War and Energy: Weekly Review of Developments in Ukraine
A technical failure on the market after a strike on Market Operator's infrastructure underlined the vulnerability of market infrastructure, while regional deals, the EU and financial institutions added resources for generation and winter preparation.
Key developments of the week
- On 23 September, a strike on the infrastructure of JSC Market Operator caused a technical failure on the day-ahead and intraday markets. Trading on the intraday market was temporarily halted and technical support was unavailable; on the day-ahead market, the gate closure time had to be extended.
- Ukrgasvydobuvannya plans to invest about USD 30.7 million in its first geothermal power plant, in Solotvyno, with 5 MW of electrical and 20 MW of thermal capacity. The technology could later be scaled up in the Carpathian region.
- Turkey's ASTOR Enerji signed a memorandum with the Kyiv Regional Military Administration on establishing regional production of energy storage systems, battery solutions, transformers and other electrical equipment.
- Following the Carpathian Eight summit, Naftogaz, Ukrnafta and ORLEN concluded two memoranda. They cover the supply of three LNG cargoes to Ukraine in the first quarter of 2027, potential oil product supplies worth up to USD 500 million, and exploring the refining of Ukrainian crude at Central European refineries.
- The government extended the main gas PSO mechanisms until 31 March 2027. Preferential prices remain in place for households, heat producers (TKE), budget-funded and religious institutions, certain new electricity producers and gas distribution operators, as does the treasury mechanism for distributing TKE funds.
- The Council of the EU approved the eighth tranche for Ukraine of almost EUR 3 billion after 10 target steps were met, including energy-sector reforms. Total financing under the Ukraine Facility will exceed EUR 32 billion.
- According to Energy Minister Denys Shmyhal, Ukraine plans to mobilise more than EUR 400 million for the Energy Support Fund by the end of 2026. The money will be used to buy equipment, carry out repairs and rebuild a more resilient, decentralised energy system.
- The IFC plans to provide Elementum Energy with up to EUR 60 million to build two wind farms with a combined capacity of 257.6 MW. With other lenders, the total facility could reach EUR 250 million. Financing for a 10 MW / 20 MWh battery storage system is also under consideration.