LONDON -- Solar and wind power plants in Crimea that have not been operating since the region voted to join Russia two months ago face an uncertain future.
Ukraine’s state-owned utility Energorynok canceled all power purchase agreements and stopped buying electricity from Russia’s newest republic after the March annexation, according to the region’s largestsolar developer Activ Solar GmbH. All solar, wind and traditional power plants were forced to suspend operations, said Hans Lang, a spokesman.
Until succession, Crimea imported 80 percent of its power and about as much water via a canal from Ukraine, given the region by the Soviets in 1954. Russia is now working to ensure Crimea’s 2 million residents have an uninterrupted power supply and most of its gas and water needs are satisfied while drafting a long-term electricity plan for the peninsula.
Activ manages most of Crimea’s solar plants, which covered almost 7 percent of its power demand. The company operated four solar parks there with almost 300 megawatts, including two of world’s largest. The region also has seven wind farms with almost 70 megawatts and 118 megawatts in thermal power plants, according to the investment portal of the Republic of Crimea.
Vladimir Konstantinov, speaker of the Crimean parliment, said talks on solar will be clearer after the Ukraine elections on Sunday. Negotiations have been made more difficult due to political instability in Kiev, he said.
The rates won’t be what producers were getting under ousted Ukraine President Viktor Yanykovych as with Russia, Konstantinov added.
The solar parks face a more uncertain future because they earned Europe’s highest feed-in tariffs of about 10 times local wholesale power prices, and its owners have never been disclosed. Crimea’s new government is looking into the plants because it considers them a vehicle used to enrich former Ukraine politicians, according to the Interfax news agency.
Activ, which sold the plants to investors, considers the allegations “groundless” and said the company abides by all regulatory requirements wherever it works, Lang said by e-mail.
The company, which in March warned that its work in Ukraine was being disrupted by unrest, has stopped all development work in Crimea amid uncertainty about current and future purchase agreements, according to Lang.
Activ is analyzing all possibilities for a workable solution to the energy standstill but will “refrain from speculating about what will happen next in terms of energy policy in the region,” he said.
Russia’s energy ministry has no comment on the issue, spokeswoman Olga Golant said by phone.
Copyright 2014 Bloomberg
Lead image: Crimea map via Shutterstock