D.Trading, a company part of Rinat Akhmetov's business group, could make up to UAH 400 million in profit from reselling electricity that state-owned NNEGC Energoatom sold at undervalued prices just before the sharp rise in market prices. The total profit of private traders in this scheme could reach about UAH 2 billion.
This is stated in a letter from Andriy Gerus, Chairman of the Verkhovna Rada Parliamentary Committee on Energy and Housing and Communal Services, addressed to the Cabinet of Ministers of Ukraine, the Office of the President, the leadership of the Verkhovna Rada, and other state bodies.
As Gerus notes, on January 14, NNEGC Energoatom held an auction for the sale of baseload electricity for the period from January 21 to 31. 2,100 MW were sold at an average price of UAH 7,566 per MWh. The total volume of electricity sold was 554,400 MWh.
Just three days after the auction, the price of electricity on the day-ahead market increased to 13,233 hryvnias per MWh — almost 75% more than the auction price of Energoatom.
According to Andriy Gerus' calculations, assuming that such prices will be maintained until the end of January, the difference between the sale price and the market price will lead to the redistribution of about 2 billion hryvnias from the state-owned company Energoatom to private traders. These funds are the state's unearned income and the actual income of the companies that bought electricity at the auction.
Almost 20% of the total electricity volume at this auction was purchased by D.Trading, a company from Rinat Akhmetov's group. Thus, the potential profit of this company from further resale of electricity could amount to about 400 million hryvnias in just one billing period.
The remaining volumes were distributed among more than a dozen other traders. At the same time, as Gerus notes, at least 15 companies sharply increased the volume of electricity purchases - by 2-5 times compared to their previous activities. At the same time, about 45 other market participants, on the contrary, reduced the volume of purchases by half.
According to the chairman of the Verkhovna Rada's energy committee, such atypical behavior of individual companies may indicate that they either knew in advance about the upcoming revision of the maximum electricity prices, or at least understood the high probability of such a decision by the regulator.
This is a decision by the National Commission for State Regulation of Energy and Utilities to increase the so-called price caps — the maximum permitted prices for electricity. On January 16, the National Commission for State Regulation of Energy and Utilities increased the maximum price from UAH 5,600–6,900 depending on the time of day to UAH 15,000 per MWh throughout the day.
Formally, the decision was explained by the need to stimulate electricity imports from Europe, where prices exceeded previous Ukrainian restrictions. However, the result was a sharp increase in prices for all electricity within the country, since contracts for utilities, transport, military units, hospitals, schools and regional energy companies are directly tied to the price on the "day-ahead" market.
Andriy Gerus also points out that lobbying for price cap increases began on January 8 during a meeting of the Anti-Crisis Energy Headquarters chaired by Prime Minister Yulia Svirydenko. This meeting was attended by a representative of NNEGC Energoatom, who, according to the logic of events, could have known about possible regulatory changes even before the auction.
In addition, on January 14, the issue of energy was discussed at a meeting at the President of Ukraine. It was attended by Prime Minister Yulia Svyrydenko, Minister of Energy Denys Shmyhal, Head of DTEK Group Maksym Timchenko, Head of NPC Ukrenergo Volodymyr Zaychenko, and Head of the Servant of the People faction Davyd Arakhamia. Public comments indicated that the issue of increasing electricity imports was discussed, but no specific decisions were made public at the time.
On January 15, the Cabinet of Ministers of Ukraine adopted a resolution “Some issues of overcoming the consequences of a state-level emergency in electric power systems,” which recommended increasing price caps by 82.5% to 15,000 hryvnias per MWh. The very next day, the National Commission for the Regulation of Energy and Power Generation and Energy of Ukraine implemented this recommendation. At that time, Energoatom had already sold electricity at prices half the new limit.
Andriy Gerus believes that the only way out of the situation should be to immediately terminate the electricity purchase and sale contracts concluded at the auction on January 14 and hold a repeat auction. According to him, the terms of the contracts allow this to be done without penalties.
In response to the publication of the information, D.Trading said it had purchased 380 MW of baseload capacity, which is about 18% of the auction volume and is lower than in the previous decade. The company emphasized that the auction was held in a highly competitive environment — about 60 companies participated, and the price increased by 15% compared to previous auctions.
D.Trading also noted that the date of the auction is determined exclusively by the seller, NNEGC Energoatom, and at the time of the auction there was no official information about the regulator's intentions to change the price restrictions. The company added that electricity was also sold at similar prices during this period by Ukrhydroenergo, Guaranteed Buyer, Zakhidenergo, Dniproenergo, and Eurorekonstruktsiya.
A separate background to this situation are the scandals surrounding the management of Energoatom. Last fall, the National Anti-Corruption Bureau of Ukraine exposed a scheme of so-called “barrier” in tenders of the state company with the participation of the top management of Energoatom and the business group of entrepreneur Timur Mindich. On the eve of the arrests, the then head of the company, Petro Kotin, resigned.
Currently, the new head of Energoatom is to be elected by the supervisory board, but the process is effectively blocked. In December, four foreign independent members were elected to the supervisory board — Rumina Velši, Laura Garbenchuņe-Bakienė, Patrick Fragman, and Bryce Bouillon. At the same time, the government has not yet filled the state quota, which makes it impossible to make key management decisions.
Formally, Energoatom is under the jurisdiction of the Ministry of Economy of Ukraine, previously headed by Yulia Svyrydenko, and now by Oleksiy Sobolev. Denys Shmyhal, who worked in Rinat Akhmetov's DTEK group before entering the civil service, became the Minister of Energy on the day of the auction, January 14.
