Russian War Against Ukraine: Energy Dimension | DiXi Group Alert – weekly review

July 3 – 9

Summary

— On July 7, the roof of the boiler and turbine shop collapsed at the Kurakhivska TPP in the Donetsk region, which had been repeatedly shelled by the enemy. The staff had to shut down the power units, 3 people were killed and 3 injured.
— According to the National Resistance Centre, the coal industry in the occupied Donetsk region is under threat. Most enterprises have huge wage arrears, a critical drop in production, a permanent process of staff reduction, and a critical situation with fixed assets and equipment.
— On July 4, the Armed Forces of Ukraine reported that objects resembling explosive devices had been placed on the outer roof of units 3 and 4 of the Zaporizhzhia NPP. Their detonation is not expected to damage the power units, but could create a “picture” of shelling from Ukraine. Defense intelligence noted that the occupiers continued to mine the ZNPP facilities and territory.
— The occupiers’ refusal to put the ZNPP Unit 5 into a cold shutdown state could lead to an accident and a large-scale radiation release – so Energoatom. During the week, ZNPP lost power supply from the main 750 kV line.
— The rise in daily temperatures spurred additional load in the power system (esp. in peak hours, 16:00-23:00). On July 6 at 16:00, the highest electricity consumption was recorded (7% higher than the hottest day of 2022). Ukrenergo urged consumers to transfer the use of air
conditioners and powerful appliances from the evening hours to other times of the day or at night, and not to turn on several powerful devices.
— After the introduction of new increased price caps from June 30, prices on the day-ahead market of electricity have become more volatile. The Base DAM index was 3,338.7 UAH/MWh (+16% week-on-week), while the weighted average daily price varied at 2,343.0-3,966.1
UAH/MWh.
— Physical imports from the EU countries increase to 91.2 mcm, which is 68% more than in the previous week. The significant part of imports (64.4 mcm) were performed in the “customs warehouse” regime, of which 61.5 mcm – in the short-haul mode. A virtual reverse flow was also carried out: 31.8 mcm – in the Moldova direction and 6.6 mcm – in the Slovak one.
— Natural gas trading at the Ukrainian Energy Exchange (UEEX) dropped 12 times week-onweek. Also, price differentiation by gas buyers emerged: Naftogaz and GTSOU purchased the resource at app. 10.8 UAH/сm (without VAT), while private companies – at app. 12.3 UAH/сm. 
— Meanwhile, a draft law was submitted to the Verkhovna Rada which provides for the legal principles and conditions for customs clearance of biomethane transported by pipeline, and the Cabinet of Ministers published the previously approved Procedure for Maintaining the State
Registry of Special Subsoil Use Permits.
— The Antimonopoly Committee granted permission to Ukrnafta for concentration in the form of receiving under management more than 50% of the authorized capital in VK Ukrnaftoburinnia PrJSC, Sirius-1 LLC, Sakhalinske LLC and East Europe Petroleum LLC. The companies are associated with oligarchs Ihor Kolomoiskyi, Pavel Fuks and Vitalii Khomutynnik.
— The Ministry of Economy forecasted that in July the retail price of diesel fuel will increase by 5 UAH/l, and petroleum – by 7-8 UAH/l.
— According to the Deputy Prime Minister Oleksandr Kubrakov, preparatory works have begun on the construction of water mains to provide water supply to at least 1 million people from the Dnipropetrovsk, Zaporizhzhia, Mykolaiv and Kherson regions.
— The government allocated more than 6.6 billion UAH from the Fund for Liquidation of Armed Aggression Consequences for the reconstruction projects. Over 340 million UAH were allocated to restore facilities damaged and destroyed in the Mykolaiv region as a result of the Russian occupiers’ explosion of the Kakhovka HPP.
— Also, the Cabinet of Ministers decided to allocate about 5.3 billion UAH in subventions for the implementation of critical projects under the Ukraine Recovery Program with the EIB in 10 regionson. The government approved an additional 1.1 billion UAH allocation from the EIB for two projects for regional development and recovery.
— A project for the development of modern power distribution systems starts in the Zaporizhzhia region, following the memorandum on cooperation signed by the Ministry of Energy with EDF International Networks.