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Market Study Food sectors in Ukraine - Part B: Biomass processing industry

Tebodin Ukraine CFI Report number: 71834-B-R

Date: 10 May 2013

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Bioenergy & Biobased Opportunities in Ukraine,

June 2013



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Introduction 4

Summary 5

1 General overview of the branch 7

1.1 Biomass feedstock and its energy potential 7

1.2 Biomass processing 15

1.3 Production analysis and key players by sub-sectors 21

1.3.1 Heat on biomass 21

1.3.2 Biogas, Heat and electricity on biogas 22

1.3.3 Solid biofuels 23

1.3.4 Bioethanol 25

1.3.5 Biodiesel 26

1.3.6 Bio-fertilizers 27

1.3.7 Biobased polymers 28

1.4 Sales system 28

1.5 Price survey 29

1.6 Foreign trade 33

2 Trends, drivers and barriers to sector development 39

2.1 Main trends 39

2.2 Main drivers 39

2.3 Major barriers 40

3 Branch regulation 42

3.1 Branch structure 42

3.2 State programs 43

3.3 Associations 44

3.4 Events and exhibitions 44

3.5 Legislation 45

3.6 Taxation 48

4 Standardization and certification 51

4.1 National standards 51

4.2 International standards 52

5 Investments in the sector 53

6 Financing the sector 53

7 Technology and equipment 54

Table of contents Page



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8 SWOT analysis 57

9 Opportunities for Dutch SMEs 59

Annex 1 Sector associations 61

Annex 2 Sector events and exhibitions 65

Annex 3 Major market participants 69

Table A. Largest boilers on solid biomass in Ukraine 69

Table B. Largest biomass and biogas processing companies for power generation 70

Table C. Largest producers of solid biomass products 72

Table D. Producers of bioethanol and biofuels with bioethanol additives 74

Table E. Largest producers of biodiesel 76

Table F. Announced investments in the sector 77



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Introduction

This report contains the results of a study done on the Ukrainian biomass processing industry carried out by

Tebodin Ukraine. The study was carried out on the request of the Ministry of Economic Affairs, Agriculture and

Innovations of the Netherlands.

The point of interest of the report is focused on processing of agricultural, agro industrial and wood wastes into

the non-food biomass products - biogas, bioelectricity, solid and liquid biofuels, bio fertilizers and bio polymers.

The main objectives of the market study are:

to provide the latest information on the biomass sector of the food market of Ukraine;

to describe major trends and problems of the biomass sector;

to indicate business opportunities for Dutch companies in Ukraine.

The overall aim of this market study is to study the market opportunities and strengthen the position of Dutch

companies in the biomass processing sector in Ukraine.

The main focus of the market study was put on the following biomass feedstock:

Straw of cereals and other crop waste;

Animal wastes;

Agro industrial wastes;

Sunflower husk;

Wood waste.

The main Dutch-end target groups for whom the research is addressed are:

Exporters of equipment

Exporters of knowledge and services (certification)

Exporters of processed goods (top price segment)

Investors

For this market study alternative sources of information were used such as information from the State Statistics

Committee of Ukraine, the Ministry of Agrarian Policy, the State Customs Committee of Ukraine, State Agency of

Forest Resources of Ukraine and other Ukrainian and international organizations.

During the sectors research, the branch authorities and companies operating in the market were contacted

directly and interviewed. Their opinions are also accounted in the report.



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Summary

Biomass refers to one of the most perspective renewable energy sources (RES) coming from carbon containing

organic materials of plant or animal origin (wood, agricultural residues, manure, specially grown energy crops,

organic portion of solid waste and sometimes peat).

Using various transformation processes such as combustion, gasification, pyrolysis the biomass is either

transformed into biofuels, bio heat, bioelectricity, animal feed, bio fertilizers and bio chemicals.

Ukraine has a good chances and enough potential for dynamic development of bioenergy.

Annually in Ukraine is produced 110 -120 million tons of biomass feedstock (straw of cereals and other crop

waste, animal and agro-industrial wastes). Of the total amount about 54% are further processed, 45% are wasted

and only about 1% are used for electricity and heat production.

The economic potential of primary agricultural residues per year is estimated at the equivalent of 14-20 million

tons of conventional energy per year. Overall biomass potential of Ukraine is estimated to 15-20% of primary

energy consumption.

Currently, a small portion of the existing potential is realized into practice. In 2011 Ukraine consumed 1.3 million

tons of conventional energy from biomass which is 0.7% of the total consumption of primary fuel. The biggest

share (about 50%) of the biomass consumption is covered by agricultural residues (mainly sunflower husk) and

wood waste.

Such a gap between the potential and actual biomass processing to energy is explained by the range of

problems. The most critical of them are: unregulated procedure of tariff formation and cross-subsidizing of prices

for heat and electricity, lack of modern technologies and difficulties with financing.

Straw of cereals and other crop waste (about 26 million tons):

is used as fuel in small straw-fired boilers and in straw-fired district heating plant;

processing into briquettes and pellets is at the early stage of development;

biodegradable polymers from vegetarian materials containing cellulose or starch (corn, sugar beets,

potatoes) and waste of crop processing plants are not produced.

Animal wastes (about 28 million tons):

Currently only 10 biogas installations are operational in Ukraine. They are mostly used for production of

heat for own needs (without electricity).

The resulting sludge (of manure) at the end of the digestion process being a fertilizer – is not commonly

used.

Agro industrial wastes (about 15.6 million tons):

Wastes of milk and meat processing suitable to produce biogas are practically not used.

About 5 Ukrainian state-owned companies and 2 private plants produce bioethanol from waste of alcohol

and sugar production.

Some breweries use the waste products of yeast production for biogas production for own heating.

Sunflower husk (about 10 million tons):

is widely used (almost 70% )for production of pellets and briquettes;

as by-product for seed oil production is used at plant’s boilers; about 50% still are available for sale;

there are only few examples in other industries to burn of sunflower husk together with traditional fuel for

heat and power production;

husk gasification – currently is not used.



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The most widespread use of 2.5 million m3 of wood biomass are:

processing into briquettes and pellets, most of which are exported to EU countries;

direct burning of wood wastes (or as briquettes and pellets) in small capacity pyrolysis boilers, water-

heating and steam boilers for heating. Mainly, these are single units installed at several enterprises of

Ukraine, aiming to save traditional fuel. In addition, small wood burning boilers are sometimes installed

for heating applications in schools, kindergartens, hospitals and other social institutions.

Gasification of wooden waste for producing a combustible gas that could be used alone or as mixture with natural

gas for electricity generation as well as biofuel production from wood biomass – are not developed.

The main drivers of the sector development are considered to be:

Agricultural and agro industrial production become the main ‘currency source’ for the country and will be

developing in the nearest perspective;

Energy dependence on import and constantly growing prices on natural gas force to look for alternative

fuels;

Necessity of upgrading and increasing of energy efficiency of the obsolete heat and power utilities

infrastructure;

EU sustainability and energy saving targets – increasing demand for biofuels from Ukraine;

Favorable taxation and recent legislative initiatives;

‘Green’ tariff for electricity produced from agricultural residues.

Dutch business can serve as a provider of knowledge, technology and equipment supplier for biomass

processing, bioenergy and biofuel industries. Wide opportunities open in biomass/bioenergy assessments and

various consultancies, upgrading of power and heat infrastructure, setting up sustainable biomass production and

processing, international trade with energy crops and solid fuels, development of local biofuels supply/logistics

chains and production, creation of rural biogas and bio-fertilizers productions, matchmaking/co-

financing/partnership.



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1 General overview of the branch

1.1 Biomass feedstock and its energy potential

Ukraine has large stock of biomass available for energy production.

Main characteristics of the biomass feedstock market:

In 2011 Ukraine produced 1101-120

2 million tons of biomass feedstock (Straw of cereals and other crop

waste, animal and agro-industrial wastes).

Of total amount about 54% are further processed, 45% are wasted and only about 1% are used for

electricity and heat production.

Most extensive biomass resources are crop residues (85.9 million tons) and energy crops (23.2 million

tons) as reported by Biomass Ltd.

Quantities of animal manure, urine, droppings vary according to different sources: from 7.7 million tons

according to data of State statistics office to 28.1 million tons (wet state) according to estimates of

Biomass Ltd.

Ukraine annually produces 9.7-15.6 million tons of agro industrial wastes according to various

assessments.

Low penalties for violation of the environmental legislation do not stimulate the agro industry to treat the

residues (animal offal, manure, slaughterhouse waste, milk whey etc.) in a proper way.

Annual amount of wood biomass constitutes 5.6-6.5 million m3. Of which about 3.5-4.0 million m

3 is used

for heating of individual housing and social objects in rural areas, heat generation for process and

heating needs of woodworking industries. Approximately 2.1-2.5 million m3

of wood waste remain

unused.3

The large amounts of crop and wood residues are rot or combusted in the fields/forests after

harvesting/logging.

Biomass distribution over the different parts of Ukraine is unequal. Each part has its own specific waste

resource:

o The Northern and Western parts of the country have vast and dense flora, such as coniferous

and deciduous woods.

o The Central and Southern parts are characterized by numerous agro-industrial sites and vast

agricultural areas.

o In the Eastern part of Ukraine, the well-developed industrial and agro-industrial sectors are

producing large quantities of secondary biomass (Figure 1).

The economic potential of biomass processing for energy purposes constitutes 25-40 million tons of

conventional energy per year which is 15-20% of primary energy consumption of Ukraine according to

various estimates.

1 Report “Potential of energy production from agricultural wastes”, IFC , 2013

2 According to Biomass ltd. assessments 122.7 million tons of biomass feedstock was produced in 2011 (Table 1). The estimates of

the different organizations and the same organization may vary from year to year. The annual estimate of biomass feedstock and

biomass potential depends on various conditions in certain year: weather, kinds and yields of crops, production volumes, storage

conditions etc. 3 State Agency of Forest Resources of Ukraine, http://ru-bio.ukrbio.com/ru/articles/1893

http://ru-bio.ukrbio.com/ru/articles/1893



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Figure 1. Geography potential of biomass energy in Ukraine (agricultural and wood waste)

Source: Institute for Environment and Energy Conservation (IEEC)

Biomass types as defined by the assignment are used for production of the following final products.

Straw of cereals and other crop waste

The straw is used as fuel in small straw-fired boilers and in straw-fired district heating plant. In Ukraine,

several companies produce boilers and other equipment to burn straw for heat and power generation.

Because of a limited availability of this equipment, very few applications are known, e.g. for heating of

some schools and farms.

Processing into briquettes and pellets is at the early stage of development. Only 5 plants of straw pellets

are operational in Ukraine. Few large scale projects were recently announced by agro industrial

holdings.

From vegetarian materials containing cellulose or starch (corn, sugar beets, potatoes) and waste of crop

processing plants may be produced the biodegradable polymers (bio plastics). So far only one plant in

Ukraine (Kiev Milk Acid Plant) can produce the substance which is used for production of bio plastics.

Almost the entire production of the plant is exported to EU.

Animal wastes

The manure can be used in biogas plants to produce heat and power in small-sized plants for

households, villages or farms. Today only 10 biogas installations are operational in Ukraine. They are

basically used for production of heat without electricity.



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The resulting sludge (of manure) at the end of the process could be used as fertilizer since the nitrogen

and phosphorous content is not lost.

Agro industrial wastes

At present time, there are just a few factories that use agro industrial biomass and wastes e.g. sunflower

husk as a fuel for direct burning together with natural gas in the industrial furnace.

