DTEK
DTEK
DTEK is a largest private energy company in Ukraine that is engaged in thermal power generation, renewables, mining, oil and gas production, electricity distribution and supply, energy trading, energy efficiency and energy innovation projects.
ID: 17429897118-54
Lobbying Activity
Meeting with Kadri Simson (Commissioner)
15 Jan 2023 · Support for energy infrastructure and equipment in Ukraine.
Meeting with Ditte Juul-Joergensen (Director-General Energy)
14 Jan 2023 · Energy Security
Meeting with Thor-Sten Vertmann (Cabinet of Commissioner Kadri Simson)
14 Jun 2022 · To discuss an initiative of building 30 GW of renewable energy capacities in Ukraine to supply renewable electricity to the EU to contribute to both energy resilience and climate goals.
Response to Gas Storage
20 May 2022
Being a leading Ukrainian energy utility company, DTEK is unequivocally committed to achieve carbon neutrality by 2040 and strongly advocates decreasing the dependence on fossil fuels within the shortest possible period of time. We would also appeal to European and global energy companies to stop any dealings with the russian energy sector that channels money into support the outrageous war against Ukraine.
Ukraine proves on daily basis its capacity to maintain the resilient operation of its energy system despite direct and indirect military aggression against critical energy infrastructure. This ability can enable the Ukrainian energy sector to contribute to security of energy, specifically of gas supplies in Europe. DTEK also strongly supports the engagement of all Contracting Parties of the Energy Community and the Secretariat of the Energy Community in the process of securing the EU’s gas supplies. We believe that it is both tactically and strategically important to cement the progress already achieved in gas markets integration and to advance it further in order to integrate the gas markets of the Energy Community Contracting Parties, including Ukraine, with that of the EU.
On market principles. We support the principles defined in the recital (15) of the proposed draft Regulation to secure the competitive and effectively functioning of the internal gas market of the EU. We support the extension of open energy borders, as outlined in recital (16), outside of the EU to include the Contracting parties of the Energy Community. DTEK is grateful for the ongoing support by the European Commission and the Energy Community Secretariat in integrating gas markets and securing gas supplies in the region, and believes that an explicit reference to the Energy Community in a relevant recital to the proposed regulation supports this process.
On filling target and filling trajectory (Article 2 of the proposed draft Regulation).The underground gas storage capacities of Ukraine that are situated in close proximity to the borders of the EU Member States are well positioned to strengthen the interconnection between Central Eastern European region (CEE) and Southern Eastern European region (SEE). If Ukraine succeeds in its goal of self-sufficiency in own gas production within the next 2-3 years, it could be able to provide additional underground gas storage capacities to the EU Member States and also to support Moldova and other Contracting Parties of the Energy Community.
Considering that this could happen under the legal framework for filling targets and filling trajectory that would be provided by current draft Regulation, it could be useful to recognize this explicitly in the text. This would give confidence to investors and to market participants, but also a strong political signal on the practical contribution of Ukraine to implement the full embargo on the importation of Russian gas by the EU by 2027 without undue negative implications for residential and industrial consumers in the EU (especially in those Member States that are historically more dependent on russia’s gas supplies).
On the engagement of the Energy Community Contracting Parties into the process. As envisaged in recital (22) and the newly introduced Article 6d(4) to the Regulation (EU) 2017/1938 the role of the Gas Coordination Group would be reinforced. We are strongly in favour of such a reinforcement envisaging the engagement of the Energy Community Secretariat and Contracting Parties on more regular basis in addition to the already ongoing cooperation within different regional groups. Such an engagement into the work of the Gas Coordination Group could also support a more formal participation of the gas sectoral associations of the Energy Community Contracting Parties, including those from Ukraine as observers.
Please kindly see the complete text of DTEK's comments enclosed.
Read full responseMeeting with Sofja Ribkina (Cabinet of Executive Vice-President Valdis Dombrovskis)
1 Apr 2022 · situation in the Ukrainian energy sector as a result of Russian military aggression
Meeting with Barbara Glowacka (Cabinet of Commissioner Kadri Simson), Thor-Sten Vertmann (Cabinet of Commissioner Kadri Simson)
31 Mar 2022 · Main point at the meeting: Financial stability of the electricity sector and to provide most recent updates on the situation on the ground in Ukraine.
