Ukraine’s spare energy can help itself and the EU
The country’s demand has fallen by half, and the one it does not use could reach the bloc, but it is necessary to invest in networks
Ukraine has a built-in weapon against the destruction caused by the conflict. With 55 gigawatts (GW) of installed power capacity, this war-torn nation can produce more electricity than it currently needs. This is an opportunity for both kyiv and the energy-hungry European Union.
Fearing that Moscow could use energy as a weapon, Ukraine has been working since 2017 to disassociate itself from the Russian electricity grid. Vladimir Putin’s invasion unsurprisingly accelerated that transition. On March 16, Ukraine fully synchronized with the EU energy grid.
This creates an attractive imbalance. Ukraine’s energy demand has been cut in half since the conflict, and is unlikely to return to full capacity even with a ceasefire. The opportunity is for the country to export excess electricity to its EU neighbors and use the proceeds to speed up its costly reconstruction. The export of 1 GW of electricity could bring Ukraine 1 billion euros a year, according to energy operators.
The EU, for its part, may be interested in importing the carbon-free power produced by Ukraine’s 15 nuclear reactors, which can generate some 14 GW when operating at full capacity. Countries like the Baltic republics are still connected to the Russian grid, so they need alternative electricity to cut their ties with Moscow. The EU is also desperately seeking to diversify away from Russian gas.
The problem is the power lines that connect Ukraine with countries like Poland, Slovakia, Hungary and Romania. Right now, they are few and far between. Ukraine’s cross-border export capacity is a measly 700 megawatts (MW). And the country only exports about 200 MW to Poland, explains Petro Kotin, CEO of the Ukrainian state nuclear power operator, Energoatom.
This can be solved with investments. Reactivating a Soviet-era power line through Poland would cost about $30 million (€28 million), says Kotin. Building new lines from scratch requires $500 million (€470 million) per line. It is clear that Ukraine does not have the money. Neighbors like Poland are skeptical, and private investors are reluctant to venture into a conflict zone. That leaves funding from multilateral organizations like the European Bank for Reconstruction and Development, the European Investment Bank or the European Commission.
Helping Ukraine boost electricity exports would support its economy and alleviate Europe’s energy headache.
