The German economy never tires of praising Ukraine as an opportunity country for green energies.

Even green hydrogen will soon come from there in large quantities.

The Ukrainian government had not yet thought of hydrogen in 2009, but recognized the potential for electricity generation from biomass, photovoltaics and wind power - not least to make itself more independent from Russia.

The feed-in tariff for renewable energies decided in 2009 was correspondingly high.

Andreas Mihm

Business correspondent for Austria, East-Central and Southeastern Europe and Turkey based in Vienna.

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With the equivalent of 11 euro cents per kilowatt hour of wind power and 46 euro cents per kilowatt hour, the fee for the feed-in was above German tariffs. The exchange rate risk was averted by being pegged to the euro. That's why investors liked coming to Ukraine. They just overlooked a risk: Kiev is not paying the promised fee. Since the beginning of last year, outstanding debts have accumulated, which according to the last counts of the law firms involved still amount to 520 million euros. But now a remedy could be in sight.

Because the Ukrainian state power grid operator Ukrenergo has issued its first green bond. It was also the first emission of its kind in the country. The $ 825 million volume was almost three times oversubscribed. The demand may not have been solely due to the interest rate of 6.875 percent with a five-year term. The trust of the market participants was probably also supported by the commitment of the Osteuropabank (EBRD). She subscribed to $ 75 million in the bond. The CEO of Ukrenergo, Volodymyr Kudrytskyi, spoke of a historic day and a role model for other issuers.

And he made a somewhat convoluted promise: “It is more important that this transaction is an important step towards resolving the imbalances in the Ukrainian electricity market, in connection with the obligations of Ukraine in favor of the producers of renewable energies.” The EBRD writes much more clearly: “Mit The proceeds will cover all arrears of renewable energy producers. ”The investment will help to“ restore ”the credibility of the Ukrainian renewable energy sector and increase the confidence of private investors and financiers.

This should pave the way for much needed investments in support of the green transition.

Less than half of the debt has been repaid

The financing regime is also set to change: competition through tenders instead of fixed feed-in tariffs. Grzegorz Zielinski, at the EBRD for energy policy in Europe, says the bond "paves the way for more renewable energies to be developed through competitive auctions or other innovative commercial structures". In the future, this will provide Ukraine with “significantly cheaper and cleaner electricity”.

Above all, however, the broken confidence of investors in the Ukraine as a location after the payment collapse in 2020 is to be restored.

Some operators of wind and photovoltaic parks had turned to the Ukrainian courts in their desperation, knowing that being right and being right is even more difficult in Ukraine than anywhere else.

The Dutch Modus Energy sued Kiev in the arbitration court in Stockholm in April.

Diplomacy also became active: in November a year ago, 17 ambassadors, including the German one, wrote to the Ukrainian Prime Minister asking for the outstanding bills to be settled.