Ministry of Energy’s four steps to resolve the crisis in Ukrainian electricity market
The Ministry of Energy proposes the following steps to resolve the crisis in the electricity market: the whole generation sells through the exchange, reliability and impartiality of exchanges, indicative - the market price of direct contracts, termination of the requirement to sell 10% of production at day-ahead electricity for state generation.
First Deputy Energy Minister Yuriy Vlasenko wrote about this in his blog on Economichna Pravda newspaper. In particular, it is proposed to adopt the following changes to the functioning of the market, with their justification:
1. Requirement for all electricity producers, regardless of ownership (both public and private) to sell electricity exclusively at auctions through commodity exchanges.
2. Clear rules for creating commodity exchanges so that they ensure their reliability and impartiality. "A commodity exchange must ensure its reliability, otherwise it will face a "wallet penalty" and revocation of the license. This will be a sufficient incentive for whether they carried out transparent activities, did not resort to manipulation and were not subject to the influence of large producers," Vlasenko said.
3. A new indicator of the price of electricity - the market price of bilateral contracts.
4. Termination of the requirement for the state generation vested with public special obligation (PSO) in the electricity market, to sell 10% of the total production volumes traded in day-ahead electricity market.