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US, Ukraine sign $522 mn memorandum to bolster Ukraine’s energy system resilience

Subject to the availability of funds, the US intends to supply Ukraine with additional $100 mn in aid, provided that Ukraine fulfills the relevant requirements.
Credit: UNIAN
US, Ukraine sign $522 mn memorandum to bolster Ukraine’s energy system resilience

The United States and Ukraine have signed a Memorandum of Understanding (MoU) concerning cooperation to bolster the resilience of Ukraine’s energy system, including a fund of $522 million, $100 million of which is contingent upon meeting certain conditions. The US Embassy in Ukraine made the announcement.

This agreement envisages cooperation to enhance the resilience of Ukraine’s energy sector, notably through rehabilitating critical infrastructure, embracing distributed generation, reforming the energy sector, and facilitating Ukraine’s post-war transition to a low-carbon, competitive, and EU-integrated energy economy.

The pathways delineated within the memorandum comprise:

● Restoration of Ukraine’s damaged electricity, heating, and gas infrastructure, including the purchase and installation of main lines autotransformers.
● Strengthening the resilience of the power system through increased adequacy and flexibility, including improvement of resiliency to power disruptions in essential services sectors like heating, water, sanitation, transport, telecommunications, and health;
● Installation of distributed gas generation (including CCGT turbines of USA production);
● Expansion of distributed generation from renewable and other energy sources in the power and heat sectors;
● Strengthening of Ukraine’s physical interconnection with European gas and electricity networks;
● Development and implementation of energy sector reforms consistent with European Union acquis and in accordance with Ukraine’s Energy Community Treaty obligations;
● Civil nuclear energy cooperation;
● Protection of Ukraine’s most critical energy infrastructure, including but not limited to areas such as physical anti-drone and anti-missile defense, physical and cyber security as well as the identification of cross-sectoral interdependencies and implementation of mitigation measures to prevent cascading failures due to potential power supply disruption.

The memorandum underlines the broader objective of advancing Ukraine’s energy sector resilience while aligning with European energy frameworks, making strides towards a low-carbon energy economy.

Ukrenergo prepares for “any possible scenario” as Russian missile attack damages energy facilities

Subject to the availability of funds, the Government of the United States of America intends to provide an additional USD 100 million in energy-related assistance to Ukraine provided that the relevant Ukrainian authorities make reasonable efforts to implement the following::

  • Approve the new charter and establish the Supervisory Board of the Gas TSO of Ukraine LLC – by October 30, 2023;
  • Show progress in the implementation of SE NNEGC Energoatom corporatization plan;
  • The National Energy and Utilities Regulatory Commission establishes the procedure, scope, extent, and frequency of submission of information on the trading in wholesale energy products related to the REMIT legislation by 1 April 2024.

To effectuate the agreement, a Steering Committee will be established, featuring representatives from the Ministry of Energy, the Ministry for Communities, Territories and Infrastructure Development of Ukraine, the National Energy and Utilities Regulatory Commission, the State Nuclear Regulatory Inspectorate of Ukraine, and the American side, representatives from the State Department, Department of Energy, and the US Agency for International Development. This committee is set to conduct quarterly meetings to assess the progress made. Although the memorandum is not a binding agreement, it sets the stage for structured cooperation, benchmarks for reform, and regular assessment within the energy sector.

During the full-scale invasion of Ukraine, Russian forces launched over 1,200 missiles and kamikaze drones to degrade Ukraine’s critical civilian infrastructure, particularly the energy system, Ukraine’s state-owned electricity transmission system operator Ukrenergo reported on 8 April 2023.

Around 250 Russian missiles and drones hit their targets, and 43% of the main power grids were damaged, according to Ukrenergo. All thermal and hydroelectric power plants in Ukraine were shelled and damaged.

British and Ukrainian intelligence agencies have warned that Russia will likely resume attacks on Ukraine’s energy infrastructure with the onset of cold weather.

On 21 September, Russian troops attacked an energy facility in Rivne Oblast in northwestern Ukraine, causing a partial blackout in the region.

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