Ukraine is preparing for “energy visa-free travel”: NEURC is introducing new rules
21 April 18:30
The National Commission for State Regulation of Energy and Public Utilities has begun implementing Law No. 12087-d. This is stated in a press release from the regulator, as reported by "Komersant Ukrainian".
The document provides for the integration of the Ukrainian electricity market into the European market, the implementation of European Union legal standards, and the enhancement of supply security and competition.
Key idea: market integration
The central element of the reform is the introduction of a market coupling mechanism.
This refers to:
- the integration of the “day-ahead” market (DAM);
- integration of the intraday market (IDM) with European markets.
This means that:
- electricity prices will be set more in sync with the EU;
- the role of cross-border trade will increase;
- the Ukrainian market will become part of a broader European system.
What will change
The NEURC is preparing a major overhaul of the rules of the game.
Updates to existing documents:
- electricity market rules;
- rules for the day-ahead and intraday markets;
- retail market rules;
- codes for transmission and distribution systems;
- commercial metering rules;
- licensing conditions;
- tariff-setting methodologies.
New regulatory acts:
- procedures for the operation of the nominated market operator (NEMO);
- capacity provision mechanisms;
- rules for providing flexibility services;
- implementation of European methodologies and procedures.
Why is this necessary
The reform has several strategic objectives:
1. Integration with the EU
Ukraine is moving toward full integration into the European energy market.
2. Competition and transparency
The new rules should:
- reduce price distortions;
- increase competition among suppliers.
3. Grid stability
Better balancing and access to European resources improve system reliability.
What is market coupling in simple terms
It is a mechanism where:
- markets in different countries operate as a single entity;
- electricity “flows” to where it is more expensive;
- prices are balanced across countries.
For Ukraine, this means:
- more imports during periods of shortage;
- more exports during periods of surplus;
- less market isolation.
Implementation Challenges
Despite the advantages, the process will be complex because it requires large-scale legislative changes, demands technical synchronization with European systems, and may lead to price fluctuations in the initial stage.
