A NEW GREEN TARIFF FREE STAGE OF THE SOLAR ENERGY MARKET DEVELOPMENT HAS BEGUN IN THE REGION OF CENTRAL AND EASTERN EUROPE

In the first half of 2021, in the field of solar energy in Central and Eastern Europe and in particular in Ukraine, a new market segment began to burgeon, the basis of which was the economic model of projects with no green tariff involved, as well as the rapid rise in the price of electricity for commercial and private consumers. The new format of industry brisk growth horizon is expected to be 5-6 years.

This forecast was made by the CEO of IB Center and co-founder of CISOLAR Vitaliy Daviy, when he was opening the CISOLAR 2021,10th Solar Energy Conference and Trade Show and IBES 2021, the Energy Storage Conference and Trade Show of Central and Eastern Europe on July 6. One of the key industry events took place in Kyiv on July 6-8 in a hybrid format – both in person- and online, bringing together more than 1,400 participants and 70+ speakers from 29 countries. More than 60 companies took part in the CISOLAR 2021 and IBES 2021 Trade Show.

In particular, according to Vitaliy Daviy, the new EU requirements for the production of goods on green energy, which come into force in 2023, will be a powerful driver for the construction of solar power plants by industrial companies.
“There is simply no way back for industrial enterprises, because there is much tension around the issue: either you build your green energy generation, or close production. And every single year the screws are tightened more and more,” the head of IB Center said.

It is worth noting that in mid-July, Ferrexpo company put into operation a solar power plant with a capacity of 5 MW to meet the needs of its industrial enterprises. By the end of the year, Ferrexpo is going to build new power plants with a total capacity of at least 20 MW.

Similar plans have other large industrial companies, whose economy depends mainly on exports.

According to the IB Center, new solar power plants with a total capacity of about 4.5 GW for domestic industrial companies consumption will be built in the region of Central and Eastern Europe by the end of 2022, without using the green tariff model. In particular, new solar power plant with a total capacity of over 1.1 GW can be built in Ukraine in the industrial consumption segment during this period.

According to the green tariff model, solar power plants with a total capacity of more than 700 MW can be built in Ukraine by the end of 2022, of which more than 400 MW will be residential solar farms.

In contrast, according to the State Agency on Energy Efficiency and Energy Saving of Ukraine, in the 1st half of 2021 in Ukraine in the segment of large commercial solar power plants 258 MW was installed, while in the segment of residential solar farms – 154 MW.

As of July 1, 2021, the total capacity of solar power plants in Ukraine exceeded 7,284 MW, of which 933 MW are residential solar farms.

The development of distributed generation at the level of private consumers is a significant global trend today.

“Over the last 10 years, the cost of equipment for solar power plants has decreased by almost 90%. Electricity generated by solar energy has long been cheaper than any traditional source electricity, so any speculations over expensive green energy are not based on any economic or strategic facts. More than that, solar energy can solve the problem of energy poverty – providing cheap electricity to socially vulnerable groups. This is the segment that is gaining momentum in the United States and many Asian countries today,” said Yuliya Berezovska, co-founder of IB Center and New Age Lab, during the CISOLAR 2021 Conference.

However, according to key players in the Ukrainian renewable energy market, a number of legislative and infrastructural issues need to be addressed to begin a new phase in the development of the industry in Ukraine.

Speaking at the CISOLAR 2021 Conference, DTEK Renewables CEO Maris Kunickis noted that the main problems of the Ukrainian renewable energy market are the imbalance in the system, the lack of legislative incentives for mass construction of energy accumulation systems and lack of electricity supply capacity to EU countries.

“From a technological point of view, Ukraine needs to develop energy storage systems and the state should support energy storage projects, as is the case in other countries. Secondly, it is necessary to provide a better connection with Central Europe via N100E networks, to create more trading capacities to reduce restrictions,” the DTEK Renewables top manager pointed out.

