Ternopil Microgrid

Sector
Energy Sector
Stream
Modernization and development of distribution electricity networks with the introduction of "smart grid" technologies
Maturity level
64
Project Status
Preliminary Investment Feasibility Study
Entry into Portfolio
State level of SPP
Investment Feasibility Study
Implementation
Completion

General information

Description of the project

Project involves design, development and installation of 4 microgrids in the city of Ternopil. These will include several generation assets: existing Gas Engine/Trubine CHP, PV plant, Battery, Substation automation and protection and Energy Management System.  When installed the microgrids will be able to provide electrical power and some heating for the part of the city.  More importantly they will be able to able to provide this power at times when the grid is unavailable, because they can work in islanded (off-grid) mode.  Additionally, critical comsumers in that part of the city, such as ambulance, police and other critical infrastructure would be supplied.  With the Energy Management System and Substation automation a lot of the operational work will be automated and more secure.

The purpose of the project

Main Goal:

Introducing innovations and energy-efficient solutions

Secondary Goal:

Contribution to climate or environmental goals, Increasing compliance with modern standards, Increasing compliance with modern standards, Improving the condition of infrastructure, Improving the quality of services, Meeting demand

Description of the purpose of the project and ways to achieve it

The project involves the design, development and implementation of 4 microgrids in the city of Ternopil. They will include several generating facilities: existing and prospective gas turbines, gas turbines, combined cycle power plants, photovoltaic plants, storage batteries, a substation automation and protection system, as well as an energy management system. After installation, the microgrids will be able to provide electricity and partially heat to part of the city. More importantly, they will be able to provide energy during periods when the Unified Power System is unavailable, as they can operate in an autonomous (off-grid) mode. In addition, critical infrastructure facilities will be provided with electricity. Thanks to the energy management system and substation automation, a significant part of the operational work will be automated and safer.

Problems and solutions resulting from project implementation

Distribution system with low level of automation and capacity. Forced limitations on electricity generation. Inability to operate in island mode. After the creation of a microgrid, they will be able to provide electricity and partially heat to part of the city. More importantly, they will be able to provide energy during periods when the Unified Power System is unavailable, as they can operate in an autonomous (off-grid) mode. In addition, critical infrastructure facilities will be provided with electricity. Thanks to the energy management system and substation automation, a significant part of the operational work will be automated and safer.

Socio-economic context

Indicator

Value

Capital expenditure per year

735 mln UAH

Number of people who will use the service

200000 human

Population in the geographical area of influence of the project

200000 human

Strategic Case

Strategic feasibility of the project

Sector

Energy Sector

Subsector

Electric power industry

Stream

Modernization and development of distribution electricity networks with the introduction of "smart grid" technologies

Strategic document

Концепція впровадження «розумних мереж» в Україні до 2035 року

Task

Increasing the reliability of energy supply to consumers, implementing automated distribution network management systems, reducing electricity losses, frequency and duration of consumer outages

Project objectives

Project objectives were not specified by the initiator

Demand for the service and its dynamics

What methodology was used to estimate demand?

Проведене техніко-економічне обгрунтування відповідно до міжнародних стандартів.
[Response was provided in the Preliminary Investment Feasibility Study]

Has data from external sources been used in the demand assessment?

No
[Response was provided in the Preliminary Investment Feasibility Study]

Does the demand forecast take into account the latest demographic and economic forecasts?

Yes
[Response was provided in the Preliminary Investment Feasibility Study]
Indicator
Year
Demand
Annual demand for services/infrastructure
1
200000 human
Economic justification

Analysis of the project's impact on ecology and climate change

Does the planned activity have a potential positive contribution to achieving climate or environmental objectives?

Climate change adaptation
[Response was provided in the Preliminary Investment Feasibility Study]
Pollution prevention and control
[Response was provided in the Preliminary Investment Feasibility Study]
Climate change mitigation
[Response was provided in the Preliminary Investment Feasibility Study]

Is the proposed project expected to significantly harm any of the following climate or environmental objectives?

None of the options are applicable

Project sustainability and inclusivity

Identify potential gender risks of the project and indicate possible ways to overcome them:

Not applicable to my project
[Response was provided in the Preliminary Investment Feasibility Study]

Does the project provide for improving women's access to services?

Envisaged training or advanced training for women in the private sector
[Response was provided in the Preliminary Investment Feasibility Study]
The project will improve women's access to education (primary, secondary, vocational)
[Response was provided in the Preliminary Investment Feasibility Study]
The project will create jobs available to women (temporarily or permanently)
[Response was provided in the Preliminary Investment Feasibility Study]
The project will improve women's access to safe water, food, and medical services
[Response was provided in the Preliminary Investment Feasibility Study]

Are civil society organizations representing women and vulnerable groups included in the consultation process?

No
[Response was provided in the Preliminary Investment Feasibility Study]

Alternative technical solutions

Technical Solution 1

Ternopil microgrid

Technical Solution 2

Do not carry out reconstruction activities

Cost breakdownCost justificationCost justification
Project cost (preparation and implementation)367'500'000 UAH0 UAH
For preparation183'750'000 UAH0 UAH
For implementation183'750'000 UAH0 UAH
Project operation and closure cost367'500'000 UAH0 UAH
For operation183'750'000 UAH0 UAH
For closing183'750'000 UAH0 UAH
Average annual costs1'000'000 UAH0 UAH
Project duration, incl.12 months24 months
Deadline for developing a FFS3 months12 months
Implementation period9 months12 months
Service life600 months12 months
Target indicatorsDefined Defined
Technical Solution Status
Active

[The technical approach was selected for further detailed analysis or implementation.]

