Current electricity market price caps pose serious risks to Ukraine's energy security for the upcoming winter period. According to experts from the Ukrainian National Committee of the International Chamber of Commerce (ICC Ukraine), existing limits could block the ability to attract necessary imports and stimulate dispatchable generation during critical deficit hours.
NEURC Draft and ICC Position
Amid preparations for the heating season, the National Energy and Utilities Regulatory Commission (NEURC) published a new draft resolution. The document proposes setting the maximum price cap on the day-ahead and intraday markets at 15,000 UAH/MWh. However, the expert community considers this threshold insufficient to fully cover market needs.
ICC Ukraine Vice President for Energy Oleksandr Trokhymets emphasized that in winter, electricity prices in neighboring European Union countries may exceed Ukraine's price ceiling. As a result, a paradoxical situation will arise: the physically scarce resource in Europe will be available, grid capacity will allow its transfer, but commercial imports will become impossible due to artificial domestic restrictions.
Threats to Gas Generation and Emergency Repairs
In addition to imports, rigid price caps undermine the prospects for the accelerated development of distributed gas generation. Such mini-power plants can quickly compensate for energy shortages, but the high cost of their operation under strict price regulation makes exploitation economically unfeasible.
ICC Ukraine is convinced that an optimal compromise would be raising the maximum price cap to 18,000 UAH/MWh. This does not mean an automatic scandalous rise in tariffs to this amount, but it will create a flexible market signal to attract emergency supplies and finance continuous repair work at critical infrastructure facilities affected by regular shelling.
