• +38 (044) 379 29 63
  • office@free-energyltd.com
UKR | ENG

News

Anatoly Nikolaychuk gave an interview to the Lviv publication Leopolis.news

Leopolis.news interview with the director of strategy and development of Free Energy, Anatoly Nikolaychuk, about the prospects for renewable energy development in the Lviv region.

The young Swedish-Ukrainian company Free Energy intends to invest in the development of alternative energy in the Lviv Region. At the end of the summer, it announced the construction of two small hydroelectric power plants and signed a memorandum of cooperation with the regional authorities.
  The Free Energy company, which was founded by the Swede Oliver Cabrera and the Ukrainian Denys Galushko in 2014, considers small hydropower plants to be its trump card. Over the next few years, investors intend to build about 5 such power plants in Ukraine. In an interview with Leopolis.news, the director of strategy and development of "Free Energy" Anatoliy Nikolaychuk talked about the prospects of green energy in Lviv region.
What factors make the Lviv region promising for the development of green energy? Natural resources, ease of doing business, consumer demand?
Lviv region has significant potential for implementation of projects in the field of alternative energy. For example, the development of small hydroelectric power stations (mHES), wind and solar power stations (WES/SES), bioenergy. In neighboring countries - Poland, Germany, the Czech Republic, Austria - thousands of small hydroelectric power plants, solar and wind power plants are operating. When you simply travel through European countries, you can see how developed this industry is. Almost every third building is covered by solar panels: roofs of private houses or businesses, even parking structures for cars...
The Lviv region is rich in natural resources for the development of WPP, SPP and, first of all, small hydropower projects, which is a priority area of activity for the Free Energy company. The region has enough rivers and convenient places for the construction of micro-, mini- and small hydropower plants. First of all, these are mountain rivers that have a powerful hydro potential, but it is more difficult to build hydroelectric power plants there. Convenient locations are often far from power grids, and the possible impact on the local ecosystem must be carefully investigated.
We mainly create small hydroelectric power plants on existing hydroelectric structures (dams, reservoirs), where small hydroelectric power plants once worked or where their construction was planned. In the flat part of the region, in our opinion, there are also places where it is possible to build small power plants that will not disturb the natural balance, but on the contrary - will only supplement and develop the current infrastructure.
But the main factor why we, as investors, became interested in the Lviv region is the position of the local authorities, in particular LODA, with which we recently signed a Memorandum of Cooperation on the development of alternative energy. Far from all regions of Ukraine, local authorities support foreign investors. In Lviv, we met a warm, transparent and professional approach to cooperation with the investor. We hope that in the future the local authorities of the Lviv region will help our company implement renewable energy projects.
  What is the reason for the recent active development of green energy? What factors restrained this development earlier and how do they affect today?
It is necessary to understand that alternative energy is not a fashion or a trend, but one of the key factors in the further development of civilization. The signing last December of the Paris Climate Agreement, which was supported even by such industrial giants as the USA and China, showed that world leaders are aware of the risks to which the planet is exposed by the use of traditional energy sources. Humanity has no choice, so every year alternative energy will gain momentum around the world.
As for Ukraine, we have clear commitments to the EC: to set the share of green energy at the level of 11% by 2020. Perhaps there is some opposition to the development of RES power plants in Ukraine (renewable energy sources, -ed.), but this is not the position of the state. The Ukrainian authorities are interested in the development of renewable energy sources, therefore there is a "green tariff" in Ukraine, which allows investors, despite the traditional risks of our country, to implement projects in the field of alternative energy.
What are the main difficulties?
In my opinion, the value of small hydropower is greatly underestimated in our country. Back in Soviet times, more than 1,000 small hydroelectric power plants were operating in Ukraine, but in the 1960s and 1970s, the energy strategy of the USSR was reoriented to the development of nuclear power plants and thermal power plants. Small hydropower was forgotten, over time the operation of many small hydropower plants was stopped. Today, less than 200 small hydropower plants are operating in Ukraine.
Meanwhile, small hydropower is a very developed industry in most European countries. For example, Austria meets the needs of 50% of households with the help of small hydropower plants, and in Norway, which has huge reserves of gas and oil, hydropower generates 98% of the electricity for the country's requirements.
The young Swedish-Ukrainian company Free Energy intends to invest in the development of alternative energy in the Lviv Region. At the end of the summer, it announced the construction of two small hydroelectric power plants and signed a memorandum of cooperation with the regional authorities.
  The Free Energy company, which was founded by the Swede Oliver Cabrera and the Ukrainian Denys Galushko in 2014, considers small hydropower plants to be its trump card. Over the next few years, investors intend to build about 5 such power plants in Ukraine. In an interview with Leopolis.news, the director of strategy and development of "Free Energy" Anatoliy Nikolaychuk talked about the prospects of green energy in Lviv region.
What factors make the Lviv region promising for the development of green energy? Natural resources, ease of doing business, consumer demand?
Lviv region has significant potential for implementation of projects in the field of alternative energy. For example, the development of small hydroelectric power stations (mHES), wind and solar power stations (WES/SES), bioenergy. In neighboring countries - Poland, Germany, the Czech Republic, Austria - thousands of small hydroelectric power plants, solar and wind power plants are operating. When you simply travel through European countries, you can see how developed this industry is. Almost every third building is covered by solar panels: roofs of private houses or businesses, even parking structures for cars...
