{"id":61873,"date":"2024-03-13T12:27:27","date_gmt":"2024-03-13T11:27:27","guid":{"rendered":"https:\/\/libmod.de\/kick-off-event-european-book-club-with-jaroslaw-kuisz-and-karolina-wigura-copy\/"},"modified":"2024-03-19T15:10:02","modified_gmt":"2024-03-19T14:10:02","slug":"green-energy-transition-in-ukraine-communal-level","status":"publish","type":"post","link":"https:\/\/libmod.de\/en\/green-energy-transition-in-ukraine-communal-level\/","title":{"rendered":"Green Energy Transition in Ukraine: Communal&nbsp;Level"},"content":{"rendered":"<div class=\"wpb-content-wrapper\"><p>[vc_row][vc_column][vc_column_text]<img class=\"alignnone wp-image-61878 size-full\" src=\"https:\/\/libmodredaktion.fra1.digitaloceanspaces.com\/wp-content\/uploads\/20240905111227\/grueneEnergiewende_500.jpg\" alt width=\"1200\" height=\"500\" srcset=\"https:\/\/libmodredaktion.fra1.digitaloceanspaces.com\/wp-content\/uploads\/20240905111227\/grueneEnergiewende_500.jpg 1200w, https:\/\/libmodredaktion.fra1.digitaloceanspaces.com\/wp-content\/uploads\/20240905111227\/grueneEnergiewende_500-770x321.jpg 770w, https:\/\/libmodredaktion.fra1.digitaloceanspaces.com\/wp-content\/uploads\/20240905111227\/grueneEnergiewende_500-768x320.jpg 768w\" sizes=\"(max-width: 1200px) 100vw, 1200px\"><\/p>\n<p>[\/vc_column_text][\/vc_column][\/vc_row][vc_row css=\u201d.vc_custom_1508251598805{margin-top: 30px !important;}\u201d][vc_column width=\u201c2\/3\u201d css=\u201d.vc_custom_1508252250311{padding-right: 20px !important;}\u201d][vc_column_text]<\/p>\n<h2>On February 28th LibMod organised a&nbsp;workshop on the Green energy transition in Ukrainian commu\u00adnities to discuss current legislative frame\u00adworks and practical local experi\u00adences of small distributed gener\u00adation in munic\u00adi\u00adpal\u00adities with lawmakers and experts from Ukraine and the EU. Decen\u00adtralized energy can benefit commu\u00adnities through strength\u00adening their resilience and security, reducing electricity costs, and increasing invest\u00adments and local ownership. Since the Russian war of aggression, municipal owned enter\u00adprises and local ownership of renewable energy have become highly&nbsp;important.<\/h2>\n<h2><!--more--><\/h2>\n<h2><\/h2>\n<p>[\/vc_column_text][vc_column_text]<\/p>\n<h3>Decen\u00adtral\u00adizing Ukrainian energy&nbsp;supply<\/h3>\n<p>The adoption by the Verkhovna Rada of the Law \u201cOn Amend\u00adments to Certain Laws of Ukraine on the Restoration and Green Trans\u00adfor\u00admation of the Energy System\u201d No. 3220 of 30.06.2023 was a&nbsp;welcome and long-awaited step towards the adaptation of Ukrainian legis\u00adlation to the EU Fourth Energy Package. The law holds many innova\u00adtions for renewable energy sources, which have signif\u00adi\u00adcantly expanded the scope of involvement of consumers wishing to install power gener\u00adating facil\u00adities (also known as active consumers or prosumers). Municipal owned entities (MOEs) can become prosumers too, which allows for more active involvement of commu\u00adnities in the energy&nbsp;sector.<\/p>\n<p>Currently, commu\u00adnities do not use the active consumer model, and each individual MOE purchases its entire electricity volume on the market through market mecha\u00adnisms and under the restric\u00adtions estab\u00adlished by public procurement legislation.<\/p>\n<p>We discussed the benefits of the active consumer model, appli\u00adcation options and regional challenges. Andriy Gerus (Chairman, Verkhovna Rada Committee on Energy, Housing and Utilities), Oleksandr Vizir (head, NGO Associ\u00adation on energy efficiency and energy saving, author of <a href=\"https:\/\/libmod.de\/en\/decentralised-energy-generation-in-ukrainian-communities\/\" target=\"_blank\" rel=\"noopener\">\u201cSmall Distributed Gener\u00adation. A&nbsp;Window of Oppor\u00adtunity for Ukraine: Focus on Commu\u00adnities\u201d<\/a>), Rouven Stubbe (Consultant, Energy and Climate Policy team, Berlin Economics), and Andriy Martyniuk (Executive Director, Ukrainian <a href=\"https:\/\/ecoclubrivne.org\/en\/about-us\/#team\" target=\"_blank\" rel=\"noopener\">NGO Ecoclub Rivne<\/a> joined as speakers in the discussion moderated by Daria Malling (LibMod).