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Businesses offer fair support for the production of electricity from alternative sources

15/ 04/ 2024
  The EBA Energy Committee has sent a number of appeals to public authorities on the importance of implementing certain changes, including in the regulatory field, to continue supporting the production of electricity from alternative sources. In particular, the business proposed to include the service of providing support for the production of electricity from alternative sources under the market premium mechanism in the list of transactions for which the cash method of value added taxation can be used, as this procedure exists for producers under the feed-in tariff and is a forced step due to non-payment of the premium by the guaranteed buyer. At the same time, on March 1, 2024, the Cabinet of Ministers of Ukraine adopted a resolution to provide support for the production of electricity from alternative sources under the market premium mechanism. In February, the EBA sent a letter to Andriy Gerus, Chairman of the Committee on Energy, Housing and Utilities Services, to record some of the agreements reached during the meeting the day before. In particular, the proposals concerned the above-mentioned issue. Thus, according to the business, it was and is necessary to amend the Law of Ukraine On Energy Efficiency in order to join the European Product Registry for Energy Labelling (EPREL). At the same time, it is important to amend the Law of Ukraine On the Electricity Market. Thus, in order to encourage electricity producers under the feed-in tariff to switch to the market premium mechanism, it is important to supplement the list of special obligations imposed on electricity market participants to ensure the public interest in the functioning of the electricity market with a new item. In particular, it is also important to focus on the importance of providing support for the production of electricity from alternative sources under the market premium mechanism, so that the cash method of calculating value added tax is also applied to electricity producers under the market premium mechanism. In addition, it is necessary to create conditions for the green premium to be charged for the volumes that were not released by the producer due to the fulfillment of the application for unloading in the balancing market and systemic restrictions. Currently, the premium mechanism is not in demand due to the inability of the guaranteed buyer to pay the premium, the absence of a cash-based VAT method, and the failure to charge a premium for the volumes of electricity not supplied. Therefore, we sincerely hope that these agreements will be reached, the relevant changes will be made, and the creation of conditions aimed at improving the countrys energy efficiency will continue.

The EBA Energy Committee has sent a number of appeals to public authorities on the importance of implementing certain changes, including in the regulatory field, to continue supporting the production of electricity from alternative sources. In particular, the business proposed to include the service of providing support for the production of electricity from alternative sources under the market premium mechanism in the list of transactions for which the cash method of value added taxation can be used, as this procedure exists for producers under the feed-in tariff and is a forced step due to non-payment of the premium by the guaranteed buyer.

At the same time, on March 1, 2024, the Cabinet of Ministers of Ukraine adopted a resolution to provide support for the production of electricity from alternative sources under the market premium mechanism.

In February, the EBA sent a letter to Andriy Gerus, Chairman of the Committee on Energy, Housing and Utilities Services, to record some of the agreements reached during the meeting the day before. In particular, the proposals concerned the above-mentioned issue.

Thus, according to the business, it was and is necessary to amend the Law of Ukraine “On Energy Efficiency” in order to join the European Product Registry for Energy Labelling (EPREL).

At the same time, it is important to amend the Law of Ukraine “On the Electricity Market”. Thus, in order to encourage electricity producers under the feed-in tariff to switch to the market premium mechanism, it is important to supplement the list of special obligations imposed on electricity market participants to ensure the public interest in the functioning of the electricity market with a new item. In particular, it is also important to focus on the importance of providing support for the production of electricity from alternative sources under the market premium mechanism, so that the cash method of calculating value added tax is also applied to electricity producers under the market premium mechanism. In addition, it is necessary to create conditions for the “green” premium to be charged for the volumes that were not released by the producer due to the fulfillment of the application for unloading in the balancing market and systemic restrictions. Currently, the premium mechanism is not in demand due to the inability of the guaranteed buyer to pay the premium, the absence of a cash-based VAT method, and the failure to charge a premium for the volumes of electricity not supplied.

Therefore, we sincerely hope that these agreements will be reached, the relevant changes will be made, and the creation of conditions aimed at improving the country’s energy efficiency will continue.

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