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Energy Independence of Ukraine

The problem of Ukraine's energy (primarily gas) dependence on the rf and ways to overcome it: reducing energy consumption, scaling up domestic oil and gas production, and developing renewable energy sources. Roman Yaremiychuk's article (2016) examines this dependence as an instrument of russian hybrid warfare, amplified by corruption and a lack of political will.

Overview

One aspect of russia's hybrid war against Ukraine was maximum possible destruction of the country's economy through its dependence on russian gas supplies. The author asserts that over 25 years this dependence could have been eliminated, but political will of state leadership was lacking, and the energy problem was compounded by large-scale corruption — both "from above" and "from below."

The foundation of economic policy was proposed to be, on the one hand, reducing energy consumption in all sectors of the national economy, and on the other — investing funds in expanding domestic energy resources.

Key Details / Subtopics

  • Reduction of energy consumption: In Europe since 1971, laws have linked reducing product energy intensity with a proportional reduction in taxes; in Ukraine, however, tax breaks were granted to the most energy-intensive industries (metallurgy, chemicals — companies of Akhmetov, Firtash), which funneled windfall profits offshore without investing in energy efficiency.
  • Polish example (1990–1996): Poland took a $6 billion loan from foreign banks, created infrastructure (in-apartment heating equipment, energy-efficient windows/doors, system replacements) and paid it back in 8 years; it currently consumes 5 times less gas than Ukraine. The key: loans for real programs rather than "patching holes."
  • Decline of domestic production: The "worst in the world" tax system was created, stalling small and medium business; a sharp drop in oil and gas production and eating through reserves occurred.
  • Unrealized state programs: Three programs for scaling up oil and gas production under P. F. Shpak were approved by the government but unfunded; they planned gas production growth to 28–36 billion m³ and oil to 5 million tons/year by 2010. They did not account for hydrocarbon production from the Crimean Black Sea shelf, shale gas, and Donbas methane.
  • Corruption in geological exploration: Minister of Fuel and Energy in Azarov's government Yuriy Boyko (2010) directed funds to exploration in Africa, citing a lack of promising structures in Ukraine; according to geologist Yevhen Dovzhok, there are over 600 million tons of oil in the Carpathian region alone.
  • Crimean shelf and Vanco: Admitting Western private companies to exploration in the Black Sea (instead of the infamous Vanco) would have made russia's seizure of Crimea extremely risky for the rf.
  • Renewable energy sources: In Germany, the UK, and South Africa they account for ~25% of energy consumption, Turkey plans 16%, and Norway has a high figure; in Ukraine this indicator is only 3–5%. 25% of German "green" energy would completely cover all of Ukraine's energy consumption.
  • Tax incentives and capital: Proposed to attract private (domestic and foreign) capital and exempt companies developing non-traditional energy sources from taxation for 10–15 years.
  • Role of science: NJSC "Naftogaz of Ukraine" sets no tasks and does not fund science; given political will, scientists could develop programs to eliminate energy dependency in 5–7 years.

Contradictions and Open Questions

  • The author places blame for the failure of energy independence primarily on political leadership and corruption, whereas practical implementation (technology availability, global hydrocarbon prices, geological risks of shale gas) requires additional critical analysis from other sources.
  • The claim of >600 million tons of oil in the Carpathians is cited based on a single geologist (Yevhen Dovzhok) without independent verification.