Ukrainian parliament approves FiT cuts for renewables

The Ukrainian parliament has approved in the first reading a draft law on feed-in-tariff (FiTs) reductions for renewable power production with 268 votes in favour, Kiev-based law firm Integrites said.

The substance of the draft law, which also regulates auctions and state guarantees protecting investment in renewables, is based on the memorandum of understanding (MoU) signed by the Ukrainian government and local renewable energy associations in June.

The European-Ukrainian Energy Agency (EUEA) and the Ukrainian Wind Energy Association (UWEA), acting as representatives of renewable power producers, agreed to accept FiT cuts ranging from 15% to 7.5% for solar and wind farms, respectively, built in 2015-2019, and 2.5% for both type of plants commissioned after January 1, 2020.

The decision by the renewables associations to accept lower FiTs was not widely accepted among the membership, but a number of power producers did not have a choice at the time, the EUEA then said.

State enterprise Guaranteed Buyer, which acquires renewable power from the producers, almost suspended payments between March and May during the coronavirus crisis. Many producers were unable to go through years worth of arbitration to collect compensation because the process would bankrupt them, according to the EUEA.

Under the terms of the MoU, the state authorities assumed the outstanding debt of the Guaranteed Buyer, committing to repay the receivables and resume regular payment for power production.

The latest draft law specifies that the FiT scheme will not be changed or canceled until December 31, 2029, Integrites said.

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