DTEK Grids transforms oblenergos into modern electricity distribution and supply companies

Thermal power generation23 May 2018

DTEK Grids proceeds with systemic updating of its business under ongoing energy reform in Ukraine aimed at the electric power market transition to the European model. In April 2018, the general meetings of the shareholders of PJSC DTEK Dniprooblenergo and PJSC DTEK Donetskoblenergo passed decisions to change their names to DTEK DNIPRO GRIDS JSC and DTEK DONETSK GRIDS JSC, respectively. On 21 May 2018, new companies names were registered. The names change is the first phase preparing oblenergos to the division (unbundling) into a distribution system and grids operation operator and a supplier of electricity to consumers.

In future, DTEK Dnipro Grids and DTEK Donetsk Grids will carry out functions of electricity distribution and grids operation. The new companies have been set up to sell electricity to consumers in accordance with the Law of Ukraine “On Electric Energy Market”. Transition to the new distribution business model is planned to be finalized by the end 2018.

“We have made the first step towards transformation of oblenergos into modern electricity distribution and supply companies meeting operating and quality standards of the European level. DTEK Grids will focus in future at upgrading grid equipment to increase reliability of electric power supply; we will also tackle a task of improving services quality and simplifying procedure of connecting grids. Our plan is to actively launch new services and apply new digital technologies to offer our clients the most advanced, convenient and cost-effective solutions,” – commented DTEK CEO Ivan Gelyukh.

It should be reminded that under the new Law of Ukraine “On Electric Energy Market” Ukrainian oblenergos will have to separate generation and electricity supply functions and keep the electricity distribution function only. This is the best practice worldwide and the requirement of the EU Third Energy Package providing for competitive market conditions.

In February 2018, in compliance with the requirements of the Law of Ukraine, DTEK was the first in Ukraine to start division (unbundling) process aimed at separation of electricity distribution and supply business from the heat and electricity generation business in Kiev having formed DTEK KYIVS’KI ELEKTROMEREZHI PrJSC as a structure separated out of KYIVENERGO PJSC. By the end of 2018, the companies under the direction of DTEK Grids (DTEK KYIVS’KI ELEKTROMEREZHI PrJSC, DTEK DNIPRO GRIDS JSC and DTEK DONETSK GRIDS JSC) will suspend their electricity supply operations and will engage in distribution only, while new companies will provide for electricity supply to consumers.

Background information

DTEK Grids is a management company established in 2018 to develop electricity distribution and supply businesses. DTEK Grids coordinates activities of DTEK operation companies: DTEK DNIPRO GRIDS JSC, PrJSC DTEK Kiev Grids, DTEK DONETSK GRIDS JSC, DTEK POWER GRID LLC, DTEK ENERGOUGOL ENE PrJS. DTEK Grids CEO is Ivan Gelyukh.

Territory of the licensed operations activity of DTEK distribution companies includes Kiev, Dnepropetrovsk and Donets Regions with over 11.5 mln employees engaged. In 2017, the Company’s distribution grids transmitted 43.2 bln kWh that makes 36% of electricity consumed in Ukraine. The Company’s clients represent over 3.5 mln households and over 90 thousand businesses.

DTEK is a strategic holding developing its energy business. The Company’s enterprises employ 73 thousand employees. DTEK General Director is Maxim Timchenko.

DTEK enterprises are engaged in coal and natural gas production, electric power generation at heat and renewable energy power plants, they supply heat and electricity to end consumers and render energy services. Production enterprises in each business sector are directly managed by operation companies.

DTEK performance indicators in 2007 are: coal production – 27.7. mln ton, natural gas production – 1,655 mln cub.m, electric power generation (supply) – 37.1 bln kWh, from which 637.8 mln kWh was provided by renewable energy power plants; electricity transmission by grids – 43.2 bln kWh.

DTEK is a member of SCM group the shareholder of which is Renat Akhmetov.

For more information on social partnership projects in the regions of DTEK operation and updated report on their implementation status please go to http://spp-dtek.com.ua/.