Presentation by Carl Sturen

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RENEWABLE ENERGY BUSINESS OPPORTUNITIES IN UKRAINE

Investment and Business Development in Ukraine 30 March 2016, Netherlands

Carl Olof Richard Sturen, Managing Director Vindkraft Ukraine LLC, UWEA Expert Council member


MACRO CONSEQUENCES FROM RENEWABLE ENERGY

Benefits in addition to sustainability and being environmentally friendly  Reduced dependency on imported gas and coal bought in hard currency;  Improving supply reliability and reducing network electricity transit losses due regional generation;

 Domestic generation and sales in local currency subject to VAT, payroll and profit taxes;  Conforming with set EU targets and association agreement;  Creating alternative modern generation capacity in parallel to aging nuclear plants;

WWW.UWEA.COM.UA


RENEWABLE ENERGY TARGETS Renewable Energy Production is foreseen to reach 11% of the total Ukrainian energy production by 2020 2015

2020

Actual mainland Ukraine

National Action Plan for Renewable Energy for the period up to 2020

MW

MW

4 800

5 200

Small Hydro

98

150

Geothermal energy

8

20

Solar power plants

420

2 300

Wind power plants (on-land)

426

2 280

Bio-mass/bio-gas

51

950

5 803

10 900

Hydro power stations > 10 МW

 On 1 October 2014 the Cabinet of Ministers of Ukraine adopted the Decree On National Action Plan on Renewable Energy for the period up to 2020. This decree of the government of Ukraine was adopted to execute the Decision of the Ministerial Council of the Energy Community D/2012/04 / MC-EnC On the implementation of Directive 2009/28/EC and amending Article 20 of the Energy Community Treaty.

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INSTALLED CAPACITY AND ELECTRICITY GENERATION FROM RES 2015

1300

Wind Energy

1200

1100

Installed capacity as of 2015, MW

1000 900

Electricity Generation in 2015, mln kWh 800

700 600 500

Solar Energy

400 300 200 100 WWW.UWEA.COM.UA

Small Hydro Biomass

Biogas


GREEN (FEED-IN) TARIFF SYSTEM Law on Introduction of Changes to Certain Laws of Ukraine with respect to Securing Competitive Conditions for Production of Electricity from Alternative Energy Sources, No 514-VIII dd 4.06. 2015

 GT rate varies by types of renewable energy and size of installed capacity  GT rates remains fixed in EUR and the UAH equivalent is re-calculated quarterly  No EUR/UAH exchange rate link of GT for PPs commissioned from 2025

 Tariff commitment valid till January 1, 2030

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FEED-IN-TARIFF RATES, IN EURO PER kWh

Jan.1, 2015 Dec. 31, 2019

Jan. 1, 2020 – Dec. 31, 2024

Jan. 1, 2025 – Dec. 31, 2029

RES

Power Plant Capacity

WIND

Wind turbines 2000 and more kW

0,1018

0,0905

0,0792

Power plants on a ground surface

0,1599 -0,1502

0,1352

0,1201

Power plants on the roofs and/or facades of buildings

0,1723 -0,1637

0,1475

0,1309

Biomass power installations

0,1239

0,1115

0,0991

Biogas power installations

0,1239

0,1115

0,0991

Mini hydro power plants from 200 kW to 1 MW

0,1745

0,1572

0,1395

0,1395

0,1255

0,1115

0,1045

0,0942

0,0835

SOLAR

BIOMASS & BIOGAS

HYDRO

Small hydro power plants from 1 MW to 10 MW

GEOTHERMAL

Geothermal PP

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LOCALLY PRODUCED EQUIPMENT

No Local Content Requirement  Producers could be eligible for a premium of 5% of the eligible GT rate if the ”level of locally produced equipment” in a project is 30%, or a premium of 10% of the eligible GT rate if the project contains at least a 50% “level of locally produced equipment”.

