The Ukrainian energy grid is constantly under the sights of Russian missiles: what can Ukrainians expect?

On June 22, massive Russian missile attacks hit several Ukrainian energy facilities, leaving thousands of people without electricity. Also, on June 20, Ukraine suffered the seventh massive Russian attack on its energy facilities since March 22 of this year. State network operator “Ukrenergo” reported damage in four regions. Seven energy workers were injured, the previously planned power outages continued. In the Zaporizhia region, two energy workers were injured overnight and an energy facility was damaged, Ivan Fedorov, the head of the Zaporizhia regional military administration, reported.

Since the beginning of the war, the Ukrainian power grid has been firmly under the sights of Russian missiles, but this year the Russian Federation began to specifically target electricity production facilities – thermal power plants, hydroelectric power plants, even energy storage – a marked change in tactics compared to the previous winter, when the attacks were less accurate and the damage easier to restore. Experts say that Russia uses better weapons and takes advantage of weak Ukrainian air defense.

At a conference on the reconstruction of Ukraine in Berlin in mid-June, President Volodymyr Zelenskyi announced the extent of the destruction caused by the first six attacks.

“Russian missile and drone strikes have already destroyed 9 GW of capacity, while Ukraine’s peak energy consumption last winter was 18 GW. So, half of it no longer exists.”, – said Zelensky.

Energy officials and executives now recognize that blackouts are inevitable this winter. For now, the challenge is simply to minimize them.

“If we don’t rebuild the existing damaged power plants, if we don’t improve the interconnector capacity for input, if we don’t build these distributed generators, at least in some places, then people will have less than four hours of power a day.

In addition, maintaining morale among energy workers is a serious problem. They see themselves in a cycle where they repair an energy facility and Russia finds out it’s being repaired and destroys it again. In some cases, employees have already done this three or four times.” – believes Dmytro Sakharuk, executive director of the largest private energy company of Ukraine, DTEK.

In Ukraine, they are trying to solve the problem in different ways. In addition to rebuilding what they can, in some cases using parts from decommissioned power plants in Europe, officials and energy companies are scrambling to secure as many generators and gas turbines as possible to support critical infrastructure through the winter, and are working with European partners to increase electricity imports.

Before the full-scale invasion of Russia in February 2022, Ukraine was a net exporter of electricity and was even able to resume some exports during the war. It stopped in March.

“We are doing our best. We understand that it will be very difficult to survive without energy. When efforts on the supply side prove ineffective, all that remains is to reduce demand. And this means demanding an even greater sacrifice from the Ukrainian people, who are already tired of the blackout.

We ask our people to be ready to understand the situation, to support Ukraine, to support our energy workers. We call it the second front line, energy.” – said Deputy Minister of Energy Svitlana Grynchuk.

In late April, weeks after a Russian attack destroyed the largest power plant in the Kyiv region, Kyiv policeman Andriy Buzovsky spent about $1,400 on two solar panels for his balcony.

“I installed them so that my family would not feel discomfort when there is no electricity. What will happen next is unknown”, he told CNN reporters.

Ukrainian Prime Minister Denys Shmyhal has just announced new grants to help housing cooperatives invest in solar panels and heat pumps. The Central Bank of Ukraine is also working to make loans to households and businesses for the purchase of energy equipment more affordable.

Ukrainian companies make their contribution. Ukrzaliznytsia changed the schedule of 74 suburban trains (about 7% of the total number), temporarily suspending some services. The company said it also stopped using air conditioners in administrative buildings and turned off exterior lighting.

Marta Trush, executive director of the Auchan Ukraine supermarket chain, told CNN that while all of her stores are already equipped with generators, she has upgraded refrigerators to save energy and reduced the range of products with short expiration dates. Some of this has the added incentive of mitigating skyrocketing costs.

“The operation of the entire network on diesel generators is approximately three times more expensive than from the central power grid. So, to save electricity in sales halls, we reduce the lighting and temporarily limit access to refrigerators, but we see how customers react to forced measures.”, – said Trush.

In May, the National Bank of Ukraine estimated that economic growth would slow to 3% this year from 5.3% in 2023, mainly due to damage to the energy sector. Inflation is expected to rise slightly to 8.2%.

“Power cuts have a clear inflationary effect. Companies have to get backup power somehow, and they buy diesel generators, solar panels, etc., and that increases the cost of production. Ukraine’s inability to export electricity also disrupts its trade balance, which contributes to inflation.

Data show that power outages force Ukrainian companies to lay off workers. The central bank still expects unemployment to fall this year, but only to 14% from the current level of 15%. This is a painful situation, Ukraine really loses a lot, but also the problem is that Russia still receives huge profits from oil and gas exports.

Last month, the Kyiv School of Economics estimated that rebuilding Ukraine’s damaged energy infrastructure would cost $50.5 billion, including new measures to make it more resilient against further attacks. That’s the equivalent of an entire hard-earned loan backed by profits from frozen Russian assets recently promised to Ukraine, but it may not receive the money for months.  The Big Seven, which has already spent $3 billion to support Ukraine’s energy sector, just announced the allocation of another $1 billion in early June.

Calculating the true cost of recovery while attacks are ongoing is impossible. There is clear uncertainty about how many more power plants will be destroyed by the Russians,” – says Ihor Piddubny, a researcher at the Kyiv School of Economics.

Ukraine’s Ministry of Energy says it is building concrete shelters to protect some energy equipment from attacks. But more sophisticated air defense systems are the only way to protect entire power plants and prevent rising costs of reconstruction.

After the massive missile attack on June 20, Ukraine’s intensive lobbying efforts finally bore fruit. After months of discussions, Romania agreed to send the Patriot air defense system. In addition, White House officials say that Ukraine is given top priority for the supply of advanced US air defense equipment over some other countries. These deliveries should begin this summer.