BESS projects in Ukraine in 2026: connection, licensing, the ‘green’ tariff and investment risks

Introduction

In 2026, the legal framework governing Battery Energy Storage Systems (BESS) in Ukraine underwent significant changes. The legislation set out detailed rules on grid connection, licensing, the operation of BESS as part of generation facilities, commercial metering and participation in the electricity market.

For investors, BESS is no longer merely backup power equipment. An energy storage facility (ESF) is a separate entity within the electricity sector and can operate as an independent market asset or as part of a solar power plant, wind farm or other energy facility, participating in the buying and selling of electricity, system balancing, and the provision of ancillary and flexibility services.

The economics of a BESS project are often determined not only by the cost of the equipment, but also by the legal framework: whether an existing connection point can be used, whether additional authorised capacity for consumption or supply is required, whether a licence is needed, how commercial metering is organised, and what sources of revenue the chosen market model permits. A mistake at the structuring stage may result in a technically ready asset being unable to operate according to the planned financial model.

As of September 2026, the key regulations for BESS are set out, in particular, in the Law of Ukraine ‘On the Electricity Market’, the Distribution System Code and the Transmission System Code. In 2026, the regulations governing the connection and use of BESS were significantly updated; therefore, projects structured according to previous approaches should be reviewed for compliance with current requirements.

BESS as an energy asset: legal framework and key considerations for investors

An energy storage facility may be a standalone facility or may be technologically integrated into a solar power plant, wind farm, other generation facility or consumer site, utilising shared infrastructure. The law expressly permits the combination, at a single point ( ), of electrical installations for the generation, storage and consumption of electricity.

For an investor, this means that the legal framework for a BESS must be determined not only by the location of the battery installation, but primarily by the functions of the asset: who the operator is, where charging takes place, where the electricity is supplied, what permitted draw-off and supply capacities apply at the connection point, whether a licence is required, and in which market segments revenue is planned to be generated.

Before ordering equipment, it is advisable to check at least the connection model, the permitted draw-off and supply capacities, the commercial metering scheme, the licensing status, the rules for market participation, and the impact of the BESS on existing state support mechanisms.

BESS business models in Ukraine and their legal implications

In practice, BESS is most often structured according to three basic models, which may be combined depending on the project.

The first model involves a BESS as part of a solar or wind power plant. It enables the deferral of electricity supply over time, reduces imbalances and allows for more efficient use of available connection capacity. For facilities with a ‘green’ tariff or other state support, the critical factors are the producer’s participation in the guaranteed buyer’s balancing group, the source of BESS charging, and separate commercial metering.

The second model is an independent BESS as a standalone market asset. It can draw electricity from the grid, store it and sell it on the market in response to price signals. For this model, licensing, connection, balancing responsibility, mandatory contracts and grid charges must be verified separately.

The third model is a BESS for balancing, ancillary services and/or flexibility services. The law explicitly provides for the right of a renewable energy operator to provide such services. Commercial implementation depends on the technical specifications of the installation, automation, telemetry, commercial metering and compliance with the rules of the relevant market segment.

Connecting a BESS to the electricity grid: can an existing connection point be used?

For an operational solar power station, wind farm or other energy facility, the key question is whether a BESS can be installed within the existing connection point without ordering additional capacity. Following the 2026 amendments, the law explicitly permits the total installed capacity of generation, BESS and consumption to exceed the permitted capacity at the connection point.

At the same time, the actual electricity fed into the grid and drawn from the grid must not exceed the permitted feed-in and off-take capacities, respectively. It is these parameters, rather than the battery’s nominal capacity as such, that are one of the key criteria for selecting a connection model.

If a BESS is installed without increasing the permitted draw-off or feed-in capacity, the project may be implemented within the existing connection point, provided that the requirements of the Distribution System Code or the Transmission System Code, technical requirements, proper commercial metering and the necessary procedures of the system operator are met .

If the operation of the BESS requires an increase in the permitted power draw from the grid and/or power feed-in to the grid, a connection service must be obtained. From 2026, the law also provides for a flexible connection mechanism as an alternative to individual network reconstruction or construction measures, which may be relevant for projects in nodes with limited transmission capacity.

BESS licensing, the ‘green’ tariff and commercial metering

Energy storage activities are subject to licensing if the installed capacity of energy storage facilities at a single metering point exceeds 5 MW. The threshold is determined by the installed capacity, rather than the permitted capacity at the connection point. At the same time, for a BESS used by an electricity generator at the site where generation takes place, the law provides for special cases where operation is permitted without a separate energy storage licence, provided that the established requirements are met.

For a producer with a ‘green’ tariff, the BESS regime depends on the facility’s participation in the guaranteed buyer’s balancing group. If the facility is part of such a balancing group, the BESS may, without a separate energy storage licence, draw electricity exclusively from its own generating units; there are also restrictions on the capacity of electricity supply and a requirement for separate commercial metering. If a facility with a ‘green’ tariff is not part of a guaranteed buyer’s balancing group, the law permits the BESS to be charged both from its own generation and from the grid, provided that the established capacity parameters and metering requirements are met.

