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

Dear subscribers! Due to the suspension of funding for all US foreign assistance programmes for 90 days, the weekly review ‘Russian War Against Ukraine: Energy Dimension’, which used to be prepared within the framework of the USAID Energy Sector Transparency project, will be temporarily published in a limited format – as a summary of the main events in the sector.

At the same time, DiXi Group NGO has prepared a survey for subscribers to receive feedback on the priority thematic sections of the review that should be continued to be covered. This will allow the team to match the interests of readers with available resources and develop an optimal format for the weekly review during the period of suspension of USAID support.

We would like to thank our audience for their continued interest in the weekly review ‘Russia’s War on Ukraine: The Energy Dimension’. We would also like to assure you that we will continue to look for opportunities to develop this information and analytical product in order to meet the interest of our audience in a timely and high–quality manner.

Survey in English (for international readers)

March 3 – 9

On March 7, Russia carried out another massive missile and drone attack, targeting electricity and gas facilities in various regions of Ukraine. In total, the enemy launched 67 missiles of various types and 194 drones.
In the Poltava region, the attack resulted in the destruction of gas production facilities, which caused them to stop working. In the Ternopil region, a critical industrial facility was hit, causing a fire and a drop in pressure in the gas transmission network, and termination of gas supply to non-household consumers.
According to the Ministry of Energy, power supply was restored to 240,611 consumers over six days of the week (March 3–7 and 9).
“Ukraine has proves that Russia has not abandoned its plans to restart Zaporizhzhia NPP and illegally integrate it into the power system of the temporarily occupied territories” – Energy Minister Herman Halushchenko at the IAEA Board of Governors
meeting.
Orano and Energoatom signed a long–term commercial agreement on provision of nuclear fuel enrichment services until 2040.
400 thousand EUR will be allocated to investigate the damage to the New Safe Confinement (NSC) of the Chornobyl NPP from the administrative budget of the International Chornobyl Cooperation Account.
The government made a number of decisions aimed at accelerating the recovery of communities. In particular, UAH 5 billion has been allocated for 150 recovery projects in 12 regions. Another UAH 5.2 billion will be allocated to a pilot project for the comprehensive restoration of five settlements, including modernization of heat, gas, and water supply networks. In addition, the Cabinet of Ministers has adopted a decision that will allow the Asset Recovery and Management Agency (ARMA) to transfer more than UAH 1.8 billion of confiscated funds of sanctioned persons to rebuild Ukraine.
During the week, electricity consumption showed a downward trend due to rising temperatures and sunny weather in most regions of Ukraine. Ukraine resumed commercial electricity exports in the amount of 8.1 GWh. In turn, electricity imports
decreased by 21% to 67.5 GWh.
The monthly Base BCM (bilateral contracts market) index for March remained at 5,611.1 UAH /MWh (+3.6% compared to February).
The average hourly price of electricity on the day–ahead market (DAM Base index) over the week decreased to 5,049.3 UAH/MWh (–16.1%). The total volume of electricity sold on the Ukrainian DAM reduced to 610.5 GWh (–17.2%).
Ukrenergo received 14 applications for the tender for the construction of new generating facilities with a total capacity of 700 MW, including two applications from PJSC Ukrnafta (for projects in Cherkasy, Poltava and Lviv regions).
During the reporting week (March 2–8) physical imports of gas from Hungary amounted to 67 mcm (+1.5% WoW), 23.1 mcm were imported from Slovakia (–66.4%), and 25.1 mcm – from Poland (–31.5%).
As of March 8, 1.3 bcm of gas was accumulated in Ukrainian gas storage facilities (4.3% of the total storage volume), withdrawals amounting to 281.4 mcm (–22.7% compared to the previous week).
According to media reports, the Cabinet of Ministers plans to extend the public service obligation (PSO) for another year (until April 30, 2026) and oblige Ukrnafta to sell its gas to Naftogaz at a fixed price (7,420 UAH/tcm). The government also plans to increase PSO gas prices for electricity producers: for plants that produce electricity in the heat cycle – from 16,500 to 18,000 UAH/tcm, in the condensation cycle – from 10,950 to 16,000 UAH/tcm.
Australia made a contribution of EUR 6 million to the Ukraine Energy Support Fund.
The European Commission and the European Investment Bank (EIB) signed a guarantee agreement that will allow the EIB to invest at least EUR 2 billion in urgent recovery and reconstruction projects in Ukraine. The agreement was concluded within the framework of the Ukraine Facility.