RELEVANCE In August 2020, the Constitutional Court of Ukraine opened proceedings on the basis of a petition of 47 deputies of Ukraine to declare unconstitutional the legislative provisions of the Law of Ukraine № 555-IV “On Alternative Energy Sources” from February 20, 2003 and the Law of Ukraine № 2019-VIII “On the Electricity Market ” from April 13, 2017. As follows, there is a threat of declaring the “green” tariff in Ukraine unconstitutional. If the court decides in support of the constitutional petition, all RES electricity producers, including households, will be deprived of the previously established "green" tariff, will be canceled state guarantees for mandatory redemption of electricity at the "green" tariff and payments in full, violation of state guarantees provided to investors, and as a consequence - numerous lawsuits and arbitrations against Ukraine, which will increase state budget expenditures, economic unsustainability of projects and bankruptcy of renewable energy investors. CONSEQUENCES OF DECLARING NORMS UNCONSTITUTIONAL - Producers of electrical energy from alternative energy sources will be deprived of the previously established «green tariff» from the moment the decision of the CCU enters into legal force;
- State guarantees for RE producers will be cancelled, including the mandatory buy-back of electrical energy at the «green» tariff and payment in full;
- The increase in the «green» tariff will be cancelled, the auction price for compliance with the level of use of equipment of Ukrainian manufacture;
- Violation of state guarantees provided to investors and, as a result, numerous lawsuits and arbitrations against Ukraine, which will increase State budget expenditure;
- Economic non-viability of projects and bankruptcy of renewable energy investors can be treated as a violation of private property and investment integrity (regulatory forfeiture) without adequate compensation;
- Reduction in the State budget’s tax revenues (during 2020, RE producers paid about UAH 20 billion to the State budget);
- Ukraine’s loss of the image of an investment-attractive country and reliable partner of investors.
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