UKRAINIAN ENERGY MARKET AND SMALL PRODUCERS: INTEGRATION OPPORTUNITIES

Abstract

The purpose of the study is to find the ways to enhance the participation of small producers and, in particular, consumer-producers (prosumers) in electricity markets, as well as the search for forms of such participation, by creating the appropriate institutional and economic conditions. It has been studied under which conditions the transition from electricity sales by such producers on the retail market under the feed-in-tariff to the sales under the net-billing mechanism or directly on the day-ahead market platform can create additional economic incentives for small producers and prosumers development. It is proven that such a transition stimulates the emergence of new small producers and active consumers, as well as their consolidation in the market into new aggregated market forms. In this regard, the importance of auxiliary market agents suport (aggregators, market platforms, developers), which are capable to create the necessary institutional and economic prerequisites for them in the organized segments of the electricity market, has been proven. In the developed electricity markets of the world, as well as in Ukraine, despite the influence of the Russia's military aggression, there is an increase in the number and the strengthening of small producers role. The consequences of attacks on the state's energy infrastructure have shown, that the decentralized power system is capable of automating energy supply and thereby reducing the risks of disruptions to critical energy infrastructure. The regulatory changes necessary to enhance the market participation of small producers and to increase their economic attractiveness need to be investigated. It is concluded that, along with the adapted support policy aimed at the lowering the equipment cost, licensing requirements simplifying, financial support, the promotion of aggregators acting as the small producers and prosumers agents in the "day-ahead" market, together with the expansion of electric storages by small producers, within the sufficiently high electricity prices will provide the necessary economic prerequisites for the small producers participation in the market.