The UAC proposed amendments to the draft law “On Amendments to the Land Code of Ukraine and Other Legislative Acts on Simplification of Land Relations of a Single Window Mechanism Introduction for Project Approval” which the Verkhovna Rada Committee on Energy and Housing and Communal Services has published for public discussion.

Experts of the advisory center “Smart Country” (formed with the help of the UAC) analyzed the provisions of the bill, identifying its positive aspects and points that need to be improved. Yes, the document aims to simplify and speed up the procedure for connection to electricity networks.

The project provides:

  • simplification of procedures related to land issues and approval of project documentation for the construction of energy facilities;
  • creation of a "single window" for the issuance of initial data and approval of the project by the authorities and local governments, municipal services and enterprises;
  • open access to urban cadastre and other source data.

However, there are risks. Some of the bill's initiatives are such that they could worsen the connection of facilities for customers.

The threat of monopolization of the service for the development of project documentation

According to the proposed changes, the obligation to perform the design work of the linear part of the connection for customers of non-standard connection with a capacity of up to 400 kW rests exclusively with the distribution system operator (DSO). In case of introduction of such norm, customers of connection to 400 kW actually lose the right to independently choose the executor of design works of a linear part of connection.

"So, the service of developing project documentation, which today can be performed on market conditions at the choice of the business entity, is artificially monopolized, which will deprive customers of the opportunity to optimize both technical solutions and costs for the linear part of the connection realization. Given this risk, the UAC proposals to the bill recommend that the customer retain the right to choose the executor of the design and estimate documentation for the construction of a linear component," the expert of the advisory center “Smart Country” Roman Fedorchenko said.

Violation of the land users and landowners rights

According to the expert of the advisory center “Smart Country” Yana Kazmina, some provisions of the bill, which in the opinion of its authors are aimed to simplify land relations and procedures for approval of project documentation, actually carry risks for land users and landowners.

"The project provides for the possibility of establishing land easements on land plots of state and communal property, which are in use, without the consent of land users. This grossly violates the land user's right to self-management of the land plot. It is also proposed to provide an opportunity to carry out new constructions of energy infrastructure on state and communal lands in the case of absence of the real rights to the land plots. Such an approach will not guarantee that construction will not "affect" private land or land used by private individuals. In the proposals of the UAC to the bill, it is recommended to improve these provisions,” Yana Kazmina notes.

The UAC proposals on protection of the rights of customers to connect facilities to electrical networks

At the same time, the UAC proposed to include to the bill new rules that were not provided by it, and are aimed to protect the rights of customers to connect facilities to the electrical grid. Specifically:

  1. To increase the size of penalties for violating the law by market participants. Nowadays, the maximum fine for DSO is UAH 1.7 million, which does not provide sufficient deterrent effect to ensure strict compliance by operators with consumer distribution systems. Including the terms of providing services for the connection of electrical installations of customers to electrical networks, because in most cases the actual expenditures, which can be incurred by the DSO in order to provide connection services, reach tens of millions UAH.
  2. To establish responsibility for the irregularity of providing consumers with information about the state of networks. Substation load is a dynamic value and depends on the number of consumers and their capacity. During the year, consumers can connect to the electrical grid, and can be disconnected. Accordingly, DSO information on congestion levels, which, for example, is published in February, is no longer relevant in June. Regular (more than once a year) publication of data on substation load will create conditions for high-quality planning of grid connection projects for potential consumers
  3. To provide for the possibility of building electrical networks to connect such facilities independently by the customer (in case when that there are no other consumers on its own line). This will reduce the time required to provide connection services and reduce the cost of such services for temporary (seasonal) and remote facilities (e.g. irrigation pumping stations, farms, greenhouses, etc.).

The UAC sent its proposals to the Verkhovna Rada Committee on Energy and Housing and Communal Services.

Wednesday, 13 January 2021


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