The Cost of Electricity in Ukraine Exceeds Prices in Poland and Hungary
In November, the weighted average price of electricity on the “day-ahead” market in Ukraine reached €140 per megawatt-hour, significantly exceeding the corresponding figure in neighboring Poland and being one and a half times higher than the price in Hungary. For comparison, last year this figure in Ukraine was €109.5, while the average across Europe was €82. The situation in the electricity market in Ukraine is currently becoming even more complicated.
This is reported by AgroReview
Industrial Prices in Europe and Germany’s Plans
European manufacturers are discussing the possibility of establishing a fixed industrial electricity price in Germany starting in 2026 at €50 per megawatt-hour for a period of three years. Negotiations with the European Commission are in the final stages. Italy and the Czech Republic oppose this initiative, believing it could negatively impact competition in the European market.
At the same time, the Ukrainian industry is forced to operate under extremely challenging conditions. The lack of state preferences and round-the-clock capacity limitation schedules, which have been in effect since November 8, significantly complicate competition with European manufacturers.
The Impact of Russian Attacks and Tariff Policy
The main reason for the current tense situation is the systematic strikes by the Russian Federation on Ukraine’s energy infrastructure. Massive shelling in October and November resulted in significant damage and insufficient capacity for transporting electricity from the western region to the east. As a result, Ukraine was unable to fully utilize the available technical capacity for imports, even though such an opportunity existed.
“The reason for this chaos is obvious — the systematic strikes by the Russians on the energy infrastructure. The massive shelling in October and November caused colossal damage. The transmission capacities proved insufficient for transporting electricity from the west to the east of the country. As a result, Ukraine was unable to utilize the entire technical capacity for imports, even though the opportunity was there.”
Additionally, the situation is complicated by the intentions of “Ukrenergo” to increase electricity transmission tariffs by 14% – to 785.39 UAH per megawatt-hour, as well as an 11% increase in dispatch management fees. This initiative has met with sharp rejection from industry associations such as “Ukrmetallurgprom,” NADPU, and UkrFA, which believe that the additional financial burden during wartime and the energy crisis could lead to a significant reduction in production. Enterprises are already operating at the edge of their capabilities, balancing between consumption limits and rising costs.
Note: RDN (day-ahead market) is a segment of the wholesale electricity market where participants buy and sell electricity for the next day based on the results of auction trading. Prices are determined by supply and demand.