New draft laws on debt repayment and crisis management registered:

Parliament member Kamelchuk Y. registered a bill on amendments to the Law of Ukraine “On the State Budget of Ukraine for 2020” (on measures aimed at repaying debts incurred in the wholesale electricity market), registration number 3459 from 08.05.2020. The text is not yet available on the Parliament’s website.

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Parliament’s members Buimister L., Yefimov M., and Moroz V. introduced an alternative draft law amending Section XVII “Final and Transitional Provisions” of the Law of Ukraine “On the Electricity Market” to overcome the crisis of settlements, registration number 3388-1 from 08.05.2020. The text is not yet available on the Parliament’s website.

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At its meeting on May 8, 2020, the Committee on Finance, Tax and Customs Policy of the Verkhovna Rada heard a report by the NBU Governor Yakiv Smolii on the activities of the National Bank of Ukraine.

The Governor of the NBU spoke about the measures taken by the Bank during the quarantine period. In particular, during the last two months: the key policy rate decreased from 11% to 8% – the lowest key policy rate in the history of Ukraine; introduced long-term financing for banks for a period of 1 to 5 years; currency swap agreement with the EBRD for USD 0.5 billion has been concluded, which will allow the NBU to receive dollars to replenish bank international reserves and the bank to receive hryvnias to lend to Ukrainian enterprises.

Also, in March, in order to ensure the smooth operation of the banking system, a number of anti-crisis measures were introduced, including “credit vacations”; prohibited imposing restrictions on withdrawal of deposits; providing recommendations on the safe operation of banks during quarantine; providing banks with sufficient cash and safe from the point of view of virus infection; ensuring demand for currency and stabilizing the exchange rate; stimulating the transition to non-cash payment.

After analyzing the current situation and the measures taken, the Governor of the National Bank predicted: “The Ukrainian economy will fall by 2020 by no more than 5%.” In the following years, he sees economic growth at 4%.

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Held personnel changes at Minecoenergo:

Dismissed Chyzhyk K. from the position of Deputy Minister of Energy and Environmental Protection of Ukraine for European Integration (RCMU from 06.05.2020 № 495-р) and appointed Boyko Y. Deputy Minister of Energy and Environmental Protection of Ukraine (RCMU from 06.05.2020 № 497-р).

Ministry of Energy

Published a draft resolution amending the PSO mechanism

The Ministry of Energy has published a draft resolution of the Cabinet of Ministers of Ukraine “On Amendments to the Regulations on Imposing Special Responsibilities on Electricity Market Participants to Ensure Public Interests in the Functioning of the Electricity Market”.

The changes concern: the possibility of the Guaranteed Buyer to enter into bilateral agreements market (the form is approved by the Auction Committee of the Ministry of Energy; conditions: up to 1 month, the price is not less than the marginal price of the NPP); remove price restrictions for GB when selling electricity; in each settlement period, NPP producers sell to GB 80% of their projected amount of electricity (+ up to 5% under bilateral agreements at special sessions) and HPPs 35% of their projected production; GB and USPs are obliged to publish detailed information on the volumes of purchased and sold electricity in due time; a number of rules concerning payment data.

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Held a video conference with representatives of the World Bank

Acting Minister of Energy and Environmental Protection Olga Buslavets informed about the urgent measures taken by the Government and the Ministry to stabilize the situation in the energy sector; told about negotiations with investors in RES, the purpose of which is to conclude voluntary memorandum, which will balance the support system at a “green” tariff.

Representatives of the World Bank advised postponing the creation of new RES capacities to address the accumulated problems. Olga Buslavets noted that this approach coincides with the vision of the Ministry.

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Acting Minister Olga Buslavets gave an interview to TV channel “Ukraina”:

prices for the population will remain unchanged; on resolving problematic issues in the field of RES – a draft framework memorandum with electricity producers on RES on a voluntary revision of the current model of “green” tariff has been prepared; it will soon be discussed at a meeting chaired by Prime Minister Denis Shmygal along with investors.

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Informs about electricity consumption in April

According to operational data, in April 2020, electricity consumption in Ukraine decreased by 11% compared to March of the same year and amounts to 9028 million kW∙h, and compared to April 2019, it has decreased by almost 8%. A decrease in consumption is observed in all consumer groups.

The main factors reducing consumption are the seasonal rise in air temperature and quarantine measures, which have limited the ability of industrial enterprises, medium and small businesses, as well as services.

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Guaranteed Buyer

Reports current status

Noted that the level of prices in organized market segments does not allow GB to receive sufficient amounts of funds for full settlements with generating companies.

Also, reports on a number of working meetings with international and state financial institutions regarding the possible opening of credit lines for the Guaranteed Buyer. Based on the results of the negotiations, a number of state-owned banks are ready to provide the enterprise with credit funds for a total amount of UAH 34 billion, but only subject to government guarantees.

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