr. Shmyhal — have met with either the President of the Academy of Sciences or the Academician-Secretary of the Energy Department of the NAS of Ukraine, under whose subordination all energy institutes are located. Scientists have something to offer, but unfortunately, there is no contact with the authorities.
– Your price forecast for 2050: electricity and heat get cheaper, gas gets more expensive, CO2 emissions cost big money. If we start restoring old gas-fired CHPs now, won’t we drive ourselves into a debt trap in 10 years?
– The poet Yevgeny Yevtushenko, in response to Boris Pasternak, who wrote that it is ugly to be famous, said: “If it gets ugly, I’ll say thanks anyway.” What am I driving at? I really want Ukraine to dominate the world so much by 2050 that its main problem will be how to pay the CO2 tax when exporting its goods to many countries around the world. That is, if we export our products to other countries, they will buy them from us, and we will have to pay the CO2 tax — let that be our biggest problem.
– If you had an unlimited budget and authority, what three steps would you take first so that the winter of 2026 passes without blackouts?
– In the current situation, no one can say with certainty that they know exactly what to do. To avoid winter blackouts, destroyed capacities need to be restored within a year. That is, to build 6.5 GW of capacity in a year. This is unrealistic for any amount of money — something from the realm of science fiction. But, based on realities, I can highlight two vectors for the country’s development. First: Ukraine needs a balanced energy mix. We must develop all types of energy generation in certain proportions. And second — I would now actively develop whatever we are given money for.
The points voiced by Oleksandr Sigal confirm once again: key decisions in the energy sector must be made not in reaction to today’s challenges, but based on a long-term vision. The industry needs systemic approaches, predictability, and clear rules of the game understood by all market participants. It is this approach that forms the basis for the resilience of the energy sector and its further development today.
Without trust between the state, business, and society, energy reforms will remain only on paper. Openness, honesty, and readiness for dialogue are becoming no less important than technical or economic solutions. And it is these factors that will determine how effective the transformation of the industry will be.
Not slogans and emotions, but arguments, figures, and responsibility for every word — this is the format the energy sector needs today. And the more such conversations are heard in the public space, the more stable the system will be overall.
Thus, the future of energy is being shaped right now — in decisions, statements, and public positions. Responsibility for these processes lies with all market participants, and it is a shared vision and coordinated actions that can become the guarantee of stability and development of the industry in the long term.
