dusting off ukraine's energy sector - why the country must address inefficiency and pollution at its...

8/9/2019 Dusting off Ukraine's energy sector - Why the country must address inefficiency and pollution at its ageing coal-fire

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eptember 2014

Dusting off Ukrain 's

n rgy s ctor

Why the country must address inefficiency and

pollution at its ageing coal-fired poer plants


2/24

!uthors list"

#oana $iuta% $&& ankatch (etork

#onut !postol% $&& ankatch (etork

!cknoledgements"

)leg Sa*itsky% (ational &cological $entre of Ukraine

Sla*ka +utsay% (ational &cological $entre of Ukraine

&diting"

Da*id ,offman% $&& ankatch (etork

ayout"

S*en ,aertig-.okar/% $&& ankatch (etork

.his publication has been produced ith the financial assistance of the &uropean Union .he content of this

publication is the sole responsibility of $&& ankatch (etork and can under no circumstances be regarded

as reflecting the position of the &uropean Union


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Why Ukraine must address inefficiency and pollution at its ageing coal-fired poer plants 1

$ontents

ain findings 2

oer generation 4

&lectricity production 3

$oal a pillar of Ukraine's energy sector 5

&missions from coal-fired poer plants 6

&lectricity trade 11

olicy a*enues 12

!doption of the &nergy Strategy of Ukraine until 2070 12

Ukraine in the &nergy $ommunity 12

8ooming in on Dobrot*ir 13 .he Dobrot*ir poer plant 13

9esidents of Dobrot*ir 16

ocal business in Dobrot*ir a big challange 1:

$onclusions 20


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ain findingsUkraine;s energy sector faces unprecedented challenges% from a reliance on eD? is three times

than the &U-a*erage% hile carbon dioD are the highest in &urope1

Despite these losses% coal poer plants are still able to sell electricity at *ery lo prices due to

the country's state aid regime

.his paper is based on a three-day field *isit to Ukraine in @uly 2014 by $&& ankatch (etork

and the (ational &cological $entre of Ukraine =(&$U? acked by desk research% the report finds

that"

While Ukraine must reform its energy sector% change is not likely to happen fastUkraine

generates electricity from nuclear poer plants =most of hich no operate beyond their

designed lifetime and represent a threat for the entire continent? and coal poer plants

=ith limited pollution control% most if not all of hich should ha*e stopped operating as

ell?% ith a small share of hydropoer Ukraine faces a great challenge in phasing out

these capacities

!lthough a $ontracting arty to the &nergy $ommunity .reaty% Ukraine counts on

gaining a derogation from implementing the en*ironmentalacA is% in spite of the social%

health and economic impacts of operating these old and polluting coal poer plants #n

!pril 2014 Ukraine reAuested of the &nergy $ommunity .ask Borce on &n*ironment that

its already fle


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times 9educing emissions at poer plants is not cheap% and such in*estments do not

make sense for poer plants built in the se*enties ithout first replacing maHor

eAuipment =also not cheap?% as the plants ould not be able to operate long enough topay back the money in*ested to reduce emissions (one of the coal-fired poer plants

in Ukraine ha*e any S)< and ()< pollution control% hile the current eAuipment that

filters ash at these plants has already been used for decades

#n estern Ukraine% the coal poer plants Dobrot*ir and 'urshtynare connected to the

&uropean grid and e


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oer generation.he folloing table shos Hust ho old is Ukraine;s fleet of coal-fired poer plants .heir totalcapacity is 26 :0 W% ith Dneproenergo the largest oner at : 400 megaatts =W? While

most of these companies are state-oned% D.&+% a pri*ate company% ons Shidenergo and

controls Dneproenergo and 8ahidenergo

!s much of the base load in Ukraine is pro*ided by nuclear poer% most thermal poer plants

are used for load le*elling% for hich a plant si/e of 200700 W is considered optimal% as they

operate at a lo utilisation factor arge ne poer plants are not currently considered a

necessity in Ukraine4 While the planned plants in Ukraine are to be of the supercritical or ultra-

supercritical *ariety% using fluidised bed combustion% no ne plants are planned in the near

future% apart from some discussion about a ne unit at Dobrot*ir% ith @apanese in*estment

4 #&! $lean $oal $entre% rospects for coaland clean coal in Ukraine% (o 11E3 @une 2011%http"EEiea-

coalorgukEdocumentsE:25:E:05Erospects-for-coal-and-clean-coal-in-Ukraine%-$$$E1:7

$oal-fired poer plants in Ukraine

(ame )ner

Iears of unit

commissioning

Units $apacity =W?

