The Ministry of Energy has proposed to the Ukrainian government to implement a new mechanism for non-household consumers — the ability to enter into direct electricity purchase agreements with producers. This step aims to provide enterprises with stable electricity supplies and give producers the opportunity to build new capacities near consumers, thereby creating conditions for the development of local generation.
This is reported by Finway
PPA Contracts: New Opportunities for Business
The PPA (Power Purchase Agreement) contracts proposed by the Ministry of Energy allow for long-term agreements between producers and businesses, bypassing intermediaries. This will promote price predictability for enterprises, enhance energy stability in regions, and reduce the burden on the national energy system.
“We are starting the implementation of PPA contracts (Power Purchase Agreement). These are direct electricity purchase and sale agreements made directly between the electricity producer and the consumer,” wrote Shmyhal.
New Incentives for the Development of Local Generation
The Ministry of Energy has already submitted changes to the legislation for government consideration that will allow such direct contracts. Additionally, the ministry is initiating the introduction of incentives — during periods of power shortages in the country, enterprises that provide at least 60% of their own consumption from distributed generation sources will not be subject to supply restrictions. This is expected to encourage businesses to invest in new gas piston and gas turbine installations, as well as stimulate the transition to local energy sources.
It is worth noting that last year, the National Commission for State Regulation in the Spheres of Energy and Public Utilities issued 335 new licenses for activities in energy markets. Of these, the largest number — 259, or 77.3% — were in the electricity sector.