Meeting with Barbara Glowacka (Cabinet of Commissioner Kadri Simson), Thor-Sten Vertmann (Cabinet of Commissioner Kadri Simson)
1 Dec 2021 · The topic discussed: - Market liberalisation in Ukraine - The security of supply issues - The development of the renewables market in Ukraine
Response to Revision of the Renewable Energy Directive (EU) 2018/2001
18 Nov 2021
DTEK would like to thank the European Commission for this opportunity to provide feedback under the revision of the Renewable Energy Directive. Updating RED II is directly relevant to the company due to Ukraine’s obligation under both the EU Ukraine Association Agreement and the Energy Community Treaty to implement the EU acquis in the electricity sector. Ukraine will only begin to elaborate domestic legislation to align with the European Clean Energy Package. To support the Contracting Parties, including Ukraine, in creating the necessary renewables legislation, the revised RED II could foresee an opportunity for them to benefit from a similar approach as with EU Member States.
Specifically, there could be a role for the Energy Community Contracting Parties, including Ukraine, on the following:
• Joint projects on renewable energy. Shared initiatives on renewables could be technically possible after completion of synchronization of the Ukrainian electricity system with the Continental Europe ENTSO-E (anticipated by mid-2023). Such an incentive would support Ukraine in implementing necessary regulatory reforms in RES.
• Mainstreaming renewable energy in industry:
o The European Clean Hydrogen Strategy mentions engagement of Ukraine into the development of the hydrogen value chain and sustainable business models. Ukraine is currently drafting its national hydrogen strategy, which will include the use of green hydrogen in industry. The criteria of using at least 50% of hydrogen in final energy and non-energy purposes in industry by 2030 could be both technically and financially difficult to achieve in Ukraine and the EU. We understand that there might be a link between this and the draft Regulation on CBAM, therefore we believe that attention needs to be paid to engaging Ukraine into the EU’s value chains, in particular on renewable fuels of non-biological origin (RFNBO) and supporting Ukraine with access to technologies and financing to decarbonize energy and industrial capacities.
o Labelling of industrial products as produced with renewable energy and RFBNOs could be a more convenient instrument for the industry. It could allow Ukrainian industry also to include it in future reporting on embedded carbon emissions. A technical solution for such labelling (i.e. ensuring traceability of green energy and green hydrogen content for products across the value chain) could be tested and achieved in Ukraine by 2025 in line with the EU criteria, therefore it would be important if the EU also recognizes such labelling even if it comes from outside the EU.
• GHG emissions saving criteria for RFNBOs. The Energy Community Contracting Parties (including Ukraine) should be engaged in the discussions on developing such criteria at the earliest stage. This would allow such countries, specifically Ukraine, to develop compatible methodologies and to strengthen regulatory certainty for investing into renewables in Ukraine by 2030. This would also enable the integration of Ukraine into European clean hydrogen value chains from an early stage.
• Union base for the use of guarantees of origin (GOs). We support the arguments of the Energy Community Secretariat to include into revised RED II a “supportive language to facilitate future trade in GOs between the Energy Community Contracting Parties and the EU Member States”. This would accelerate the development of domestic legislation on the guarantees of origin and power purchase agreements in line with the EU requirements. Additionally, the software solutions for green hydrogen, which are under development in Ukraine (distributed ledger technology), could also support such facilitation.
We strongly believe that in the anticipated implementation of the RED II in Ukraine, one of the priority issues would be production and use of green hydrogen that would further stimulate development of renewable energy sources.
Please see enclosed the full text of our comments.
Read full responseResponse to Carbon Border Adjustment Mechanism
18 Nov 2021
We would like to thank the European Commission for this opportunity to comment on the draft Regulation on CBAM. Although DTEK mostly operates outside of the European Union, our activities are closely connected with European Union energy markets. Primarily this relates to existing trade in electricity, but also to anticipation of synchronization of the Ukrainian energy system with the Continental Europe ENTSO-E and future market coupling with the EU electricity market. Such developments would incentivize Ukraine to accelerate deployment of renewable energy sources to advance decarbonization.