<\/p>\n<h3>Municipal Owned enter\u00adprises as Active&nbsp;Consumers<\/h3>\n<p>We discussed how the new law can be imple\u00admented in Ukrainian commu\u00adnities and what role it plays in promoting the green energy transition. The creation of prosumers by commu\u00adnities can positively effect commu\u00adnities in three&nbsp;ways:<\/p>\n<ul>\n<li>security (strength\u00adening the system\u2019s resilience in the event of a&nbsp;power outage);<\/li>\n<li>economy (reduction of electricity costs for community&nbsp;entities);<\/li>\n<li>investment (the possi\u00adbility of attracting investment in relevant community&nbsp;programmes).<\/li>\n<\/ul>\n<p>Option 1&nbsp;to create active consumers is to install power gener\u00adation facil\u00adities at the expense of the community, or by using donor funds. Such MOEs can install renewable gener\u00adation units that are directly connected to their internal power grids and consume most of the electricity produced at the point of production (directly by the facility on the roof of which the gener\u00adating unit is located) or close to it, thus creating a&nbsp;classic distributed generation.<\/p>\n<p>This will reduce the cost of purchasing electricity and makes it possible to create energy islands in the future, making the commu\u00adnity\u2019s energy system more resilient to security&nbsp;risks.<\/p>\n<p>Option 2&nbsp;is to compile a&nbsp;register of locations where the investor has the right to install power gener\u00adation units and connect them to the MOE\u2019s internal networks, which will allow such MOEs to obtain the status of active&nbsp;consumer.<\/p>\n<p>The community may hold open tenders (e.g. on the Prozorro platform) for investors, offering to build a&nbsp;regional power gener\u00adation facility, poten\u00adtially guaran\u00adteeing investors that the MOE will buy the electricity produced at a&nbsp;certain price.<\/p>\n<p>Option 3, the most efficient one, is a&nbsp;combi\u00adnation of the two. To further develop this logic, it is important that the surplus electricity produced but not consumed by MOEs is sold to other MOEs in the community. For this purpose, several signif\u00adicant changes should be made to the model of electricity procurement by munic\u00adi\u00adpal\u00adities as suggested by Oleksandr&nbsp;Vizir.<\/p>\n<p>Firstly, it is necessary to reduce the population threshold to establish a&nbsp;central procurement organi\u00adzation (CPO), or to use the existing CPOs. Currently, only hromadas (<em>Ukrainian for \u201ccommu\u00adnities\u201d<\/em>) with a&nbsp;population of over 1&nbsp;million residents can do this, and therefore most hromadas cannot use this framework. Another possi\u00adbility would be for associ\u00ada\u00adtions of munic\u00adi\u00adpal\u00adities to have one central purchasing organisation.<\/p>\n<p>Secondly, commu\u00adnities must be allowed to create their own balancing group and join another, so that they can maximise the economic effect of these groups and use the available electricity resource to cover their own needs. It should also be possible for community entities to quickly move from one balancing group to another \u2014 in fact, the terri\u00adtorial hromada\u2019s party that is respon\u00adsible for the balance will be moving. Balancing groups can be formed within but also across communities.<\/p>\n<h3>Benefits and practical aspects of the energy transition at the communal&nbsp;level<\/h3>\n<p>The practical benefits that can be achieved for commu\u00adnities by using the active consumer model are&nbsp;diverse:<\/p>\n<ul>\n<li>Electricity can become 5\u201310% cheaper, if 20\u201330% of annual consumption is covered by the installed power&nbsp;units.<\/li>\n<li>Municipal owned entities can acquire electricity from one supplier though one entity. They can achieve signif\u00adicant economic benefits as prices will be lower for large volumes of electricity.