According to Vsevolod Kovalchuk, former chairman of NPC Ukrenergo board, there is still no strategic vision of energy development in Ukraine at the state level, except for those projects that are on construction completion stage, so large facilities with a capacity from 10 MW are unlikely to be promising in the current Ukrainian realities.

“I would advise industry players to focus on small projects that would meet the needs of increasing energy efficiency, reducing the cost of electricity for specific industries. In my opinion, this is the only prospect we have for the next 2-3 years,” Vsevolod Kovalchuk remarked in his speech during the CISOLAR 2021 Conference.

During his speech, the head of the Agency on Energy Efficiency and Energy Saving of Ukraine Kostiantyn Hura drew the audience's attention to the following figures:

- $ 7.5 billion Ukraine pays for energy imports each year;
- The energy intensity of the Ukrainian economy is 3 times higher than the energy intensity of the European economy;
- According to the national energy strategy, by 2035 Ukraine should have 25% of renewable generation in its total energy balance.

“In my opinion, the first task for the state is to solve the problem of debt at a green tariff to companies and restore investor confidence in Ukraine. It is also important to solve the problem of balancing the grid, to finally launch green auctions and move to new methods of stimulating the further development of green generation. How? There are two answers: the first is Net Energy Metering, i.e. giving the opportunity to build a new generation in order to consume energy for their own needs and giving the excess energy to the grid, and the second – to start issuing certificates of origin. The certificate of origin is a digital certificate, which is a product,” Kostiantyn Hura said.

According to the head of the SE “Energorynok” Yurii Gnatyuk, the Ukrainian energy industry needs a clear strategy and action plan that would take into account both global trends and Ukrainian realities.

“Unfortunately, we have a problem not only in solar energy, the issue of energy accumulation as a balancing tool is relevant for all energy. We have a big problem with fuel, as well as with the implementation of the National Emission reduction plan and, unfortunately, there is no understanding what we are heading towards. There is no other way but to replace the generating equipment, which is too much for the energy balance, to build new renewable energy and shunting power,” the head of “Energorynok” emphasized.

“In order to meet the global requirements for reducing CO2, Ukraine needs to spend about $ 100 billion in domestic and foreign investment on decarbonisation in 10 years,” said Oleksii Riabchyn, an adviser to NJSC Naftogaz of Ukraine.

“Ukraine does not need a European Green Deal, but a Ukrainian one, which will answer the question: What is the goal? What figures? What are we closing? Where do we build? That is, there must be a clear signal from the state on where we are moving,” Oleksii Riabchyn added.

According to industry experts, the future of Ukrainian energy is with ENTSO-E (the European Association for the Cooperation of Transmission System Operators (TSOs) for electricity), an association with the European system. This step can become a powerful technological driver for Ukraine.

However, before joining the European energy system, Ukraine needs to demonstrate its autonomy, without the Russian and Belarusian energy systems. Renewable energy can be the technological basis for this transformation.

“As for the next few years’ prospective, I think that the most important trend is the future unification of the Ukrainian energy system with the European energy system and preparation for it. We will have to prove the ability to work autonomously, separately from Russia and Belarus, and then synchronously. We will also need to financially stabilize the situation with “Ukrenergo” and to undergo its certification,” noted Olha Buslavets, former head of the Ministry of Energy of Ukraine, during her speech at CISOLAR 2021.

According to the former head of the State Agency on Energy Efficiency, and now the executive director of Clear Energy company Serhii Savchuk, the possibilities of decarbonization of the Ukrainian economy can be significantly expanded if a number of changes are made to the financial sector legislation.

“Today, no one is willing to finance renewable electricity. Unfortunately, there is still a carbon tax biomass, which needs to be abolished. I personally predict a huge shortage of electricity. The government needs to support green energy, pay off debts and finance projects in this segment, to restore confidence in SC Guaranteed Buyer,” Serhii Savchuk explained.

He also emphasized the need for Ukraine to immediately establish a decarbonisation agency that would have much broader intergovernmental powers and work not only in the budget spheres, housing stock, but in all areas that make it possible to reduce CO2 emissions.

