Ukraine's Centrenergo suspends imported coal purchases due to lower prices on electricity market

MOSCOW. March 20 (Interfax) - Ukraine's Centrenergo has suspended the purchase of contracted imported coal due to the low electricity price on the market, the company's CEO Andrei Churkin said.

"So far, the price on the market does not allow us to continue buying imported coal [...]. Therefore, in order not to get into debt again, we have suspended deliveries of already contracted coal as of today," Churkin said in an interview with Ukrainian media.

There would be no insurance sanctions on the company due to this, he said. At the same time, the share of imported coal accounts for about a quarter of all contracted fuel during the autumn and winter seasons, he said.

The company immediately aimed at domestic producers, but it secured itself with imports due to the risks associated with the crisis, he said.

Centrenergo is planning to import coal for the next year, but its volumes will be known after the Energy Ministry reaches the planned accumulation of fuel at the storage facilities and consumption for the winter season, he said.

"But today I can already say that we will not do without imports. And today we are already working on different supply routes in order to minimize the risks faced by our agricultural producers. I mean the Ukrainian-Polish border," Churkin said.

As reported, the weighted average price of purchase and sale of electricity in the day-ahead market (DAM) in February 2024 amounted to UAH 3,268.58/MWh, down 15.3% from UAH 3,858.57/MWh in January. The weighted average price of electricity purchase and sale on DAM for the first ten days of March 2024 amounted to UAH 2,300.64/MWh, dropping 34.5% from UAH 3,514.82/MWh compared to the same period of February.