Ukraine is creating more favorable conditions for the development of the renewable energy sector, primarily by improving the auction mechanism and reducing the financial burden. These changes are being implemented by Law No. 4777-IX, which was signed by the President of Ukraine on March 9.
This was reported by the Verkhovna Rada.
Law No. 4777-IX became draft law No. 13219 "On Amendments to Certain Legislative Acts Regarding the Improvement of the Functioning of Energy Markets, Competitive Conditions for the Production of Electricity from Alternative Energy Sources, and the Strengthening of Energy Security." It is designed to stimulate the development of renewable energy through the following changes:
- introduction of a premium mechanism for renewable energy producers;
- improvement of auction procedures;
- reduction of the size of bank guarantees for investors;
- extension of industry support until 2034.
More about the changes
Instead of contracts for difference (CfD), a "clean" market premium (FiP) model will be introduced. Auction winners will thus receive a market premium agreement as a guarantee. An important aspect is that the price for energy at the auctions will now be determined by demand rather than administrative means.
The validity of the "green" auction mechanism has been extended for five years, until December 31, 2034, allowing for advance planning of investments in alternative energy.
The law reduces the amount of the bank guarantee for auction participants: for each awarded kilowatt, the cost decreases from €15 to €10, and in case of extended construction deadlines, from €30 to €10.
The formation of quotas is becoming more flexible. The minimum share for producers by individual renewable technologies has been reduced from 10% to 5%.
“The document improves the electricity origin guarantee mechanism in line with EU requirements, which is crucial for international buyers and export contracts. In addition, it enables the integration of battery energy storage systems (BESS) into the cable pooling mechanism, opening up new opportunities for the development of the energy storage market in Ukraine,” explained the Ministry of Energy.
EcoPolitic previously reported that during 2025, more new wind power capacity was built in Ukraine than in the previous three years combined.
In the solar energy segment, in 2025, equipment with a capacity of 1.5 GW was installed, which is almost double the level of the previous year.
