Energy News Digest | August 2025

Launch of the European Flagship Fund for Ukraine’s Recovery

The European Commission announced the launch of the European Flagship Fund for Ukraine’s recovery. The initiative is being implemented jointly with France, Germany, Italy and Poland, with the participation of the EIB, KfW, CDP, BGK and Proparco. The Fund aims to mobilise up to €500 million by 2026 to support Ukraine’s economy through private investment. An initial contribution of €220 million is being provided as “catalytic capital” to reduce investor risk. The Fund will invest in renewable energy, infrastructure, digitalisation, industrial modernisation, critical raw materials and dual-use goods. The Fund is expected to strengthen the private equity market in Ukraine, stimulate the creation of new capacities and jobs. Operations are expected to begin by the end of 2026.

Launch of the Ukrainian Renewable Energy Investment Risk Mitigation Mechanism (URMM)

The European Bank for Reconstruction and Development (EBRD) and the European Commission have announced the launch of the Ukrainian Renewable Energy Investment Risk Mitigation Mechanism (URMM). This is a unique European de-risking instrument designed to unlock up to €1.5 billion of private investment in the construction of 1 GW of new renewable energy capacity in Ukraine. The URMM guarantees a minimum electricity price for investors, which significantly reduces the risks of guaranteed buyout, increases bank confidence, and stimulates the launch of new projects at a critical time for the country. The mechanism is being implemented under the Horizon Europe programme with the support of the European Derisking Energy Platform, in cooperation with the Ukrainian government, the European Commission, the EBRD and other partners. The European Union has already approved €180 million in support of URMM under the Ukraine Investment Framework (UIF) initiative, and the Dutch government plans to provide another €12 million in grant assistance. Other European countries are also expected to participate. What makes the initiative particularly important is that its concept originated in the private renewable energy sector of Ukraine and was developed in close cooperation with the European-Ukrainian Energy Agency, the Ukrainian Wind Energy Association (UWEA), the EBRD, the European Commission and partners from Green Deal Ukraine.

Digital Register of Renewable Energy Facilities

Implementation of EU Law in the Energy Sector

On 22 July, the Verkhovna Rada of Ukraine adopted at first reading Draft Law No. 12087-d, titled “On Amendments to Certain Laws of Ukraine concerning the Implementation of EU Law on Energy-Market Integration, Supply Security and Competitiveness in the Energy Sector.” The draft law anticipates the integration of Ukraine’s electricity markets with those of the EU, refines the Day-Ahead and Intraday market rules, introduces new terminology (such as aggregation, flexibility, energy communities), and ensures Ukraine’s fulfilment of its commitments under the Association Agreement and the Energy Community Treaty.

Amendments to the Commercial Electricity Metering Code

On 22 July 2025, NEURC approved amendments to the Commercial Electricity Metering Code and the Temporary Procedure for Determining Electricity Purchase Volumes during the Transitional Period. These amendments aim to improve metering and settlement mechanisms among market participants, in particular by increasing the accuracy and transparency of actual electricity-volume determination. This is crucial for financial stability – especially given the growing share of renewable energy sources, where production forecasting is more challenging. The updated rules also bring Ukraine’s market closer to European standards of commercial metering and facilitate further integration with the EU energy space.

Changes to the Connection Fee Calculation Methodology

On 5 August, NEURC adopted Resolution No. 1158, amending the methodology for calculating fees for connection to transmission and distribution networks. The document stipulates that all procurement for the construction and upgrading of connection facilities must be conducted on a competitive basis; clients who develop and approve project documentation independently are entitled to offset part of the previously paid fee against the final connection cost. A cost-adjustment mechanism is provided: if actual expenditures fall below the projected costs, the operator must refund the difference, and conversely – if final costs exceed expenditure – the excess paid must be returned. Moreover, fees paid for capacity reservation are now credited towards the total connection charge. These amendments are intended to enhance transparency, competition, and fairness in settlements between clients and network operators.

Amendments to the Retail Electricity Market Rules

On 5 August 2025, NEURC also approved a draft amendment to the Retail Electricity Market Rules, aimed at enforcing payment discipline among non-household consumers. Under the proposed changes, the mere existence of a court ruling initiating legal proceedings is no longer sufficient grounds to halt the procedure for disconnecting defaulting consumers. At the same time, uninterrupted supply guarantees remain in place for protected consumers and critical infrastructure facilities (such as medical institutions, water utilities, and defence- or security-related installations). These measures are designed to prevent abuse and ensure the financial stability of the market.

Long-term Allocation of Cross-border Transmission Capacity

On 29 July, NEURC approved the rules for long-term allocation of cross-border transmission capacity between Ukraine and Slovakia, Hungary, and Romania. From now on, export–import operations in electricity will be conducted via a joint monthly allocation mechanism on the Joint Allocation Office (JAO) platform. This decision expands Ukraine’s access to the European electricity market, enhances transparency and competitiveness in trade, and bolsters energy security and integration within the EU energy space.