Sla*yanskaya Donbassenergo 133-5 2 ::0

Starobeshe*skaya Donbassenergo 151-56 10 2000

ridnepro*skaya Dneproenergo 13-55 : 1:00

+ri*oro/hskaya Dneproenergo 153-67 10 7000

8aporo/hskaya Dneproenergo 162-66 6 7500

8miye*skaya $entrenergo 150-5 10 2400

.ripolskaya $entrenergo 15-60 5 1:00

Uglegorskaya $entrenergo 162-63 6 7500

Dobrot*irskaya 8ahidenergo 13-54 3 500

ady/hinskaya 8ahidenergo 160-62 5 1:00

urshtynskaya 8ahidenergo 153-67 12 2400

uganskaya Shidenergo 135-5 : 1300

+urakho*skaya Shidenergo 162-63 6 1400

8uye*skaya Shidenergo 1:2-:: 4 1200

Source" #nternational &nergy !gency% &nergy olicies 'eyond #&! $ountries% Ukraine 2012% pg 13:
http://www.iea-coal.org.uk/documents/82689/8096/Prospects-for-coal-and-clean-coal-in-Ukraine,-CCC/183http://www.iea-coal.org.uk/documents/82689/8096/Prospects-for-coal-and-clean-coal-in-Ukraine,-CCC/183http://www.iea-coal.org.uk/documents/82689/8096/Prospects-for-coal-and-clean-coal-in-Ukraine,-CCC/183http://www.iea-coal.org.uk/documents/82689/8096/Prospects-for-coal-and-clean-coal-in-Ukraine,-CCC/183http://www.iea-coal.org.uk/documents/82689/8096/Prospects-for-coal-and-clean-coal-in-Ukraine,-CCC/183http://www.iea-coal.org.uk/documents/82689/8096/Prospects-for-coal-and-clean-coal-in-Ukraine,-CCC/183


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&lectricity productionUkraine's energy system is the siermany% Brance% #taly% Spain% andthe U+ .he installed capacity of Ukrainian poer plants as 343 >W in 20173

.hermal poer plants and co-generation plants produce 747 >W or 52 per cent of Ukraine's

electricity (uclear poer plants ha*e a capacity of 17: >W or 234 per cent of the total energy

mi


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$oal a pillar of Ukraine'senergy sector$oal is seen as a source for energy% economic and political independence in Ukraine !s the

country;s main indigenous fossil energy source% coal production totaled nearly :2 million tonnes

=t? in 20116

.oday the coal sector in Ukraine is characterised by a mi< of public and pri*ate onership

ublic onership is decreasing as pri*atisation progresses D.&+:%a *ertically integrated pri*ate

holding company ith a stake in coal production as ell as poer generation and distribution%

represents around half of the coal production capacity in Ukraine .he go*ernment plans to

ad*ance the sector pri*atisation of the coal sector in the coming years

9esources

Ukraine has abundant coal reser*es%hich account for more than 0 per cent of the country;s

fossil fuel reser*es !lthough the capacity of the coal and poer sectors is ell in eas accounts for almost 40 per cent of Ukraine;s energy

usage10

ost of Ukraine's coal is located in the conflict stricken regions of Donetsk% uhansk and

Dnipropetro*sk in the Donetsk coal basin% hich continues into 9ussia .here are to other

basins% the *i*-Kolyn basin in estern Ukraine% hich continues into oland% and the Dnieper

coal basin% a lignite basin in central Ukraine Ukrainian coal is high in ash and sulphur .his

limits its e


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&missions from coal-firedpoer plants$oal-fired poer plants in Ukraine are generally old and inefficient (one of the coal-fired

poer plants in Ukraine ha*e any S)< and ()< pollution control% hile particulate matter

emissions currently eeneration Sector of Ukraine on the ay to implement $

Directi*e 2001E:0E&$ -http"EEenergy-communityorgEplsEportalEdocsE12151:0DB

12 http"EEenergy-

communityorgEportalEpageEportalE&($N,)&E&(&9>IN$)U(#.IEegalE&UNegislationO.,&!$PU#S)(&(K#9)(&

(.

&mission l * ls and int rnational obligations of

Ukrain =mgEm7?

565:

1363

2472

300 30030

400200 30

Sulfur =S)2? (itrogen =()


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Why Ukraine must address inefficiency and pollution at its ageing coal-fired poer plants :

.reaty .he e*entual fulfilment of these directi*es ill ha*e a positi*e impact on pollution

reduction% as the directi*es impose dramatic emission reductions on Ukraine;s coal-fired poer

plants

,oe*er in !pril 2014% Ukraine reAuested that the aforementioned opt-out be eroup of the &nergy

$ommunity #n this ay% Ukraine ants to continue business as usual in implementing the #&D%

ithout properly complying first ith the $D

.he ermanent ,igh e*el >roup17

proposed that the inisterial $ouncil support an eIN$)U(#.IE#nstitutionsE,>

14 https"EEentsoeeuEdb-AueryEe


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Why Ukraine must address inefficiency and pollution at its ageing coal-fired poer plants

e


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ost of the land around the urshtyn is agricultural% and according to the and $ode of

Ukraine1:

% art 27% agricultural land has a priority o*er other categories% industry included% and

changes in the type of land use from agricultural purposes to other types is alloed only if themoti*ation for such a change is determined by a separate la

