In recent years, renewable energy sources have been actively built in Ukraine. The issue of creating energy storage systems was relevant, the relevant law was adopted, but the war destroyed a significant part of the "green producers". So does Ukraine still need energy storage? Will the issue of creating and developing energy storage systems be relevant during the post-war recovery of Ukraine? Will the adopted draft law 5436-d contribute to attracting investments? What market and investment volume can we talk about?
The energy storage system (according to the Law 2019-VIII), or energy storage installation (according to the Law 2046-IX) is already relevant "for yesterday", and even more so will be relevant "tomorrow"! In the future - ESI (energy storage installation).
In the legislation of Ukraine there were two concepts: consumption and generation, but the ESI works both for consumption and generation, so legally it was not possible to use the ESI as a separate object. For example, DTEK was the first to launch an industrial ESI in Ukraine (https://dtek.com/ru/media-center/news/dtek-zapustil-pervuyu-v-ukraine-promyshlennuyu-sistemu-nakopleniya-energii/), but in order not to violate the law, it was launched not as a separate facility, but as part of Zaporizhzhia TPP. Therefore, the state has amended the legislation so that investors can implement such projects.
Does the state need it? Definitely YES!
In the development plans of the transmission system operator (Ukrenergo) for 2022-2031, one of the requirements for the integration of the Ukraine Power System into ENTSO-E is to provide the necessary amount of primary frequency control. This is approximately 160 MW in 2023. According to the target development scenario, the system-wide measures to increase the maneuverability of the Ukraine Power System envisage the construction of 1 GW of highly maneuverable capacities with quick start (by 2027) and 0.5 GW of power and frequency control systems (by 2026). It should be noted that the ESI can be used both for frequency control and for highly maneuverable capacities! That is, the need to implement the ESI is related both to the requirements for integration with ENTSO-E and to improving the reliability of the Ukraine Power System as a whole.
Do investors need it? It's simple: if it is economically feasible, yes.
Let's understand:
1. The owners of SPPs or WPPs, according to the new legislative changes, can install ESIs at their facilities, but they will not do it! It is economically inexpedient: 15 years of payback, while in 5 years it is necessary to replace part of the ESI equipment. The state needs to set an additional tariff for existing or prospective renewable energy facilities in case of using the ESI. Then the market will work!
2. To use ESI to buy cheap electricity at night with subsequent resale in the morning, when the cost of electricity is maximum? Technically it is possible, but the payback period of 20 years speaks for itself. This market will work under two factors: the price of electricity in Ukraine will rise and/or the cost of the ESI will fall.
3. Maneuvering capacities? Very necessary for the state, but currently there are no state financial mechanisms to attract investors.
4. ESI as frequency regulation? This market is ready to start working. There are already auctions, tariffs are set and there is a great technical need for the Ukraine Power System. But there are several "buts". First, it is necessary that the amendments to the Distribution System Code and the Transmission System Code and other bylaws "work". Secondly, the war does not allow attracting investors. If we take the weighted average cost of construction of 1 MW of ESI for 1 million USD and the above mentioned prospects of development of the IPS of Ukraine, we can talk about investments of at least 2 billion USD, which will help the state to create a reliable IPS of Ukraine, meet the technical requirements of the European Union and further develop the RES market. prednisone 20 mg
In my opinion, as soon as the state creates all legal, technical and, most importantly, economic mechanisms, the market will begin to develop even during the war!
