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The economic implications of phasing out coal in Ukraine by 2030

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The coal sector has been an integral part of the Ukrainian electricity system for decades. But infrastructure and plants are approaching the end of their technical lifetime, and investments in the electricity sector are necessary, independent of the future composition of the power sector.

This study explores how this window of opportunity could be used to phase out coal in Ukraine and transition to a cleaner power mix for the future. We present a potential coal phase-out by 2030, reducing coal generation over the decade, while investing in new renewable power generation.

Overall, the study shows the following:

A coal phase-out is not only technically feasible, it also creates economic opportunities and new jobs, while reducing the inefficient subsidy payment. As the current coal industry of Ukraine is projected to accumulate losses of more than a billion Euro over the next decade, a coal phase-out can reduce the burden on the state budget while simultaneously creating new jobs in the renewables industry.

The study is designed to span a ‘solution space’, assessing the economic impacts of an ambitious coal phase-out plan in contrast to a continuation of the status quo.

Research for “The economic implications of phasing out coal in Ukraine by 2030” was conducted in October 2020 - April 2021 by Aurora Energy Research on initiative and with financial support of the Heinrich Böll Foundation, Kyiv Office – Ukraine.

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Executive summary_Economic implications of Ukrainian coal exit.pdf