Increasing the resilience of the electricity distribution network through modernization and digitalization of electricity distribution substations and network voltage changes

Sector
Energy Sector
Stream
Modernization and development of distribution electricity networks with the introduction of "smart grid" technologies
Maturity level
58
Project Status
Preliminary Investment Feasibility Study
Entry into Portfolio
State level of SPP
Investment Feasibility Study
Implementation
Completion

General information

Description of the project

Replacement and modernization of medium voltage networks by supplying more modern primary equipment for substations.

International technical assistance project, registered by the SCMU on 26.06.2025 under No. 6071, financed by the Government of France (13 million euros) and implemented by EDF International Networks on the basis of JSC “Khmelnytskoblenergo”. The project requires additional financing in the amount of 7 million euros for construction and installation works. 

The purpose of the project

Main Goal:

Increasing compliance with modern standards

Secondary Goal:

Contribution to climate or environmental goals, Increasing compliance with modern standards, Improving the condition of infrastructure, Introducing innovations and energy-efficient solutions, Improving the quality of services, Meeting demand

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

Replacement and modernization of medium voltage networks by supplying more modern primary equipment for substations.

Problems and solutions resulting from project implementation

Reconstruction of 10 kV power grids with the transition to a 20 kV voltage class, which will increase the reliability of electricity supply to consumers and improve the economic performance of the network, reduce electricity losses and maintenance costs, and also reduce the carbon footprint.

Socio-economic context

Indicator

Value

Number of people who will use the service

20 thous. people

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

Indicator
Base value
Target value
Number of consumers
20 thous. people
40 thous. people

Project Sustainable Development Goals

Demand for the service and its dynamics

What methodology was used to estimate demand?

Техніко-економічне обґрунтування проводилось на осонові чинних стандартів.
[Response was provided in the Preliminary Investment Feasibility Study]

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

Yes
[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
20 thous. people
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]

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?

Not applicable to my project
[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

Increasing the resilience of the electricity distribution network by modernizing and digitalizing electricity distribution substations and changing the network voltage

Technical Solution 2

Do not carry out reconstruction

Cost breakdownCost justificationCost justification
Project cost (preparation and implementation)480'000'000 UAH0 UAH
For preparation240'000'000 UAH0 UAH
For implementation240'000'000 UAH0 UAH
Project operation and closure cost480'000'000 UAH0 UAH
For operation240'000'000 UAH0 UAH
For closing240'000'000 UAH0 UAH
Average annual costs2'500'000 UAH0 UAH
Project duration, incl.16 months2 months
Deadline for developing a FFS3 months1 month
Implementation period13 months1 month
Service life300 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 budget960'000'000 UAH0 UAH
Project cost (preparation and implementation)480'000'000 UAH0 UAH
For preparation240'000'000 UAH0 UAH
For implementation240'000'000 UAH0 UAH
Project operation and closure cost480'000'000 UAH0 UAH
For operation240'000'000 UAH0 UAH
For closing240'000'000 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 UnitСередня вартість проєкту на одного отримувача послуги
Service Unit Cost48'000 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?
Not applicable – the project does not provide for the provision of paid services or the establishment of tariffs

[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?
No, no assessment was conducted.

[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?
No

[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]

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]

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]

Business case - analysis of the market environment

[Response was provided in the Preliminary Investment Feasibility Study]

Does the team have experience implementing similar projects?
Yes, successfully implemented 1 or more similar projects

[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
None of the options are applicable
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?

Yes
[Response was provided in the Preliminary Investment Feasibility Study]

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

Other
[Response was provided in the Preliminary Investment Feasibility Study]
Need for financing

Does the project require additional funding for preparation?

Yes
[Response was provided in the Preliminary Investment Feasibility Study]

Project Approval History

DateDecision NumberPortfolioProject StatusDecisionReasonsMaturity level
18/08/2025SP-N-180825-1EC872D8State SPPreliminary Investment Feasibility StudyInclude--
01/10/2025SPP-N-011025-82AD4BF3State SPPPreliminary Investment Feasibility StudyInclude-58