According to EDS Group founder Oleksandr Zapyshnyi, the economic performance of renewable energy projects in Ukraine is deteriorating due to lower green tariffs, as well as higher costs for equipment and components.

“Now Ukraine's renewable energy is stagnating. There are several factors here that affect this situation: systemic failure to honour commitments by the state, problematic connection to the grid, unpredictable income and payback due to constant changes in the rules of the game and lack of competition,” Oleksandr Zapyshnyi added during his speech at the CISOLAR 2021 Conference.

However, according to EDS Group top manager, in Ukraine today the segment of own consumption plants is actively developing, which opens new opportunities for market players. It is also extremely necessary to create a legal basis in Ukraine for the construction of energy accumulation systems.

“Energy storage is the element that solves the problem of imbalances and at the same time the state has problems with legislation. Today, our company develops a 27 MW energy storage project. Energy storage is not only the accumulation and transmission of electricity, it is also a technology to improve the quality of electricity. The European directive speaks about reducing electricity consumption, but not by reducing production capacity, but by increasing the technological level, which is simply impossible without the development of energy storage,” said Nadiia Petruchenko, Director of SPP Development Ukraine.

Oleksii Badika, the founder of the Atmosphere group of companies, stressed that now it’s high time to start competing in a new way.

“There are common challenges and tasks for the whole market between the state and business, so it is desirable to join our efforts – to create a common environment for the development of the whole market and all its players. The market for solar, distributed and microgeneration energy needs its own inspiring and cost-effective goal. Our company sees it as 1 million solar roofs by 2030 and we have already joined it. This is only 13% of all roofs in Ukraine. This is the goal that our colleagues from Europe achieved more than 5 years ago, and we can also achieve it,” Oleksii Badika shared his challenging target.

ETL Group Development Director Andrii Vavilin shared about the rapid development of electric charging infrastructure for electric vehicles on the basis of a real case, “Our country, compared to Europe, does not lag behind in this segment, we are ahead of almost all our neighbours. For example, in Dnipropetrovsk region, the number of fast chargers has tripled in the last year. The development of electric charging infrastructure is one of the biggest contributions to decarbonization.”

According to Serhii Kravchuk, director of KNESS ENERGY, for most Ukrainian companies, about 30% of their own electricity consumption can be replaced by their own generation source.

“In the market, storage devices that will work for the consumer, will be economically viable. And an important step that will make it possible to replace about 90-100% of the amount of electricity that a consumer needs is prosumerism and the creation of balancing groups, that become an active participant in the electricity market with the help of aggregators”, Serhii Kravchuk stressed.

These days, key players on the market of technological solutions for renewable energy are ready to offer comprehensive solutions for storage systems for both large facilities and household consumers.

“Huawei has its own solutions for both small and large commercial plants. Huawei has given Photomate the right to be the exclusive leader in Eurasia, a new region for us. These are the countries where the solar market is just beginning to develop: Armenia, Georgia, Kazakhstan and others,” Photomate CEO Anton Abramov said.

According to technical experts, in order for the grid to become more stable, it is necessary to move from synchronization with the grid to the formation of it, and this is now possible thanks to storage systems. The interconnection of digital technologies, storage systems, solar power plants, and power electronics can accelerate the energy revolution and achieve carbon neutrality.

Huawei's senior product manager Oleksandr Alokhin told that deliveries of Huawei inverters exceeded 42 GW in 2020, and in total, as of May 2021, the company has delivered 175 GW of solar inverters globally.

"Huawei has introduced a DC-coupled storage system. This means that there is no need for additional conversions to transfer the energy from the solar panels to the battery. This conversion is significantly more efficient – by 3-4%, and the system is a two-pole structure, +/- 1,500 V”, Oleksandr Alokhin explained on the technological features of the company's solutions.