Wastes of alcohol, sugar, brewery, milk and meat processing is suitable to produce biogas. At present,

only about 10 farms have installed biogas generation capacities. Mainly due to high equipment cost and

unregulated issue of ‘green’ tariff for electricity from biogas, the applications are not very popular in

Ukraine.

Residues of alcohol and sugar production wastes and corn for grain can be used in bioethanol

production. About 5 Ukrainian state-owned companies and 2 private plants produce bioethanol.

Sunflower husk

Direct burning of sunflower husk for heat and power generation in the same working cycle, i.e. in the

sunflower processing factories. An example is oil extraction plant ‘Kirovogradoliya’ (Kernel group) which

constructed a whole industrial combined heat and power (CHP) plant on sunflower husk. It cost the

company USD 24 million. But it was worth it: today, the company saves more than USD 5.5 million

annually. The heat that is released from the burning of raw materials is used for the technological needs

of the enterprise, and the excess of electricity is sold in the energy market with a high ‘green’ tariff rate.

In other industries using different types of furnaces, it is also possible to have provisions for a direct

burning of sunflower husk together with traditional fuel for heat and power production. This practice can

help saving expenses of traditional fuels, such as natural gas, oil, etc. Such project had been realized at

Vatutinskyi plant of refractory products in Cherkassy region. The plant consumes sunflower husk

products of Nikolayev biofuel plant. After the project it has been possible to achieve nearly 50%

economy of natural gas.

Sunflower husk possesses favorable properties to undergo gasification, the process that yields a

producer of gas with a good quality to be used in combustion boilers or in power generation turbines.

Gasification appears to be a better option than combustion in terms of energy efficiency.

Sunflower husk is widely used for production of pellets and briquettes. Almost 70% of totally produced

husk is processed for solid biofuel.

Wood waste

The most widespread use of wood biomass is its processing into briquettes and pellets, most of which

are exported to European countries.

Direct burning of wood wastes (or as briquettes and pellets) in small capacity pyrolysis boilers, water-

heating and steam boilers for heating. Mainly, these are single units installed at several enterprises of

Ukraine, aiming to save traditional fuel. In addition, small wood burning boilers are sometimes installed

for heating applications in schools, kindergartens, hospitals and other social institutions.

Burning of wood waste in furnaces and combustion chambers, directly in factories and enterprises of

woodworking and chemical industry for heating.



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Gasification of wooden waste for producing a combustible gas that could be used alone or as mixture

with natural gas for electricity generation. The energy produced can be sold to wood-fired district heating

plants or combined heat and power (CHP) plants.

The cellulosic content of wood biomass and wood industry wastes can be extracted and converted into

liquid biofuel (bioethanol), while the remaining waste (lignin) can be subsequently processed for

electricity generation.

The main components of the energy potential are primary agricultural wastes for burning and pelletizing, energy

crops for biodiesel production, secondary agricultural residues and wood waste for burning and pellets

production, animal wastes for biogas production and for replacement of fossil fuels in power generation (Table 1).

Table 1. Energy potential of biomass in Ukraine, 2011

Type of biomass Production,

mln tons

(wet state)

Share of total

production, %

Potential of energy

production, mtce

Share of total

potential

energy production,

%

Primary agricultural waste (crops residues), including:

85.9 - 18.27 -

- Stems of corn for grain 34 28% 8.59 22%

- Straw of cereal crops 32 26% 3.17 8%

- Stems of sunflower 17 14% 5.55 15%

- Straw of rape 2.9 2% 0.96 3%

Energy crops (poplar, miscanthus, acacia, willow,

rapeseed)

23.2 19% 13.3 35%

Secondary agricultural waste

(sunflower husk, sugar bagasse)

9.7 8% 0.99 3%

Wood waste 3.9 3% 1.87 5%

Bioethanol - - 2.36 6%

Peat - - 0.4 1%

Biodiesel - - 0.35 1%

Biogas from manure - - 0.35 1%

Landfill gas - - 0.26 1%

Sewage gas - - 0.09 0.2%

Total 122.7 100% 38.24 100%

Source: Scientific Engineering Centre ‘Biomass’ Ltd.

1.1.1 Crops residues

Ukraine enjoys an advantageous position for cultivation of cereals (wheat, oats, barley, etc.) producing huge

quantities of straw. Nearly 60% of the Ukrainian territory is under agro-industrial use. Each of Ukrainian regions

generates considerable amounts of crop residues.

In 2011 Ukraine produced 85.9 million tons (wet state) of crop residues including:

Stems of corn for grain - 34 million tons

Straw of cereal crops – 32 million tons

Stems of sunflower – 17 million tons



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Straw of rape - 2.9 million tons

Facts about crop residues usage in Ukraine:

The straw of cereal crops is used for about 80% as soil fertilizers, animal feed and bedding. The

remaining 20% is usually lost in the field.

The sunflower as a plant is used for 40-50% for oil extraction, for 10% on sunflower husk palletizing.

Remaining 50-60% of the plant in the form of stems and leaves is not utilized.

Despite this significant potential, today, only a small share of the available feedstock is used for energy

production, mainly by mean of direct burning.

About 20 straw fired boilers (mostly below 1 MW) are installed for heating in rural areas and about 5 companies

are producing fuel pellets from straw.

The utilization of crop residues is hindered by significant collection cost, and the fact that most of agricultural

enterprises lack possibilities to invest into collection, bundling and adequate storing of the wastes.

1.1.2 Animal wastes

According to State statistics in 2011 the farms produced 7.7 million tons of manure, droppings, urine4. Larger

quantities (up to 28.1 million tons) of animal wastes are available in Ukraine according to the estimates of

Biomass Ltd (Table 2).

Table 2. Potential of biogas production from animal wastes, 2010

Type of enterprise Type of waste Content of dry

substances

Number of

enterprises, units

Total wastes (wet

state), million

tons/year

Potential biogas

production,

million m³/year

Cattle farms manure 10-12% 5,734 20.5 719

Pig farms manure 7-10% 6,515 4.7 180

Poultry farms droppings 25-30% 861 2.9 326

Total - - 13,110 28.1 1,225

Sources: Scientific Engineering Centre ‘Biomass’ Ltd.

Facts about animal wastes treatment/usage in Ukraine:

The animal wastes are first separated into the liquid and solid fractions. At best case, the liquid fraction

(or waste water) is chemically cleaned and discharged into the sewage system or water body. At worst

case, the waste water without any treatment is supplied to filtrating fields. The solid fractions are dumped

nearby the farm and used as fertilizers of poor quality.

Low penalties for pollution of lands with animal wastes do not stimulate the livestock producers to

recycle such waste in a proper way.

The animal wastes could be successfully used for production of biogas and bio-fertilizers. According to

calculations of market experts the animal manure available in Ukraine is enough for construction of about 4,000

biogas plants. Instead of that, about 10 biogas plants were operational in 2011. All they belong to the large

agricultural farms and produce in total 4 MW.

Because of the lack of acting ‘green’ tariff on electricity produced from biogas, the farms mainly use biogas for

own heating and transportation needs often without generating electric energy out of it.

4 In a wet state



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Figure 2. Gas output from various types of substrates, m3/t

Source: Data of market operators

1.1.3 Agro industrial wastes

The potential of agro industrial (secondary agricultural) wastes processing into the energy is not as high as of

primary agricultural wastes, however it still constitutes 0.99 million tons of conventional energy production per

year.

According to different estimates during the last few years Ukraine produced annually from 9.7 to 15.6 million tons

of agro industrial wastes (Tables 1 and 3).

Main suppliers of agro industrial wastes in Ukraine are oil extraction, sugar plants, distilleries and brewery plants.

Table 3. Potential of biogas production on agro industrial plants of Ukraine, 2010

Type of enterprise Type of waste Content of dry

substances

Number of

enterprises

Total wastes (wet

state), million

tons/year

Potential biogas

production,

million m³/year

Brewery plants grains 20-25% 50 1.4 171

Sugar plants beet pulp 10-12% 184 6.5 216

Distilleries grains 6-8% 82 4.5 180

Milk processing waste water 1-6 g/l 300 0.9 90

Cheese production milk whey 6-7% 2.5

Total 616 15.6 657

Sources: Scientific Engineering Centre ‘Biomass’ Ltd.

Oil extraction

Oil extraction companies install granulators for processing of sunflower husk into solid biofuels. Of 1 million tons

of sunflower husk annually produced at oil extraction plants about 700,000 tons is palletized.



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The pellets are burned at the plants for production of steam, heat and combined heat and power. The surplus of

solid fuel is exported to EU countries.

Figure 3. Consumption of sunflower husk for production of energy in different regions of Ukraine, 2010

Source: Institute of Engineering Thermo Physics, NAS of Ukraine, Scientific Engineering Centre ‘Biomass’ Ltd.

Sugar plants and distilleries

The wastes of sugar plants and distilleries are not practically processed for energy.

At the level of Cabinet of Ministers the arrangement of bio ethanol production at the facilities of State distilleries

and old sugar plants is discussed. The main barrier for implementation of the idea is the lack of financing for

purchase of specialized equipment.

Livestock production and slaughterhouses

To improve incineration and recycling of agro industrial wastes and to increase production of animal feed

ingredients (meat meal, bone meal, blood meal, fish meal, feather meal, fat, etc.) the State Concern

‘Ukrvetsanzavod’ composed of 23 plants was founded by the decision of the Cabinet of Ministers of Ukraine.

The technologies and equipment at the Concern are outdated and only few of them are operational. The agro

industrial wastes are burned in old boilers and produce insignificant quantities of low quality feed ingredients.

1.1.4 Wood wastes

Wood stock of Ukraine is estimated at 1.8 billion m3. In 2011 Ukraine harvested 17.5 million m

3 of wood.

3.5-4.0 million m3 of wood biomass is annually used for heating of individual housing and social objects in rural

areas, heat generation for process and heating needs of woodworking enterprises, production of heat and

electricity at heat stations and municipal boilers, production of briquettes and pellets, charcoal, gas syntheses5.

Facts about Ukrainian forestry:

5 State Agency of Forest Resources of Ukraine, http://ru-bio.ukrbio.com/ru/articles/1893

http://ru-bio.ukrbio.com/ru/articles/1893



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Ukraine is characterized by relatively low level (15.9%) of forest coverage.

High percentage of protection forest which has a trend of increase.

Considerable forest area is increasing in the zones of radiation pollution.

Half of Ukrainian forests are artificially planted and needs intensive care.

Forest locations in Ukraine are irregular. They are concentrated mainly in Polissia steppes and in the

Ukrainian Carpathians.

Key harvested tree species are pine, spruce, birch and alder.

Table 4. Wood biomass resources in Ukraine

Years Reforestation,

thousand ha

Wood procurement,

thousand m3

Firewood for heating, thousand m

3

Wood felling wastes,

thousand m3

1990 37.5 12,642.00 2,804.0 1,264.20

2000 37.8 11,261.70 2,573.0 1,126.20

2005 58.6 17,124.30 2,650.6 1,712.40

2006 66.7 17,759.80 2,674.3 1,776.00

2007 73.6 19,013.90 2,511.8 1,901.40

2008 80.2 17,687.50 2,654.5 1,768.80

2009 80.9 15,876.50 4,219.0 1,587.70

2010 70.1 16,145.60 4,102.0 1,614.60

2011* 72.4 17,510.00 4,200.0 1,720.00

* Preliminary data

Source: Institute of Renewable Energy of National Academy of Science of Ukraine, State Statistics Committee of Ukraine

Annual quantity of unused wood wastes according to estimates of State Agency of Forest Resources of Ukraine

constitutes 2.1-2.5 million m3 of which:

1.7-2.0 million m3 of primary wood wastes produced in the process of logging and felling

0.4-0.5 million m3 of secondary wood wastes produced at woodworking enterprises

Primary wood waste

The primary wood wastes are practically not used in Ukraine. They are burnt or rot in the felling. Minor quantities

are used for direct burning and less for pellets production.

