UDPR is an investment and development company in the Ukrainian renewable energy industry. We see our cause as a noble one as we believe this business contributes to a brighter future for all humanity. We adapt and implement world trend technologies in Ukraine with full commitment to quality and long-term performance. As well as create and operate our own capacities in renewables.
We search for investment opportunities for stakeholders and partners, while opening up the Ukrainian market to global players with sufficient reliability and safety.
Our approach is based on clarity and transparency. We believe this is the only way to build strong partnerships, meet the expectations of our clients, and gain their trust and recognition. We are also constantly improving our services to deliver the best solutions and quality results.
Our job is to develop projects on a “turn-key” basis that includes: legal and technical due diligence of the land plot, interconnection check-up due diligence, land status reclaim, project design, technical documentation development, feed-in tariff obtaining, EPC and O&M.
The first phase of Dymerska Photovoltaic Power Plant, the biggest in Kyiv Region. Commissioned on September 2017.
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The region remains particularly attractive for photovoltaic installations because it offers high level of solar irradiation and has large areas of unutilized land, unsuitable for agricultural purposes.
Having a highly skilled local execution team, which supports the development and construction of the solar project pipeline in this area, reinforces UDPR commitment to the sustainable energy development in the region. Solar radiation in area: 1459 kW-hr/m²/year
Kherson region is the most perspective Ukrainian area for solar energy development. Their amount of solar radiation can be compared to northern Italy, which is the leader by quantity of solar power plants in the world.
committed to Earth
Our main goal is to build a better future for the next generations by implementing and delivering clean solar electricity. As a company, we feel we have the power to popularize environmentally responsible behavior that will lead to reducing and preventing environmental damage.
Environmental protection is an essential part of our philosophy. To be a good role model is our duty.
Our mission is to create new sources of growth for international power generating companies in Ukraine.
We make it possible by offering high-quality and high-yield projects for the further development, while co-investing and providing efficient local risks control.
CFO at UDP Renewables Kiril Bondar on Solar Power Plant Development in Ukraine
CEELM: What were the most challenging aspects of this project to manage, and why?
K.B: The Renewables business was a new field for UDP Group. Since time is the most critical factor when developing renewable projects we need to build our pilot PV station fast, with no risks, and with our reputation kept high. The complexity of the project was the major challenge for us since it included deal structuring, tenders, tenders for equipment and EPC, a funding arrangement including bank loan and collaterals, import, construction, and finally putting the station into operation and obtaining a “green tariff.”
CEELM: Did entering into the Renewables sector present any unexpected challenges?
K.B.: To be frank the most unexpected challenge was the fact that permission procedures and dealing with regulators took more time than project construction itself. We definitely see improvements in the energy sector in Ukraine but still it takes time and leads to losing several months of electricity generation. So proper planning, risk management, conservative financial models, and top class legal services are among most crucial elements of project management.
CEELM: Why did you decide to reach out to Everlegal for assistance on the project?
K.B: By assessing the firm’s previous expertise, its client-oriented approach, its flexibility and proactive approach in providing solutions, and its competitive pricing, we made our decision to engage with Everlegal on the project.
CEELM: Everlegal’s press release reported that Managing Partner Yevheniy Deyneko «provided specialist advice on certain project-related matters.” What matters were those?
K.B: Yevheniy assisted the team led by Andriy Olenyuk by offering his insights and specialist knowledge on corporate, antitrust, and regulatory matters.
CEELM: If it’s not confidential, what was the nature of the fee arrangement you operated under, and how was it arranged? Looking back, was that model the right one to choose?
K.B: We cannot disclose all the details. Generally, the fee arrangement was flexible and combined several elements wrapped up in a package. Specifically, secondment of personnel for a fixed fee, retainer for a fixed budget, and blended hourly rate specifically designed for our project. Aside from the fee arrangement, the Everlegal team became our legal business partner and both sides benefitted a lot from knowledge sharing and commingling of the teams. This was our first project with Everlegal and since it was successful we are massively expanding and now developing a pipeline of about 100 MW of new projects where Everlegal is engaged in due-diligence and project structuring.
Renewable energy investors return to Ukraine with cautious optimism
Ukraine, with its vast and windy steppes, meandering Dnipro River, year-round sunny weather and experience with nuclear power disaster, should be fertile ground for renewable energy projects.
But while 98 percent of the power produced in Norway already comes from renewable sources (mainly hydroelectric), Ukraine still lags far behind other countries in the region. Only 7.5 percent of the electricity generated in Ukraine comes from “green” sources and, like in Norway, it’s mainly from hydropower.
The corollary from that is, of course, that there’s still plenty of room for growth in the renewables sector in Ukraine. Why is it not happening? Industry players say it’s not for want of opportunities, but the effect of political instability combined with poor government.
The renewable power sector started to take off in Ukraine in 2009, when the country introduced differentiated green tariffs on various types of power generation. The legislation on green tariffs pegs them to the euro, setting the price per kilowatt-hour in euro cents.
But the modest development of the sector came to a halt with the 100-day EuroMaidan Revolution that drove President Viktor Yanukovych from power on Feb. 22, 2014.
Before a two-year economic recession in 2014 and 2015, the renewable energy industry was increasing generating capacity by about 800 megawatts per year. However, in 2014, the increase was only 26 megawatts.
Turbulence following the revolution, including Russia’s annexation of Crimea and the launch of its war in the Donbas, rattled most investors, according to Oleksiy Orzhel, the head of the Ukrainian Association of Renewable Energy.