Rejected

[The technical approach was not selected for further detailed analysis or implementation.]

Commercial Justification

Supplier and contractor market assessment

Is the project likely to attract a sufficient number of bidders to ensure real competition that will encourage bidders to think innovatively and maximize the quality of their proposals?
Yes

[Response was provided in the Preliminary Investment Feasibility Study]

Is the project of interest to small and medium-sized enterprises?
Yes

[Response was provided in the Preliminary Investment Feasibility Study]

Will the project involve national or international suppliers and contractors?
Yes, both national and international

[Response was provided in the Preliminary Investment Feasibility Study]

Has an analysis of available procurement options been conducted for the technical solution?
Yes

[Response was provided in the Preliminary Investment Feasibility Study]

Financial justification

Total project budget

Total preliminary budget735'000'000 UAH0 UAH
Project cost (preparation and implementation)367'500'000 UAH0 UAH
For preparation183'750'000 UAH0 UAH
For implementation183'750'000 UAH0 UAH
Project operation and closure cost367'500'000 UAH0 UAH
For operation183'750'000 UAH0 UAH
For closing183'750'000 UAH0 UAH
Were the methodological recommendations approved by the Ministry of Finance of Ukraine applied when calculating the indicative budget?
No
[Response was provided in the Preliminary Investment Feasibility Study]

Average project cost per service recipient

Service UnitСпоживач
Service Unit Cost3'675 UAH

Profitability of the project

Is the project expected to generate income?YesNo
Is the project self-sustaining?No

Availability of services

Has an analysis been conducted of the accessibility of services for consumers and their financial ability to pay the established tariffs?
Yes – the analysis was conducted, it was found that the tariffs correspond to the financial capabilities of consumers

[Response was provided in the Preliminary Investment Feasibility Study]

Project Financing Mechanisms

Are funding sources and mechanisms identified?

Source and MechanismYesNo

Public-private partnership

Has a qualitative and quantitative assessment of the project's suitability for implementation through a PPP mechanism been conducted?
Yes, the project is suitable for PPP

[Response was provided in the Preliminary Investment Feasibility Study]

Are there, after conducting an appropriate study, private investors interested in the possibility of implementing the project in the PPP format?
Yes

[Response was provided in the Preliminary Investment Feasibility Study]

Management Rationale

Team competencies

Determine which competencies/expertise required for successful project preparation and implementation can be provided by the project initiator's own project team (without involving external advisors)
Strategic justification - analysis of the strategic feasibility of the project

[Response was provided in the Preliminary Investment Feasibility Study]

Economic justification - economic analysis

[Response was provided in the Preliminary Investment Feasibility Study]

Project management - communication with stakeholders

[Response was provided in the Preliminary Investment Feasibility Study]

Project management - risk management

[Response was provided in the Preliminary Investment Feasibility Study]

Economic justification - social and gender analysis

[Response was provided in the Preliminary Investment Feasibility Study]

Project management - public consultations

[Response was provided in the Preliminary Investment Feasibility Study]

Economic feasibility study - technical expertise

[Response was provided in the Preliminary Investment Feasibility Study]

Business case - analysis of available procurement options

[Response was provided in the Preliminary Investment Feasibility Study]

Project management - legal support

[Response was provided in the Preliminary Investment Feasibility Study]

Strategic rationale - SDG compliance analysis

[Response was provided in the Preliminary Investment Feasibility Study]

Project management - working with international financial organizations (IFOs)

[Response was provided in the Preliminary Investment Feasibility Study]

Financial analysis - financial analysis

[Response was provided in the Preliminary Investment Feasibility Study]

Strategic rationale - demand analysis

[Response was provided in the Preliminary Investment Feasibility Study]

Economic justification - environmental expertise

[Response was provided in the Preliminary Investment Feasibility Study]

Business case - analysis of the market environment

[Response was provided in the Preliminary Investment Feasibility Study]

Does the team have experience implementing similar projects?
Partially, we have limited experience

[Response was provided in the Preliminary Investment Feasibility Study]

Identify which competencies/expertise required for successful project preparation and implementation need to be strengthened by engaging independent experts or consultants
Economic justification - social and gender analysis

[Response was provided in the Preliminary Investment Feasibility Study]

Management rationale - public consultation

[Response was provided in the Preliminary Investment Feasibility Study]

Economic justification - environmental expertise

[Response was provided in the Preliminary Investment Feasibility Study]

Strategic rationale - demand analysis

[Response was provided in the Preliminary Investment Feasibility Study]

Is there an understanding of where to find relevant experts and consultants?
Yes, negotiations are already underway.

[Response was provided in the Preliminary Investment Feasibility Study]

Risk assessment

Financial riskDefinedUndefined
Results of the feasibility analysis
Project Preparation Program Engagement and Funding Needs

Is there ongoing cooperation or support within the framework of international technical assistance (ITA) or from other donor or government agencies?

No
[Response was provided in the Preliminary Investment Feasibility Study]

Does the project require preparation assistance from Project Preparation Programs (PPF)?

None of the options are applicable
Need for financing

Does the project require additional funding for preparation?

No
[Response was provided in the Preliminary Investment Feasibility Study]

Project Approval History

DateDecision NumberPortfolioProject StatusDecisionReasonsMaturity level
18/08/2025SP-N-180825-0EBA508EState SPPreliminary Investment Feasibility StudyInclude--
01/10/2025SPP-N-011025-CC19D4B7State SPPPreliminary Investment Feasibility StudyInclude-64