07.04.2025
On March 28, 2025, Energy Club gathered leading experts and business representatives for an online meeting dedicated to discussing the implementation of the Carbon Border Adjustment Mechanism (CBAM) and its impact on the Ukrainian power sector in the context of European integration. Participants included:
Opening the meeting, Energy Club Vice President Valerii Bezus emphasized the scale of the challenges facing the Ukrainian energy sector: “Today we are holding a meeting on an extremely important topic that will have a powerful impact on the development of the national economy – the introduction by the European Union of the CBAM mechanism, effectively a carbon barrier at the European Union’s border for imported goods. It is clear that the introduction of such a mechanism will affect key Ukrainian industries oriented towards export to the European Union, but, considering that electricity constitutes a key part of the carbon footprint, it is clear that such a mechanism will critically impact the development of Ukrainian energy.”
He also highlighted the timeline: “The transitional period in the European Union for the implementation of the CBAM mechanism has been ongoing since last October, and the transitional period expires at the end of this year. At the beginning of next year [2026], this mechanism will be implemented not just in reporting mode, but in full operation mode with corresponding consequences for importers of products into the European Union.”
Maksym Nemchynov, Vice President of Energy Club, Deputy Minister of Energy of Ukraine (2020-2021), shared his experience working on this issue: “I worked on this issue when I was deputy minister, I clearly remember when we were working on it before signing this agreement with the Ministry of Economy, the Ministry of Ecology, and when we were assessing the risks from an implementation perspective. It seemed to us that it wouldn’t happen soon, we were confident there would be no force majeure events, that we would manage to upgrade everything – both our power plants, and resolve issues with natural gas extraction so as not to increase CO2 emissions, and we planned to build CO2 storage facilities. But, unfortunately, the war made its own adjustments.”
He also emphasized the need for a postponement: “Today we can say that Ukraine indeed needs at least a postponement from fulfilling its obligations for the period of the war, during martial law, and plus several more years after its end, because we will essentially have to build some things from scratch. And indeed, looking at priorities, we have much higher priority tasks – to restore the economy, production, and including electricity generation.”
Viktoriia Karpets, Manager of the Industrial Ecology and Sustainable Development Committee at the European Business Association, noted: “Since the EU announced the introduction of this mechanism, Ukraine has been among the countries that CBAM is expected to affect most negatively. And this is understandable, as a very large share of Ukrainian exports includes metallurgical products, cement, and others, and, of course, our energy sector.”
She also highlighted the damage caused by the war: “With the start of the Russian invasion, Ukraine’s economy has indeed suffered huge losses. We know about significant infrastructure destruction, the destruction of enterprises, limitations on energy resources, and all this greatly complicates our infrastructural and economic recovery.”
Karpets proposed specific steps: “We believe it is necessary to start by initiating direct negotiations with the European Commission regarding CBAM, with the participation of the Ministry of Economy and Ukrainian business associations. Considering that Ukraine is already preparing for EU accession and is actively adapting its legislation to European norms, particularly regarding emissions monitoring, we believe it would be appropriate to obtain a special status from the EU within the framework of CBAM implementation.”
Dmytro Korniienko, Chief Specialist of the Heat Engineering Department at TPS ENGINEERING LLC, focused on the technical aspects of the problem: “Within the current discussion topic, I would like to outline the problematic issues specifically from the perspective of designing energy facilities, the content of regulatory requirements regarding greenhouse gas emissions from energy facilities, and the requirements for the presence of greenhouse gas accounting and monitoring systems.”
Oleksii Zakharchuk, Director of Regulatory and Legal Affairs at DTEK, emphasized Ukraine’s contribution to carbon neutrality: “Today, Ukraine is making a significant contribution to carbon neutrality. We have reduced our emissions volume by 63% compared to 1990.”
He also called for negotiations with the EU: “We primarily need to think about how we will revive our economy and spheres of activity after this war. For this, we will need exactly what currently falls under CBAM: metal, cement, electricity, and many other building materials that would help us recover in a short period. To achieve this, we need the Government of Ukraine to reach an agreement with the European Commission, the leadership of the European Parliament, and the Council to include Ukraine in the list of countries granted a temporary derogation.”
Summing up, Valerii Bezus noted: “The professional discussion around these issues, in our opinion, in Energy Club’s opinion, must at least intensify, and consequently, a subtle request to the government, and perhaps even gentle pressure from the professional community, should increase.”
Maksym Nemchynov added: “‘Summing up, I want to say that we, as Energy Club, will definitely make such a proposal’ – to appeal to the Government regarding the start of negotiations with the EU about a postponement.”
