Who's Pushing for Higher Electricity Prices? Expert Says Ukraine Has No Real Energy Market

Ukraine's Electricity Market: A System Run by Monopolies

According to ХВИЛЯ: According to energy expert Oleh Popenko, Ukraine lacks a genuine electricity market. Instead, he argues, the sector is dominated by monopolists who are actively lobbying to raise price caps on electricity for all 24 hours of the day. Popenko specifically points to Andriy Herus, the head of the relevant parliamentary committee in the Verkhovna Rada, who he claims personally asked the National Energy and Utilities Regulatory Commission (NEURC) to increase these price caps.

The Ukrainian energy landscape currently features two major monopolists, roughly a dozen traders, and several regional power distribution companies (oblenergo). This structure, Popenko says, creates a deeply opaque environment. He contends that what is happening is not a market-driven process but rather a coordinated effort to protect the interests of specific producers. According to Popenko, the weighted average electricity price for April will not exceed 9.5 to 10 Ukrainian hryvnias per kilowatt-hour (including VAT). He adds that this price level displeases the monopolists and oblenergo, who receive compensation to cover the gap between this pseudo-market price and the regulated rate charged to households.

'The weighted average price for April will be no more than 9.5 to 10 hryvnias including VAT, which the monopolists and oblenergo really don't like, since they get compensated for the difference between the pseudo-market and the price for the population.' – Oleh Popenko

Challenges Facing Ukraine's Energy Sector

The expert also warned the public to be skeptical when they hear the term 'electricity market.' He stated bluntly: 'So when you hear the word electricity market, know that they want to screw you over again.'

Popenko's remarks highlight the significant challenges facing Ukraine's energy sector, where the dominance of monopolies threatens price stability and market transparency. These comments are particularly relevant as they raise urgent questions about the need for energy market reform to ensure fairer pricing and greater accountability for consumers. At a time when the country requires stability in its energy industry, such discussions could serve as a catalyst for changes in policy and regulation.

As the situation in Ukraine's energy sector continues to evolve, concerns about potential price increases are mounting. Experts suggest that a shift to tiered pricing could mitigate the impact of rising costs on consumers. For a deeper understanding of these developments, check out this analysis on how electricity prices might surge by 70–80% and the proposed solutions to address these challenges, including tiered pricing options.