The Lviv region is rich in natural resources for the development of WPP, SPP and, first of all, small hydropower projects, which is a priority area of activity for the Free Energy company. The region has enough rivers and convenient places for the construction of micro-, mini- and small hydropower plants. First of all, these are mountain rivers that have a powerful hydro potential, but it is more difficult to build hydroelectric power plants there. Convenient locations are often far from power grids, and the possible impact on the local ecosystem must be carefully investigated.
We mainly create small hydroelectric power plants on existing hydroelectric structures (dams, reservoirs), where small hydroelectric power plants once worked or where their construction was planned. In the flat part of the region, in our opinion, there are also places where it is possible to build small power plants that will not disturb the natural balance, but on the contrary - will only supplement and develop the current infrastructure.
But the main factor why we, as investors, became interested in the Lviv region is the position of the local authorities, in particular LODA, with which we recently signed a Memorandum of Cooperation on the development of alternative energy. Far from all regions of Ukraine, local authorities support foreign investors. In Lviv, we met a warm, transparent and professional approach to cooperation with the investor. We hope that in the future the local authorities of the Lviv region will help our company implement renewable energy projects.
  What is the reason for the recent active development of green energy? What factors restrained this development earlier and how do they affect today?
It is necessary to understand that alternative energy is not a fashion or a trend, but one of the key factors in the further development of civilization. The signing last December of the Paris Climate Agreement, which was supported even by such industrial giants as the USA and China, showed that world leaders are aware of the risks to which the planet is exposed by the use of traditional energy sources. Humanity has no choice, so every year alternative energy will gain momentum around the world.
As for Ukraine, we have clear commitments to the EC: to set the share of green energy at the level of 11% by 2020. Perhaps there is some opposition to the development of RES power plants in Ukraine (renewable energy sources, -ed.), but this is not the position of the state. The Ukrainian authorities are interested in the development of renewable energy sources, therefore there is a "green tariff" in Ukraine, which allows investors, despite the traditional risks of our country, to implement projects in the field of alternative energy.
What are the main difficulties?
In my opinion, the value of small hydropower is greatly underestimated in our country. Back in Soviet times, more than 1,000 small hydroelectric power plants were operating in Ukraine, but in the 1960s and 1970s, the energy strategy of the USSR was reoriented to the development of nuclear power plants and thermal power plants. Small hydropower was forgotten, over time the operation of many small hydropower plants was stopped. Today, less than 200 small hydropower plants are operating in Ukraine.
Meanwhile, small hydropower is a very developed industry in most European countries. For example, Austria meets the needs of 50% of households with the help of small hydropower plants, and in Norway, which has huge reserves of gas and oil, hydropower generates 98% of the electricity for the country's requirements.
In fact, small hydroelectric power plants using modern technologies are one of the safest sources of electricity production that do not contain CO2 emissions into the atmosphere. Modern turbines, manufactured in accordance with environmental protection standards, do not pollute water, but rather saturate it with oxygen. Such hydroelectric power plants have advantages: they can regulate floods, retain tons of garbage, etc.
As investors, we try to conduct a dialogue with communities and local leadership in order to convey the socio-economic benefits of building small hydropower plants.
How profitable are green energy production facilities in terms of return on investment? How much funding do such projects require and how long will it take to return the investment?
The development of even a small hydroelectric power station requires significant efforts, time and finances, as well as special knowledge to implement the project in practice. But while the "green tariff" is in effect, any investor has the opportunity to return the investment in 7-10 years of operation of the hydroelectric power plant. Before each project, we consult with our European partners, as well as specialized associations in Ukraine, such as Ukrhydroenergo. As for investments, it all depends on the complexity and specifics of the project, whether the existing hydraulic structure is used, or the construction is carried out "from scratch". Therefore, financial costs for the implementation of a turnkey project can range from 2,500 to 7,000 euros per 1 kW of installed capacity.
Is it more profitable to sell green energy in the Lviv region on the domestic market or is it better to export it to Poland?
This is a premature question. Currently, according to the current legislation, all generated electricity is supplied to the single unified energy system (UES) of Ukraine. Since 2016, the Free Energy company has been a member of the Ukrhydroenergo association, and we also take an active part in working meetings organized by the State Agency for Energy Efficiency and Energy Saving of Ukraine. We are initiating legislative European practice regarding the possible sale of electricity under direct agreements to consumers. We hope that similar laws will be enacted in the future, which will allow this practice to be implemented in Ukraine as well.
How bureaucratic is doing business in your segment? Does the state support the development of such projects?
Bureaucracy in the field of small hydropower is a real problem. It takes more than a year, or even two, to agree the basic documents, permits, etc., even with a very qualified legal service in the company. The state is trying to change the situation, but changes are happening very slowly. Much depends on the attitude of the local authorities towards the investor. Therefore, we hope that it will be easier for us to implement renewable energy projects in the Lviv region, because we see a more progressive attitude to cooperation with investors.
When, according to your estimations, may a boom occur in the green energy market and what place will Lviv Oblast occupy in it?
  Perhaps the boom has already begun, and if Lviv Oblast, and our state in general, show its ability to work transparently with investors, then, I am sure, alternative power plants will grow all over Ukraine. Our investor, Swedish businessman Oliver Cabrera, communicates with many European entrepreneurs. They are very interested in Ukraine from the point of view of business development, but they are often repelled by opaque relations. Apparently, examples of implemented successful investment projects that have already appeared in Ukraine, especially in Lviv and the region, are important for investors.
  Lyubomyr SHKIL, Leopolis.news: http://leopolis.news/lvivshhyna-bagata-na-resursy-dlya-rozvytku-zelenoyi-energetyky-anatolij-nikolajchuk/