European Commission Eyes to Integrate Ukraine into EU Power Market by 2027

The European Commission aims to fully integrate Ukraine into the regional power market by 2027, it said Monday, also pledging financial aid for the country’s natural gas purchases and investment support for Ukraine’s renewable energy build-out.

“The package will facilitate electricity market integration with the EU by spring 2027, together with Moldova, as well as further integration in the EU gas sector”, the Commission said in an online statement.

It announced the package at the International Summit on the Support of Ukraine in Kyiv, held on the third anniversary of Russia’s invasion.

“This will be possible if Ukraine speeds up the implementation of existing commitments under the Ukraine Plan and the Energy Community in relation to legal, regulatory and public service obligation frameworks”, the Commission added. “This includes establishing a support mechanism for vulnerable households”.

Earlier the Commission signed a deal with Moldova to help the country decouple from Russian energy supply and fully integrate into the EU energy market. The agreement includes a EUR 250 million ($261.9 million) support package from the EU for 2025.

“In the longer term, the EU support will allow Moldova to improve its energy security through investments and reforms for the energy transition and ensure the full phase-out of Russian supply of energy resources”, the Commission said in a statement February 4.

The power systems of Moldova and Ukraine, which are both seeking EU membership, have been synchronized with the European continental network since March 2022 in response to Russia’s invasion a month earlier.

“We will fully integrate Ukraine’s and Moldova’s electricity market with our electricity market by the end next year”, Commission President Ursula von der Leyen told the summit Monday, according to an official transcript.

The Commission also committed funding assistance for gas purchases, mainly through the Ukraine Facility. The facility is a stable EU funding platform to support Ukraine amid the war. The facility offers up to EUR 50 billion for 2024-27.

The gas procurement assistance “will result in ample gas reserves to ensure security of supply, benefiting both Ukraine and the wider region”, the Commission said.

Von der Leyen told the summit, “[W]e will seize the full potential of Ukraine’s vast gas storages, of which 80 percent are located close to EU Member States”.

The Commission added, “The package will accelerate investments in renewable energy, adding up with up to 1.5 GW [gigawatts] of generation capacity”.

Also channeled through the Ukraine Facility, the renewables support represents a growth of about 25 percent in Ukraine’s renewables-based generation capacity, according to the Commission.

“Ukraine’s civilian energy infrastructure has been the target of relentless Russian attacks over the past three years, with half of the country’s energy infrastructure destroyed”, it said. “Only a fully independent energy system can shield Ukraine from current attacks and future pressure.

“Ukraine’s full integration with the EU energy market will act as part of the overall security guarantees the EU can provide, as well as an effective pre-condition for reconstruction as energy security is key to allow for investments to flow across the country”.

According to the statement, the EU delivered over EUR 2 billion of energy support to Ukraine over the past three years. “Support was primarily delivered via the Ukraine Energy Support Fund, the Union Civil Protection Mechanism, as well as humanitarian aid and proceeds from Russian immobilized assets”, the Commission said.

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