DTEK's goal is to achieve carbon neutrality by 2040. DTEK strongly supports market mechanisms such as implementation in Ukraine of energy reforms in line with the European Green Deal which should enable Ukraine’s transition to a green economy by attracting financing and technology. With this in mind, we would like to express the following considerations and suggestions.
Including Ukraine into Annex II, Section B:
We believe that Ukraine could be well qualified for an exemption from application of CBAM, notably on electricity (Article 2, para 7, 8). Such an exemption would advance electricity market reforms as well as opportunities for renewable energy to access cross-border trade. This would be fully in line with EU-Ukraine cooperation on integrating electricity markets as stated at the EU-Ukraine Summit on 12th October 2021. Among the supporting arguments for such an exemption are:
• Anticipated synchronization of the Ukrainian energy system with the Continental Europe ENTSO-E by mid-2023 accompanied by Ukraine fulfilling necessary market preconditions.
• Ukraine’s strong progress on aligning with the European Green Deal, in particular on a climate neutrality target, implementing the EU acquis in energy, environment and climate (as defined by the EU-Ukraine Association Agreement, specifically in Annex XXVII and Annex ХХХ).
• Rapid development of Ukraine’s renewables sector with a potential to account for 70% of the generation mix by 2050. This goal would be supported by national legislation on power purchase agreements (PPAs) and Guarantees of Origin (GOs). Mutual recognition of GOs from countries like Ukraine that design their legislation based on the EU acquis would be one of the best ways to achieve the goal of CBAM to incentivize climate neutrality beyond EU borders.
• The EU welcomed the adoption by Ukraine of its updated National Determined Contribution (NDC) to the Paris Agreement1. Ukraine has committed to reduce GHG emissions by 65% by 2030, compared to 1990 (including LULUCF).
• Ukraine has introduced monitoring, reporting, verification (MRV) legislation (in 2019) as an important step to prepare for development of its national emission trading system based on the EU ETS.
Calculation of carbon content:
We support the possibility to apply two methods of calculating embedded carbon emissions in electricity as outlined in the draft CBAM Regulation:
• Based on default values for embedded emissions determining the average CO2 emission factor in tonnes of CO2 per megawatt-hour of price-setting sources in Ukraine (art 7, para 3; Annex III, para 4.2.1). In 2020, 63% of Ukrainian the generation mix was carbon neutral and the share of renewables is set to increase significantly by 2030. Therefore, after synchronization of the Ukrainian energy system with ENTSO-E in 2023, the carbon content of supplied electricity to the EU would be below the EU average and constantly decreasing.
• Based on actual embedded emissions (art 7, para 3; Annex III, para 5). This links to a clear opportunity of mutual recognition of guarantees of origin (GOs) for renewable electricity and green hydrogen under the revision of RED II.
Please find enclosed the full text of our comment with an Annex to it.
Read full responseResponse to Updating the EU Emissions Trading System
8 Nov 2021
DTEK welcomes this opportunity to comment on the proposal of the revised EU ETS Directive. We would like to reiterate our statement from the previous comments under these consultations that DTEK supports Ukraine’s commitment to implement an Emission Trading System based on the EU ETS Directive. We believe that the EU ETS Directive would benefit from recognizing that its influence stretches further than the EU and has direct impact on Neighbourhood countries, including Ukraine.
International dimension of the EU ETS: Ukraine was one of the first countries to ratify the Paris Agreement. Recently, the Government of Ukraine has updated its revised national determined contribution (NDC) under the Paris Agreement and committed to reduce its greenhouse gas emissions by 65% by 2030 from the 1990 level. Ukraine is rapidly improving its climate and energy policies to align with the EU acquis; it has committed to implement Directive 2003/87/EC under the EU-Ukraine Association Agreement. The Ukrainian legislation on ETS is to enter into force in 2025.
DTEK believes that the ETS in Ukraine will help to support development of renewables, EU-Ukraine electricity market coupling, and increasing energy security by reducing dependence on imports of fossil fuels. However, implementation of the ETS is a significant challenge for Ukraine and its success would depend, in particular, on how transparent and predictable the process would be.
