The mining and metallurgical company “ArcelorMittal Kryvyi Rih” is facing serious issues with electricity supply, which was procured under import contracts with European countries. The reason for this is the regular shelling and damage to distribution networks, which complicate the delivery of energy resources for the company’s production needs.
This is reported by Finway
Impact of the Energy Crisis on AMKR’s Production
AMKR’s Director of Government Relations Oleg Krykavskyi noted that the government has significantly increased the requirement for the level of electricity imports for enterprises: currently, 90% of the company’s required volume must be imported. However, these import contracts are made for very short terms—only one day in advance. It often happens that the purchased electricity cannot be delivered to the enterprise due to damage to the networks. In such cases, traders are forced to sell resources on the market at a zero price, leading to direct financial losses and forcing the company to reduce production volumes.
“There is a government decision regarding the increased percentage of electricity imports (for companies that want to avoid electricity outages – ed.). Now, enterprises must import up to 90%. This rate has fluctuated depending on the situation. We also understand this. At different times, it was 80%, then 60%, now 90%. The problem is that these are very short import contracts—one day in advance. Moreover, sometimes you buy electricity, but the next day there is no possibility to import it to the enterprise. There have been several cases where we did not receive this resource, and our trader sold it on the market for 0 UAH. Not only did we buy electricity, not receive it, and were forced to reduce production, but we also incurred direct losses,” he said.
According to Oleg Krykavskyi, when the enterprise operates at half of its capacity, its electricity consumption is 230-250 MW/h. However, due to the electricity shortage, limits were set at the level of 70 MW/h, which forced the company to seek additional opportunities for imports, although due to strikes on the network, it was not always possible to receive the purchased electricity. Such cases occurred even in January of this year.
Electricity Shortage and Market Prospects
AMKR is negotiating with the government to improve the conditions for electricity imports and transition to long-term contracts, which are more advantageous and stable from a financial perspective. However, according to Krykavskyi, European suppliers are not in a hurry to sell cheaper base electricity for the long term, preferring short-term contracts with higher prices.
Additionally, the company plans to develop its own generation, but notes that it is currently impossible to install capacities at the level of 250 MW to fully meet production needs.
According to the National Bank of Ukraine, the electricity shortage that arose in the country in December 2025 – January 2026 was the highest since the beginning of the large-scale aggression of the Russian Federation. In the fourth quarter of 2025, the deficit reached 7% (previously forecasted at 4%), and for the first quarter of 2026, the estimate increased from 6% to 12%. The average annual electricity deficit for the current year has been raised from 3.3% to 6%. The main reasons are the increased intensity of Russian shelling and unusually low temperatures.