With Ukraine fighting for energy independence from Russia, which has been waging war against the nation since 2014, the country is looking for alternative sources.
- US coal in Ukraine
The first-ever load of U.S.-produced anthracite coal was delivered to Ukraine in September. Pennsylvania-based XCoal Energy and Resources and Ukrainian state energy company Centerenergo signed a 700,000-ton deal of anthracite coal, following talks between Ukrainian President Petro Poroshenko and U. S. President Donald Trump’s administration in June.
But Russia still remains to be the main exporter of coal to Ukraine, according to Ukraine’s State Fiscal Service.
In February activists blocked railway wagons that carried coal from Russian-occupied territories in the Donbas.(Volodymyr Petrov)
- US liquefied natural gas
Ukraine is also looking into liquefied natural gas. It has been more than two years since Ukraine stopped buying gas from Russian state-owned Gazprom. In December, the U.S. delivered its first load of liquefied natural gas to Ukraine through Poland.
Earlier this year, ERU Trading LLC, a Ukrainian subsidiary of ERU Corporation USA, signed a 20-year contract for political risk insurance with the U. S. Overseas Private Investment Corporation. This support allows ERU Trading to supply 135 million cubic meters of liquefied gas to UkrTransGaz, a subsidiary of state-owned monopoly Naftogaz, over the next seven months.
ERU is the only private supplier alongside Naftogaz. According to UkrTransGaz, gas imports went up by almost 40 percent this year to some 14 million cubic meters. The main suppliers are Slovakia, Hungary and Poland.
Several European gas traders also entered the Ukrainian market this year — Swiss companies DufEnergy, MET Holding AG, Petroforce, French ENGIE, and Netherlands-registered Trafigura.
- Boosting renewable energy
Ukraine remains weak in its use of renewable sources of energy, which supply only 1.6 percent of the country’s energy. This year OPIC approved $150 million in financing and $250 million in political risk insurance for EuroCape Ukraine LLC, an international onshore renewable wind energy group, to build a large wind farm in Zaporizhzhya.
Once built, the farm will increase the country’s capacity to generate wind energy by 40 percent. General Electric will supply 62 wind turbines for the project.
- Westinghouse moves in
In addition to renewables, Westinghouse Electric Sweden expanded its cooperation with Ukraine’s state nuclear energy company Energoatom.
The company will supply nuclear fuel to six Ukrainian reactors until 2020 and will provide safety systems for four more reactors for the Zaporizhzhya nuclear power plant. Nuclear energy supplies about 50 percent of the nation’s electricity.
- Privatization
Ukraine’s depreciating state-owned energy enterprises will do much better if they are in the hands of private companies. That’s only if they are not in the hands of oligarchs. Following the requirements of the International Monetary Fund lending program, Ukraine’s government started the privatization of electricity distribution companies called oblenergos.
But in mid-August, the State Property Fund sold 25 percent state-owned stakes of five oblenergoes to Ukraine’s richest man Rinat Akhmetov who already had a majority stake in the companies through his DTEK Holding shares.
Now Akhmetov is the sole owner of 20 percent of Ukraine’s oblenergos, a step backwards for a country that is trying to achieve fair competition. Next year six more oblenergos will be put on sale as well as the majority stake of Centerenergo.
Ukraine is still not producing enough energy to be self-sufficient and lags in renewable energy, which provides only 1.6 percent of supply. (Ministry of Energy and Coal of Ukraine)
