Construction of a modern PGTEC (production of electricity and thermal energy) in the territory of Lviv region using gas-turbine technology for the production of electricity for sale on the market and supply of heat to the territorial community


The purpose of the project:

Meeting demand

Key spending unit
Ministry of Energy of Ukraine
Functional classification of expenditures and budget crediting
0433 - Електроенергетична галузь
Target priority of the government
010201 - Розвиток малої (децентралізованої) генерації електричної енергії
Score
5.8675

Basic data

Detailed description of the project

Decree of the President of Ukraine dated November 7, 2023 No. 737/2023 introduced the Decision of the National Security and Defense Council of Ukraine dated November 7, 2023 "Regarding additional measures to strengthen the stability of the energy system and prepare the national economy for work in the autumn-winter period of 2023" /24 of the year», as well as the Energy Strategy of Ukraine for the period until 2050, approved by the order of the Cabinet of Ministers of Ukraine dated 04.21.2023 No. 373-r, determined the priority of measures to restore facilities of decentralized electricity and thermal energy generation.

Responding to the challenges provoked by the constant missile and drone strikes of the Russian Federation on the energy facilities of Ukraine, PJSC "UKRNAFTA" a decision was made to implement a number of projects in the field of cogeneration, in particular, a project for the construction of a modern PGTEC (production of electricity and thermal energy) using gas turbine technology with a total installed capacity of 320 MW in the Lviv region to work on the electricity market and supply heat to the local community.  

Construction of a combined cycle CHP plant with a total capacity of 320 MW is divided into 2 technological stages: 1) Installation of a complex of gas turbines with a total capacity of about 250 MW; and 2) installation of a steam turbine with a total capacity of 70 MW. Estimated date of commissioning – the end of 2027 – the beginning of 2028. The detailed configuration will be determined after the completion of negotiations with manufacturers and the finalization of the feasibility study. The implementation of the project aims to: 1) Provide electrical and thermal energy to industrial and population facilities; 2) Covering the deficit of electric and thermal energy, which arose as a result of the destruction of generating capacities due to missile and drone attacks by the Russian Federation; 3) Increasing the energy generating capacity of UES-U; 4) Obtaining profit from the sale of produced electrical and thermal energy on the market. Fuel – natural gas. Estimated date of commissioning – Q1 2028

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Problems

Current status, description of problems and needs for their solution
According to the Energy Security Strategy, approved by the order of the Cabinet of Ministers of Ukraine dated 08/04/2021 No. 907-r, the fuel and energy complex of Ukraine was in a critical state even before the beginning of the full-scale armed aggression of the Russian Federation against Ukraine. Despite joining ENTSO-E and a significant increase in investments in the energy system of Ukraine during 2022-2022, the energy sector of Ukraine continues to be in a critical state as a result of damage caused by systematic missile and drone strikes of the Russian Federation on energy facilities of Ukraine during 2022-2024. Responding to such challenges, PJSC "Ukrnafta" is actively involved in solving the issue of unstable electricity generation. In particular, a strategic decision was made to focus on energy production using natural gas. One of the directions that the company is actively developing is the production of electric and thermal energy (cogeneration) using gas piston or gas turbine units. Installation of generating units (gas turbine, gas piston, cogeneration, etc.) is a primary task to cover the power deficit in the energy system of Ukraine and ensure reliable electricity supply to consumers and critical infrastructure facilities, especially in the autumn-winter period. Promoting the involvement of cogeneration plants in Ukraine's energy system is also consistent with Ukraine's aspirations for further integration of Ukraine with the European Union. Pursuant to Directive 2012/27/EU of the European Parliament and of the Council of 25 October 2012 on energy efficiency, Member States shall adopt policies that encourage due consideration at local and regional levels of the potential for use of efficient heating and cooling systems, in particular those using highly efficient cogeneration . The potential for the development of local and regional heat supply markets should be taken into account.
A detailed description of the project goal and the way to achieve it
It is not only the possibility of more efficient use of natural gas, the reduction of its consumption by TKE facilities, and the possibility of long-term containment of the increase in heating tariffs that is relevant. The potential of decentralized electricity generation is important. What's more, the use of highly efficient cogeneration units instead of boilers, which are traditional for most heating and communal energy enterprises, will turn the latter from those that put a heavy load on the electric power system into ones that, on the contrary, will become net suppliers of electric energy to the energy system. Moreover, suppliers of flexible generation, which is the most demanded of our power system. This need for distributed flexible generation is important in the face of terrorist attacks in the Russian Federation, but will be even more important for the further decarbonization of the electricity system. The purpose of this project is to ensure uninterrupted supply of thermal energy to the selected territorial community of Lviv region and electric energy of UES-U both in the basic mode and in the mode of peak loads. Gas turbine engine technologies are best suited for flexible modes with frequent starts and stops and therefore can effectively cooperate with generation plants from renewable energy sources. Cogeneration plants (power plants) are designed to provide UES-U with energy, in particular, in the hours of the absence of wind (for wind turbines) or sunlight (for SPPs), thereby significantly increasing the resilience of UES-U to climatic conditions and demand in a specific period of time.

Coordination of the project with strategic documents

Sphere development strategies
On the approval of the Energy Strategy of Ukraine for the period up to 2050
The decision of the NSDC of Ukraine
Regarding additional measures to strengthen the stability of the functioning of the energy system and prepare the national economy for work in the autumn-winter period of 2023/24

Involved organizations

Organization
MINISTRY OF ENERGY OF UKRAINE
Roles
  • Project author
  • An executor
  • An initiator
EDRPOU code
37552996
Organization
Ministry of Energy of Ukraine
Roles
  • Key Spending Unit
EDRPOU code
240

Demand for the service and its dynamics

Category
Year
Rating
Measure
Annual demand for services/infrastructure
2025
400
MW

Project indicators

Indicator
Base value
Target value
Number of jobs, including for IDPs
100
130

Risk assessment

Risk
Category
Degree
Probability
Strategy
Non-compliance with the terms of delivery of equipment and MTR
Market risk
Minor
Low
Transfer
Delay or lack of project funding
Financial risk
Critical
Low
Transfer
Detection of a lower efficiency factor of the equipment in comparison with the declared indicators
Technical risk
Considerable
Low
Transfer
Low-quality execution of construction and assembly works and start-up and adjustment works
Technical risk
Considerable
Low
Transfer
Damage, destruction or loss of access to property related to the project as a result of the armed aggression of the Russian Federation against Ukraine
Financial risk
Critical
Medium
Avoidance
Change in the cost of equipment required for project implementation
Market risk
Minor
Low
Acceptance
Change in the cost of raw materials required for project implementation
Market risk
Minor
Low
Acceptance
Delivery of faulty equipment and MTR
Technical risk
Considerable
Low
Transfer

Project plan

Implementation
Feasibility study
Technical design
Financing
Budgeting
Preparation
Appraisal
Assessment
912 days
212 days
121 days
91 days
61 days
31 days
31 days
31 days

Gallery

DREAM Code

DREAM-UA-220824-98F79E92

Status

Active

Create date

22.08.2024

Estimated budget

15'741'406'000

Project creator

MINISTRY OF ENERGY OF UKRAINE

Initiator

MINISTRY OF ENERGY OF UKRAINE. JOINT STOCK COMPANY "UKRNAFTA"

Implementer

MINISTRY OF ENERGY OF UKRAINE

Project implementation period

09.24 - 03.28

Geography

The territory of Ukraine

Classification of sectors of economic activity according to the taxonomy of the World Bank

LN - Non-Renewable Energy Generation