Considering social and economic reality in Ukraine (GDP of USD 13,056 per capita PPP; 30% of the Ukrainian population lives in energy poverty), a sharp increase in carbon prices would have a detrimental impact. As of today, Ukraine applies a carbon tax for stationary units that amounts to 10 UAH per tonne and is to increase up to 30 UAH (1 euro) by 2024. The CO2 price in the EU could climb up to 85 euros per tonne by 2030, which would be unbearable for Ukrainian society and the state budget. The proposed changes to the ETS Directive would make the 4th phase of the EU ETS even more ambitious. If directly transposed to Ukraine, they might have an adverse impact on the capacity of the domestic electricity sector to adapt to carbon pricing while ensuring security of energy supply.
Therefore, we believe that the process of implementation of the EU ETS in Ukraine should account for carbon price adjustment factors (linked to the country’s GDP) and consider free allowances for electricity and industrial sectors, which would be covered by the Ukrainian ETS. We rely on understanding from the European Union and EU’s industry that such instruments would be needed in Ukraine after 2025 and would not represent a danger of carbon leakage.
DTEK also supports the conclusions of the Energy Community Secretariat in favour of gradual introduction of carbon pricing (in the form of ETS in particular) alongside electricity market integration between the Contracting Parties and the EU Member States. Such an approach would support investment into renewables and flexibility, which is needed to enable successful decarbonization of the power sector.
Supporting instruments: We believe that it could be appropriate if the revised EU ETS Directive would acknowledge the need for significant investments by non-EU countries to implement this Directive in their national legislation. This could be an opportunity to highlight the support which the EU provides to such countries, but also to outline instruments of future support.
Stakeholders’ engagement: A more detailed outline of the external dimension of the EU ETS Directive could indicate a possibility of intergovernmental discussions with non-EU countries. We believe that stakeholder consultations should play an important role in such intergovenmental proces. The official negotiations would benefit from more systemic engagement with stakeholders (including business from energy and energy intensive industries as well as civil society).
Plese see the full text of DTEK's comments enclosed.
Read full responseResponse to Updating the EU Emissions Trading System
25 Nov 2020
DTEK welcomes the unequivocal commitment by the leadership of the EU and Ukraine to strengthen the political association and economic integration of Ukraine with the European Union as defined in the Joint statement following the EU-Ukraine Summit on 6th October, 2020. Being the leader in the energy sector in Ukraine, DTEK reconfirms its ambition and continuing efforts to deliver real positive changes on the ground.
In January 2020 in Davos, DTEK initiated high-level discussions on Ukraine’s participation in the European Green Deal. Since April 2020, DTEK consistently takes part in public consultations on legislative initiatives under the European Green Deal, in particular on the EU 2030 Climate Target Plan and carbon border adjustment mechanism (CBAM). In August 2020, DTEK joined the European Clean Hydrogen Alliance. Domestically, we take an active part in the ongoing discussions with business and wider stakeholders held by the Government of Ukraine and the Committee for the European Integration of the Parliament of Ukraine.
We would like to reiterate our deep belief that the European Green Deal has an immediate impact on the EU’s Neighbourhood and specifically on Energy Community contracting parties. This is especially true for ongoing legislative processes in the EU to ensure accelerated decarbonization and more ambitious greenhouse gas reductions by 2030. Considering the EU’s emissions reduction target of at least 55%, the revision of the EU ETS will amplify the ability of the EU ETS to impact countries and regions outside of the EU.
Such an impact would not be limited to climate policy. It would also impact global value chains, hence there could be implications for the EU’s trade relations with neighbouring countries as well as for trade relations between third countries. Therefore, companies from the EU Neighbourhood and the Energy Community contracting parties, including Ukraine, will have to take into account the whole spectrum of challenges that the revision of the EU Emissions Trading System entails.
This Inception Impact Assessment recognizes the complexity and systemic nature of future changes to the EU ETS. Notably, that they are cross-connected with other ongoing legislative initiatives under the European Green Deal including on the carbon border adjustment mechanism. The EU can rely on strong institutional, administrative and financial capacities to undertake such a systemic and science-based approach. However, EU Neighbourhood states might struggle in addressing such complexity within the relatively short timelines that they face.
