It would cost Ukraine $550 million to stop using coal from the Donbas

Almost three weeks ago, Ukrainian veterans of military actions in eastern Ukraine blocked several railway stations in the Donbas, thus declaring an economic blockade with the uncontrolled Ukrainian regions in the Donetsk and Luhansk Republics. Authorities did not support this action, insisting in particular that without anthracite coal, Ukrainian thermal power stations (TPSs) will not be able to function for a long time (of the 24 million tons annually consumed by Ukrainian TPSes, 9 million tons are anthracite coal, which in Ukraine is produced only in the Donbas).

Prime Minister of Ukraine Volodymir Groysman and head of the Security Service of Ukraine (SBU) Vasyl Hrytsak said that there are currently no alternatives to Donetsk coal in Ukraine (in the territories controlled by Ukraine, only coal gas coal is mined). Minister of Energy and the Coal Mining industry of Ukraine Ihor Nasalyk repeatedly insisted on the necessity of these critical supplies, and warned Ukrainians about rolling blackouts of electricity and an increase in coal prices. But on Ukrainian TV channel 1 + 1, the minister said that Ukraine could do without coal from the Donbas. Nasalyk also announced how much it will cost the state and made assurances that there no cash payments to the separatist-held territories of Ukraine, only a barter exchange.

"If it is decided at the state level to block [the uncontrolled territory of the Donbas] and have no further exchange of goods, Ukraine has enough resources to withdraw from using anthracite [coal]. But we must understand that it is 15 billion Hryvnias (UAH) ($550.9 million USD) of additional funds. And you must understand, at whose expense will be a ball. That is, these 15 billion will fall on the economy and consumers ", said Ihor Nasalyk.

One of the organizers of the blockade, a deputy from the Samopomich (Self-Reliance party) faction, Semen Semenchenko, wrote on his Facebook page that these calculations are overestimated. The real cost of energy independence of Ukraine, in his opinion, is UAH 10 billion ($370 million USD).

It was also recently reported that Ukraine and the United States have been negotiating on alternatives to coal supplies from the uncontrolled territories. This was announced by energy market expert Vitaly Kropachev, who is involved in the negotiations. He said that he has already met with leaders from the U.S. Department of Energy.

"A variant of American coal is currently being discussed, which would be offered under a long contract and at a discounted price that will satisfy Ukrainian consumers and generating companies, both private and public ... It may be a delivery from Richards Bay (South Africa). At this time, various price range options have been proposed for our country ", explained Kropachev.

Nasalyk, in turn, said that existing stocks of coal will be able to provide enough energy for thermal power stations until the end of the winter, but in the case of a complete blockade of the coal zone during the war, stocks will reach virtually zero by the end of March. The minister also said that in case that an agreement is reached, it would take at least 50-60 days for coal to arrive in Ukraine.

“We can replace anthracite from Donetsk for our thermal power plants either through imported coal (for example, South African), or our own, so-called gas coal.” Expert on Energy Ihor Volchin explained how long it would take for the modernization of thermal power stations for gas coal.

According to experts, there is currently a conversion project at the Zmiiv thermal power station, which is located near Kharkov, to allow for the use of gas coal. (Zmiiv TPS is a member of PJSC "Centrenergo" - the only state-owned power generating company in Ukraine).

To accommodate the thermal power stations, which are designed for burning anthracite coal for gas, it is necessary to restructure the coal preparation system.

"We need to upgrade or replace the mills that grind coal. Furthermore, coal group G (gas) is relatively dangerous, and self-ignition and explosion are possibilities. Instead of 300-350 degrees, which is the level required for the ignition of anthracite, it will require 70-120 degrees. That is, the process is different, " explained Igor Volchin.

According to the expert, Converting the Ukrainian coal thermal power plants to gas would require at least six months, and for an optimal relation - a year's time.

Volchin is certain that Ukraine's energy security shift to gas coal, which is only just beginning, is the best way to get rid of energy dependence on territory outside the control of Ukraine. The total cost of retrofitting all Ukrainian thermal power plants is currently difficult to say. But on Zmiiv TPS specifically, we have the data: 200 million UAH. At the same time, Zmiiv TPS is perhaps the oldest such station in Ukraine, and thus almost the most expensive in scope of works to refurbish and upgrade. And if such work will become systemic, the time and costs will be reduced, and in the future Ukraine will be heated without Donbas-mined anthracite.

  Ukraine, Donbas

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