Ukraine in the Energy Community : independent assessment Implementation of the Energy Community acquis as the way to enhance Ukrainian and European energy security Vienna,

This document has been produced with the financial assistance of the European Union, in the framework of the project "Improving implementation of Ukraine’s commitments within the Energy Community through enhancing impact of civil society", implemented by the DiXi Group think tank jointly with the Resource & Analysis Center "Society and Environment". The contents of this document are the sole responsibility of NGO "DiXi Group" and can under no circumstances be regarded as reflecting the position of the European Union.

 Report findings  Energy security policy  Gas market  Other acquis

Report findings Clear commitment (Association Agreement, Third Energy Package by 2015) Political will is not sufficient (low competition, less transparency) Framework laws to be improved, specific actions plans developed Implementation in priority areas should include internal and external control from the stakeholders Support of those responsible (mid level officials)

Energy security policy  pressure of gas and coal supply crises (Crisis Energy Office)  short-time solutions (early warning mechanism, "winter package", imports from other sources)  substitution creates stress for energy systems, forces restrictions in gas and electricity trade  long-term solutions (diversification, demand management) on early stages and require investment  administrative "management" vs market instruments

Gas market  recommendations of the EU stress tests ignored  instead – temporary return to administrative-based monopoly (CoM Resolutions No. 596 and 599)  unbundling of Naftogaz and distribution companies to be formal  actual liberalization seen as post-crisis target  entry/exit system for TSO, gas exchange - positive steps  possible options for restart - new Gas Law, single wholesale price

Other acquis  Oil/petroleum stocks: mid 2015 as deadline for framework law; smaller fuel stocks (20-days consumption) could be an option, subject to appropriate funding mechanism  Statistics: prices/tariffs reporting in process (new forms), as depends on data transfer from regulatory authority; no public reports on the ESAP available  Competition: Law on State Aid to take effect in 2017, the AMC capacity should be increased; gas supply companies to be inspected

Thank you for attention ! Roman Nitsovych enref.org