The new normal for Europe’s energy sector ‘is thinking out of the box’

Ukraine energy boss highlights new reality for Europe's energy sector

"The world in which we lived is gone...thinking out of the box is the new normal."

This thought-provoking statement was made by Vitaly Butenko, chief executive of JSC Energy Company of Ukraine. Butenko was speaking in the opening panel discussion at ETCSEE, a session focused on how to fortify the energy sector after the Russian invasion of Ukraine and the ensuing energy crisis.

Butenko elaborated on the significant impact the war has had on Ukraine's energy sector and electricity market.

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He referred to Russian energy terrorism, which has impacted Ukraine's energy system in a manner not seen since World War Two.

The war, thus far, has resulted in a 10GW loss of capacity in the energy system, eight million people have left the country and a 52% decline in industrial consumption has been noted.

"There is no manual or instructions on what to do, said Buktenko. "One of the big questions was what should happen with the energy market – it was a hard decision to make, but they stuck with the market."

The market has been preserved and continues to operate. By 16 March 2022, full synchronisation with Europe's grid was achieved and measures to simplify cross-border trade and licensing were put in place.

According to Dmytro Maliar, chief executive of D.Trading Ukraine: "Ukraine's energy system came through a crash test with damage to generation and blackouts, but we managed to survive," a fact he attributes to the courage and dedication of the people, as well as the energy system and market access.

The new normal for Ukraine and Europe

There is clearly a new reality, an overriding need to make decisions quickly and apply out-of-the-box thinking to challenges in the fast-moving energy landscape.

The war and energy crisis have mapped a new road for energy markets, said Butenko. "Historical roadblocks such as regulation and ageing infrastructure have been forcibly removed because of the situation...that opens up opportunities for the whole trading community...They will have to put pressure on the politicians and policymakers to move ahead much more aggressively."

Moving ahead, panellists agreed it's time to get back to basics. Global thinking, coupled with European cooperation and single rules will define the way forward.