The use of wood wastes for energy purposes is hindered mostly by the lack of a developed network of quality

forest roads and specialized logging and timber transportation equipment.

The timber is usually skidded to a distance of 2-3 km, during which significant contamination of wood and lumber

waste take place. This substantially impairs the use of waste for the production of quality fuel pellets.

The issue of contaminated wood could be solved with previous barking and washing of wood materials but this

equipment is quite expensive for majority of sawmills in Ukraine.

Secondary wood wastes

Till recently the woodworking industries didn’t use the secondary wood wastes at all which was explained by the

low price of natural gas.

As of today, the situation significantly changed and many wood working companies have instilled the boilers on

wood wastes.



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About 500 modern wood fired boilers have been installed, and over 1,000 old boilers were converted from coal

and oil to wood biomass.

However, still the significant amount of secondary wastes (about 0.4-0.5 million m3) are dumped, burnt or utilized

in vain.

Table 5. Types of wood materials used for production of energy, 2010

Supply of wood energy Annual consumption, %

Firewood 74.8

Chip 9.2

Sawdust 7.8

Lump waste 5.9

Bark 2.3

Biofuel briquettes and pellets Less 0.02

Char Less 0.01

Total 100

Source: Equipment and instruments for professionals. Wood processing

1.2 Biomass processing

The share of natural gas in Ukraine is unreasonably high (about 43%) which is almost 2 times as higher than, for

example, in the EU. At that the contribution of renewable energy sources is unduly low – 1.6%, which is 6 times

as less than in the EU.

Table 6. Structure of primary energy consumption in the world, %

Energy carriers 2010 2030

World Ukraine EU USA Ukraine* EU

Natural gas 20.9 42.6 25.1 25.2 28 24

Oil 32.9 10.0 35.1 36.1 14.5 33

Coal 27.1 27.9 15.9 23.0 30 7

Uranium 5.8 17.9 13.5 9.8 22.5 11

RES 13.1 1.6 9.8 5.6 5.7 25

Source: State Statistics Service of Ukraine, http://www.uabio.org/img/files/docs/position-paper-uabio-1-en.pdf

Figure 2. Structure of primary energy consumption in Ukraine 2010, %

Source: State Statistics Service of Ukraine, http://www.uabio.org/img/files/docs/position-paper-uabio-1-en.pdf

http://multitran.ru/c/m.exe?t=2121560_1_2

http://www.uabio.org/img/files/docs/position-paper-uabio-1-en.pdf




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In 2010 the share of biomass in the total consumption of primary energy of Ukraine was 0.6%, in 2011 – 0.7%.

For comparison, the indicator in the EU is on average 6.2%, and in some countries: Latvia - 24.4%, Sweden -

21%, Finland - 20.7%, Austria - 15.5%, Denmark - 14.5%6 (Figure 3).

Figure 3. Share of biomass in the gross internal energy consumption in EU and Ukraine, 2011, %

Source: http://ua-energy.org/post/18030

The large share in the biomass consumption for energy production is represented by sunflower husks used for

heating and solid fuels production (35%), firewood used for heating by population (29.2%) and wood waste used

for heat and power and solid fuels production (20.2%) (Table 7).

Table 7. Consumption of biomass for energy production in Ukraine (2010)

Biomass type Consumption* % of the total

natural units ktce

Straw 50 thousand tons 24 1.9

Wood waste 957 thousand tons 261 20.2

Firewood (population) 1,972 thousand solid m3

377 29.2

Sunflower husks 884 thousand tons 452 35.0

Peat 339 thousand tons 156 12.1

Biogas (manure) 4,516 thousand m3 3 0.2

Landfill gas 26,192 thousand m3 18 1.4

Total 1,291* 100

*1.29 mtce make up about 0.7% of the total energy consumption in Ukraine.

Source: http://www.uabio.org/img/files/docs/position-paper-uabio-1-en.pdf

1.2.1 Heat on biomass

Biomass is used for heating of private houses and in boilers of wood processing and agricultural enterprises.

Interest is constantly growing to installation of boilers on biomass in small district heating systems, heat and

power plants, for heating of social, public and private buildings in rural areas.

6 http://ua-energy.org/post/18030

http://ua-energy.org/post/18030




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Domestic consumption is limited by:

Most of the heat generating facilities are currently owned by the state, the regions or the municipalities

which complicates access to investments;

Low prices for heating;

Lack of information about advantages and executed projects (best practice examples) of heating on

biomass vise fossil fuel;

Lack of finances for purchasing and installation of the new equipment (boilers, generators);

Necessity of biomass procurement / storage technologies and equipment.

1.2.2 Biogas, Heat and electricity on biogas

The main consumers of biogas and heat and power derived from it are the large agricultural farms and agro

industrial companies (oil extraction). The companies mainly use biogas for their own transportation and heating

needs, often without making of it the electric energy.


Most of the heat and power facilities are currently owned by the state, the regions or the municipalities;

Heat and electrical energy prices are not linked to market dynamics and are perceived by public

authorities as social service;

Low fines for violations of environmental legislation for pollution of the territories with wastes;

Not yet in force a law on the ‘green’ tariff for electricity from biogas and biomass and for co-firing of

biomass with fossil fuels;

High investments into biogas processing equipment;

Problem of selling of electricity to State electricity networks.

1.2.3 Solid biofuels

Domestic market of solid biofuel is developing quite rapidly with an average annual growth rate of 30%.

Figure 4. Domestic consumption of solid biofuels in Ukraine

Source: Fuel Alternative, data of market operators



Date: 10 May 2013

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The share of domestic consumption of biomass is progressing. In 2008 the share of the domestic market of solid

fuels produced in Ukraine accounted for 3%, in 2009 - 9%, in 2010 –13%, and in 2011 – already 15% (Figure 5).

Figure 5. Share of domestic consumption of solid bio fuel in Ukraine, %

Source: Fuel Alternative, data of market operators

The main consumers of solid biofuels in the domestic market are private households (60% of local consumption),

industrial plants (30%) and reconstructed municipal boilers (10%)7 (Figure 9).

The market share of the reconstructed municipal boilers for solid fuels on biomass resources is constantly

expanding.

Figure 6. Domestic consumers of solid biofuels

Source: Equipment and instruments for professionals. Wood processing (2/2012)

Since pellets need to compete with low priced traditional sources of energy used for heating, the domestic

Ukrainian market for pellets is yet underdeveloped and the majority of producers are export oriented, mostly to

the European market.


7 http://biomass.kiev.ua/images/conference/pdf/07-davii-ukr.pdf

http://biomass.kiev.ua/images/conference/pdf/07-davii-ukr.pdf



Date: 10 May 2013

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Absence of local infrastructure (equipment) for burning pellets;

Lack of suppliers of large feedstock amounts;

Low prices for natural gas.

1.2.4 Liquid fuels

Consumption of liquid biofuels is not widespread in Ukraine. According to market operators it accounts for about

1.7% of the total consumption of gasoline and diesel. For the comparison, in Europe the biofuels account for

about 5% of the total consumption of light oil.

The demand for ethanol is virtually nonexistent in Ukraine. According to market experts the share of ethanol

consumption in the total gasoline consumption is not exceeding 1.8%, the share of consumption of biodiesel in

total diesel consumption is about 1.6% (Figure 7).

Figure 7. Consumption of transport fuels in Ukraine, tons, 2011

Source: State Statistics Committee of Ukraine, data of market operators

The most of the bioethanol and biodiesel produced in Ukraine is used for the own technical needs of

manufacturers.

The share of sales of bioethanol and biodiesel in retail is less than 0.05% (up to 5 thousand tons) of the total

consumption of gasoline and diesel in Ukraine.

The Ukrainian government believes that oil producers are interested in adding bioethanol to gasoline, because it

reduces the cost of fuel. But bioethanol produced in Ukraine does not meet European standards. Thus, the

producers/retailers of gasoline refuse to add the liquid biofuel to gasoline because the consumers soon stop

buying the fuel containing such additives.

Domestic consumption of biodiesel is limited by:

Price of biodiesel production is higher than one of gasoline and diesel;

It is more profitable to sell rapeseed and soybeans for export than to produce biodiesel locally;

Aggressive to rubber parts of the automotive fuel system which should be replaced with plastic parts;

Engine is difficult to start in the cold weather, and it is necessary to heat the fuel coming from the tank

to the pump, or to work on mixes with no more than 20% of biodiesel content;



Date: 10 May 2013

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It is required the regular cleaning of the oil tank because of bacteria reproducing in it;

Fuel consumption by automobile increases by 10%;

Engine power filled with biofuels falls by 5-10%.

Domestic consumption of bioethanol is limited by:

Informal state monopoly for production of ethanol (Ukrspirt);

High prices for Ukrainian bioethanol;

Lack of investment in modernization of distilleries / sugar factories for the production of bioethanol

(dehydration equipment);

Ukrainian automobile fleet is not ready to use a mixed gasoline. All the old brands of cars and some

modern cars are designed to consume the fuel with only 5% ethanol (Е5);

Filling stations require installation of the equipment for mixing gasoline and ethanol (unit price - USD

3-4 million);

There is a perception that ethanol destroys aluminum parts of fuel systems, under low temperature

mixed gasoline with ethanol (6%) forms a jelly-like clumps in the fuel tank;

Consumption of fuel by automobile filled with bioethanol mixed fuel increases by 25%.



Date: 10 May 2013

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1.3 Production analysis and key players by sub-sectors

The mapping of major participants of biomass processing market in Ukraine is shown in Figure 8.

Figure 8. Major participants of biomass processing market in Ukraine

Source: Tebodin Ukraine CFI, data of market operators


More and more solid biomass boilers are installed in small district heating systems and rarely on Ukrainian heat

and power stations.

Splash of such projects was generated by the foreign aid programs (the Ministry of Economic Affairs or the

Netherlands SENTER, Danish-Ukrainian Project of Heating System Implementation in Rural Areas).

European Union financed various pilot projects for creation of demonstration models and promotion of benefits of

energy-saving and environmentally friendly heating generation technologies.

According to Association of Participants of The Market of Alternative Types of Fuel and Energy, in Ukraine it was

constructed more than 30 large heat generation objects on biomass with total capacity of 42 MW. Total

capacities of heat generation objects on biomass (wood and agrarian wastes) constitute in Ukraine about 64 MW.

Over 60 straw fired boilers, mostly below 1 MW have been put in operation in agricultural farms and rural

schools. About 500 modern wood fired boilers have been installed, and over 1,000 old boilers were converted

from coal and oil to biomass in the wood-working industry and public/social sector.



Date: 10 May 2013

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Up to 1,000 hot-water boilers working on wood waste (wood chips, sawdust) and straw are installed in housing

sector of small cities of Ukraine. Of them, about 200 are modern units; the rest is redone and converted from coal

to solid biomass.

14 oil extraction plants from 20 available have been transferred to burning of sunflower husk which allowed

replacing 70% of natural gas consumed by the enterprises.

The list of the largest projects of boilers on solid biomass installation is given in Table A in Annex 3.

Thermal power generation of Ukraine has 102 power units with capacity of 150 to 800 MW with total capacity

27.8 MW. Most of heat and power stations were built in 1950-1970 and operated more or about 40 years - a

period which is considered the deadline for operation of boilers and turbines.