“This was the period of maximum instability,” Orzhel said. “The EuroMaidan Revolution, the change in the authorities, and the prosecution of corrupt capital. At that time ‘white’ capital also understood it could be caught up in a general sweep, so a lot of developments came to halt.”
By 2016, however, the economic situation had stabilized, and the euro-pegged tariffs started to attract new capital, Orzhel said.
Pricing in euros “reduces devaluation risks for investors considering coming to Ukraine and developing green power generation here,” Orzhel told the Kyiv Post. “Moreover, this allows investors to raise credit resources in foreign currency at comparatively favorable rates. That’s a nice incentive.”
Since 2015, the sector returned to stable growth. In 2016, another 100 megawatts of generating capacity was added. And in 2017, Orzhel expects another 350–400 megawatts to come online from solar power stations alone.
“People tend to invest in solar panels because they are simpler, in terms of infrastructure, than other ways of generating green power. As a result, a lot of companies now have experience in starting such projects in Ukraine, and they’re intensifying their activities here.”
One of them is UDP Renewables, which has built the biggest solar power plant in Kyiv Oblast. It plans to operate the plant at 50 megawatts annual capacity by 2018; and at 300 megawatts by 2020.
The power plant’s main investor, Vasyl Khmelnytsky, told the Kyiv Post that now is the perfect time to develop renewables in Ukraine.
“Power plants that run on coal, gas, heavy oil, nuclear — they’re things of the past,” the investor said. “Of course, they aren’t going to disappear today or tomorrow, but Ukraine, the country that survived the (1986) Chornobyl (nuclear power plant) disaster, should be especially interested in renewables.”
Khmelnytsky’s UDP Renewables is also going to build another two plants, in Odesa and Kherson with 10 megawatts and 17 megawatts of generating capacity respectively.
The oligarch says he expects to invest up to $200 million in the industry, and he’s not as concerned as other investors are about instability in Ukraine.
“I’m confident in Ukraine’s economic growth,” he said. “This country is much more stable than it seems from the outside.”
Khmelnytsky is not the only one with big plans for the future in Ukraine: Canadian renewable energy company TIU-Canada recently invested 10 million euros in building a 10-megawatt solar power plant in Dnipropetrovsk Oblast.
The company is the first Canadian investor to set up shop in Ukraine since the Canada-Ukraine Free Trade Agreement came in effect on Aug. 1. According to Valentyna Beliakova, TIU-Canada’s country director in Ukraine, the company plans to invest another 100 million euros in 2018.
TIU-Canada decided to invest in Ukraine because of its green tariffs, which are “the most attractive in Europe,” Beliakova told the Kyiv Post.
“Ukraine has potential, while the appealing green electricity tariffs promise quick returns,” she said. “Why solar power? TIU-Canada has an expertise in this field and, moreover, solar power stations are easy to build.”
Andrii Hetman, the CEO of Unasolar, a tech company that engineers and installs solar panels in the country, has seen an uptick in sector development in the last two years.
“The market’s growing, yes, but the problems of doing business in Ukraine remain very real — buying power is still low,” Hetman told the Kyiv Post. “All the same, more people now understand that renewables might be profitable.”
Hetman’s counterpart Elena Skrypnyk also feels that the industry’s changing for the better.
Skrypnyk is a managing partner at Helios Strategia, a company that provides services for setting up solar plants in several countries, including Poland, Senegal, Belgium and Ukraine. According to her the Ukrainian market has better conditions than many others.
“Here in Ukraine, the pay-back time for projects is a lot shorter, so a lot of new investors are appearing, foreign ones included,” she told the Kyiv Post. “It’s easy to work here, so it’s getting competitive.”
Orzhel from the Ukrainian Association of Renewable Energy says solar power’s expansion could have been much substantial if the government had managed it better.
“Our system remains unpredictable,” Orzhel said. “This holds back a lot of foreign investors from bringing their money into Ukraine.”
For a start, Orzhel says Ukraine’s renewable market needs more timely decisions from the government. In particular he’d like to see a cut in bureaucracy, more rapid revision of laws, and more powers for the industry’s regulator.
The activist and businessman is particularly concerned about the regulator, which he says is unable to make decisions on future tariffs as not enough members of its board have been appointed for it to form a quorum.
“This meant the industry remains unregulated, and hence unpredictable,” Orzhel said. As a result, a lot of projects currently under construction are at risk of cancelation.
“The general political instability and other problems have a very negative effect on the industry,” Orzhel said. “I wish we could foresee at least something.”
Helios’s Skrypnyk, however, sees the situation differently. She believes the Ukrainian regulatory system performs better than many others.
One way or another, after weighing the pros and cons of operating on Ukraine’s renewable market, its players still express optimism.
Ukraine’s UDP to invest $300 mln in alternative energy by 2022
In July 2017, the first phase of Dymerska Solar Power Plant 1 with a capacity of 6 MW was connected to the Ukrainian power grids. In 2018, after the commissioning of three more phases, UDP Renewables will bring the plant’s capacity to 50 MW, which will be about 5% of the capacity of a standard nuclear power plant unit. The first phase has been built from 22,200 solar PV modules.
In October-December, the company plans to launch the construction of two new solar power plants: a 17.5 MW facility in Kherson region and a 10 MW facility in Odesa. The total capacity of the facilities to be commissioned by UDP Renewables in the southern regions is 120 MW.
UDP is one of the leading developer groups in Ukraine. Its most known long-term investment projects include the development of Kyiv International Airport (Zhuliany), the construction of the Kyiv-based shopping mall OCEAN PLAZA and residential complexes Novopecherski Lypki, Boulevard of Fountains, RiverStone, and Parkove Misto. UDP Renewables is the UDP Group’s alternative energy asset.