In brief
Raising the price caps on the wholesale electricity market during daytime hours, according to the NEURC, reduced the duration of outages by roughly one and a half rounds. The regulator’s head, Yurii Vlasenko, spoke about the effect of the mechanism change at a session of the Verkhovna Rada.
Why this happened
In mid‑January the regulator raised the price caps after a series of missile‑and‑drone strikes on the power system. As a result of damage and forced restrictions on certain types of generation, losses of available generating capacity during peak hours reached large percentages of consumption.
"In peak periods losses of available generating capacity reached up to 40% of the volume of actual electricity consumption in the country. This means that almost half of the needs could not be met by domestic generation without resorting to emergency reserves, imports, or consumption restrictions."
— Yurii Vlasenko, head of NEURC
How raising the price caps helped
The higher upper price limit sent an economic signal to the market: imports became more profitable and their volumes grew significantly. In the first ten days of February, according to the regulator, imports nearly doubled compared with early January — daily deliveries reached about 50,000 MWh, or almost 20% of daily consumption. This relieved pressure on domestic generation and reduced outages.
"Record volumes of imported electricity were mobilized... This allowed the duration of electricity outages for consumers in Ukraine to be reduced by one and a half rounds."
— Yurii Vlasenko, head of NEURC
Technical details of the decision
According to the NEURC decision, from 17 January through 30 March inclusive the maximum price cap on the day‑ahead and intra‑day markets is set at UAH 15,000/MWh, and for the balancing market — UAH 16,000/MWh in all hours.
What this means for people and business
The decision produced a short‑term effect on energy availability — fewer outages means more stable operations for businesses and household consumers. However, higher price caps may also affect wholesale and potentially retail prices. Therefore it is important that the regulator and government act on two fronts in parallel: secure imports and reserves now, and accelerate restoration of domestic generation and investment in network resilience.
Analysis and forecast
The NEURC decision is a rational response to a resource deficit and external pressure (including rising prices on neighboring European markets). The social effect — reduced outages — is already noticeable. The next step must be technical and economic: reduce the system’s vulnerability through diversification of supplies, preserve social guarantees for the most vulnerable consumers, and incentivize repair and modernization of generation.
Now the question for market leaders and international partners: how much will this temporary relief turn into a lasting strengthening of Ukraine’s energy security?
