The Parliament of Ukraine recently adopted Law No. 4777-IX of 10 February 2026 (the Law), updating the rules regarding the functioning of energy markets. These changes primarily concern support applicable to RES producers obtained through “green” auctions, as well as developing energy storage facilities and grid connection regulations. Targeted amendments were also introduced for regulations pertaining to biofuels and special regimes during martial law.
Highlights
Key changes regarding “green” auctions and the support system
The Law extends the period the support quota allocation auction mechanism is applied until 31 December 2034.
The structure of support quotas has also been amended, with the annual quota distributed among RES technologies in the following manner:
RES technology | Annual support quota share |
Solar energy (without energy storage facilities) | not less than 5% |
Solar energy (with energy storage facilities) | not less than 10% |
Wind energy | not less than 5% |
Other types of RES (excluding solar, wind, and blast furnace/coke oven gas, and only applicable to micro, mini, and small hydropower plants in the case of hydropower generation) | not less than 5% |
The annual support share for hybrid plants (e.g. solar power plants (SPPs) with battery energy storage systems) has therefore been increased from the previous quota.
For such hybrid plants, the Law establishes enhanced technical requirements for storage systems:
- storage power: must be at least 80% of installed generation capacity
- capacity: at least 2 kWh per 1 kW of SPP capacity.
A maximum bid price for such hybrid projects is set at EUR0.12 per kWh.
The Law also transforms the RES support model, replacing the two-sided “contract for difference” with a one-sided market premium mechanism (i.e. a “pure” premium). The key change in this instance is the abolition of producers’ obligations to pay the Guaranteed Buyer when the market price exceeds the auction price. However, the Guaranteed Buyer’s obligation to pay the market premium when the market price falls below the auction price remains in place.
The Law also introduces time-of-day limitations for calculating premiums for solar generation:
- from 04:00–23:00 between 1 April and 31 October
- from 06:00–21:00 between 1 November and 31 March.
These time limitations do not apply to electricity supplied from storage facilities operating as part of an SPP.
The anti‑concentration restriction has also been clarified: one participant (together with related parties) may not receive more than 50% of the annual and additional annual support quota.
There are also a separate set of amendments related to financial guarantees. Instead of a bank guarantee, a participant may now submit an alternative financial security instrument in the amount of EUR5 per kW of declared capacity in order to participate in an auction. To secure obligations under the contract with the Guaranteed Buyer, an additional guarantee of EUR10 per kW is required. If the construction period is extended by another 12 months, an additional guarantee of EUR10 per kW must also be provided.
Furthermore, the Law details the procedure for submitting, returning, and enforcing such guarantees/securities (including depositing funds in an escrow account).
Grid connection
The Law also introduced the concept of “flexible connection” providing for the option to potentially connect to the grid either temporarily or permanently, with limitations in terms of permitted capacity.
This means that customers may offer the system operator a flexible connection as an alternative to costly or lengthy grid reconstruction.
The Law also permits combining different types of electrical installations (e.g. generation, storage, consumption) at a single connection point, provided that the relevant technical requirements have been met.
The potential for RES producers to power their own and related facilities through internal networks has also been clarified. Should producers meet the relevant criteria, such networks are not considered “direct lines” and therefore do not require separate Regulator approval.
Guarantees of origin
The Law also changes the system for confirming the environmental value of energy, focusing on international recognition of Ukrainian guarantees of origin (GO) for RES electricity and preparing for accession to the Association of Issuing Bodies (AIB).
- GOs issued outside Ukraine may be recognised in Ukraine based on reciprocity with the relevant Issuing Body.
- The NEURC is authorised to adapt the “Ukrainian domain protocol” to meet AIB standards, enabling Ukraine’s full membership.
Biofuel
In the motor fuel market, the Law introduces a mandatory share of biofuel in petrol fuel starting from 2026, along with detailed requirements for fuel composition and related reporting and liability.
Special regimes during martial law
The Law introduces a mechanism for regulating activities for RES facilities located in temporarily occupied territories or in active combat zones by creating and maintaining a special register of such generating capacities. The inclusion of a facility in this register provides the official basis for suspending payments by the Guaranteed Buyer at the “green” tariff or auction price. The procedure for returning to the standard support scheme and removal from the register may only be feasibly addressed following the full de-occupation of the respective territories.
Extended exemption for importers
The Law also extends the temporary exemption whereby the requirement for a minimum mandatory monthly volume of electricity sales on the day-ahead market does not apply to electricity importers, with this extension applicable until 1 April 2026.
The Law came into force on 11 March 2026, with the exception of certain provisions that applied retroactively from 1 January 2026 (i.e. regulating alternative fuels, settling bankruptcy issues for certain enterprises, as well as provisions related to the special register of generating capacities in temporarily occupied territories and settling electricity market debts).
Overall, we assess the adoption of the Law as a positive step, with such legislation creating a clearer and more predictable regulatory environment for developing renewable energy in Ukraine. The relevant changes introduced in the Law aim to stimulate investment in new RES projects, specifically in terms of hybrid stations with energy storage facilities, developing distributed generation capacities, and increasing integration between the Ukrainian energy market and European mechanisms.
