Appeal of RES leading associations to the Prime Minister of Ukraine

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On November 17, 2021, EUEA together with RES industry associations (UWEA, UARE) sent a joint letter to the Prime Minister of Ukraine on compliance with the principles of transparency, equality and proportionality in debt repayment, which was formed before the RES electricity producers in 2020-2021.

Dear Prime Minister of Ukraine!

On behalf of the European-Ukrainian Energy Agency (EUEA), the Ukrainian Wind Energy Association (UWEA) and the Ukrainian Association of Renewable Energy (UARE), which together unite more than 80% of Ukraine's renewable electricity market and represent international and Ukrainian investors, with deep respect we address to you with the following.

On November 3, 2021, PJSC “NPC “Ukrenergo” announced the placement of 5-year "green" Eurobonds worth USD 825 million (approximately UAH 21.6 billion) under government guarantees provided by the Cabinet of Ministers of Ukraine (hereinafter - Eurobonds).

According to the official information published by SE "Guaranteed Buyer", as of November 17, 2021 SE "Guaranteed Buyer" made payments to electricity producers with RES in the total amount of UAH 16.27 billion and has another 3.04 billion in balance.

At the same time, we do not have any information about the terms in which the Guaranteed Buyer plans to transfer the remaining amount of UAH 3.04 billion in favor of RES electricity producers, and PJSC “NPC “Ukrenergo” will transfer the remaining amount of money received from Eurobonds to the account of SE "Guaranteed Buyer".

We would like to note that on October 11, 2021, the Cabinet of Ministers of Ukraine adopted a resolution on providing in 2021 a state guarantee to ensure full fulfillment of debt obligations of PJSC “NPC “Ukrenergo” on borrowing, the amount of which does not exceed UAH 22.8 billion. Separately, in this resolution the Government obliged the Ministry of Energy together with PJSC “NPC “Ukrenergo” and the SE “Guaranteed Buyer” to ensure the direction of funds on borrowings to repay debts incurred in accordance with contracts for the sale of electricity at the "feed-in" tariff, concluded by the SE "Guaranteed Buyer" with electricity producers, which set the "feed-in" tariff.

The “Use of Proceeds” section of the Eurobond Prospectus states that “An amount equal to the amount of funds received from the Bond issue will be used to finance or refinance, in whole or in a part, the identified Green Projects” described in the Issuer's Green and Sustainability-Linked Bond Framework.

Among the financial institutions that have invested in the bonds of PJSC "NPC" Ukrenergo" are international financial institutions, such as the EBRD, who purchased bonds based on the Government's assurance that the funds raised will be used to resolve the payment crisis in the renewable energy sector by repaying the debts of SE "Guaranteed Buyer" to RES electricity producers. 

Accordingly, both investors of PJSC "NPC" Ukrenergo" Eurobonds and RES electricity producers expect the Government to fulfill the set goal of issuing Eurobonds and directing the entire amount of UAH 21.7 billion to repay the debts of the SE "Guaranteed Buyer" for electricity generated from RES during the period of 2020-2021. The Ministry of Energy of Ukraine, PJSC “NPC "Ukrenergo" and SE "Guaranteed Buyer" must ensure the immediate use of borrowed funds to repay debts arising from contracts for the sale of electricity at the Feed-in tariff concluded between SE "Guaranteed Buyer" and RES electricity producers. At the same time, we expect SE "Guaranteed Buyer" to comply with the principles of transparency, equality and proportionality in the distribution of funds between RES electricity producers.

Thank you in advance for reviewing our letter, and we remain at your disposal to provide any additional comments and clarifications.

Sincerely,

Oleksandra Gumeniuk,Director of EUEA

Andrii Konechenkov, Chairman of the UWEA Board, WWEA Vice President

Kozakevych Oleksandr, Director of UARE

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On November 17, the Guaranteed Buyer announced on its website that the balance of UAH 3.04 billion, which had not yet been transferred by the bank, was returned to the accounts of the Guaranteed Buyer.

Details… 

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On November 15, 2021, the heads of industry associations spoke at a joint press conference of Interfax-Ukraine

in order to call on the Government of Ukraine to fulfill the commitments made to investors and RES producers, to make timely and full payments to the "green" generation.Details…

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EUEA has grown into an effective advocate for the realization of Ukraine’s massive renewable energy and energy efficiency potential, by working within Ukraine’s business community, government structures, and with other key energy market stakeholders.

Members of EUEA: Acciona, Arzinger, Beycelik-Elawan Renewable Energy LLС, CCT Energy, CES, DTEK, EMERGY AS, EMSOLT, Electrum, Elementum Energy, Eurocape, GOLAW, Guris, Green Genius, GrECo Ukraine, GSE&C, Huawei, iC consulenten, IMEPOWER, Indian Solar, IRUN Engineering, Investment Fund For Developing Countries, Irshanska SES, Khmelnytsky Bio Power Plant, Met Energy, Scatec, Schneider Electric Ukraine, Sfera, Sungrow, West Solar, Terra Solar, Thermosystems, TIU Canada, Total Eren, Ukraine Power Resources, Ukrwindinvestments.

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