Construction of wind power plants to be expedited in Ukraine

On 4 September 2018, the Verkhovna Rada of Ukraine (the Ukrainian parliament) adopted at the second reading draft law No. 8015 "On the Amendment of Certain Laws of Ukraine Regarding Investment Attractiveness of the Construction of Renewable Energy Objects" (the "Draft Law"). The Draft Law aims to eliminate administrative barriers to the construction of wind power plants and raise the attractiveness of the wind power industry for investment.

The Draft Law contemplates that a wind power plant can be assigned the "insignificant consequence" class (CC1), provided that there is a positive conclusion of the relevant authority in charge of environmental impact assessment. In this event, it will be possible to commence construction works following developer's notice on the commencement of construction works being served on the relevant architectural and construction control authority. Commissioning (putting into operation) of a wind power plant will be carried out upon registration by the developer of the declaration of readiness for commissioning with the relevant authorities.

Consequently, it will not be necessary for a wind power plant classified as CC1 to obtain a permit for the performance of construction works, undergo a mandatory examination of design documentation or obtain a certificate confirming the plant commissioning from the architectural and construction control authorities, as this is currently the case with the higher сonsequence class (CC2) usually assigned to wind power plants.

In addition, the Draft Law modifies one of the classification criteria applicable to any objects of construction (not limited to a wind power plant). Previously, an object could not classify as CC1 if damages or losses which could be incurred in its termination or disruption would amount to 2,500 minimal wages (currently totaling the equivalent of ca. 330,000 USD in Ukraine). These objects could be assigned at least CC2 consequence class, but not CC1. Under the Draft Law, it is contemplated that damages or losses of a developer will not be included in the above calculation where the developer does not raise for construction any state or local budget funds, loans secured by the state guarantees or funds of state or communal enterprises and budget institutions. This amendment may facilitate construction not only of wind power projects, but also of solar power plants and other types of construction not limited to the energy sector. Many construction objects can thus become eligible for CC1 (provided that they do not qualify for CC2 or CC3 by other criteria).

The adoption of the Draft Law is expected to considerably facilitate and expedite implementation of wind power projects, and promote investment in the industry.

The Draft Law should now be signed by the Chairman of the Ukrainian parliament and submitted to the President of Ukraine for signature. It should take effect on the day following its official publication.

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