Specifically, Ukraine would need to cope with a range of challenges. Firstly, by completing the ongoing market reforms including in the electricity sector to ensure fully functional markets in line with the EU acquis. Secondly, by developing and implementing domestic legislation on the Ukrainian ETS in line with EU legislation and Ukraine’s commitments under the EU-Ukraine Association Agreement. Thirdly, by accounting for direct impact on carbon prices and on integration with EU markets resulting from EU ETS revision.
Therefore, we would like to call on the European Commission to further consider the external dimension of the revision of the EU ETS while undertaking the impact assessment. Specific focus is warranted on how to support external countries within the frameworks of Deep and Comprehensive Free Trade Areas (DCFTAs) and the anticipated CBAM in a way that would strengthen their economies, address the distributional concerns and contribute to their sustainable prosperity as per EU external action and climate policies.
We would also like to appeal for extending a just and inclusive approach, which is a cornerstone of the European Green Deal, as well as a spirit of solidarity to countries such as Ukraine which have Association Agreements with the EU and aspire to further integrate with EU markets.
Read full responseMeeting with Olivér Várhelyi (Commissioner) and METINVEST
25 Nov 2020 · Green transition of Ukraine
Meeting with Aleksandra Tomczak (Cabinet of Executive Vice-President Frans Timmermans)
19 Nov 2020 · Online event bringing women networks on Green deal and gender parity
Response to 2030 Climate Target Plan
16 Apr 2020
DTEK is the largest private investor in the Ukrainian energy sector, employing 70 thousand people. DTEK Group generates electricity at solar, wind and thermal power plants, distributes and supplies electricity to end consumers, provides energy efficient solutions, develops a network of EV charging stations, as well as producing coal and natural gas. DTEK aspires to achieve carbon neutrality by 2040 across all its businesses.
We welcome the initiatives of the European Commission to set out the European Green Deal, a new growth strategy that aims to transform the EU into an economy with zero net GHG emissions by 2050. We also appreciate its commitment to ensure a level playing field for all market players and to lead the way globally in achieving carbon neutrality.
In this context, we would like to highlight our support for the strategic policy of the President and of the Government of Ukraine to gradually align with EU legislation on energy and climate and to continuously implement commitments under the EU-Ukraine Association Agreement and the Energy Community Treaty. In January 2020, the Government of Ukraine launched a Green energy transition process aiming to achieve carbon neutrality.
Regarding the inception impact assessment of the initiative on the 2030 Climate Target Plan, we would like to emphasize that the EU ambition to reduce GHG emissions by 50 or 55% by 2030 will have a direct impact on neighboring countries, especially on the contracting parties of the Energy Community, who aspire to integrate their energy markets with the European one.
The role of the EU as a global climate leader would consider such challenges and support for economies that are also committed to carbon neutrality but have less resources to achieve it at such an accelerated pace. Such considerations should cover the risk of a deepening gap between the EU and neighboring countries as the EU has larger capacities and resources to achieve these ambitious targets.
Therefore, we believe that the assessment should thoroughly examine the international impact of this initiative and suggest practical recommendations aiming to assist neighboring countries on their paths to climate neutrality. The assessment should consider the unintended consequences of the EU’s climate ambition on less mature electricity markets, such as the emerging Ukrainian electricity market. This could also envisage the extension of the analysis of the potential impact of the higher 2030 Climate Target on the situation around energy poverty and energy affordability in such countries.
This is a first part of the submission. Full text is enclosed.
Read full responseMeeting with Bernd Biervert (Cabinet of Vice-President Maroš Šefčovič)
18 May 2018 · State of play Electricity Sector Ukraine
Meeting with Bernd Biervert (Cabinet of Vice-President Maroš Šefčovič)
4 Oct 2017 · Reform electricity sector Ukraine
Meeting with Maroš Šefčovič (Vice-President) and
19 Dec 2016 · Energy sector reform Ukraine
Meeting with Joachim Balke (Cabinet of Vice-President Miguel Arias Cañete)
3 Nov 2015 · Energy Community
Meeting with Miguel Arias Cañete (Commissioner) and
21 Sept 2015 · Energy sector reform in Ukraine
Meeting with Joachim Balke (Cabinet of Vice-President Miguel Arias Cañete)
19 Mar 2015 · Ukrainian wind power