Ukraine, US sign $522m energy memorandum, with bonus for reforms

The Ukrainian and US governments have signed a memorandum providing for USD 522 million assistance for energy projects in Ukraine as Kyiv braces for another winter marred by Russian strikes on energy facilities.

The US assistance is to be allocated towards the improvement of the resilience of Ukraine’s energy system, including "through the restoration of critical infrastructure, introduction of distributed generation, reformation of the energy sector, and facilitation of Ukraine’s post-war transition to a low-carbon, competitive, and EU-integrated energy economy", per the document.

The memorandum provides for the allocation of USD 422 million to Ukraine, with another USD 100 million as a bonus subject to the implementation of several measures:

• Approve the new charter and establish the Supervisory Board of the Gas TSO of Ukraine LLC – by 30 October 2023
• Show progress in the implementation of SE NNEGC Energoatom corporatization plan, namely:
  • Launch procedures for holding a competition for the selection of members of the Supervisory Board of NNEGC Energoatom – by 30 November 2023
  • Establish Energoatom PrJSC – by 31 December 2023
• Implement the procedure on the trading in wholesale energy products related to the REMIT legislation by 1 April 2024

Last year, Russian systematic missile and drone strikes led to rolling blackouts in Ukraine that lasted for several months in a row and only ended in February.

The Ukrainian energy ministry assumes that Russia will resume attacks on the energy infrastructure with the onset of cold weather. It hopes to strengthen the resilience of the Ukrainian power system in cooperation with international partners.