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Scatec connects a 32MW solar power plant for commercial operation in Ukraine

At the very end of the past year Scatec, an integrated independent renewable power producer, together with FMO, the Dutch entrepreneurial development bank, have connected Ukraine’s 32-megawatt (MW) Kamianka solar power plant to the network, which means it started its operation on 1 January.

With this new investment Scatec gained approximately 1.6 gigawatts (GW) in operation globally, furthermore, another 320 MW construction is on its way, of which 203 MW will be deployed in Ukraine again. The newly activated system Kamianka is estimated to deliver 37 gigawatts-hour (GWh) per year and will provide clean solar energy to 11,000 households.

“We are pleased to complete our third project in Ukraine,” said Raymond Carlsen, CEO of Scatec. “The Kamianka solar power plant will lead to the abatement of more than 15,000 tonnes of CO2 emissions and will contribute to growing the share of renewable energy in the country.”

The project was realised under Ukraine’s Feed-in-Tariff scheme, which generally means long-term contracts and guaranteed payment methods to producers of renewable energy. On 1 August 2020 the law On Amendments to Certain Laws of Ukraine on the Improvement of Support for the Production of Electricity from Alternative Energy Sources came into action in the country: it restructured the FiT, which meant a reduction in the FiT rates with certain percentage every year retroactively from 2015. The measure of the reduction depends on the type of the energy source, capacity and date of commissioning.

For example, in the case of onshore wind farms with a capacity of 2 MW or more, reduction in the FiT is between 2.5 and 7.5 per cent. On the other hand, solar power plants with more than 1 MW capacity will experience reductions between 2.5 and 15 per cent. Moreover, these kinds of solar power plants that have been operating from 31 October 2020 could face a reduction between 30 and 60 per cent.

The Ukrainian state is taking steps in order to resolve the issues caused by the reduction, but the current situation could lead to investor action, who are considering even legal steps to arrange the situation because they calculated with the original FiTs when making their investment and deployment decisions.

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