Obsolete and worn-out boilers, constant increase in natural gas prices and, as a result, rising costs of heating,

availability of local waste resources make bioenergy very promising and profitable sector of the economy.

Today the input of biomass into the heating energy is less than 4% in Ukraine however the potential is much

higher. The volume of Ukrainian market for the introduction of heating industrial and domestic biomass boilers is

about 60 thousand units with a total installed capacity of 8,180 MW8.

1.3.2 Biogas, Heat and electricity on biogas

In Ukraine there are about 10 biogas installations working on agrarian biomass owned by the large agro industrial

enterprises. Agro-industrial companies mainly use biogas for internal heating and transport needs, rarely for

power generation which is not profitable in Ukraine because of absence of working ‘green’ tariff for biogas.

According to The State Energy Saving and Efficiency Agency of Ukraine 5 companies are involved in production

of electricity from biogas with total capacity of 3.785 MW and 2 plants – in production of electricity from biomass

with total capacity of 4.200 MW.

In addition there are about 5 enterprises (e. g. Pig Farms of 'Zaporozhstal', 'Agro-Oven', Cognac plant

Voznesensk etc.) which are producing biogas exclusively for their own needs.

Enterprises which produce heat and electricity in larger quantities than is necessary for their own needs face the

problem with the sales of their products to utility networks of Energy market of Ukraine.

For these reasons such companies as ‘Spetsgasremtekhnologia’ LLC, ‘West-Ukrainian gas technologies’ LLC,

‘LNK’ LLC, ‘Terezyne’ LLC suspended electricity generation in 2011.

The list of largest biomass and biogas processing companies for power generation are given in Table B Annex 3.

The overall power capacity of renewable energy in Ukraine is estimated at 413.4 MW that allowed producing

332.9 million kW/h of electricity in 2011 that is 0.17% of the total electricity produced in Ukraine9.

The share of biogas and biomass in renewable power capacities constitutes 0.9% and 1% respectively (Table 8).

Table 8. Electricity produced from renewable energy in 2011

Renewable energy source

(number of units)

Installed capacity

Electricity produced

MW % million

kW*hour

%

8 http://delo.ua/business/bioenergeticheskaja-perspektiva-155484/

9 http://www.aif.ua/money/article/34326



Date: 10 May 2013

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Wind (11) 146.415 35.4% 88.984 26.7%

Solar (17) 188.224 45.5% 30.042 9.0%

Small Hydro (50) 75.016 18.1% 203.463 61.1%

Biogas (8) 3.785 0.9% 0.774 0.2%

Biomass (2) 4.200 1.0% 9.602 2.9%

Total 413.440 100% 332.865 100%

Source: The State Energy Saving and Efficiency Agency of Ukraine

The use of types of biomass for power generation is distributed as follows: straw - 1.4%, wood waste - 17.6%,

firewood - 37.7%, sunflower husks - 25.6%, peat - 15.6%, biogas from manure - 0.3%, biogas from landfills -

1.8% (Table 9).

Table 9. Electricity produced from biomass/biogas in 2009

Type of biomass Consumption

ton/m3 per year tce per year % of total consumption (tce)

Straw 30,000 tons 14,000 1.4%

Wood wastes 646,000 tons 176,000 17.6%

Firewood (population) 1,972,000 m³ 377,000 37.7%

Sunflower husk 500,000 tons 256,000 25.6%

Peat 339,000 tons 156,000 15.6%

Biogas (manure) 4,516,000 m³ 3,000 0.3%

Biogas (solid domestic waste) 26,192,000 m³ 18,000 1.8%

Total 1,000,000 100%


In case the Parliament of Ukraine approves and the President of Ukraine signs the changes into the Law on

Electricity regarding the introduction of ‘green’ tariff for electricity produced from biogas and biomass, the boom of

biogas construction may start.


Sunflower husk, wood and straw are used as main biomass feedstock for pellets and briquettes production in

Ukraine (Figure 9).

Domestic use of solid fuel for heat is relatively common in oil extraction plants and woodworking industries and

becoming more and more popular in rural areas.

However, more often the boilers in rural areas are working on unprocessed wood waste or straw instead of fuel

pellets which are still too expensive.

Small portion of pellets are used by wealthy residents of cottages who for one reason or another do not use gas

for heating.

Totally about 1,000 of boilers on solid fuel (pellets and briquettes) of small capacity have been installed in rural

areas of the countries.

In spring 2012 the boilers on solid biofuels and electricity for heat generation have been installed at 20 public

facilities in Odessa region. Some of them use not only granular biofuels for heat production but other types of

crop residues such as crushed straw and cane.

In the future more than 50 boilers are planned to be converted from gas to solid biofuels made of straw in Kharkiv

region.



Date: 10 May 2013

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Figure 9. Structure of raw material base for pellets production

Source: D&P Consult

In 2011 Ukraine produced 741 thousand tons of solid fuels. As the market is immature it is developing rapidly

with the annual growth rates of 15-20% (Figure 13).

Furthermore, the market growth potential is significant due to availability of unused straw of cereal crops, wood

wastes and sunflower husk.

Figure 10. Production of pellets and briquettes in Ukraine

Source: D&P Consult

According to data of market operators in 2011 about 137 pellets and 121 briquettes plants in Ukraine produced

about 620 thousand tons of pellets and 120 thousand tons of briquettes from various types of biomass.

According to forecast of APEU the substantial expansion of facilities for production of solid biofuels is expected

by the end of 2012 (Table 10). These could be reached thanks to good harvest in 2011, increase of demand on

pellets on domestic and EU market, and also to improvement/extension of solid fuels production capacities.



Date: 10 May 2013

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Table 10. Producers of solid biofuels by types of raw materials

Indicators As of September

2011

Forecast on

2012

%

change

Number of producers of pellets incl.: 137 150 9%

Straw 9 11 22%

Wood wastes 90 94 4%

Sunflower husks 38 45 18%

Total design capacities of pellets production, tons/year 800,000 970,000 21%

Number of producers of briquettes incl.: 121 140 16%

Straw 7 14 100%

Wood wastes 96 106 10%

Sunflower husks 18 20 11%

Total design capacities of briquettes production, tons/year 150,000 250,000 67%

TOTAL DESIGN CAPACITIES OF SOLID BIOFUEL PRODUCTION,

TONS/YEAR

950,000 1,220,000 28%

Source: Association of Alternative Fuel and Energy Market Participants (APEU)

The list of the largest producers of solid fuel is shown in Table C Annex 3.

The European Union’s policy targets for renewable energy and greenhouse gas (GHG) emissions reduction and

connected subsidies are the main driver of growth of the pellet market in Europe. Pellet production in the EU

cannot satisfy European demand for pellets offering export opportunities for Ukrainian producers.

Currently, pellets of Ukrainian origin constitute only about 2.5% of the European pellet market. To further

increase their market share Ukrainian pellet producers have to improve the quality of the exported pellets. Two

main factors influence how successful they will be in the process: the quality of the feedstock and the quality of

the equipment.

1.3.4 Bioethanol

The commercial production of bioethanol in Ukraine till recently was a state monopoly. Majority of ethanol

producers are combined under the State Concern ‘Ukrspirt’10

. The two-thirds of the ‘Ukrspirt’s capacities are

currently out of work. In 2006 - 2007 the conversion of few of ‘Ukrspirt’ distilleries for bioethanol production had

been carried out.

According to the Ministry of Agrarian Policy and Food of Ukraine in 2011 at four state-owned factories of ‘Ukrspirt’

- Naumovskyi, Luzhanskyi, Haysinskyi, Khorostkovskyi distilleries there were produced 9,726 tons of bioethanol

and 14,416 tons of components of alternative fuel blend.

Production capacities of bioethanol are also available to private companies – ‘Budylskyi experimental plant’

(White House Trading, UK), ‘Koron Agro’ LLC (Continium Group, WOG fueling stations), ‘Dacor Agroholding’

(Ukrlandfarming).

Few oil refueling retailers mostly in Eastern Ukraine – ‘BioHim Group’, ‘Agro-Nafta’, ‘Azovskaia oil company’ LLC

have launched the mixing of gasoline with bioethanol additives.

Large producers of bioethanol and biofuels with bioethanol additives are shown in Table D Annex 3.

10

To date, in fact, two-thirds of the capacities of ‘Ukrspirt’ do not work. In 2006 - 2007 the activities to convert those distilleries for

bioethanol production were carried out.



Date: 10 May 2013

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In the retail trade in the period of 2011 - first half 2012 there were such types of fuels containing ethanol:

INNOVATIVE-95, A-92-E 40, A-92-E40 turbo, A-95-e40, A-95A, Ab-92e40 EXTRA, Ab-95e40 EXTRA, Ab-98e85

EXTRA. The share of bioethanol (produced from biomass resources) in these fuels is about 30-40%11

.

According to market operators’ estimates, the annual production of bioethanol in Ukraine is about 80,000-

100,000 tons.12

The gasoline with bioethanol additive is produced in Ukraine in small amounts (20,000-30,000 t/y).

At the moment the design capacities of liquid biofuel plants is estimated to 200,000 tons of bioethanol and

500,000 tons of biodiesel. However, due to lack of domestic consumption, the biofuels production is far behind

their actual and potential capacities.

According to Ministry of Agrarian Policy and Food of Ukraine the potential capacities of bioethanol production is 2

million tons, and of biodiesel - 1 million tons per year (Table 11).

Table 11. Production of liquid biofuels, 2011

Liquid biofuels Large plants Medium & small

plants

Capacities, thousand tons

actual design potential

Bioethanol of which: 2 (Haisyn distillery, Koron

Agro)

18 <100 200 2,000

- Bioethanol of state distilleries

‘Ukrspirt’

1 (Haisyn distillery) 12 9.7 130 370

Biodiesel

<10 84 <100 500 1,000

Source: Ministry of Agrarian Policy and Food of Ukraine, Institute of Food Biotechnology and Genomics of National Academy of

Sciences of Ukraine, Scientific Engineering Centre ‘Biomass’ Ltd.

Ukraine has significant potential for bioethanol production from different feedstock (sugar beet, corn, potato,

wood wastes, and residues of alcohol and sugar production).

Taking into account recently accepted Law on production and use of transport fuel with content of bio

components and intention of the government to convert 37 state owned unprofitable distilleries (‘Ukrspirt’) for

production of bioethanol – the sector becomes more perspective.

1.3.5 Biodiesel

Ukraine produces annually about 100,000 tons of biodiesel - almost the same amount for the past 3 years. About

60-70% (60,000-70,000 tons) of this volume is produced by the small-scale biodiesel installations with capacity of

300-5,000 tons/per year used by the farmers for their internal heat and transport needs.

According to the Ministry of Agrarian Policy and Food of Ukraine, by 2011 84 small biodiesel installations and up

to 10 large plants has been built which at full load can produce a minimum of 500,000 tons of biodiesel per year.

Kalush chemical enterprise in Ivano-Frankivsk region has the largest capacity of biodiesel production. The plant

can produce 180,000 tons of biodiesel. In 2012 the plant was declared bankrupt and now is offered for sale.

Till recently significant amounts - about 50,000 t/y of cheap biodiesel were imported from Belarus. In August

2012, the imports of Belarusian oil products (including biodiesel) were suspended.

11

http://oilnews.com.ua/news/article14273.html 12

State Statistics doesn’t keep records on ethanol production (neither potable, nor technical) and according to independent (private)

experts ‘estimate - about 60-70% of Ukrainian ethanol is in the shadow.



Date: 10 May 2013

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The list of the largest biodiesel producers in presented in Table E Annex 3.