 The premium will not apply for power plants commissioned after 2025  The Regulator will determine the level of locally produced equipment based on certificates of origin from the Chamber of Commerce of Ukraine and other confirming documents  The Law contains the lists of equipment which could qualify as locally produced equipment and based on which one could calculate the share of local component in a project, see table

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DRAFT LAW No 2010 Wind Turbine Elements of Equipment locally produced in Ukraine

Share, %

Blades

30

Tower

30

Nacelle

20

Main Frame

20

Total

100


WIND OPPORTUNITIES IN UKRAINE

Good wind potential and large territories suitable for a wind projects development

Attractive feed-in-tariff Fixed EUR/UAH exchange rate No local content requirement Bonus for use of locally manufactured equipment System operators are obliged to connect wind farms to the grid WWW.UWEA.COM.UA


WIND CAPACITY IN OPERATIONS 2015

MW 6000 5300 5000

ď ľ More than 7000 km2 of land area is ideally suited for wind farm development

4192

4000

3330

3000 2000 1000

426

0

Ukraine

Romania

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Turkey

Poland


OPERATING WIND FARMS

Chernihiv

Lutsk

Sumy Rivne Zhytomyr

Kyiv WF LLC Ligena (0,45 MW)

Lviv Ternopil Starosamborskaya WF (6,6 MW)

Kharkiv

Poltava Cherkasy

Khmelnytskyi Vinnytsia

Uzhhorod

Luhansk WPU Lutugino WF (25 MW)

Ivano-Frankivsk

Kirovohrad

Dnipropetrovsk

Chernivtsi

WPU Krasnodon WF (25 MW) Donetsk Zaporizhzhia

Mykolaiv

WPU Novoazovsk WF (88 MW) Botievo WF (200 MW)

426 MW

WPU Ochakov WF (47,5 MW) Odesa

Kherson Sivashskaya WF (2,92 MW)

Vindkraft Ukraina WF (30,75 MW)

Simferopol

WWW.UWEA.COM.UA


WIND PROJECTS PIPELINE

Chernihiv

Lutsk

Sumy Rivne Kyiv

Zhytomyr

Sokalska 2 WF (42,9 MW) Lviv Starosamborskaya 1 WF (6,6 MW – 13,2 MW ) Starosamborskaya 2 WF (19,8 MW)

Poltava Cherkasy

Khmelnytskyi

Opaka WF (50 MW)

Kuryany WF (5 MW)

Kharkiv

Vinnytsia

WPU Krasnodon WF (425 MW) Luhansk

Skolivska 2 WF (46,2 MW) Ivano-Frankivsk Uzhhorod

Kirovohrad

WPU AtomWind Kramatorsk (66 MW) Dnipropetrovsk WPU Lutugino WF (225 MW)

Chernivtsi

WPU Antrizit-1 WF (225 MW) Donetsk Zaporizhzhia

WPU Baltskaya WF (225 MW) Mykolaiv WPU Berezanskiy WF (95 MW) Tiligul WF (500 MW)

3 555 MW

WPU Tatarbunaru WF (150 MW) WPU Zolninskaya WF (12,5 MW) Simferopol

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Berdyansk WF (150 MW)

Primorsk WF (200 MW) Botievo 3,4,5 WF (300 MW) Kherson WPU Illichovskaya WF (50 MW) Odesa WPU Kaborga WF (100 MW) Sivashenergoprom (5 MW) Ovidioplo Energy WF (120 MW) Novotroitsk WF (140 MW) WPU Ovidiopolska WF (200 MW) Kalanchak WF (300 MW) WPU Belyaevskaya WF (150 MW)


UKRAINIAN WIND ENERGY ASSOCIATION The UWEA is an All-Ukrainian public organization aimed at promoting wind energy technologies and ensuring wind energy industry’s interests at the national and international levels. It is a proven, effective advocate for Ukrainian wind industry and it continues to mature along with the industry.

UWEA members include: DEVELOPERS MANUFACTURERS CONSULTING COMPANIES TRANSPORT COMPANIES SERVICE COMPANIES P.O.Box 75, Kiev 01033, Ukraine phone: +380 (44) 2232996 е-mail: uwea@i.ua www.uwea.com.ua

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LAW FIRMS INSURANCE COMPANIES


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