Kyiv discloses cost estimates for backup heat and power network

Business

2 June, 01:13 PM

Kyiv is seeking government assistance to develop a backup heat and power supply network estimated to cost between $676 million and $1.3 billion, Kyiv Mayor Vitali Klitschko said in an interview on June 1.

“In total, more than UAH 60 billion ($1.3 billion) is required to build a backup heat and power supply network. We calculated the actual figures and reviewed whether it’s possible to purchase the necessary equipment to set up such a network. That figure came out to roughly UAH 30 billion ($676 million),” he said.

“Half will be paid for by the government, while Kyiv will shoulder the other half. We’re moving forward, constantly meeting with officials. We don’t want words; we want clear guarantees on which sites the government will oversee and whether they will be operational this winter,” the mayor added.

Klitschko noted that Kyiv has one of the largest centralized heating systems in Europe, emphasizing that it must be repaired within four months. He added that a backup network must also be set up in the event that the primary centralized system is destroyed.

“It’s a very difficult task to build a new, fully fledged, high-capacity cogeneration system in just a few months, but it needs to be done, and Kyiv is already implementing energy sustainability measures. However, this requires a lot of resources, particularly people – we’re in dire need of more people,” the Mayor said.

Klitschko stated that 70-80% of Kyiv’s budget goes towards salaries for medical workers, teachers, and utility workers. He added that the central government retains 60% of the Personal Income Tax (PIT), fails to compensate local communities for heat tariff differentials and subsidized transit costs, and seized UAH 8 billion from the city budget last year. Meaning the capital is financially incapable of building a backup heating and power supply system on its own.

“During the last Kyiv City Council meeting, we appealed to the Cabinet of Ministers and the Verkhovna Rada to formalize our agreements regarding financial support for the city's resilience plan. We hope the government will adhere to them,” he said.

“Incidentally, we have already provided UAH 1.25 billion ($28 million) to Ukraine’s Restoration Agency and have approached several financial institutions for funding. We’re now allocating more than UAH 15 billion ($338 million) for Kyiv’s heating system and its repair in preparation for the next heating season,” the mayor clarified.

Ukraine’s Energy Minister Denys Shmyhal earlier reported that the Darnytsia Thermal Power Plant had sustained significant damage, noting that its restoration would require considerable time.

Klitschko announced on Feb. 11 that it will be impossible to replace Kyiv’s centralized heating system with localized sources or cogeneration plants, adding that the infrastructure still requires extensive repairs.

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