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IEA reports Russia’s attacks on Ukraine’s energy sector have escalated as winter sets in

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IEA reports Russia’s attacks on Ukraine’s energy sector have escalated as winter sets in
Energy infrastructure damage in Ukraine caused by Russian attacks. (Courtesy: DTEK)

For the second consecutive winter, Russia has increased military attacks on Ukraine’s energy system, significantly undermining security of the country’s power supply, according to the International Energy Agency (IEA).

The bombing campaign – which lasted throughout the 2022/23 heating season and resumed in recent months – has targeted a range of energy infrastructure, power plants, oil refineries and district heating facilities. The World Bank recently estimated that Ukraine’s energy sector has sustained US$12 billion in damages during the war.

In 2021, the U.S. Energy Information Administration reported that Ukraine had a total installed generation capacity of 55,000 MW. Fossil fuel energy represents the largest share of capacity, at 52%, followed by nuclear at 24% and renewables, including hydro, at 22%.

Safeguarding power system resilience and boosting electricity security are key priorities for Ukraine. IEA, which deepened its relationship with Ukraine since Russia’s invasion, is providing support – sharing data and analysis and working with policy makers as they look to address the country’s immediate energy needs and develop plans for the longer term. Ukraine joined IEA as an association country in July 2022. A two-year Joint Work Programme signed in December 2022 laid out how IEA could further help Ukraine meet its short- and long-term energy objectives.

Russia’s initial offensive against Ukraine’s energy system resulted in widespread destruction. In October 2022, Ukraine’s energy minister said that about 30% of Ukraine’s energy infrastructure appeared to have been attacked in a single day. During the following seven months, Russia used missiles and drones to target energy facilities, leaving no thermal or hydropower plant untouched, IEA said. Some areas only had access to electricity, heating and the internet for a few hours a day, and hospitals, businesses and households had to turn to expensive diesel generators for backup. More than 50% of Ukraine’s power infrastructure was damaged, according to the World Bank.

Ukraine made significant efforts to improve energy security. Over the spring and summer, power utilities – aided by grants, loans and investment from a range of governments, multilateral donors and the private sector – undertook the biggest energy infrastructure repair and maintenance campaign in the country’s history. The Ukrainian government also strengthened its air defense systems and invested in passive defense measures such as engineering fortifications.

Other steps were taken in parallel to help millions of people and businesses in Ukraine keep the lights on and stay warm. Ukraine’s disconnection from Russia’s power system and synchronization with Continental Europe was made permanent in November 2023, and operators of Continental Europe’s transmission system decided to raise the commercial capacity limit for electricity imports. This will allow Ukrenergo, Ukraine’s transmission system operator, to better absorb shocks to the system, such as further attacks or spikes in consumption driven by colder temperatures.

However, this winter is set to be extremely challenging. Not all of Ukraine’s energy facilities could be fully restored by the start of the 2023/24 heating season – especially given difficulties securing financing to repair coal-based generation and sourcing high-power autotransformers, a critical component of Ukraine’s Soviet-legacy power system. Meanwhile, new strikes are causing fresh damage. A long-lasting cold snap would also pose risks.

The role of distributed resources

With the displacement of people and industry during the war shifting demand patterns, distributed resources such as rooftop solar PV – which have a shorter lead time for deployment than conventional generation – can help meet demand where it is most needed.

Distributed energy resources installed in combination with behind-the-meter battery storage allows consumers to store energy and use it later and potentially have continued access to power after a wider grid outage. In this way, distributed energy resources only add flexibility and empower consumers and lower energy security risks, as these systems are harder to target and will not cause widespread power outages if they are damaged in an attack.

Integrating more distributed energy resources would also help Ukraine meet its ambition to reduce greenhouse gas emissions 65% by 2030 compared with 1990 levels. And they present an opportunity to reduce reliance on a highly centralized Soviet-era power system, with aging infrastructure that needed to be refurbished or replaced even before the war.

However, incorporating more distributed energy resources requires a major paradigm shift for system planners, operators and regulators. It calls for substantial investment in smart grid technologies, enhanced regulation and improved market design. Active management is needed to support strong growth in the volume of distributed energy resources without compromising the security of the power system.

Appropriate and targeted policies such as tariff design, smart metering and technical standards are essential to ensure that distributed energy resources are incorporated in a system-friendly manner. Alignment with EU legislation could help Ukraine achieve this goal – aiding in the regulation and market design of a more modern power system while providing the foundation for full energy integration with the EU.

Ukraine’s government said its energy recovery hinges on strong planning for its net-zero future. The 2050 National Energy Strategy, adopted in May 2023, laid out a target of decarbonizing the country’s energy sector by mid-century. Work is under way with strategic partners, who are using modelling to develop transition pathways across key economic sectors. Ukraine is also developing a National Energy and Climate Plan through 2030, which will lay out ways to prioritize decarbonization and the green transition during the country’s recovery.