Economist Andrian Prokip talks about this and other consequences of the enemy attack.
NEW ATTACKS. PREPARE FOR RECALLS
Last week, something everyone was supposed to be psychologically prepared for but hoped wouldn’t happen happened – massive attacks on the power grid. After the carefully planned attack on March 22 (which it was), smaller-scale strikes were carried out for several days in a row.
The energy system suffered serious damage and losses. DTEK, for example, reports the loss of half of its capacity for a long period. Significant loss of part of the capacity of DniproHES. In fact, the balancing capacities suffered serious losses. Mostly losses in frontline regions, but also in other regions there was significant damage and loss of capacity.
The gas infrastructure has also been hit. And the information attack will immediately be aimed at the reliability of non-residents' gas storage in Ukrainian storage facilities.
- I previously wrote that we should expect an attack on the energy infrastructure before next winter, but I believed that they would fall in the summer, when the power system is in the stage of an active repair campaign, and there could potentially be a shortage of capacity. The enemy decided to act earlier. On the one hand, their logic may be based on expectations about the exhaustion of our air defense, in the context of delayed assistance from the United States - they decided not to wait for active deliveries of air defense systems and missiles to them to resume. On the other hand, the period between the Russian elections and the inauguration of the new US president was an expected period of increased escalation (in short, Biden is bad for the Kremlin, but Trump is even worse, because he is unpredictable and can be more radical in his pressure). So the enemy wants to force us to freeze until the moment of a potential change of administration in Washington.
- The loss of large volumes of capacity makes us sharply dependent on imports. And, of course, it significantly cuts all hopes for exports. And it cannot be ruled out that the government will return to the export ban again in the event of a deterioration of the situation. If it is premature or too long, it will be another blow to energy companies, which already lack the funds to carry out repairs. And the need for repairs, of course, grows with each shelling.
- We have become very close to the outage schedules. Currently, we are more or less getting by stably due to imports. However, a large part of consumers in Kharkiv and Odessa are still without electricity, and when they are connected, the total consumption will increase and the risk of shortages, and therefore the schedules, will be greater. This is not to mention the risk of additional damage due to shelling. But to a significant extent, the introduction of outages depends on ourselves - whether we will be able to demonstrate responsible consumption during peak hours. It is worth leveling consumption as much as possible throughout the day, transferring some of it to the night, and not turning on powerful electrical appliances at the same time, especially during peak load hours. But if you or your neighbors cannot do this, then outage schedules, for example, emergency ones, will easily cope with this - quickly, without unnecessary conversations and persuasions. However, there will be no comfort either.
- How to solve the problem of shortage? We need distributed generation, semi-peak and peak – a lot and a little power, dispersed across the country. And also the development of networks, in particular low-voltage class, to increase the reliability of the system, which, accordingly, would be more difficult to disable by missile strikes. Perhaps, now it is worth not fantasizing about future volumes of gas exports (and the head of Naftogaz Oleksiy Chernyshov recently spoke about this), but about how much of it will be needed to ensure the operation of decentralized generation. Talks about how our exports will grow day by day look like stubbornly not noticing the elephant in the room. Of course, exports are important for the economy. But let's not just guess, but take into account all the risks for the gas transportation system and storage facilities in the face of potential large-scale shelling. Reliability and uninterrupted power supply first and foremost.
- To implement the decision to build a new small decentralized generation, we have almost everything, except incentives for the emergence of such generation. Administrative methods here, unfortunately (or fortunately), will not work. But as soon as there are economic incentives for investing in such capacities and infrastructure, it will begin to appear. This, in particular, is about the problem of debts in the market, and about price restrictions.