The practice shows that biodiesel production from rapeseed in Ukraine is unprofitable because of the high cost of

processing of rape ester and the world prices on rapeseed oil. 90% of Ukrainian rapeseed crop is exported to EU

with zero rate of excise duty.

According to Ukrainian scientists the corn is even better feedstock then rape for biodiesel production. Large

opportunities for biodiesel production represent the multi-wastes of meat processing, poultry, wastes of oil

refining and frying oil of catering.

The Draft Law No. 7524 of 12.29.2010 ‘On the development of production and consumption of biofuels’ has been

developed to stimulate the production of biodiesel. According to the Draft Law, in 2012, the proportion of

biodiesel in the total production of diesel fuel in Ukraine should not be less than 10%, in 2013 - at least 30%, in

2014 - at least 50%, in 2015 and beyond - not less than 80%.

The Draft Law was declined by President of Ukraine on 22 June 2012 as requiring improvement. If this Law will

be worked-out and finally adopted, Ukraine will have a chance to develop the biodiesel industry.

Stricter requirements for import of rapeseed in Europe (the EU ‘Renewable Energy Directive’) might be also an

incentive to start industrial biodiesel production and to give a push for the domestic market of biodiesel.

1.3.6 Bio-fertilizers

The important by-product of biogas production is disinfected bio fertilizers - sludge remaining after full over

fermentation of feedstock. It is odorless, does not contain harmful bacteria and eggs of worms.

The sludge can be divided into two fractions: the liquid and solid. And both are good fertilizers. Solid fraction is

easier to be packed, stored and transported.

Bio fertilizers market in Ukraine has not yet been formed. All bio fertilizers produced by existing biogas plants in

Ukraine are either consumed by the producers or are sold to neighboring agricultural enterprises.

Figure 11. Use of fertilizers for agricultural crops by agricultural enterprises, per hectare of sown area

Source: State Statistics Committee of Ukraine



Date: 10 May 2013

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1.3.7 Biobased polymers

From plants containing cellulose or starch (corn, sugar beets, potatoes) and waste of crop processing plants the

production the biodegradable polymers (bio plastics) may be arranged.

Polylactide (PLA - Poly Lactic Acid, PL) is a product of the polymerization of lactic acid is now seen as one of the

most promising biodegradable polymers.

‘Kyiv Lactic Acid Plant’ is the only Ukrainian manufacturer of microbiologically produced lactic acid. It produces

lactic acid from sugar. Lactic acid is currently used only by the Ukrainian food industry.

1,000-1,200 tons of lactic acid is produced at the plant. Today, the plant capacity is used for 60%, because the

product is more expensive than synthetically produced lactic acid imported from China.

‘Dnieper Starch and Syrup Plant’ (Dnipropetrovsk region) is also operating in Ukraine whose products - corn

starch and corn syrup - can be used for the production of lactic acid. The plant produces about 30,000 tons of

molasses and 6,500 tons of starch.

Legally and economical supportive mechanisms can encourage the manufacturers of packaging and food

products to produce and use the biodegradable packaging. But such conditions in Ukraine so far do not exist.

Production of other types of biomaterials and biochemical is not developed in Ukraine due to lack of legislation

and financial resources for such financially heavy projects.

1.4 Sales system

Most of the enterprises and companies which operate on bioenergy market utilize their own biomass resources

buy it from farmers in the vicinity of production site.

Transport distance is one of the most important factors influencing the feedstock price. This could be explained

by the small value of the ratio of feedstock’s density to weight. Therefore, transport distances of more than 50 km

are not economically feasible. Furthermore, truck renting services has not been properly developed in Ukraine

yet and their costs remain high. As a result, pellet producers sign individual contracts with private transporters.

For example, a truck of 40 m3 body volume can transport 10 large straw bales or 26 medium straw bales.

Transportation for each kilometer in Ukraine costs about USD 0.03-0.1/t. Medium straw bales are cheaper to

transport than large ones due to their lower size to weight ratio. Transportation of straw bales for the distance of

10 km costs about USD 0.9/t and of 50 km – up to USD 4.6/t.

Transporting wood residues is cheaper in comparison to transporting straw bales. However, it should be

accounted that supplied wood feedstock can be of different size (from large parts of trees to small particles like

sawdust or wood chips). Transportation of small wood residues for the distance of 10 km costs about USD 0.6 /t

while transportation of large wood residues is about 2 times cheaper.

Sunflower husk is light by weight and thus requires large truck body volume to transport. According to the market

information, the largest truck used to transport sunflower husk has a body volume of 60 m3 and can contain up to

9 t of the feedstock.

The products of biomass processing (such as heat, biogas, fertilizers, electricity) is often used for internal needs

of the company which produce them. For example, forestry and woodworking enterprises use their own wood

residues in boilers for heat production, oil extraction plants process sunflower husks for steam and heat

generation etc.



Date: 10 May 2013

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Biomass trade is more developed in energy crops, wood materials and solid fuels. Sales of biomass are often

spontaneous. Practice of long-term biomass supply contracts is not developed.

Prices for straw, wood residues and other types of biomass resources and products are not clearly formed and

may vary at different regions, areas and depend on the season.

Business portals containing the information on available biomass feedstock, types and characteristics of fuels,

prices, types of delivery and contact information of the buyers/sellers are developing:

Business portals ‘Waste World’ http://waste.ua/

Ukrainian Biofuel Portal http://pelleta.com.ua/

AllBiz Ukraine http://www.ua.all.biz/

Project EcoB2b.net: http://ecob2b.net/ru

Exchange trading of alternative fuels http://ueex.com.ua/ukr/auctions/biofuel/

The external trade with Ukrainian biomass products is performed with help of:

Traders/suppliers of various foreign industrial customers

Foreign heat and power plant and industrial enterprises by-passing intermediaries

Trade houses and agents of producers.

Biomass products (apart of small amounts of solid fuels for domestic use and mixes of gasoline with bioethanol)

are not present in Ukrainian retail.

1.5 Price survey

Price of natural gas in Ukraine has been rising constantly since 2005 - from USD 60 to 421/1,000 m3

(on

average) in 2012. The average price for 2013 is announced at the level of USD 417/1,000 m3 (Figure 15).

Figure 12. Rise of natural gas price in Ukraine

Source: NJSC ‘Naftogas of Ukraine’

http://waste.ua/

http://pelleta.com.ua/

http://www.ua.all.biz/

http://ecob2b.net/ru

http://ueex.com.ua/ukr/auctions/biofuel/



Date: 10 May 2013

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The high price of natural gas is one of the strong drivers for bioenergy technologies development. Biomass as

fuel becomes more and more competitive. Comparison of costs recalculated per fuel energy content shows that

firewood and baled straw is about 4 times as cheaper than natural gas, and wood pellets are 2 times as cheaper

(Table 12).

Table 12. Comparison of prices of natural and solid biomass fuels, 2010

Fuel type Typical price, EUR/t Low heating value,

MJ/kg

Cost of fuel energy,

EUR/GJ

Ratio: cost of NG

energy*/cost of BM

energy

Wood processing

wastes

0-0.86 11 0-0.08 >85

Firewood (delivered

price)

17 11 1.6 4.3

Wood pellets 69 18 3.8 1.7

Wood briquettes 60 18 3.4 2.0

Baled straw (delivered

price)

26 15 1.7 3.9

*EUR 6.7/GJ (based on NG price for industry and organizations financed by the state and local budgets)



With current prices for production of one unit of heat, the firewood is in 6.8 times, husks pellets – in 3.3, baled

straw - in 2.613

, wood pellets - in 2.1, coal – in 1.7 times cheaper as the natural gas (Table 13).

Table 13. Comparison of price of resources for 1 GJ heat generation

Type of resource Unit of

measurement

Price of

resource,

USD

Price of

resource,

EUR

Price of fuel for

generation of

1GJ of heat,

USD

Price of fuel for

generation of

1GJ of heat,

EUR

Ration: cost

of NG heat

/cost of

biomass heat

Electricity (average tariff) KWh 0.1 0.1 39.0 29.8 -

Natural gas 1,000 m3 600.8 458.9 19.5 14.9 -

Anthracitic coal t 162.7 124.3 11.4 8.7 1.7

Wood pellets t 169.0 129.1 9.5 7.3 2.1

Husk pellets t 106.4 81.3 6.0 4.6 3.3

Firewood t 50.1 38.2 2.9 2.2 6.8

Source: http://teplo.zp.ua/fuel-cost-for-heat-unit/

As shown in Figure 16 the price of heat generated with coal is comparative to those produced with solid biomass

(wood pellets and baled straw). Taking into account that solid biomass firing requires additional investments into

the new equipment, collection and storage technologies; the profitability of biomass projects is lower than those

of coal firing.

13 http://esco-ecosys.narod.ru/2008_3/art26.htm

http://teplo.zp.ua/fuel-cost-for-heat-unit/

http://esco-ecosys.narod.ru/2008_3/art26.htm



Date: 10 May 2013

Page: 31 of 80

Figure 13. Comparison of prices of 1 GJ of heat generated by different energy resources, USD

Source: http://teplo.zp.ua/fuel-cost-for-heat-unit/

1.5.2 Electricity on biogas

Prime cost of electricity produced from biogas and biomass in Ukraine ranges EUR 0.05-0.12 per kWh and

greatly depends on a number of factors such as location of production, type and cost of raw materials etc.

Table 14 shows the difference between the prime cost of electricity and the proposed ‘green’ tariff for energy

generated from alternative sources of energy in Ukraine.

Table 14. Comparison of prime cost and ‘green’ tariff for electricity from RES

RES Prime cost, euro

cent/kWh

‘Green’ tariff, euro cent

/ kWh

Sun (max) 15-30 46.53

Sun (min) 20-50 42.65

Biogas (from agricultural raw materials and components of biodegradable

solid household waste)

5-12 12.39

Biomass 5-12 12.39

Wind (max) 5-14 11.31

Wind (min) 5-14 6.46

Hydro (up to 10 MW) 5-12 7.75

Source: ‘Delovaya Stolitsa’ #48/602 26.11.2012, International Solar Energy Society


The prices for solid fuels depend on many factors such as pellet/briquettes types, their quality (mostly ash

content), terms of delivery, seasonality etc.

There is no official statistics on average prices for solid fuel in Ukraine. According to market operators in 2012 the

average domestic price of pellets (ENPlusA2) amounts to USD 122-148 per ton, for briquettes – USD 116-140

per ton.

http://teplo.zp.ua/fuel-cost-for-heat-unit/



Date: 10 May 2013

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Starting from February 2012 Ukrainian Energy Exchange (UEEX) provides the weekly publication of wholesale

prices for solid biofuels put up to the auction for large consumers and traders (Table 15).

Table 15. Price for solid biofuels for large consumers and traders as of 13 September 2012

CE "UEEX" Solid biofuel Pellets Briquettes

Husks Straw Wood Husks Straw Wood

Price, USD/ton 107.6 91.4 103.9 103.8 85.1 87.6

Price, EUR/ton 83.7 71.1 80.8 80.8 66.2 68.2

Source: http://ueex.com.ua/eng/auctions/indicators/

Price of solid fuels during the heating season is usually 10-15% higher than in spring and summer.

Wood pellets traditionally are of high demand in EU and thus of higher prices on the market.

Prices of sunflower husk briquettes and pellets are comparative to prices of wood pellets and in spring and

summer are even higher. This is related to the fact that the sunflower husk feedstock is naturally cheaper during

the oil-extracting period and more expensive in cold season of the year with the peak of sunflower oil production

lasting from October to December.

