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Sun Times. Live journal
The doctrine of energy development, the popularization of the ideas of the RES among the public, the cooperation of power and business – such components of Ukraine energy independence noted the participants in the SunTimes panel discussion. It took place in February 5 in Vinnytsia during the opening of the first factory in Ukraine for industrial production of solar panels KNESS PV.
Key topics: stable legislation, overcoming the monopolies opposition, people's faith in renewable energy

Valerii Kotsiuba, Head of the Investment Activity Department at the State Energy Efficiency Agency, Valerii Koroviy, Head of the Vinnytsia Regional State Administration, Sergii Morhunov, Vinnytsia City Mayor and Serhii Shakalov, CEO of KNESS Group participated in the first part of the discussion. They spoke of current state of development of renewable energy, in particular, in Vinnytsia and Vinnytsia region, and the necessary actions needed to bring Ukraine's renewable energy to the level of the leading countries. At the opening of the panel discussion, its moderator – Doctor of Economic Sciences Andrii Dlihach said: «What we are going to talk about is the beginning of a great history of renewable energy development in Ukraine. This panel discussion will be devoted to the future. About how the government can help the development of renewable energy. And on the other hand – how can business turn this industry into one of the drivers of Ukraine's growth».
Valerii Kotsiuba, head of the investment activity management department at the State Energy Efficiency Agency, said: «On the behalf of the agency, I want to point out that RES is not the future but the present». To support this thesis, Mr. Valerii gave an example of the global dynamics of the growth of renewable energy capacities, which have been doubled in recent years. He noted that in 2018 the investment was $131 billion, which exceeded investment in fossil fuel power. «We see that companies that were previously engaged in traditional energy are rapidly switching to a renewable energy projects. Solar energy due to its flexibility and annual reduction of the equipment cost develops successfully», he said.
According to Mr. Valerii, today's renewable energy is developing in Ukraine with a rather high speed – by 2020 it is planned to achieve a 11% share of RES in the country's overall energy balance. It testifies that Ukraine supports the global vector of energy development and plays active role in it.
Valerii Koroviy, head of the Vinnytsia Region State Administration, drew attention to the fact that public authorities have been focusing on renewables and energy efficiency not for the first time. In Vinnytsia region, since 2013, due to the complex of measures, systemic consumption of natural gas has been reduced. In 2018 an economy of 370 million cubic meters per year was achieved, which equals 2.7 billion UAH. «These are the financial resources that have remained in the country, and did not go to Russian Gazprom», he said. «But, at the same time, the question now is: what do we have to do next? Business and budget institutions have twice reduced their gas consumption, but Teplocomunenergo reduced consumption by only 10%». The next task was formed, as the need to find the factors and incentives to accelerate the transition of classical thermal energy to renewable energy sources.
To make it real, according to Mr. Koroviy, it is necessary to look for new mechanisms. In particular, economic mechanisms that will reduce the cost of renewable energy for the consumer. «Obviously -
renewable sources need to be developed. But at the same time it is necessary to understand that these technologies are expensive», he said. «What will happen next year in connection with the introduction of amendments to the law – this should be the subject of discussion of specialists, so that we do not kill the child who was born and wants to move on».
Sergii Morhunov, Vinnytsia City Mayor, noted that renewable energy in the city context is an important component of energy efficiency in general: «If we talk about cities, then we have to work in a balanced way. This is the modernization of existing systems of heating and hot water supply to the population. Over the past 5 years, we have reduced the need for gas to 11 million cubic meters. This is an environmental component – the release of CO2 into the atmosphere. Our actions over the last 4 years have reduced CO2 emissions by 21 thousand tons». He also stressed on the need of a strategy to implement energy efficiency issues. For example, such as the concept of integrated development of Vinnytsia until 2030, which, in particular, provides measures for energy efficiency and the development of renewable energy sources. «I want to say with KNESS that we have hope for fruitful cooperation on the implementation of renewable energy in Vinnytsia», – said the mayor. CEO KNESS Group Sergii Shakalov noted that even a few years ago the company's specialists realized that the existing Ukrainian energy system based on traditional generation technologies does not meet the modern world technological and economic demands. Accordingly, the modernization of this system will be more expensive than the construction of a brand new one that would be economic and environmental. «We have an understanding of what the energy model of Ukraine should be in the future. It is 100% renewable energy. Just perceive at it as a target and look beyond the horizon. We will see what opportunities this may give to the state, business, society. Actually, that's why we chose the way for our company: the strategic goal is the development of the RES», he emphasized.
Andrii Dlihach proposed to discuss what stands in the way of investments flow into Ukraine and what we have to do to obtain at least 5% of the 131 billion dollars of world investment for RES in Ukraine? Sergii Morhunov, Mayor of Vinnytsa, replied that the city authorities are promoting the implementation of renewable energy based on utility companies. For example, a biogas plant is already operating on a household waste disposal site. Having the possibility noted as well as the necessity of introducing the general joint venture programs of producers of equipment and financial institutions on the principle of already existing programs of «warm loans». Sergii Morhunov stressed the need to create a strategy for the RES development for at least 10 years ahead.
Andrii Dlihach addressed Valerii Koroviy the following question: what should be done to head this direction? «The main problem concerns those who develop strategies and how these strategies are implemented. Strategic planning is important. I can say about the Vinnytsia region – we systematically implement the regional strategy for RES development», – said Mr. Koroviy.
He was supported by Valerii Kotsiuba: «Through fruitful cooperation, the agency, along with the parliament and profile ministries, acted as the main drivers of the law (on the development of RES), which works today and provides the following benefits: the feed-in tariff is tied to the euro and an increase for the use of equipment domestic production». And he noted that 118 potential projects have already been collected for investment of 4 billion euros, 1.7 billion euros out of which has been already invested.
However, among the main areas of work, he stressed on the need of more active educational work with Ukrainian society and Ukrainian potential investors who «hold their funds under the pillow and do not know where to find or where to apply it to get both profit and energy independence of the country. Measures to popularize RES are necessary».
Sergii Shakalov, CEO KNESS Group, continued this idea: «I believe that in Ukraine the biggest problem is not only in solar energy, but also in business development in general, I am talking about something that many of us are not ready to have long business models thinking. Our KNESS PV has an estimated payback of 5-7 years. And the question arises: who is ready to invest a lot of money in production with an unsecured payback period of 5-7 years? I think there will be very few people ready to wait so long. But with such thinking long, perspective, strategic development of Ukraine will be very difficult».
Valerii Koroviy supported Sergii Shakalov about the country being in need of changing the outdated model of organization of the energy market. «Until we have fundamentally changed the model, we will have problems», he said, stressing that it is very important for the business community to support the steps that the government has begun to take already.
Sergii Morhunov summed up the first part of the discussion, pointing out three important components of success: «Stable legislation. Overcoming the opposite of the monopolies. Faith and understanding of people that RES really brings benefit».