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PRESIDENT OF UKRAINE SIGNS LANDMARK LAW ON CAPACITY BOOKING

On 07 February 2025, President of Ukraine Volodymyr Zelenskyy signed Law No. 4213-IX, officially titled “On Amendments to Certain Laws of Ukraine in the Energy and Heat Supply Sectors to Clarify Provisions Related to Martial Law in Ukraine” (registration No. 9381). This long-anticipated legislation introduces several key market provisions. 

The law addresses market abuse in the wholesale electricity market, disclosure of insider information, penalties for violations, electricity imports, cogeneration plant status, licensing, active consumers, green auctions, and more. However, one of its most significant provisions is the introduction of the capacity booking/reservation service, a game-changing measure for the Ukrainian energy market. 

Key Provisions: 

• Capacity Booking Service – A new service provided by the TSO (NPC Ukrenergo) that allows developers to book technical solutions for the grid connection scheme of their generating capacities for up to two years. This service is available for wind energy projects with a capacity of 20 MW or more. 
• Reservation Fee – Set at €5 per kW of reserved capacity, payable within 20 days to an escrow account. Non-payment results in contract termination. If a grid connection agreement is signed, the reservation fee is credited toward the connection fee. 
• Grid Connection Technical Conditions – The validity period of grid connection terms can be extended to six years through an additional agreement. A three-year extension is possible upon approval of project documentation, payment for connection, and receipt of construction permits. 
• Advance Payment for Grid Connection – A mandatory prepayment of €10 per kW of ordered capacity. Payments are made in two installments:  50% within 30 days and 50% within 12 months. 
• Installed Capacity Flexibility – The total installed capacity of a project can exceed the capacity agreed upon with the TSO or DSO at the connection point, as long as instantaneous power injection into the grid does not exceed the contractual limit. 
• Construction of Grid Infrastructure – Developers of projects over 1 MW can design and build the grid connection infrastructure themselves, with costs included in the overall non-standard connection fee. 
• Green Auctions Reform – The maximum quota share a single business entity (or entities with the same ultimate beneficial owner) can bid for in a green auction has been increased to 50%. 
• Financial Obligations – During martial law, the enforcement of financial obligations for electricity market participants listed by the NEURC is suspended. 
• Debt Repayment – Excess revenues from dispatch activities in 2023 and 2024 will be allocated to repaying TSO debts and covering operational expenses. According to the NPC Ukrenergo, this measure will channel approximately 12-13 billion UAH into market debt settlements. 

The UWEA expresses its gratitude to the Parliamentary Committee on Energy and Utilities for reviewing and supporting these provisions, as well as to the President of Ukraine for signing this critical legislation.  By introducing the capacity booking service and directing funds toward electricity market debt repayment, this law represents a significant step toward enhancing market stability, improving investment attractiveness, and securing energy resilience during wartime conditions.