Solid fuel from straw has the lowest cost of production because of the lowest average purchasing price of straw

feedstock.

1.5.4 Liquid fuels

In Ukraine there are several companies that sale gasoline with a share of more than 30% of ethanol (called E30).

The output of such fuels are small but the producers state that the blends compete well with traditional fuels

because of more favorable price (transport fuel with biological share of more than 33% is exempt of excise

payment).

For example the hybrid gasoline A-95e (with 33-40% of bioethanol) costs USD 1.24/l instead of USD 1.39/l for

normal A-95. In general, the liter of biofuel is 10-18% cheaper than traditional fuel (Figure 14).

Figure 14. Retail price of engine fuel as of September 2012, USD/l

*30-40% bioethanol

Source: http://biz.liga.net/tek/oil/, data of market operators

http://ueex.com.ua/eng/auctions/indicators/



Date: 10 May 2013

Page: 33 of 80

At the same time the price of Ukrainian pure ethanol is one of the most expensive in the world because of the

state monopoly in the sector.

As stated in the Association of Market Participants of the Alternative Fuel and Energy of Ukraine, in 2012 the

domestic bioethanol is sold at USD 1.45-1.51 thousand per ton. This makes Ukrainian ethanol uncompetitive

compared with imported analogues that are USD 1.26-1.32 thousand per ton.

The producers and sellers of liquid fuels are considering the possibilities of purchasing ethanol in Moldova, North

Ossetia, and Kabardino-Balkaria. Apart of that there is an option to buy the cheap Brazilian bioethanol which is

less expensive than Ukrainian one even under condition of its transportation and supply to Black Sea ports.14

1.6 Foreign trade

1.6.1 Export

Ukraine is large exporter of solid fuel (mainly husks briquettes and wood pellets) and biomass feedstock

(rapeseed) for biodiesel production to Europe. Moreover, Ukraine is one of the six largest grain exporters of the

world and a large producer and exporter of oilseeds and sugar beets.

Key export figures and trends:

Total export of processed solid fuel (pellets/briquettes) amounted to 630 thousand tons in 2011. Annual

export growth dynamics in natural form – 30% (Figure 18)

Total export of solid fuel (straw and wood biomass feedstock and products) amounted to about 1.2

million tons in 2011. Annual export growth dynamics in natural terms – 16% (Table 20).

80-85% of Ukrainian solid fuel production is exported to EU for electricity and heat production.

90% of Ukrainian rapeseed crop is exported to EU with zero rate of excise duty.

Orientation to low cost export segment (countries of Central Europe: Poland, Slovakia, the Czech

Republic) rather than top cost segments (Germany, Austria).

In Ukraine is more profitable to export rapeseed and soybeans than to produce biodiesel locally.

Pellets of Ukrainian origin constitute about 2.5% of the European pellet market.

The EU targets of increasing the share of renewables stimulate the export of Ukrainian biomass

feedstock and solid fuel.

14

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Date: 10 May 2013

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Figure 15. Export of processed solid fuel, tons

Source: Fuel Alternative

In 2010 the total export of processed solid fuels amounted to 573.4 thousand tons, of them:

wood pellets - 87.1 thousand tons; wood briquettes - 48 thousand tons;

husk pellets - 406.8 thousand tons; husk briquettes - 25.7 thousand tons;

straw pellets - 3.1 thousand tons; briquettes - 2.7 thousand tons.

Figure 16. Export structure of solid biofuels in 2010, thousand tons

Source: Fuel Alternative

Table 16. Export of straw and wood fuels

Type of product Unit 2007 2008 2009 2010 2011 Jan-Aug

2012

Straw and chaff of cereals fuel

(UKTZD 1213)

USD thousand 7 97 366 556 1,414 1,870

ton 44 578 3,437 5,720 12,627 14,542

Wood fuels (UKTZD 4401*) USD thousand 31,501 35,770 50,782 65,801 86,395 55,160



Date: 10 May 2013

Page: 35 of 80

Type of product Unit 2007 2008 2009 2010 2011 Jan-Aug

2012

ton 674,529 694,965 924,073 1,126,354 1,164,942 797,954

* Wood fuels according to Ukrainian classification (UKTZD 4401) includes the logs, twigs, branches, wood chips or shavings, sawdust,

debris, whether agglomerated or not agglomerated in the form of logs, briquettes, pellets etc.

Source: State Customs Service of Ukraine

The most attractive markets for Ukrainian pellets and briquettes are considered Denmark and Sweden, which are

themselves the largest manufacturers in this market. Large purchasers of Ukrainian solid fuels are Poland,

Slovakia, Germany, the Baltic countries. England, Italy, the Czech Republic also have an interest in local

biofuels.

Straw pellets are mainly exported to Poland, Germany, Austria and Denmark. Lesser amounts are also sold on

the domestic market (Table 16).

Ukrainian wood fuels enjoy the popularity in many EU countries. The large portions are supplied to Poland,

Slovakia, Austria, Germany and Italy (Table 17).

Table 17. Export of straw fuels (UKTZD 1213) in 2011

Country USD

thousand % tons

%

Poland 1,009 71.4% 9,070 71.8%

Germany 353 25.0% 3,167 25.1%

Austria 24 1.7% 220 1.7%

Denmark 13 0.9% 87 0.7%

Belgium 9 0.6% 41 0.3%

Italy 4 0.3% 22 0.2%

Czech Republic 2 0.1% 20 0.2%

Total 1,414 100.0

% 12,627

100.0

%




Date: 10 May 2013

Page: 36 of 80

Table 18. Export of wood fuels (UKTZD 4401) in 2011


Biogas

The biogas of Ukraine is not exported. The trade with biogas including the external trade in Ukraine is a subject

of compulsory licensing. Export and import of biogas in Ukraine is not practically possible as the procedure of

licensing has not been approved and the necessary infrastructure is not available.

Bioethanol

The export of domestic bioethanol is hardly probable in the near future because the price of Ukrainian ethanol is

one of the most expensive in the world. Even local producers and retailers of transport fuels are willing to import

the ethanol from other countries. Ethanol is supplied to Europe basically from Brazil where it is produced from

sugar cane. Sugar cane is the cheapest feedstock for ethanol production with which it is difficult to compete.

Biodiesel

The export of Ukrainian biodiesel is not expected in short perspective. Ukrainian rapeseed export is largely driven

by the EU biofuel and food policy as more than 90% of domestically produced rapeseed is exported to the EU for

vegetable oil production (for food and industrial use). In Europe the biodiesel production is subsidized by the

government, thus, the export price of Ukrainian rapeseed and soybean is even higher than the price of the edible

oils from them.

Export and import duties for biomass feedstock and products are described in Sub-chapter 4.6.3 Customs dues.

1.6.2 Import

Ukraine imports inconsiderable amounts of wood fuel (Figure 20) and bioenergy technologies.

Country USD thousand % tons %

Poland 28,454 32.9% 369,264 31.7%

Slovakia 15,158 17.5% 284,438 24.4%

Germany 13,204 15.3% 98,867 8.5%

Italy 6,885 8.0% 76,395 6.6%

Austria 5,828 6.7% 116,576 10.0%

Czech Republic 4,341 5.0% 38,992 3.3%

Hungary 3,528 4.1% 73,934 6.3%

Rumania 2,743 3.2% 54,393 4.7%

Denmark 1,793 2.1% 14,040 1.2%

Belgium 1,512 1.8% 10,353 0.9%

France 551 0.6% 2,867 0.2%

Luxemburg 510 0.6% 4,056 0.3%

Slovenia 469 0.5% 5,371 0.5%

Lithuania 318 0.4% 2,174 0.2%

The

Netherlands 302 0.3% 2,128 0.2%

Moldova 137 0.2% 1,472 0.1%

Other 666 0.8% 9,622 0.8%

Total 86,399 100.0% 1,164,942 100.0%



Date: 10 May 2013

Page: 37 of 80

Figure 17. Import of wood fuel (UKTZD 4401)* to Ukraine

* Wood fuels according to Ukrainian classification (UKTZD 4401) includes the logs, twigs, branches, wood chips or shavings, sawdust,

debris, whether agglomerated or not agglomerated in the form of logs, briquettes, pellets etc.


The wood fuels are supplied to Ukraine from Germany, Poland, Belarus, Russian Federation and Lithuania

(Table 19).

Table 19. Import of wood fuels (UKTZD 4401) in 2011


Bioethanol

Domestic trade with bioethanol is a subject of compulsory licensing in Ukraine. Today, only one license is

available to SE ‘Ukrspirt’. The state enterprise is supplying only inconsiderable amounts of alimentary spirit.

The import of various ethanol comprising products (components of motor fuel) and mixtures of gasoline with

bioethanol is possible without obtaining the license. However, so far these products are not imported into

Ukraine.

Country USD thousand % tons %

Germany 237 69.7% 392 51.9%

Poland 58 17.1% 116 15.3%

Belarus 2 0.6% 58 7.7%

Russian Federation 4 1.2% 39 5.2%

Lithuania 13 3.8% 35 4.6%

Slovakia 2 0.6% 28 3.7%

The Netherlands 5 1.5% 22 2.9%

Denmark 1 0.3% 22 2.9%

USA 2 0.6% 21 2.8%

France 13 3.8% 2 0.3%

Total 337 100.0% 735 100.0%



Date: 10 May 2013

Page: 38 of 80

Biodiesel

Until recently Ukraine imported annually more than 50 thousand tons of biodiesel from Belarus (Figure 21).

Because of biological additives the biodiesel from Belarus was sold outside the Customs Union free of Russian

export duties.

In August 2012, the imports of Belarusian oil products (including biodiesel) were suspended. Currently,

governmental bodies of Ukraine are studying the possibility to protect Ukrainian producers of petroleum products

and are working on a package of anti-monopoly measures.

The result of this work may be the establishment of some local import duties for biodiesel or increase in excises.

Figure 18. Biodiesel motor fuel supply to Ukraine from Belarus

Source: http://oilnews.com.ua/news/article15032.html

http://oilnews.com.ua/news/article15032.html



Date: 10 May 2013

Page: 39 of 80

2 Trends, drivers and barriers to sector development

2.1 Main trends

Ukrainian biomass processing sector is characterized by the following trends:

The market is under development and formation;

Increasing demand for bioenergy products in the domestic market;

Increase of production and trade (incl. external) with solid fuels from wood, straw and sunflower husks;

Rise in cost of biomass raw materials;

Solid fuel producers consolidation and leaving the market by smaller players;

Growing interest of the large agro industrial holdings to any type of waste processing technologies.

Large investments in high-capacity sunflower husk palletizing and biogas production. Increasing interest

in straw pelletizing technologies;

Increase in number of heat generation units on biomass (basically wood) in rural areas;

Interest of politicians and business environment to RES issues. Appearance of the new state programs

(National Projects ‘Energy of Biogas’ and ‘Energy of Biomass’), acceptance of the new standards (solid

fuels), favorable legislative novelties (biogas and bioethanol production).

2.2 Main drivers

The main drivers of the biomass sector development:

1. Energy dependence on import and constantly growing prices on fossil fuels. Since 2005, Ukraine

has seen the rise in gas prices more than by 700% (from USD 60 in 2005 to USD 421/1,000 m3 in 2012

on average) and electricity prices - more than by 100%.

2. The European Union sustainability and energy saving targets. The EU’s targets for renewable

energy growth and greenhouse gas (GHG) emissions reduction stimulates the growth of the bioenergy

market and enhances the export of Ukraine15

.

