Ukraine introduces more flexible rules for renewable energy auctions

On 13 August 2026, the Cabinet of Ministers of Ukraine (CMU) adopted Resolution No. 1010 “On Amendments to the Procedure for Conducting Auctions for the Allocation of Support Quota” (Resolution No. 1010).

Resolution No. 1010 amends the Procedure for Conducting Auctions for the Allocation of Support Quota, approved by CMU Resolution No. 1175 of 27 December 2019 (Auction Procedure), and provides the detailed framework for implementing the renewable energy auction reforms adopted earlier this year.

Those reforms were introduced by Law of Ukraine No. 4777-IX “On Amendments to Certain Laws of Ukraine Regarding the Improvement of Competitive Conditions for the Production of Electricity from Alternative Energy Sources and Strengthening Energy Resilience” (Law No. 4777-IX), which entered into force on 11 March 2026.

The updated Auction Rules reduce the financial burden on successful bidders and provide greater flexibility in relation to financial security, grid connection and project implementation. 
The Guaranteed Buyer has already announced that the first auctions under the updated procedure will take place on 25 and 30 September 2026.

CMS’s overview of the broader reforms introduced by Law No. 4777-IX is available at this link.

Key takeaways

The salient features of the Resolution No. 1010 include the following:

• more flexible security options – auction and performance security may now be provided not only by bank guarantee, but also by transferring funds to the Guaranteed Buyer’s current account or an eligible escrow account;
• lower performance security – the required amount has been reduced by one third, from EUR 15,000/MW to EUR 10,000/MW;
• more time to secure grid connection documentation – the deadline has doubled from six to 12 months;
• greater flexibility in project implementation – construction and commissioning may be extended once by up to 12 months, subject to additional security;
• new deadlines for completing and commissioning projects – 18 months for solar projects, 36 months for other RES projects and 42 months for certain projects during martial law; and
• greater clarity for solar projects co-located with energy storages (BESS) – minimum BESS sizing requirements and a two-hour period excluded from market-premium support are now applicable.

Background

Law No. 4777-IX introduced a broader reform of the “green” auction mechanism, aimed at reducing barriers to investment in new RES generation and improving the bankability of projects.

Among other changes, the Law:

• extended the support mechanism until 31 December 2034;
• reduced the performance security requirement to EUR 10,000/MW;
• broadened the available forms of financial security;
• reduced the minimum shares of the annual support quota from 10% to 5% for solar, wind and other eligible renewable energy projects, while setting a 10% minimum share for solar-plus-BESS projects; and
• introduced additional flexibility in project implementation and grid connection arrangements.

Resolution No. 1010 implements these legislative changes at the level of the Auction Procedure and sets out the detailed rules applicable to future auctions.

The principal changes for prospective auction participants are summarised below. 

Table 1. Key changes 

Financial security requirements

A significant change concerns the financial security required for participants to take part in an auction and, if successful, to secure performance of their obligations.

Under the previous Auction Procedure, participants were required to provide a bank guarantee of EUR 5,000 per MW of proposed capacity. Following the auction, a successful bidder was required to provide a performance guarantee of EUR 15,000 per MW.

Resolution No. 1010 implements the reduced performance security requirement and expands the available forms of security requirement.

Under the updated framework of Resolution No. 1010:

• the participation security remains EUR 5,000/MW;
• the performance security is reduced from EUR 15,000/MW to EUR 10,000/MW; and
• both forms of security may be provided through a bank guarantee or financial security in accordance with the applicable requirements.

Financial security may be provided by transferring the relevant amount to the Guaranteed Buyer’s current account or to an escrow account opened with an eligible bank.

The amendments also introduce requirements for banks used to provide financial security for the auction:

• an escrow account must be opened in accordance with the Law of Ukraine “On Payment Services” with a bank designated by the Guaranteed Buyer; and
• the escrow agreement must contain terms equivalent to those prescribed for the corresponding bank guarantee and must provide for the bank’s right to debit (i.e. transfer) funds from the account on a contractual basis upon the Guaranteed Buyer’s payment demand.

The reduction of the performance security requirement by one third, together with an alternative form of security, may provide greater flexibility in meeting the auction security requirement.

Grid connection requirements

Resolution No. 1010 also updates the procedure for a successful bidder to provide the Guaranteed Buyer with evidence of the project’s grid connection arrangements.

