Ukraine holds significant renewable energy potential, previously one of the largest in Europe, with capabilities extending to 874GW, including 250GW from offshore wind. The sector has suffered USD 56.2 billion in damages due to the war, necessitating USD 50.5 billion for reconstruction. Ukraine’s pre-war energy infrastructure included 13.8 GW from nuclear power and substantial capacities in onshore wind, solar, and hydroelectric power.
RES accounts for 25% of installed capacity (excluding prosumers) while reconstruction and new investment are underway in
safer regions. Furthermore, strategy positions RES as key to EU-aligned recovery.
Around 24% of RES assets are now damaged or inaccessible, yet momentum is returning.
Despite the disruptions, Ukraine’s RES transition remains central. Between 2016 and 2021, the country expanded its installed RES capacity (solar, wind, biomass, small hydro) more than 8x to 9.6 GW.
Ukraine’s energy sector is a critical pillar of national security and economic recovery. The sector is undergoing a historic transformation, both forced by war and driven by long-term strategic goals. The sector offers unparalleled opportunities for investment in view of upcoming EU integration, it shift towards decentralised and green energy and the need to rebuild energy-related infrastructure (e.g., electricity, gas, oil, and heating). Given its natural endowments and regulatory alignment with the EU, Ukraine could emerge as a future cornerstone of regional energy security and the European Green Deal.
Energy in Ukraine
Market Model and Regulatory Framework.
Since July 2019, Ukraine has operated a multi-level liberalised electricity market aligned with the EU’s Third Energy Package and long-term integration into the European Energy Union. The market includes the Bilateral Contracts Market (BCM) for long-term energy contracts, the Day-Ahead Market (DAM) as a centralised price-setting mechanism, the Intraday Market (IDM) for delivery adjustments, the Balancing Market (BM) for real-time dispatch and deviation correction, and the Ancillary Services (AS) Market, which procures reserves (FCR, FRR, aFRR) to maintain system stability. NEC Ukrenergo acts as the TSO, overseeing dispatch, settlements, and reserve
procurement.
Current state of the power system
Ukraine’s energy sector has endured severe challenges during the war, with over 9 GW of capacity destroyed and 18 GW, including the Zaporizhzhia NPP, under occupation. The imbalance in electricity supply and demand, driven by a reliance on nuclear and weather-dependent renewable sources, has left the country dependent on ENTSO-E imports and power outages to stabilize consumption. Despite these difficulties, Ukraine is conducting its largest-ever repair campaign and commissioning new facilities, showcasing its determination to restore energy stability amidst conflict.
Prospects for the development of electricity generation
In 2024, Ukraine’s power system demonstrated remarkable resilience despite ongoing Russian attacks that caused significant damage to infrastructure and capacity losses.
The government advanced its “green recovery” strategy, emphasizing sustainability, affordability, and the development of distributed generation to enhance energy efficiency and reduce vulnerabilities.
Nuclear power generation emerged as the backbone of the system, supplying 60% of the country’s electricity and ensuring stability amid the conflict.
Renewable energy sources (RES) are at the heart of Ukraine’s energy transition, with plans to increase RES capacity by 21.1 GW by 2030 and achieve a 27% contribution to gross energy consumption. Ukraine’s vast RES potential, exceeding 750 GW, positions it as a key partner in the EU’s green transition. With the ability to produce over 2,200 TWh annually — equivalent to 80% of the EU’s electricity consumption — Ukraine is poised to become a major exporter of green energy and hydrogen, contributing to Europe’s decarbonization and the integration of its energy markets.