3. Credit lines, technical assistance and pilot projects financed by IFIs.

a. In 2011 Ukraine signed the agreement with the World Bank on allocation for Ukraine of 30-year

loan of USD 200 million for energy efficiency investment projects in industrial enterprises,

municipalities and energy utility service companies. Such a loan is designed to help reducing

the country's energy-intensive economic indicators by 20% till 2015 and by 50% - till 2030,

according to the goals set by the Government of Ukraine.

b. European Bank for Reconstruction and Development provides the credit lines and partial

support of the technical assistance projects in energy efficiency sector of Ukraine. The Bank’s

strategy for 2011-2014 among other issues is focused on development of renewable energy

generation capacities, including under the programs UKEEP, USELF and for rehabilitation of

existing hydro power plants.

4. Necessity of urgent upgrade and increase of energy efficiency on heat and power capacities.

Most of heat and power generation facilities in Ukraine are owned by the state, the regions or the

15

The total share of RES constitutes 9% of energy consumption of EU. The goal set for 2020 stipulates 20% of RES. The input of

bioenergy into RES constitutes 107.1 mtce (about 70% of the total input of RES in the EU energy balance). Production of biomass

pellets in EU is expected to reach 46 million tons by 2020, reflecting the annual growth rate of roughly 11%.



Date: 10 May 2013

Page: 40 of 80

municipalities and for 70% operate on traditional fuel. The rate of depreciation of the existing capital

assets has reached 70% on average which leads to inefficiency and sometimes stoppage of operations.

5. Favorable taxation and recent legislative initiatives of the government of Ukraine. Introduction of

‘green’ tariff for agrarian residues and adoption of the Law regarding compulsory adding of bioethanol to

transport fuel give a serious impetus for development of the biomass processing market of Ukraine.

Ukraine has already appeared on the latest Ernst & Young Renewable Energy Country Attractiveness

Indices report, proving to be an attractive emerging market for renewable energy due to tax incentives

available to ‘green’ energy companies16

.

6. Ukrainian interstate agreements. In 2011 the European Union admitted Ukraine to the European

Energy Community (EEC). According to EEC’s contract Ukraine should gradually introduce the

European energy norms and standards (including those for biofuels and bioenergy), provide assistance

to producers of power energy and to assess the current regulatory framework on removing obstacles for

increasing production of electricity from RES.

2.3 Major barriers

In spite of numerous perspectives there are a lot of problems which hamper development of biomass processing

of Ukraine. The most critical issues are as follows:

Legislation

Legislation is subject to frequent and not always transparent changes.

Unregulated procedure of tariff formation for heating and unregulated rights of independent heat

suppliers.

Cross-subsidizing of prices for heat and electricity and low prices for coal and natural gas for population

and municipal housing sector.

Misbalance of prices on biomass in the local and export markets.

Pellet producers can benefit from several types of the tax exemption. To be granted these tax

exemptions, however, they must have an alternative energy producer certificate. The procedure of

obtaining the certificate is complicated with much leeway for the issuing authority.

Technologies and equipment

Lack of complex process solutions which results in assembling of equipment of various suppliers and

inefficient production process.

Ukrainian producers often use modernized soviet technologies. Those are cheaper in comparison to the

foreign analogues; however, the lifecycle of such equipment is shorter and the quality of the produced

products is often lower.

Most of heat and power generation facilities in Ukraine are owned by the state, the regions or the

municipalities and for 70% operate on traditional fuel. Due to the lack of investments the rate of

depreciation of the existing capital assets has reached 70% on average which lead to inefficiency of

production.

High cost of the heating equipment operating on pellets/briquettes. At present, coal and gas boilers are

cheaper than boilers for pellets.

16

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Date: 10 May 2013

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Feedstock supply

Since the feedstock market is underdeveloped, biofuel producers face difficulties with the quantity of

feedstock supply and its quality.

Low availability of the collection equipment and poor rural and forest infrastructure cause obstacles for

efficient feedstock collection.

Furthermore, as demand exceeds supply for transportation services, costs of transport are high. The

collection and transportation problems create obstacles for the constant feedstock supply. It may

therefore influence the process and volume of production.

Additionally the feedstock can have excess moisture and rubbish content which increases the required

quantity per ton ratio of pellets.

Lack of well qualified personnel

Low understanding of the matter of biomass and RES at the Ministries and State authorities.

Ukraine is characterized by high urbanization which has increased since independence. Currently the

rural population constitutes about one third of the total population in Ukraine. This is associated with

underdeveloped infrastructure in rural areas. Since wages are low, the highly qualified workers tend to

move to the cities. This creates difficulties for employers to find appropriate staff in villages to operate

the biofuel production. Therefore, investors/producers in rural areas can only attract them by paying

above average wages or make additional investments to increase local personnel’s qualifications.



Date: 10 May 2013

Page: 42 of 80

3 Branch regulation

3.1 Branch structure

The existing system of governance in the energy sector of Ukraine was formed spontaneously, acting primarily in

the interests of certain groups of influence and are imperfect.

There is no single institution which regulates the sector of renewable energy. The areas of responsibility in the

field of biomass and other renewable sources are not clearly delineated. Different state bodies and institutions

are involved in the sector regulation and their policies are often mismatching.

Figure 19. State bodies regulating the areas of RES

Table 20. Information of the state bodies

Organization Address Contact Position Tel. E-mail, Web-site

Ministry of Energy and

Coal Industry of

Ukraine

01601, Kyiv, 30,

Khreschatyk Str.

Mr. Yuriy

Anatoliyovych

Boiko

Minister +38 044 206 38 00 http://mpe.kmu.gov.ua/fuel/c

ontrol/uk/index

Ministry of Economic

Development and

Trade of Ukraine

12/2 Grushevskogo

St., 01008, Kyiv,

Ukraine

Mr. Poroshenko

Petro

Oleksiyovych

Minister +38 044 253 93

94;

+38 044 226 31 81

http://www.me.gov.ua/contro

l/en/index

Ministry of Agrarian

Policy and Food of

Ukraine (MAPFU)

01001, Kyiv, 24,

Khreschatyk Str.

Mr. Mykola

Prysiazhnuk

Minister +38 044 279 84 74 http://www.minagro.gov.ua

The Ministry of

Regional

Development,

Construction, and

Housing of Ukraine

01601, Kyiv,9,

V.Zhytomyrska str.

Mr. Anatoliy

Mykhailovych

Blyzniuk

Minister +38 044 284 05

54; +38 044 284

05 51

http://minregion.gov.ua/

http://mpe.kmu.gov.ua/fuel/control/uk/index

http://mpe.kmu.gov.ua/fuel/control/uk/index

http://www.me.gov.ua/control/en/index

http://www.me.gov.ua/control/en/index

http://www.minagro.gov.ua/

http://minregion.gov.ua/



Date: 10 May 2013

Page: 43 of 80

Organization Address Contact Position Tel. E-mail, Web-site

National Agency of

Ukraine on Ensuring of

Efficient Use of Energy

Resources

Kyiv-01601, Muzeinyi

lane,12

Mr. Mykola

Pashkevych

Head +38 044 590 59

60; +38 044 590

59 74;

+38 044 590 59

61; +38 044 590

59 75

http://saee.gov.ua/en/manag

ement

State Agency of Forest

Resources of Ukraine

1601, Kyiv,

Sh. Rustaveli str., 9-a

Sivets Victor

Mykolayovych

Head +38 044 235-56-

20; 226-32-53

http://dklg.kmu.gov.ua/forest

/control/en/index

State Agency of

Ukraine for Investment

and Development

V. Zhytomyrska str.,

11, Kyiv-34, Ukraine,

01601

Mr. Oleksand

Taran

Head +380 44 255 91

73; +380 44 278

05 34

http://in.ukrproject.gov.ua/in

dex.php?lang=en

State Agency for

Investment and

National projects of

Ukraine

01015 Kyiv,

Tsytadelna 7th Street

Mr. Vladyslav

Volodymyrovych

Kaskiv

Head +38 044 254 40 15 http://www.ukrproject.gov.ua

/en

National Electricity

Regulatory

Commission of

Ukraine

19, Smolenska st.

Kyiv, Ukraine

03680

Mr. Titenko

Sergiy

Mykhailovych

Head + 38 044 241

9001; + 38 044

241 9047

http://www2.nerc.gov.ua/con

trol/en/publish/category

3.2 State programs

In Ukraine a number of programs in energy efficiency and alternative energy have been developed. For the most

part they are of declarative character and miss the description of funding mechanisms and responsibilities for

their implementation. Announced objectives of the programs differ at times in various state programs.

3.2.1 Acting programs

The following State programs are acting in Ukraine:

1. ‘The Energy Strategy of Ukraine till 2030’ dd. 2006. The strategy was approved in March 2006 by the

Cabinet of Ministers and provides comprehensive overview of the situation in the energy sector of

Ukraine. The Strategy declares the necessity of efficient energy use, introduction of energy-saving

technologies, rationalizing of the structure of industry and reducing the share of energy-intensive

technologies. Weak point of the Strategy is that it was approved by the Cabinet of Ministers but was not

accepted by the Parliament. It means that the Strategy is not a Law and has rather advisory and not

mandatory status. In 2011 the up-date of the Energy Strategy of Ukraine was initiated (information on

the status of its acceptance is given below as Programs which are under development and approval).

2. ‘The State Target Program ‘Forests of Ukraine for the period of 2010-2015’ dd. 2009. The program

was approved in September 2009 by the Cabinet of Ministers and foresees the annual construction of

more than 1.5 thousand km of forest roads to provide access to wood resources and to increase the

logging/felling/collection of wood wastes. The effect of the Program is not perceived according to market

operators.

3. ‘The State Target Economic Program of Energy Efficiency and Development of the Production of

Energy from Renewable and Alternative Sources of Energy in the Period of 2010-2015 dd. 2010.

The Program was approved by the Cabinet of Ministers in 2010 and is aimed at the achievement in 2015

of 10% share of renewable energy and alternative fuels in the energy balance, the construction of

facilities for solid biomass and biogas for heat and electricity generation, the commissioning of plants for

http://saee.gov.ua/en/management

http://saee.gov.ua/en/management

http://in.ukrproject.gov.ua/index.php?lang=en

http://in.ukrproject.gov.ua/index.php?lang=en

http://www.ukrproject.gov.ua/en

http://www.ukrproject.gov.ua/en

http://www2.nerc.gov.ua/control/en/publish/category

http://www2.nerc.gov.ua/control/en/publish/category



Date: 10 May 2013

Page: 44 of 80

production of biodiesel (80 thousand tons/year) and ethanol (600 thousand tons/year), the realization of

projects for the generation of electricity from biomass. The implementation of the Program goes hardly.

3.2.2 Programs under development

The Programs which are under development or approval stage:

1. The National Projects ‘Energy of Biogas’ and ‘Energy of Biomass’ dd. 2012. State Agency for

Investment and National Projects of Ukraine is preparing the new projects ‘Energy of Biogas’ and

‘Energy of Biomass’ being a part of the National project ‘Energy of Nature’. The main goal of the projects

is the demonstration on the state level of the economic and environmental advantages of biogas and

biomass projects realization and development of recommendations to legislation regarding the intake of

bio methane into the gas transportation system of Ukraine.

2. ‘The Draft Energy Strategy of Ukraine till 2030’ dd. 2011. In 2011 the updated version of the Energy

Strategy of Ukraine till 2030 has been developed. The new Strategy envisages a major structural shift in

the energy facilities by 2030: the share of the renewable energy is expected to increase from 6% to 10%.

However, the bioenergy is not present at all in the up-dated Strategy. Market experts explain that fact by

the lobbying of interests of fossil fuel resources and other sectors of RES (wind, solar and hydro). The

Strategy is not accepted yet.