Under the updated Auction Procedure:

• the deadline for providing the Guaranteed Buyer with grid connection agreement is extended from six to 12 months. 
• successful bidders may submit a capacity reservation agreement instead of a grid connection agreement, provided that the latter is submitted before the capacity reservation agreement expires.
• the capacity specified in the grid connection agreement must be at least 90% of the capacity for which support was awarded; and
• the project location specified in the grid connection agreement must correspond to the region or regions specified in the auction announcement where such a regional requirement applies.

The extension gives developers an additional six months to secure and document the required grid connection arrangements before the relevant evidence must be submitted to the Guaranteed Buyer.

Deadlines for confirming grid connection and readiness for operation

Resolution No. 1010 implements the deadlines established by Law No. 4777 for successful bidders to complete construction, commission and connect their projects to the grid. The applicable deadline depends on the type of RES project. The applicable time periods are summarised in Table 2 below.

Table 2. Deadlines for grid connection and project commissioning under Resolution No. 1010

By the applicable deadline, the successful bidder must provide: 

• evidence confirming the provision of grid connection services to the electricity facility or relevant construction phase; and
• a certificate or declaration confirming the project’s readiness for operation.

The amendments also allow a degree of flexibility in the installed capacity of the completed project. A capacity deviation of up to 10% above or below from the capacity for which support was awarded will not constitute a breach of the support agreement.

Extension of the commissioning deadlines

Resolution No. 1010 allows successful bidders to extend the commissioning deadline by up to 12 months, subject to the following additional security requirements:

• additional security of EUR 10,000/MW to be provided either as a bank guarantee or financial security; and
• the security must remain valid for at least 10 business days beyond the extended deadline for commissioning the project.

BESS requirements

Resolution No. 1010 sets out the following requirements for projects incorporating BESS, including solar-plus-storage projects:

• where an auction provides for the determination of technical parameters of a BESS facility, these parameters must be specified in the auction announcement and reflected in the participant’s application;
• the grid connection agreement must also cover the relevant BESS facility and its technical parameters; and
• for solar projects incorporating BESS, the BESS capacity must be at least 80% of the installed solar generation capacity, with energy storage capacity of at least 2 kWh per 1 kW of installed solar capacity. The auction must also specify a two-hour consecutive period between 10:00 and 16:00 when support under the market premium mechanism will not be available.

For investors considering solar-plus-storage projects, the BESS sizing requirements and the two-hour period excluded from market-premium support will need to be factored into project design and revenue modelling from the outset.

Other eligibility and documentation requirements

Resolution No. 1010 also introduces additional documentation and eligibility requirements for auction participants. In particular, to participate in the auction participants must provide information confirming:

• no relevant state support or reimbursement of costs has been received for the project; and
• no existing price-stabilisation agreement is in place for electricity generated from alternative energy sources.

Practical implications for investors

Developers considering participation in the upcoming auctions should assess the updated requirements against their project development timetable and financing structure before submitting a bid. In particular, they should consider the following:

• whether to use a bank guarantee or cash-based financial security, accounting for the respective bank costs and liquidity implications; 
• the amount and timing of the required security: EUR 5,000/MW for auction participation, EUR 10,000/MW for performance security and an additional EUR 10,000/MW if the construction and commissioning period is extended;
• the timing of grid connection arrangements: the relevant documentation must be submitted within 12 months of entering into the support agreement, and the capacity under the grid connection agreement must be at least 90% of the capacity for which support was awarded; 
• the project implementation timetable: construction, commissioning and grid connection must be completed within 18, 36 or 42 months where the support agreement is concluded during martial law, subject to a possible one-time 12-month extension. For solar projects incorporating BESS, the requirement for BESS capacity to equal at least 80% of installed solar capacity, storage capacity to equal at least 2 kWh per 1 kW of installed solar capacity, the two-hour period between 10:00 and 16:00 when market-premium support is unavailable and the resulting impact on project design and revenue modelling; and
•  whether the project receives or is expected to receive any other form of state support and whether this may restrict its eligibility for support under the auction mechanism.

Conclusion

The Resolution No. 1010 completes an important part of the regulatory framework needed to implement Ukraine’s revised renewable energy auction regime. With the first auctions under the updated framework expected in autumn 2026, prospective bidders should now assess their security arrangements, grid connection status, project timelines and, where relevant, BESS design against the new requirements. 

For more information, contact your CMS client partner or the CMS experts who contributed to this article.