Digest of Recent Legislative Developments in the Fields of Energy and Natural Resources II

Electricity

• Recalculation of "Green" Tariffs
• Amendments to the Resolution on Stable Functioning of the Electricity Market
• Amendments to the Regulation of the Register of Electricity Facilities and Electrical Installations
• State Support for the Installation of Generating Facilities
• Amendments to the Resolution on Temporary Connection of Electrical Installations
• Changes to the regulation of the guaranteed buyer

Gas/Oil

• Amendments to the Methodology for Calculating the Tariff for Natural Gas Distribution Services
• Amendments to the Reporting Forms on Tariffs for Gas Storage Services

Licensing

• Amendments to the Procedure for Monitoring Licensees' Compliance with Legislation

Regulation of information and reporting

• Introduction of a Test Regime for Disclosure of Insider Information
• Amendments to the Reporting Rules
• Improvement of the Report Review Process
  Protection of Restricted Information
• Changes to the regulation of the Guaranteed Buyer

Other

• Amendments to the Procedure for Determining the Amount of Fines
• Exemption from Taxation of Imports of Goods for the Energy Sector
• Agreement for Participation in Special Auctions Published

Electricity

1. Recalculation of "green" tariffs | On 28 June 2024, the NEURC recalculated the "green" tariffs because the average official exchange rate of UAH to EUR for the period from 29 May 2024 to 27 June 2024 was UAH 4364.6663 per EUR 100, and adopted the following resolutions:

• on the establishment of "green" tariffs for electricity and a surcharge to the "green" tariffs for compliance with the level of use of Ukrainian-made equipment for business entities
• on the establishment of "green" tariffs for electricity produced by generating facilities of consumers, including energy cooperatives, with an installed capacity of less than 150 kW
• on the establishment of "green" tariffs for electricity produced by generating facilities of private households.

2. Amendments to the Resolution on Stable Functioning of the Electricity Market | On 28 June 2024, the NEURC adopted amendments to the Resolution on ensuring the stable functioning of the electricity market, including the financial position of electricity market participants for the period of martial law in Ukraine. The amendments are necessary to ensure that market participants can avoid transactions that result in a negative balance of more than 1 MWh for the billing period.
3. Amendments to the regulation of the Register of Electricity Facilities and Electrical Installations | On 3 July 2024, the NEURC adopted amendments to Resolution No. 2624 to ensure the quality and completeness of data in the Register of Electricity Facilities and Electrical Installations of Consumers Using Alternative Energy Sources.
4. State support for the installation of generating facilities | On 3 July 2024, the Cabinet of Ministers of Ukraine adopted amendments to the Procedure for Providing Financial State Support to Individuals who install generating facilities generating electricity from alternative energy sources in their households.
5. Amendments to the Resolution on Temporary Connection of Electrical Installations | On 10 July 2024, the NEURC adopted amendments to the Resolution on Peculiarities of Temporary Connection of Electrical Installations to the Distribution System during the Period of Martial Law in Ukraine, which:

• introduce a mechanism for additional control during the procedures for connecting new generating capacities
• define the requirements for project documentation
• clarify the form of information submission for providing temporary connection services.

6. Changes to the regulation of the Guaranteed Buyer | On 26 July, the NEURC adopted amendments to Resolution No. 641, which provide for:

• approval of individual agreements on increasing the share of electricity production from alternative sources
• reduction of the cost of support for the production of electricity from alternative sources by the amount of income from the sale of guarantees of origin
• clarification of the provisions of standard contracts for the transfer of guarantees of origin and reduction of penalties for late payments from 7% to 1%

Gas/Oil

1. Amendments to the Methodology for Calculating the Tariff for Natural Gas Distribution Services | On 10 July 2024, the NEURC adopted amendments to the Methodology for Determining and Calculating the Tariff for Natural Gas Distribution Services to determine the specifics of setting and reviewing tariffs for natural gas distribution services during the martial law in Ukraine and six months after the month in which martial law is terminated or cancelled.
2. Amendments to the reporting forms on tariffs for gas storage services | On 10 July 2024, the NEURC adopted amendments to the annexes to the reporting form on the application of tariffs for storage, injection, and withdrawal of natural gas, which set out in a new version Annexes 3 and 8 to the reporting form, to expand the list of information to be provided by the gas storage operator.

Licensing

1. Amendments to the Procedure for Monitoring Licensees' Compliance with Legislation | On 10 July 2024, the NEURC adopted amendments to the Procedure for Monitoring Licensees’ Compliance with Legislation in the Energy and Utilities Sectors, which clarify the provisions on issuing certificates for inspections, including their issuance in electronic form.

Regulation of information and reporting

1. Introduction of a test regime for disclosure of inside information | On 28 June 2024, the NEURC approved amendments to NEURC Resolution No. 614, which provide for a 60-day test regime for disclosure of inside information on platforms, during which no penalties are applied.
2. Amendments to the Reporting Rules | On 10 July 2024, the NEURC adopted amendments to the Reporting Rules in the areas of heat supply, centralised water supply and sewerage, which determine the procedure for applying a coefficient to utility tariffs during martial law.
3. Improvement of the report review process | On 10 July 2024, the NEURC adopted amendments to certain NEURC resolutions to improve the process of reviewing reports on the implementation of the Compliance Programmes for the previous calendar year by the Compliance Officers.
4. Protection of restricted information | On 10 July 2024, the NEURC adopted amendments to the Resolution on the protection of information that may be classified as restricted information under martial The NEURC considers it reasonable to publish the Distribution System Operator's Compliance Programmes and reports on their implementation for the previous calendar year by the authorised persons on compliance. At the same time, close access to the information contained in certain provisions is envisaged.
5. Clarifications on REMIT requirements | On 15 July 2024, the NEURC published on its website answers to the most frequently asked questions on the implementation of the European Union's Regulation on Wholesale Energy Market Integrity and Transparency (REMIT ) in the context of inside information disclosure. In particular, the document addresses the issues of what exactly is considered inside information, the procedure for its disclosure, and how market participants can ensure transparency of their operations. The regulator also emphasised that the answers to the questions may be updated and supplemented with new clarifications at the request of market participants.

Other

1. Amendments to the Procedure for Determining the Amount of Fines | On 28 June 2024, the NEURC adopted amendments to the Procedure for Determining the Amount of Fines imposed by the NEURC to clarify the circumstances for which a reduction in the amount of a fine may be applied.
2. Exemption from taxation of imports of goods for the energy sector | On 16 July 2024, the Parliament of Ukraine adopted the Law amending the Tax Code of Ukraine regarding the exemption from VAT on importing goods for the production and repair of mechanised demining machines. The Parliament also adopted the Law on Amendments to the Customs Code of Ukraine regarding the exemption from customs duties and VAT on importing energy equipment, wind and solar generation equipment, and batteries.
3. Agreement for participation in special auctions published | On 24 July 2024, NPC Ukrenergo published an agreement for participation in special auctions for ancillary services for up to 5 years. The agreement, the procedure for its conclusion and the application form are published on the official website of NPC Ukrenergo.

By Yaroslav Petrov, Partner, Asters