KPMG Ukraine and IBCentre have published results of their joint survey “Ukraine’s Energy Sector”. The survey was conducted via interviews for 34 industry experts and employees of local and foreign companies, who worked in various sub-industries of the energy sector (including extraction, production, distribution and transportation of power carriers, electric power generation, renewable power sector, and energy efficiency projects).

“Our report summarizes the energy sector experts’ views as regards the main challenges facing Ukrainian energy sector and the principal drivers of the industry development. In particular, special section of the survey is dedicated to the alternative energy sector that has been increasingly attracting attention of many market players recently. We intend to go on with such annual surveys for the purpose of monitoring and analyzing the problems in the domestic energy sector focusing on topical issues of the industry development”, – said Daria Nikolova, manager, leader of KPMG in Ukraine Energy Industry team.

In addition, the report compares the views of Ukrainian experts with those obtained as the result of similar interviews conducted by KPMG on the international scale (KPMG’s Global Energy Survey 2012), which made it possible to identify the aspects specific for Ukrainian industry, as well as those observed globally.

“The experts predictably said low energy efficiency (aggravated by excessive energy consumption) and significant dependence of exports were the main problems of Ukrainian energy industry. The respondents identified low accessibility to and high cost of financing, volatility and non-transparency of regulatory policy as the key obstacles for development of Ukrainian energy industry, – commented Yurii Shved, manager of Energy and Natural Resources Practice of KPMG in Ukraine. He said it was interesting that, according to the results of international survey of KPMG, the respondents emphasized the significance of the problem of volatility of energy carrier prices and poor qualification and accessibility of labor force rather than the importance of the financing problems. Nevertheless, taking into account the degree of international integration of the domestic economy, similar challenges are expected to become typical for Ukraine’s power sector.”

“The dissimilarity between the results of Ukrainian market survey and those obtained within the scope of similar international survey is explained mainly by the fact that the European markets are approaching the saturation point which results in decrease of financial support of renewable power sector by European governments. Nevertheless, we can see the prospective points of efforts concentration on the markets of CIS and Ukraine in particular, – said Yulia Berezovska, IBCentre Managing Director, – The latest changes in the legislation regulating relations on the renewable energy market raised many questions both from the market players and potential investors. However, already today interested entities draft their proposals on elaboration of the legislation framework and adjustments in the terminology and streamlining the procedures for obtaining permits and approvals of the renewable energy projects”.