<\/li>\n<li>Less bureau\u00adcracy and people involved in the proce\u00addures and better procurement specialists.<\/li>\n<li>Overcoming the bottleneck of financing RES-projects. Creation of investment possi\u00adbil\u00adities for business in communities.<\/li>\n<\/ul>\n<p>According to Andriy Martyniuk, who works on promoting renewable energy and imple\u00admenting RES in commu\u00adnities, the main motivation of municipal decision makers is the cost efficiency of using renew\u00adables and an alter\u00adnative energy supply in case of a&nbsp;black out. Since the beginning of the full-scale invasion, local author\u00adities signif\u00adi\u00adcantly changed the attitude towards renew\u00adables as they realised that they can be a&nbsp;back-up power source for critical infra\u00adstructure. At the same time, the payback period for the on-grid solar power plants in hospitals and water utilities is only around 3\u20135&nbsp;years.<\/p>\n<p>While working with munic\u00adi\u00adpal\u00adities some typical challenges should be&nbsp;considered:<\/p>\n<ul>\n<li>Lack of capac\u00adities and the need for training the staff respon\u00adsible for the mainte\u00adnance of power units and energy&nbsp;management.<\/li>\n<li>The condition of roofs, buildings, electrical wiring or water utility infra\u00adstructure can be a&nbsp;major limiting&nbsp;factor.<\/li>\n<li>It is unreal\u00adistic for MOEs to supply electricity to the grid under current regulations.<\/li>\n<li>Energy use schedules of hospitals, schools, kinder\u00adgartens, etc. do not coincide with the gener\u00adation schedules of solar power plants and installing storage capac\u00adities is not econom\u00adi\u00adcally advan\u00adta\u00adgeous. The main motivation for installing batteries is providing security of supply and stability of perfor\u00admance on cloudy&nbsp;days.<\/li>\n<\/ul>\n<p>Even though renewable energy started playing an important role in securing power supply since the energy system is under Russian attack, there is still a&nbsp;need for raising awareness and helping commu\u00adnities under\u00adstand the benefits of the green energy transition. High-quality calcu\u00adla\u00adtions and clear under\u00adstanding of the new regulatory framework might be helpful. It is also crucial that munic\u00adi\u00adpal\u00adities actively partic\u00adipate in obtaining financing outside or inside their community and develop a&nbsp;sense of&nbsp;ownership.<\/p>\n<p>The challenges listed above and the sugges\u00adtions for the regulatory framework are applicable for the municipal owned enter\u00adprises, while the situation in the residential sector is different. The classic feed-in-tariff (\u201cgreen tariff\u201d) remains much more attractive for residential consumers than the net billing scheme. And with very low prices for electricity there are currently no incen\u00adtives for self-consumption for residential consumers. The system is not functioning efficiently as it incen\u00adtivizes consumption in the peak hours thus increasing balancing costs and the system\u2019s peak load. Rouven Stubbe from Berlin Economics suggested that a&nbsp;<a href=\"https:\/\/www.lowcarbonukraine.com\/en\/law-of-ukraine-on-amendments-to-certain-laws-of-ukraine-regarding-the-restoration-and-green-transformation-of-the-energy-system-of-ukraine-n-9011-d-assessing-the-economics-of-prosumer-provi\/\" target=\"_blank\" rel=\"noopener\">solution would be to phase out residential subsidies gradually while supporting vulnerable house\u00adholds<\/a> (using independent support schemes, which offer a&nbsp;budget neutral way or budget positive way and are far fairer).[\/vc_column_text][vc_column_text]<\/p>\n<p><i>&nbsp;<\/i><\/p>\n<p><img class=\"alignnone wp-image-23921 size-full\" src=\"http:\/\/libmodredaktion.fra1.digitaloceanspaces.com\/wp-content\/uploads\/20240905145906\/textende.png\" alt=\"Textende\" width=\"40\" height=\"120\">[\/vc_column_text][vc_separator][vc_column_text]Did you like this article? 