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Energoatom closed the first half of 2021 with a profit, a significant part of which will be spent on PSO

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The net profit of NNEGC «Energoatom» for the first half of 2021 is UAH 1.1 billion. At the same time, the gross profit of NNEGC for six months is equal to over UAH 2.7 billion.

It should be noted that Energoatom could have closed the first half of this year with much better financial indicators, if not for a few unfavorable factors for the Company's activities. These are, firstly, two crises in the day-ahead market, caused slump in electricity prices 2-2.5 times in May and June. And secondly, there are huge overdue receivables to the Company for its products – as of July 1, 2021 it is more than UAH 20.1 billion. Of these, UAH 11.6 billion was owed by SE «Energorynok», and over UAH 8 billion was owed by SE «Guaranteed Buyer» and NPC «Ukrenergo» to Energoatom during the operation of the new electricity market – UAH 5.7 billion and UAH 2.5 billion, respectively.

Furthermore, Energoatom's profit directly depends on the price of electricity that the Company supplies, fulfilling its public service obligations to provide the public with affordable electricity (PSO).

The set price at which NNEGC supplies electricity under the PSO – 15 kopecks per kWh, is much lower than the cost of its production. In fact, Energoatom receives no more than 7-8 kopecks per kWh for it, and therefore the debt to the Company is constantly growing, stresses Hartmut Jacob, Vice-President of NNEGC «Energoatom». He emphasizes that if in the structure of the Company's gross income to take into account the cost of its losses from the fulfillment of PSO, which according to the Law «On Prices and Pricing» must be compensated by the state, the net profit of Energoatom would amount to almost UAH 10 billion and it could pay to the state budget not less than UAH 8 billion in dividends.

«As a socially responsible company, we continue to fulfill the current PSO, and will continue to fulfill them under the new approved mechanism – even though the cost of electricity significantly exceeds the tariff set under the PSO,» said Mr. Jaсob. «According to our estimates, in 2021 we will spend more than UAH 20 billion on public service obligations fulfillment.»

Therefore, even in extremely difficult conditions, Energoatom does its best to ensure stable operation and financial profitability. At the same time, the Company needs  early energy market stabilization, repayment of debts for electricity as well as a fair PSO model.