For a BESS belonging to a ‘green’ tariff producer that is not part of a guaranteed purchaser’s balancing group and is charged from the grid, the law provides for a special procedure for payment for transmission, distribution and dispatch control: the basis for calculation is linked to the absolute value of the difference between the monthly electricity consumption by the BESS from the external grid and the monthly electricity fed into the grid that was previously drawn by this installation.

A guaranteed buyer may purchase electricity at the ‘green’ tariff that is fed from a BESS forming part of a supported facility, provided that the electricity drawn, stored and fed back by such a facility was generated from alternative energy sources. For the investor, this makes the traceability of the electricity’s origin and an accurate metering system critically important.

Separate commercial metering of electricity flowing to and from the BESS is mandatory: operation of the renewable energy facility without such metering is prohibited. For the investor, the metering scheme must be verified as early as the design stage, as it affects not only regulatory compliance but also calculations based on the market model and state support mechanisms.

Legal due diligence on a BESS project prior to purchase or financing

Before acquiring a BESS project, joining a joint venture or providing funding to an investor, it is advisable to carry out a legal due diligence focused not only on corporate and land issues, but primarily on the asset’s ability to operate according to the stated revenue model.

Key issues for a legal due diligence review of a BESS project:

• the legal basis for the use of the land plot and the siting of the BESS, transformers, cable lines and other infrastructure;
• compliance of the stated business model with legal requirements and market regulations;
• legal and technical parameters of the connection point, permitted power intake and output, validity of contracts and technical specifications;
• licences, market participant status, balancing responsibility and mandatory contracts;
• the commercial metering scheme and the ability to separately identify electricity flows to and from the BESS;
• contracts for the supply of equipment, construction, operation and maintenance, equipment manufacturer’s warranties, financing and insurance.

For BESS forming part of a solar or wind power plant, the impact of the installation on the ‘green’ tariff, the market premium mechanism or other support model should be checked separately, as well as the compliance of contracts with the guaranteed buyer, the system operator and other market participants with the actual operating scheme of the asset.

How to structure a BESS project prior to an investment decision

It is advisable to structure a BESS project prior to ordering the main equipment, commencing construction and securing financing. At this stage, it is still possible to change the connection scheme, the asset owner, the metering model and the contractual structure without significant additional costs.

In practice, it is worth starting by addressing four key questions: the revenue model; the permitted capacity for consumption and feed-in; the licensing and market model; and the commercial metering scheme. Following this, the corporate structure, supply and construction contracts, service contracts, financing terms and risk allocation are finalised.

The installation of a BESS by a producer with a ‘green’ tariff does not in itself constitute grounds for revising the ‘green’ tariff or other conditions of state support. At the same time, the specific model for using the BESS must comply with the specific legal requirements applicable to the relevant category of producer, in particular regarding the charging source, capacity and commercial metering.

A properly structured BESS project must pass a simple test: the technical diagram, legal framework and financial model must all describe the same asset and the same electricity flows. A discrepancy between these three levels creates the primary regulatory and investment risk.

Frequently asked questions about BESS in Ukraine

Is a licence required for a BESS in Ukraine?

Yes, if the installed capacity of energy storage systems at a single metering point exceeds 5 MW. However, for a BESS used by an electricity generator at the site where electricity is generated, the law provides for special operating regimes without the need for a separate licence, provided that the established requirements are met.

Is it possible to install a BESS at an existing solar or wind power station without increasing the connection capacity?

Yes, in principle this is possible, provided that the power drawn and supplied at the connection point remain within the permitted capacity limits and the requirements of the relevant network code, commercial metering and the system operator’s procedures are met.

Can a producer with a ‘green’ tariff charge a BESS from the grid?

This depends on their market regime. For a facility that is part of a guaranteed buyer’s balancing group, a BESS may, without a separate licence, draw electricity exclusively from its own generating units. For a facility with a ‘green’ tariff outside this balancing group, the law permits charging from the grid as well, subject to specified conditions.

Does the installation of a BESS affect the ‘green’ tariff?

The mere installation of a BESS by a producer with a ‘green’ tariff does not constitute grounds for revising the tariff or other support conditions, provided that the specific legal requirements for the relevant operating model of the installation are met.

Conclusion: what an investor should check before launching a BESS project

BESS in Ukraine already constitutes a distinct investment segment, and the 2026 amendments have made the rules governing the connection and operation of such assets considerably more specific. At the same time, the investment outcome depends on the extent to which the legal structure aligns with the technical and financial model.

Before making an investment decision, three things should be confirmed: the BESS can operate at the chosen connection point; the chosen revenue model is permitted by legislation and contracts; and the commercial metering system allows all electricity flows to be correctly identified.

The GOLAW team supports BESS projects in Ukraine: from business model analysis and connection to legal due diligence, structuring acquisitions or financing, and preparing contractual documentation. For BESS systems forming part of an existing solar or wind farm, or as a standalone investment asset, it is advisable to review the legal model before ordering equipment and incurring major capital expenditure.

The article was written by:

Oleksandr Melnyk, Partner at GOLAW, Head of Corporate Law and M&A practice, Attorney at law

Oles Riabchuk, Senior Associate at Corporate Law and M&A practice at GOLAW, Attorney at law