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Decen\u00adtralized energy can benefit commu\u00adnities through strength\u00adening their resilience and security, reducing electricity costs, and increasing invest\u00adments and local ownership. Since the Russian war of aggression, municipal owned enter\u00adprises and local ownership of renewable energy have become highly&nbsp;important.&nbsp;<\/p>\n","protected":false},"author":10,"featured_media":61880,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"wp_typography_post_enhancements_disabled":false,"mc4wp_mailchimp_campaign":[],"footnotes":""},"categories":[14789],"tags":[2987,2877,10657],"class_list":["post-61873","post","type-post","status-publish","format-standard","has-post-thumbnail","category-event","tag-current","tag-eastern-europe","tag-ukraine-en"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v27.6 (Yoast SEO v27.9) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Green Energy Transition in Ukraine: Communal Level - libmod.de - Zentrum Liberale Moderne<\/title>\n<meta name=\"description\" content=\"On February 28th LibMod organised a workshop on the Green energy transition in Ukrainian communities to discuss current legislative frameworks and practical local experiences of small distributed generation in municipalities with lawmakers and experts from Ukraine and the EU. 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Since the Russian war of aggression, municipal owned enterprises and local ownership of renewable energy have become highly important.\" \/>\n<meta name=\"twitter:creator\" content=\"@liberalemoderne\" \/>\n<meta name=\"twitter:site\" content=\"@liberalemoderne\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"\u200b\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"9 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/libmod.de\\\/en\\\/green-energy-transition-in-ukraine-communal-level\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/libmod.de\\\/en\\\/green-energy-transition-in-ukraine-communal-level\\\/\"},\"author\":{\"name\":\"\u200b\",\"@id\":\"https:\\\/\\\/libmod.de\\\/#\\\/schema\\\/person\\\/1d9e50b59b21b878f81b8df9ba1a3a31\"},\"headline\":\"Green Energy Transition in Ukraine: Communal&nbsp;Level\",\"datePublished\":\"2024-03-13T11:27:27+00:00\",\"dateModified\":\"2024-03-19T14:10:02+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/libmod.de\\\/en\\\/green-energy-transition-in-ukraine-communal-level\\\/\"},\"wordCount\":1505,\"publisher\":{\"@id\":\"https:\\\/\\\/libmod.de\\\/#organization\"},\"image\":{\"@id\":\"https:\\\/\\\/libmod.de\\\/en\\\/green-energy-transition-in-ukraine-communal-level\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/libmodredaktion.fra1.digitaloceanspaces.com\\\/wp-content\\\/uploads\\\/20240905111227\\\/grueneEnergiewende_800.jpg\",\"keywords\":[\"current\",\"Eastern Europe\",\"Ukraine\"],\"articleSection\":[\"Event\u2003\"],\"inLanguage\":\"en-US\"},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/libmod.de\\\/en\\\/green-energy-transition-in-ukraine-communal-level\\\/\",\"url\":\"https:\\\/\\\/libmod.de\\\/en\\\/green-energy-transition-in-ukraine-communal-level\\\/\",\"name\":\"Green Energy Transition in Ukraine: Communal Level - libmod.de - Zentrum Liberale Moderne\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/libmod.de\\\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\\\/\\\/libmod.de\\\/en\\\/green-energy-transition-in-ukraine-communal-level\\\/#primaryimage\"},\"image\":{\"@id\":\"https:\\\/\\\/libmod.de\\\/en\\\/green-energy-transition-in-ukraine-communal-level\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/libmodredaktion.fra1.digitaloceanspaces.com\\\/wp-content\\\/uploads\\\/20240905111227\\\/grueneEnergiewende_800.jpg\",\"datePublished\":\"2024-03-13T11:27:27+00:00\",\"dateModified\":\"2024-03-19T14:10:02+00:00\",\"description\":\"On February 28th LibMod organised a workshop on the Green energy transition in Ukrainian communities to discuss current legislative frameworks and practical local experiences of small distributed generation in municipalities with lawmakers and experts from Ukraine and the EU. 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