DTEK keeps developing electricity distribution business, and plans to acquire Kirovogradoblenergo PJSC

Thermal power generation30 April 2021

DTEK keeps developing its electricity distribution business. The company believes that it is promising and important for the transformation of the Ukraine’s energy market. DTEK Grids LLC has entered into a purchase and sale agreement for a minority stake in Kirovogradoblenergo PJSC in the amount of 24.5%. DTEK Grids is considering the possibility of acquiring a controlling interest in Kirovogradoblenergo PJSC if the relevant agreement is approved by the Antimonopoly Committee of Ukraine.

On April 30, 2021, DTEK Grids LLC entered into a purchase and sale agreement for a minority stake in Kirovogradoblenergo PJSC in the amount of 24.5%. DTEK Grids is considering the possibility of acquiring a controlling interest in the Kirovogradoblenergo PJSC Distribution System Operator subject to the relevant approval of the Antimonopoly Committee of Ukraine.

"The main goal of our company is to enhance the reliability of electricity supply, reduce losses and improve the quality of customer service in Kropyvnytskyi and Kirovohrad Region. We plan to implement a comprehensive program of modernization of existing assets, as well as introduce system automation and digitalization of electrical network management at Kirovogradoblenergo PJSC,” says Ivan Geliukh, CEO of DTEK Grids.

DTEK Grids Distribution Systems Operators, DTEK Kyiv Grids and DTEK Dnipro Grids are among the most efficient in the country. According to the results of 2020, the SAIDI indicator (average duration of interruptions per customer a year) equals to 441 minutes in Dnipropetrovsk Region, which is 46% less than the average in Ukraine (816 minutes/year) or 37% less than in Kirovogradoblenergo PJSC (697 minutes/year).

Today, the market for electricity supply to customers is fully competitive. The NEURC National Regulator monitors the operation of distribution system operators, obliging them to ensure unconditional access to the network infrastructure to any electricity supplier. Thus, the concentration of DTEK's new assets complies with the law and the right of customers to have the market opportunity to choose from whom to buy electricity.

In this case, the distribution system operator is a natural monopoly within the specific territory defined by the license. Its volume of distribution, profit and other working conditions are characterized by the specifics of the licensed territory, and the activity is regulated by the National Regulator. Therefore, the concentration of DSOs owned by DTEK complies with the Law of Ukraine "On Natural Monopolies".

DTEK is transforming its business in line with the New Strategy 2030, which is based on the principles of the ESG, values and business responsibility for progress towards the UN General Assembly's sustainable development goals. Network infrastructure is the fundamental for social and economic growth. And the development of all other spheres of the economy is impossible without it. Smart grids are a unifying element for the development of green generation, electrification, and sustainable development.