Besides, the new technological solutions for roof solar stations were presented at CISOLAR 2021 by Jinko Solar company. It is worth noting that the company has joined the climate groups and is part of the RE100 and P100 initiatives, and also committed to convert all offices and production to green energy consumption.

“In my opinion, the Tiger Pro 60-cell modules and the latest 54-cell module with up to 415 W capacity and over 21%-efficient are interesting for the Ukrainian and European markets. After all, these modules can be quite efficiently built and are easy to operate on the roof. We also use multi-bus technology in these modules, increasing efficiency, and even when microcracks occur, these modules demonstrate greater efficiency than 5-bus modules,’ said Yevhen Prydatko, Business Development Manager, Jinko Solar CIS Adviser.

Another today’s market trend is the development of solar power plants maintenance service segment. In particular, at the 10th CISOLAR 2021 Solar Energy Conference, Unisolar presented its own service facilities which began to develop actively during the pandemic.

“Our customers, who have had problems with green tariff payments for a long time, have been forced to reconsider the economic component of their stations. In 2020 and 2021, our main efforts were aimed at improving 24/7 maintenance, developing the stock of equipment that is always available in our warehouses,” Unisolar CEO Tetiana Odnoroh said.

In recent years, energy accumulation systems have traditionally been part of CISOLAR, and this year for the first time, with the support of energy storage associations in Europe and Poland, they became the particular subject of a new important European event – IBES 2021, Conference and Exhibition of Energy Accumulation Systems. The IBES 2021 conference took place online on July 8 on a joint platform with CISOLAR 2021. In turn, solutions in the field of energy storage were presented at the exhibition on July 7-8.

Another traditional component of CISOLAR 2021 was the PVUA conference for private solar power plants owners, which took place on July 7 during the exhibition and became a powerful source of essential information for future and current owners of private solar power plants.

CISOLAR & IBES Strategic Partner - IB Club - is an international community of innovative business united by the idea of decarbonization.

CISOLAR and IBES 2021 partners include EDS Engineering, Atmosfera (GW-sponsors), ETL Group (Business Lounge Sponsor), Kness (Partner), HUAWEI & Photomate, SPP Development Ukraine, JA Solar, Helios Solar (MW-sponsors), Jinko Solar, Unisolar, Kehua Tech (KW-sponsors), ProCredit Bank (Chief Financial Partner), UkrGasBank (Chief Environmental Partner),
Honcharuk & Partners (Legal Partner).

The next industry event of IB Center, the 14th Sustainable Energy Forum and Trade Show of Central and Eastern Europe SEF 2021 Kyiv, will take place on October 19-21 in Kyiv off- and online. As well SEF Poland 2021 will be held in Krakow on December 1-2, 2021.

CISOLAR is the main business and think-tank platform for the solar energy industry in Central and Eastern Europe, as well as the second largest industry event in Europe. CISOLAR is one of the main events for entering the solar business, a business platform that has brought together investors, entrepreneurs and outstanding innovators over the past decade and serves the ultimate goal – to bring affordable cheap energy to every household, as well as to make the market transparent, fair and competitive.

CISOLAR Organizer is IB Centre – Innovative Business Centre that undertakes projects in the field of energy and eco-innovations and is a leading provider of conferences, trade shows and training programs in the field of new energy and clean technologies with over 15 years’ history and implemented projects from Brussels to Almaty, which have accelerated the formation of cleantech industry and, in particular, renewable energy and energy technologies in emerging markets.

Contact details:
Julia Nepyipyvo
julia.nepyipyvo@ibcentre.org
cisolar@ibcentre.org

IB Centre Inc.
+44 207 442 55 55
+38 (044) 383-03-56
1001 North Federal Highway, suite 300, Hallandale Beach, Florida 33009
info@ibcentre.org

IB Centre Inc. is a leading producer of trade shows, conferences, educational courses and programs in the field of renewable energy and environmentally clean technologies focused on the emerging markets of Europe and Central Asia.

Also, IB Centre is a publisher of the environmentally clean market guidelines and provider of consulting services.

This release was published on openPR.