.he ash dump of the 'urshtyn coal-fired poer plant

1: http"EE/akon2radago*uaElasEshoE265:-14
http://zakon2.rada.gov.ua/laws/show/2768-14http://zakon2.rada.gov.ua/laws/show/2768-14


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&lectricity trade! portion of Ukraine;s electricity system is synchronised ith countries in eastern &urope .heurshtynskaya thermal poer plant supplies electricity to local consumers and to neighbouring

Slo*akia% ,ungary and 9omania at a total connection capacity of about 300 W% but the plant is

not connected to the rest of Ukraine oer stations at Dobrot*orskaya and urshtynskaya the

only ones that can e


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olicy a*enues!doption of the &nergy trategy of Ukraine to 2070

!fter lengthy public debates and appro*al by industry e


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a number of steps are already underay% further room for impro*ement and reform remains

Ukraine;s electricity infrastructure is ageing and deteriorating" many poer plants operate ell

beyond their technical lifetimes =see chart belo?27and at lo efficiency le*els Burthermore%limiting emissions from air pollutants at large combustion plants as reAuired under the &nergy

$ommunity .reaty ill reAuire in*estments of nearly USD 10-12 billion $onforming to these

reAuirements pro*ides an opportunity to reduce harmful air pollution and impro*e plant

efficiency

Under the original &nergy $ommunity .reaty pro*isions% Ukraine had to upgrade its plants by

201: to comply ith the $D or face closure ,oe*er in )ctober 2017 a decision24as taken

to e


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!s part of the )ctober 2017 decision mentioned abo*e on compliance of e


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8ooming in on Dobrot*ir.he Dobrot*ir poer plant

.he Dobrot*irska poer plant23

is oned

by D.&+ 8akhidenergo and located in the

estern part of Ukraine% appro


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and @#$ are proposing to alter the initial construction plan =223W7 units? into a single ultra-

supercritical 500 W unit at a cost of USD :60 million Ffor the purpose of efficiency

impro*ements and reducing emission of S)% () and dustG26 D.&+ asked in*estors to considermaking the best use of old constructions .he reasons hy Dobrot*ir as chosen and not others

in the area are that it uses combusted bituminous coal to hich US$ technology can be applied%

and the plant is near the olish border and a transmission line that could e


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9esidents of Dobrot*ir

Dobrot*ir is a ton of 5%300 people% founded in 131 ith the construction of the e


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Why Ukraine must address inefficiency and pollution at its ageing coal-fired poer plants 1:

ocal business in Dobrot*ir a big challenge

9oman #*ano*ich Depa started his fish

farming business 13 years ago in the

*illage of 9uda fi*e kilometres from

Dobrot*ir .he farm is located right after

the outfall of the ater discharge channel

from the Dobrot*ir poer plant .he

plant% as in urshtyn% does not ha*e a

cooling toer and instead uses a se*en

kilometer discharge channel that is

di*erted from the 8akhidnyi uh 9i*er

)n 23 ay 2014 hot ater as

discharged into the channel% and

temperature at the fish farm site

measured 41 to 42 degrees $elsius%

killing all the fish in the channel .he

ater discharged at the poer plant as

presumably much hotter than that !fter

the accident% dead fish from the channel

ere collected by fishermen and D.&+

employees D.&+ pro*ided trucks to carry

the fish to a aste deposit facility .he

fish farm lost all of its brood stock fish

and most of the young fish% eighing

more than si< tonnes in total !bo*e and belo"

9oman #*ano*ich Depa at his fishfarm


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Since his business started% in 1% 9oman has taken Dobrot*ir oer lant to court 1: times

,e says there ha*e been multiple accidents% in*ol*ing ater pollution and hot ater discharge

,e is a licensed public en*ironmental inspector and the deputy head of the public council for thedepartment of fishery protection in the *i* region .he accident in ay as ell documented%

and official complaints ere sent to all rele*ant institutions .he official estimate of state losses

due to en*ironmental damage is U!, 1: million% a bit more than &U9 1 million% and the losses to

the fish farm itself ere estimated at nearly &U9 100%000

Water le*els in the lake and the rate of ater discharge through the dam are set by the poer

plant operator ithout notifying the fish farm or local communities

.he poer plant operator% as concessionaire of the lake% is responsible for dredging the lake% but

it has not done so in the last 13 years .he costs of this operation are estimated at about &U9

130%000

.he poer plant is *isible behind the fishfarm


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$onclusionsUkraine;s energy sector is at crossroads and in need of large and continued in*estments toensure its modernisation% sustainability% security% self-sufficiency and competiti*eness .he

sector also needs coherent policies to ensure that en*ironmental and social protection is gi*en

due consideration% and that in the dri*e for electricity e


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scenarios and reference rele*ant literature ! recent report published by ,ealth and &n*ironment

!lliance states72

that the e


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FUkraine;s energy sector faces

unprecedented challenges% from

a reliance on e

dusting off ukraine's energy sector - why the country must address inefficiency and pollution at its...

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