More than $50 billion: Calculated how much money will be needed to restore the energy system

Ukraine needs 48.5 billion dollars to repair destroyed production facilities. The needs of the electricity sector alone are estimated to be almost 34 billion.

Since the beginning of Russia’s large-scale invasion, Ukraine’s energy sector has suffered direct and indirect losses of $56.2 billion, according to an analysis by the Kiev School of Economics (KSE).

It is stated that as of May 2024, direct losses in the country’s energy sector are more than 16 billion dollars, and the largest financial loss occurs due to the destruction of electrical energy production facilities ($8.5 billion) and electricity transmission lines ($2.1 billion). oil and gas infrastructure ($3.3 billion).

Russian Armed Forces deprived Ukraine of more than 18 GW of electricity generation capacity, most notably by occupying the Zaporozhye Nuclear Power Plant. In addition, the Kakhovskaya and Dnieper hydroelectric power plants, as well as the Zmievskaya and Trypilska thermal power plants, were completely destroyed.

More than 80 percent of the damage was caused by Ladyzhinskaya, Burshtynskaya, Dobrotvorskaya, Kurakhovskaya, Krivorozhskaya and Pridneprovskaya private thermal power plants. About half of the high voltage power transmission centers were damaged. Russian troops also almost destroyed all oil refineries on Ukrainian territory and a significant part of the infrastructure for storing oil and oil products.

Indirect losses in the energy sector are estimated at approximately $40.1 billion. The majority of this amount ($39.6 billion) comes from revenue losses of energy companies, and $0.5 billion comes from debris cleaning and dismantling works at damaged facilities.

It is preliminary estimated by KSE that the total restoration need of the Ukrainian energy sector is 50.5 billion dollars; 48.5 billion dollars of this is required to repair the destroyed and damaged energy infrastructure, taking into account the principle of “better than it was”. The $2 billion includes meeting the liquidity needs of energy companies due to revenue lost due to the war.

The restoration needs of the electricity sector are estimated to be 33.8 billion dollars in total, of which 29.3 billion dollars belong to production facilities. Another 4.6 billion dollars are needed to renew the electricity transmission and distribution infrastructure. The cost of restoring the oil and gas sector is estimated at $14.8 billion. Excluding the restoration of large thermal power plants, the district heating sector needs $1.4 billion for these purposes.

Let us recall that Dmitry Sakharuk, director of the DTEK energy company, said in early June that the restoration of facilities after Russian attacks would require a lot of time and money.

Moreover Focus He wrote that starting from June 11, hourly shutdown schedules will be valid throughout Ukraine between 14:00 and 23:00. As Ukrenergo points out, damaged power plants can no longer produce as much electricity as before.

Source: Focus


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