Foreword

This report aims to help Ukrainian policy makers and authorities with responsibilities for the electricity sector to improve the functioning of Ukraine’s electricity market by identifying and recommending ways to overcome barriers to effective competition. It reviews the design, regulatory framework and functioning of wholesale and retail markets, from a competition perspective, and issues around the use of renewables and synchronisation with the European power system.

The market study was conducted by the OECD Competition Division with the financial support of the European Union, within the framework of the OECD Memorandum of Understanding for Strengthening Co-operation with the Government of Ukraine, and with the support of Ukrainian stakeholders. The recommendations of this project provide a roadmap for the Government of Ukraine to broaden and deepen pro-competitive reforms in the sector. If implemented, these recommendations will lead to improved competition at the wholesale and retail levels, the further integration of renewables into Ukraine’s generation mix, and enhanced liquidity and investment in the power sector overall. It will also facilitate better integration with EU energy markets.

This report builds on the previous market studies conducted by the OECD’s Competition Division. In 2016, market studies were chosen as a long-term theme for discussion by the OECD Competition Committee and between 2016 and 2018 the OECD held roundtables, hearings and workshops on various related subjects, including the characteristics of market studies, the powers available to competition authorities to collect information, procedural safeguards for stakeholders, interactions on market studies between competition authorities and other public bodies and ex-post evaluations of market studies. The Market Studies Guide for Competition Authorities summarises the work conducted by the OECD Competition Committee on this topic.