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The largest energy company in Ukraine asks the state to intervene in the situation with coal supplies

Ukraine

State coal mining enterprises are able to provide TPPs of PJSC "Centerenergo" with only one third of the demand, therefore the situation with coal for TPPs requires government intervention.

The largest energy company in Ukraine asks the state to intervene in the situation with coal supplies

State coal mining enterprises of Ukraine are able to meet the needs of thermal power plants (TPP) of PJSC "Centrenergo" only one third of the need. This is stated in a press release of PJSC "Centerenergo", which stated that the situation requires immediate government intervention.

In particular, in November-December, deliveries of coal from state mines, previously guaranteed by the Ministry of Energy of Ukraine, amounted to less than 30%. While the production of state thermal generation during this period amounted to a third of all thermal generation in Ukraine and exceeded the forecast balance of the Ministry of Energy by 30-50%. In a situation of acute shortage of coal, which developed under the aforementioned circumstances, private suppliers raised the price of coal from UAH 1,650 to UAH 1980 per ton.

According to Centrenergo, the economy and practice prove the need to import coal, given the shortage of domestic production despite a lot of political speculation.

“Thermal power engineering is in a difficult state - because of the crisis in the coal industry, and because of imperfect market rules, and through the incomparability of the market price of electricity with its cost,” the company noted.

Centerenergo stated that there is no program of reorganization of the state coal industry in Ukraine, and the creation of a vertically integrated company by merging with state coal mining enterprises is being carried out only in words.

“It is only conditionally possible to draw conclusions about the real potential of production and profitability, based on any analyzes and audits. A clear answer can only be given by properly developed and approved feasibility studies for further operation, and mine reconstruction projects to bring them to a breakeven level of coal production, "Centrenergo noted.

At the end of 2020, there were 29 state mines operating in Ukraine with a design capacity of more than 25 million tons per year. In January 2021, they were joined by five Dobropolyeugol mines, which were returned early from the lease, after which the total design capacity of the public sector of coal mining amounted to 32.6 million tons per year.

“All these enterprises were unable to meet the needs of PJSC“ Centerenergo ”with marketable coal products of the gas group in the amount of 4.2 million tons, which corresponds to the forecast balance of the Ministry of Energy, therefore the issue of reforming the coal industry remains extremely urgent - to prevent a recurrence of the crisis in the season ", - summed up in" Centrenergo ".

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