The renewable energy business in Ukraine:
photovoltaic, wind, hydroelectric and biomass.
The phases in which the firm offers consultancy in Ukraine in relation to what is in question:
1) identification of the contract, land or lot that the foreign company in Ukraine intends to win via notification from the company itself or via market research by the Firm;
2) Due Diligence. It is essential to have a clear picture of the parties and whether there are risks underlying the deal;
3) initiation of contacts and negotiations;
4) contract proposal. In this case, if the contract due to its amount or specificity is of high value or requires varied workers, it is advisable to create an "AI" (business association) in Ukraine or, create it in Italy and transfer it to Ukraine;
5) bilingual procurement contract, signed by a lawyer qualified in an Italian court and one in Ukraine and registered by a notary. Being authorized in both states, the firm is able to assist one or both parties;
6) registration of the company or "AI" in Ukraine for works whose estimated duration is more than three months, with opening of a bank account, and keeping of accounts in Ukraine;
7) support in every area before the "central commission of Ukraine".
It should be noted that the firm is recognized as a leader in the sector in this regard.
In 2019 alone, the country will complete the installation of 86 utility systems. If everyone is connected to the grid, 488MW will be added to the photovoltaic power installed in Eastern Europe. The continuous environmental problems and increase in the costs of energy sources such as oil and gas are pushing Ukrainian energy policy towards energy diversification, through massive investments in the renewable energy program; Ukraine is making its energy needs independent and making its national energy market more reliable. The 2018/2017 development plan provides for the total economic independence of Ukraine from an energy point of view and this can happen exclusively with renewable energy.
The announcement to convert the area affected by the Chernobyl disaster into a 1000MW plant became the spark for the development of renewables: international investors from the United States of America, Canada, China and Germany became interested in the project and the market Ukrainian. At the moment, Ukraine has an incentive tariff system which remunerates the energy produced by plants connected in 2016 at €0.1599/kWh, €0.1502/kWh for plants connected between 2017 and 2019. Upon completion of the investments started in 2017, Ukraine will be able to overcome the GW barrier. According to IRENA (International Renewable Energy Agency), Ukraine could produce 21.8% of its needs thanks to renewable energy. Through the promotion of investments in high energy efficiency technologies, the program will support Ukraine in the gradual process of reducing overall energy needs and in the dissemination of projects for the extension of environmental protection. This programmatic design is the natural continuation of the Ukrainian Energy Efficiency Program (UKEEP), which in the period 2007-2013 financed 77 energy efficiency projects throughout the country through five financial intermediaries. Raiffeisen Bank Aval, the EBRD's financial partner in Ukraine, was the first bank to join the new "framework programme".
Wind energy.
The intention behind the Ukrainian energy plan is to implement the share of energy supplied by wind, bringing it to 2.28 GW by 2020. To fully understand the dimensions of the plan, just focus your attention on the analysis that would be a growth of 500% compared to the current 410 MW that Ukraine can count on. The greatest wind energy potential is located in the large areas adjacent to the Black Sea and the Azov Sea, in the Carpathian, Transcarpathian and Lower Carpathian areas. Not just wind power, however, given that Kiev's energy plan focuses decisively on all renewable sources, so as to make the country less and less dependent on foreign supplies. The investments needed to complete the ambitious energy plan are four billion euros. Once Ukraine reaches 11% renewable energy in the energy mix in 2020, natural gas consumption will be reduced by 50%.
Hydroelectric energy.
This resource is fundamental in the country: there are six large hydroelectric power plants located on the Dnieper river and the presence of 55 smaller units located on other rivers. The total water potential is estimated at more than 20 TWh.
Solar power.
The attractiveness factors for foreign and national investors could increase in the last part of 2017. Almost every week there are new projects and contracts regarding solar energy plants to be built that attract foreign investments.
The advantages offered by photovoltaics in Ukraine.
There are three essential factors: the "green tariffs", the extremely favorable geographical position and the internal rate of return, the IRR rate.
The Ukrainian state is among the few European countries to operate through "green tariffs", that is, it purchases all the electricity produced by photovoltaic systems. This commitment is constant at least until the year 2030. It is essential, when we analyze the "green tariffs" plan, to consider that the program is linked to the European currency. The "green tariffs" are established in Euros and this makes it extremely interesting to focus on this project. In Ukraine, the legislation does not provide for the payment of customs duties and exemption from VAT on equipment imported for the production of renewable energy. Ukraine is geographically located in a climatic zone that is very favorable for investments in photovoltaic energy. The country's latitude allows for many "sunny" days between early spring and until late autumn. According to the "irradiance calculation", the amount of solar radiation per unit of surface area, Ukraine far exceeds the recognized leading nation in Europe for solar energy: Germany. The current "green tariff rate" combined with the increasingly decreasing cost of photovoltaic systems, thanks to scientific and technological research, provides interesting opportunities for foreign investors.
In the country, those who decide to invest in solar energy receive the contribution of advantageous bank loans that provide an internal rate of return that exceeds 20%, a very high average value if compared, for example, with the United States or with Western Europe, where the rate stops at a maximum of 10%.
Total investments in renewable energy worldwide amounted to $313 billion in 2016, almost 20% of total energy spending in 2015; Renewable energies thus now represent the largest source of energy investment. Ukrainian institutions are determined to publicize the “green tariffs” program as a way to stimulate production and investment in alternative energy, particularly photovoltaic energy.
Biomass and biogas.
According to the Energy Industry Research Center, biomass and biogas are among the most promising forms of renewable energy for Ukraine and can help replace the natural gas used by the nation's 24,000 boilers.
Vadym Glamazdin, CEO of the Center, explained that Ukraine is looking for strategic partnerships with especially European companies, even if potential partners have not yet been identified.
All to free itself from those 115 million cubic meters that Ukraine imported with advance payments for supplies.
In Ukraine, energy economic stability is also linked to ecological claims.
With the transformation of Ukrainian energy into green energy, projects will also be promoted to facilitate the action of small and medium-sized businesses, new jobs will be created and the problem of waste disposal will be addressed. "Clean" energy could change the face of Ukraine and attract numerous investors to the country, generating numerous opportunities also for Italian companies.
The firm boasts proven and in-depth experience in the fields on the subject of business and procurement for the construction and maintenance of alternative energy plants in Ukraine; provided assistance and consultancy in 2018 for nine projects for the construction or transformation and maintenance of renewable energy plants. If necessary, the firm is able to assist the community and common law client, turnkey, regarding contracts in any sector, also with the aid of the search for financial instruments of participation such as financing, credit and contributions, research of members or business association formations.