Russia’s gas blackmail and the energy crisis caused by the Kremlin are forcing European countriesto look for a variety of solutions – from creative ideas on how to save electricity now, to drawingup plans in case of blackouts in winter, Ukrenergo CEO Volodymyr Kudrytskyi told NV on Aug. 16 inthe commentary published below.
Germany’s capital Berlin has turned off the lighting of several architectural monuments since last week: the most beautiful places in Berlin remain unlit in the evening, the list including more than a dozen monuments, including the symbolic Victory Column.
Prior to that, municipal pools in Germany have already disconnected from hot water supplies.
These are only the first steps, because due to the reduction of Russian gas supplies, Germany needs to reduce electricity consumption by 20%.
European supermarkets are reducing their opening hours to use less electricity. Spain and Italy have introduced restrictions on the temperature of air conditioners in municipal buildings, while Paris has introduced fines for shops that leave their doors open while air conditioners are on.
The UK is already planning how to cope with blackouts for several days in January 2023 if gas shortages coincide with cold weather.
At the same time, German Chancellor Olaf Scholz for the first time publicly supported the continuation of the operation of three German nuclear power plants, which were to be closed by the end of the year.
Russian aggression in Ukraine has destroyed not only the international security order by unleashing war in Ukraine, but has already disrupted the normal life of citizens in countries where there is no war. Businesses are preparing for layoffs and production cuts, while households are preparing for winter with indoor temperatures of 16 degrees.
But Russia’s hopes to intimidate all of Europe by turning on the gas tap will not come true. Its blackmail will fail, just as its hopes for an easy capture of Ukraine did.
On Feb. 24, 2022, the day the war began, the Ukrainian power system was disconnected from the power systems of Russia and Belarus, and all of Ukraine was to have been plunged into darkness simultaneously, with the fall of Kyiv in three days. Later, the Russians were supposed to come, restore the connection of the Ukrainian energy system to Russia and appear to be saviors.
But the reality turned out to be different – Ukraine has been steadily repelling the Russian attack for almost six months, while the Ukrainian energy system has been synchronized with the European one and the export of Ukrainian electricity to Europe resumed on June 30.
The test of isolation that was successfully passed during a full-scale war contributed to the quick decision of the European Union and the European Network of Transmission System Operators for Electricity (ENTSO-E) to synchronize Ukraine’s energy system with the system of continental Europe. The Ukrainian and European energy systems were synchronized on March 16, 2022, and have been working together ever since.
Europe has come to believe that we are energetically resilient and that Ukraine is a reliable partner. And now we have someone to ask for imports or emergency aid in case the Russians attack our energy infrastructure.
But so far, we are not asking for help, but helping the EU ourselves. The synchronization of energy systems made it possible to start the export of electricity. And this gave an impressive result: 8-11 bidders come to the auctions for access to the interstate crossing, the price offered by the winner in each hour exceeds the records of previous years by several times. The Ukrenergo company has already earned over UAH 1 billion ($27.3 million) for the state.
And this is the result of exporting only 250 MW. Together with our Polish colleagues, we have recently started the restoration of the interstate line to Poland, which will help increase the export of electricity from Ukraine to 1,000 MW.
All this is the result of working under transparent European rules – all market participants compete openly on equal terms. And this transparent work allows us to help replace toxic Russian gas with Ukrainian electricity, most of which is produced without a carbon footprint, and earn money for the state at the same time. Our profits from auctions are so high, because due to the energy crisis, the price of electricity in Europe is three to five times higher than in Ukraine.
This is money Ukraine needs to prepare for the heating season. And it will be spent on power unit repairs and network modernization before winter, the purchase of equipment and repairing materials, and on fuel. According to the government’s decision, Ukrenergo also finances the purchase of strategic coal reserves for the country.
Working under European rules allows us to be a full partner for the EU, not a beggar. To earn money in honest cooperation, and not ask for help. To contribute to gas savings agreed upon by all EU countries. Ukrainian electricity can replace 5 billion cubic meters of gas in Europe. After all, a lot of electricity in the EU is produced from gas, and it is precisely these capacities that the Europeans will replace.
This partnership cooperation is possible only if the achievements of energy market reforms are preserved and continued under all European rules. It is very important that proposals to “ditch market rules because of the war” don’t stand a chance. Because any departure from the standards of transparency and competition will mean the suspension of integration and the loss of potential revenues from exports, which Ukraine needs in the current situation. It will not be possible to “blame” reforms for this. And here our energy system will come in handy. Europeans will not give in to blackmail and are ready to save gas, and will also not compromise on security issues.