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Green energy in the Ukraine

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12 October 2012


Ukrainian market of renewable energy, represented by solar, wind, small hydropower, as well as industry and the production of solid biofuels, is one of the most attractive in Europe.
This was announced on December 23 in Kiev at the news agency "Interfax-Ukraine" during the press conference "Renewable Energy in Ukraine: results of 2011" (Organizer - Association of Market Participants of Alternative Fuels and Energy Market of Ukraine (APEU), the president of APEU  - Vitally Daviy.
According to the Association, as of December 23, 2011 the total installed capacity of Ukrainian solar power plants is 170 MW,  wind farm - 117.5 MW, of small hydro power - 104 MW of thermal power generation facilities on alternative fuels (agricultural and wood waste) - 68 MW . In Ukraine, there are also two industrial enterprises for the production of liquid biofuels with a total capacity of about 30 tonnes per year.
According to the president of APEU Vitally Daviy, in 2012, these figures could increase in2 times.
"In 2010, renewable energy facilities have developed about 240 million kilowatt hours of electricity, this figure will be more than 360 million kilowatt hours in 2011. If as declared by all market participants plans to build new facilities will be met, then in 2012, Ukraine will generate about 1 billion 17 million kilowatt hours of "green" electricity ", - stated the head of APEU.
At the same time, Vitaly Daviy noted that the industry development is prevented by the Soviet legacy in the energy system of Ukraine - the construction of structures under large objects generates thermal and nuclear power plants.
Along with the features of Ukrainian energy infrastructure, an important issue for the market of renewable energy is also a local component (specific share of Ukrainian goods) in ongoing projects in Ukraine. According to the law of Ukraine renewable energy facilities to produce "green" tariff must use at least 15% of Ukrainian raw materials, equipment and services for commissioning in 2012, not less than 30% - upon delivery in 2013 and not less than 50% - upon delivery in 2014.
According to the President of the Israeli Sun Electra (which is involved in several Ukrainian construction projects for solar power plants) Peter Rosenkranz, who has participated in the press conference, it will not be difficult to follow the rule of local component in the initial stage, but further increase in the share of Ukrainian goods and services will require more high-tech contractors.
"To achieve utilization rate of local content to 15% - is not a problem in 2012, but the further process of implementing the plan is impossible to predict, because at this stage of technological development in Ukraine there is no established system of operation of high-tech enterprises", - noted the head of Sun Electra.
According to Peter Rotsenkrantz, his company is interested in projects in the field of solar energy in the Odessa area. It is assumed that the company will realize about 10 new projects with a total capacity of 25-30 MW in the next 2 years.
Mariana Sakhno,  the speaker and the representative of the company 3 W Power. (production of equipment for renewable energy facilities) also doesn’t see any problems for the industry at the beginning of the rule of the local component
"3W Power Company entered the Ukrainian market half a year ago. Next year we plan to increase our production capacity and do not see any problems in implementing the projects. There is always a legal possibility to solve such problems, "- said Mrs. Sakhno.
According to the CEO "Rentehno" (construction of solar energy) Eugene Ladnich, "Increasing the proportion of local content is promising for the Ukrainian market as an incentive for the development of an entire industry, but this process should take into account local conditions and in accordance with clear legislative mechanisms ".
Another important direction of development of alternative energy and energy efficiency of municipal, industrial and agricultural enterprises in Ukraine is the production of heat and electricity from wood and agricultural wastes.
According to APEU, potential of Ukrainian recourses allows to replace about 5 billion cubic meters of natural gas by alternative energy in the next 2-3 years. Nowadays, such projects are the most relevant to boiler facilities in communal areas, which the government was forced to subsidize to purchase the gas. According to Vitaly Daviy, transfer gas boiler for biofuels can reduce the production cost of thermal energy by 2.5-3 times.
At the same time, according to director of TD "Business Format" Sergiy Apalkov there is a difficult situation the Ukrainian market of solid biofuels today. On the one hand producers of fuel briquettes and pellets are experiencing the shortage of raw materials, on the other - the Tax Code contains a number of rules that create a conflict of laws for manufacturers of solid biofuels in terms of VAT. In particular, the raw material for production of wood fuel VAT is not charged, but the final product - is charged.
In terms of trends in the market of solid biofuels, in the opinion of the head of APEU Daviy Vitaliy, on the basis of Ukrainian exports in 2011 of solid biofuels from all feedstocks could reach more than 650 thousand tons, total production - more than 800 thousand tons. Forecast for 2012 - growth of 5-6%.
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