3. ‘The National Strategy for Heat Supply to Population Aggregates of Ukraine till 2030’ dd. 2012.

Ministry of Regional Development and Construction of Ukraine have to develop a Draft Strategy and

submit it to the Cabinet of Ministers until 1 January 2012. According to the Strategy goals it is foreseen

to reduce by 30% the use of natural gas for production of heat and hot water by means of upgrading the

boilers and utility networks, calculation of heat energy while its production, transportation and

consumption, the partial use of alternative energy sources (biogas, biomass, solar and wind energy).

4. ‘The Concept of the State Target Economic Program ‘Bioethanol’ dd. 2012. The State Enterprise

‘Ukrspirt’ and Ministry of Agriculture Policy and Food of Ukraine are involved in development of the

Concept. The concept is currently under consideration of the Cabinet of Ministers. If the Concept is

approved, it will give the start for development of the State Target Economic Program ‘Bioethanol’. The

Concept prescribes the measures which will create conditions for the development of alternative fuels in

Ukraine under state support, reduction of Ukraine's dependence on imported petroleum, rejuvenation of

several enterprises of alcohol industry.

3.3 Associations

For short period of time quite a number of associations and other non-profit organizations have been appeared in

the sector. Sector organizations are presented in Annex 1.

3.4 Events and exhibitions

Main sector events and exhibitions are listed in Annex 2 to this Report.



Date: 10 May 2013

Page: 45 of 80

3.5 Legislation

Among recently accepted legislative acts which provide practical benefits for alternative and bio energy

producers:

1. Law of Ukraine No. 5485-VI dd. 30.12.2012: ‘Amendments to the Law of Ukraine on Electricity

Industry (for stimulation of production of power from the alternative energy sources)’

The Law was signed by the President of Ukraine on 30 November 2012 and concerned the two important issues

as shown in Table 21.

Table 21. Law of Ukraine No. 5485-VI dd. 30.12.2012

1) ‘green’ tariffs;

The Law introduces the ‘green’ tariff on electricity generated from biogas and components of

biodegradable solid household waste. The ‘green’ tariff coefficient for biogas will be similar to that of

biomass – 2.3.

The ‘green’ tariff will be applicable to companies that will launch the biogas power plants from April 2013.

2) size of local

component

The size of the local component (technologies, equipment, construction materials used for construction)

for power generation facilities that produce electricity from wind, solar and biomass, is set at the level of:

not less than 30% for the construction which commenced after 1 January 2012 and completed

(put in operation) after 1 July 2013

not less than 50% for the construction which commenced after 1 January 2012 and put in

operation after 1 of July 2014.

The size of the local component for power generation facilities that produce electricity from biogas:

not less than 30% for the construction which commenced after 1 January 2012 and put in

operation after 1 January 2014

not less than 50% for construction of which commenced after 1 January 2012 and put in

operation after 1 January 2015

Facts about ‘green’ tariffs in Ukraine:

Goal of the ‘green’ tariff is to enable a diversity of technologies (wind, solar, biogas, etc.) to be

developed, providing investors a reasonable return on their investments.

Under the ‘green’ tariff the eligible renewable electricity generators (which can include homeowners,

business owners, farmers, as well as private investors) are paid a cost-based price for the renewable

electricity they produce.

In Ukraine, ‘green’ tariff was introduced by legislation in 2009 for the period until 2030.

Difference between regular and ‘green’ tariff: regular tariff – 5.38 eurocents per kWh.

A unit of renewable energy costs a lot more than a kWh of conventional energy (Table 22).

Table 22. ‘Green’ tariff for electricity from RES acting in Ukraine

RES

Coefficient (for facilities

commissioned till

31.03.2013)


commissioned till

31.12.2014)

‘Green’ tariff,

euro cent /

kWh

‘Green’

tariff,

kop/kWh

Sun (max) 4.8 3.5 46.53 505.09

Sun (min) 4.4 3.7 42.65 463.0

Biogas (from agricultural raw

materials and components of

biodegradable solid household

- 2.3 12.39 134.46



Date: 10 May 2013

Page: 46 of 80

RES


commissioned till

31.03.2013)


commissioned till

31.12.2014)

‘Green’ tariff,

euro cent /

kWh

‘Green’

tariff,

kop/kWh

waste)

Biomass* 2.3 2.3 12.39 134.46

Wind (max) 2.1 - 11.31 122.77

Wind (min) 1.2 - 6.46 70.15

Hydro (up to 10 MW) 1.2 1.2 7.75 84.18

Source: Law of Ukraine No.1220-VI (2009), Law of Ukraine No. 5485-VI (2012)

Note: In this Law, the term ‘biomass’ is determined as renewable non-fossil biological material of organic origin

as waste of forestry and agriculture (crops and livestock), fisheries and technologically related industries

undergoing biological decomposition, as well as part of industrial or household waste able to biological

decomposition. Thus, energy crops such as reeds, miscanthus, etc. do not fall under ‘green’ tariff regulation.

2. Law of Ukraine No. 1391-VI dd. 21.05.2009: ‘Amendments to Certain Laws of Ukraine as to

Support of Biofuels Production and Use’

The Law establishes the legal framework for production and consumption of biological types of solid, liquid and

gaseous fuels in Ukraine and imposes:

mandatory step-by-step increase in the production and use of biofuels and mixed motor fuels. (Still the

exact volume of production and use of biofuel and mixed motor fuel is not defined by the law);

mandatory certification for biofuels intended for implementation as commodity products;

profit derived of biofuel sale is exempted from taxation starting from 1 January 2010 for 10 years;

equipment for the biofuel industry, which is not produced in Ukraine, is imported at zero rate of value

added tax;

biofuels can be produced by any business enterprise. Previously, such fuels could be produced only by

state monopoly ‘Ukrspirt’;

excise duty on gasoline with ethanol additives has been reduced from 60 to 30 EUR/ton since 2007;

zero rate of excise duty on fuel bioethanol domestically produced.

3. Law of Ukraine No. 4970 dd. 17.07.2012: ‘On Amendments to Certain Laws of Ukraine for

Production and Use of Transport Fuel with Content of Bio Components’

The Draft Law was elaborated by the Ministry of Energy and Coal Industry of Ukraine stipulates that:

recommended rate of ethanol in gasoline motor, which are produced and/or are sold in the territory of

Ukraine will be in 2013 at least 5% (by volume), since 2014-2015 its required content should be not

less than 5%, and since 2016 - at least 7%.

production of transport gasoline mixed and adding (mixing) ethanol and/or bio-components will be

carried out by enterprises accepted by the Cabinet Council on the proposal of the central executive

body that provides implementation of state policy in the fuel and energy sector.

conversion of state owned unprofitable distilleries (37 plants) for the production of ethanol.

Other lows regulating the sector of bioenergy and biofuels are more of descriptive nature and do not provide any

practical stimuli to the bioenergy producers:



Date: 10 May 2013

Page: 47 of 80

Law of Ukraine No. 1391-XIV dated 14.01.2000 ‘On alternative types of liquid and gas fuels’.

Law of Ukraine No. 1775-III dated 01.06.2000 ‘On licensing of certain types of economic activities’.

(With the latest amendments the trade with liquid fuel from biomass and with biogas is subject to

licensing. Till October 2010 production and storage of biogas and liquid fuel from biomass were subject

to licensing as well. The respective draft of licensing conditions has been elaborated by the Ministry of

Fuel and Energy of Ukraine, but has not been approved yet).

Law of Ukraine No. 3032-III dated 07.02.2002 ‘On state regulation of production and turnover of ethyl,

cognac and fruit alcoholic beverages and tobacco products’.

Law of Ukraine No. 555-IV dated 20.02.2003 ‘On alternative energy sources’.

Law of Ukraine No. 2509-IV dated 05.04.2005 ‘On combined heat and power generation (CHP)’

Law of Ukraine No. 2633 dated 02.06.2005 ‘On heat supply’.

Law of Ukraine No. 760-V dated 16.03.2007 ‘On amendments to the Law of Ukraine on promotion of

energy efficiency measures’.

Number of regulations and governmental decrees called for replacement of traditional fuel with involvement of

R&D effort in renewable energy:

Resolution of the Cabinet of Minister of Ukraine No 576-р dd. 28.12.2005 “On Approval of the Concept

of Biodiesel Production Development Program for the period to 2010” and the Resolution of the

Cabinet of Ministers No 1774 dd. 22.12.2006 “On Approval of the Diesel Biofuel Production

Development Program” are in force. (It is provided that normative acts directed at promotion of rape

growing and construction of plants for production of biodiesel shall be elaborated. The program also

provides for elaboration of respective state standards in the sphere of production and use of alternative

fuel types, in particular biodiesel with high ecological and technical qualities).

Resolution the Cabinet Council No. 126-p dated 19.02.09 ‘Special features regarding connection of the

units producing electricity from the alternative energy sources to power grids’.

Resolution the Cabinet Council No. 256-p dated 19.02.09 ‘First priority measures to reduce natural gas

consumption during the period till 2010’.

Resolution the Cabinet Council No. 217-p ‘Organizational issue for production and use of biogas’ and

Resolution of the Cabinet Council No. 223-р dated 12.02.09 ‘On creation of register for resources

‘Suitable for biogas production’. (With these instructions the Cabinet Council of Ukraine obliged the

respective authorities to develop and implement pilot projects on biogas production, to elaborate and

approve state standards for biofuel, to regulate issues of lease of state-owned land plot as per

simplified procedure for placement of a fuel station selling liquid and/or gas biofuel and mixtures with

content of pure biodiesel over 80%).

Resolution the Cabinet Council No. 276-p dated 12.02.09 ‘Approval of conception of the state scientific

and technical program target. Production and utilization of biological fuels’.

Resolution of the Cabinet Council No. 159-p of 11.02.09 ‘Some issues of state policy implementation in

the field of efficient use of fuel and energy sources’.

Resolution of the Cabinet Council No. 102-p dated 04.02.09 ‘Measures concerning the use of the

alternative energy sources’.



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Page: 48 of 80

3.6 Taxation

The legislation of Ukraine provides a number of preferences as to taxation of activity connected to development,

implementation and use of alternative energy.

3.6.1 Company’s profit tax

The Tax Code of Ukraine stipulates that there shall be no income tax for 10 years for:

Income of enterprises of the electric power industry (class 40.11 group 40 KVED DK009:2005) gained

out of sale of the electricity produced with the use of renewable energy sources (such as wind, solar,

geothermal, wave and tidal, hydro, and biomass energy, landfill gases, sewage facilities gases,

biogases);

Income of biofuel producers from sales of biofuel;

Income of mechanisms and equipment producers as determined by Article 7 of the Law of Ukraine ‘On

Alternative Fuel Types’ intended for production and reconstruction of technical and transport means,

electrical devices which consume biofuel gained out of sale of such mechanisms and equipment

produced in Ukraine;

Income of enterprises exercising co-generation activity and/or producing heat energy using biofuel;

Income of enterprises gained out of extraction and use of coal bed methane;

No taxation is either stipulated for 80% of income of enterprises gained out of sale in Ukraine of own-

produced goods according to the List as approved by the Cabinet of Ministers of Ukraine:

Equipment working on renewable energy sources;

Materials, raw materials, equipment and components which will be used for production of

energy out of renewable energy sources;

Equipment for production of alternative fuel types.

Funds released due to tax allowances shall be directed by the tax payer for increase of

production volumes pursuant to the procedure as stipulated by the Cabinet of Ministers of

Ukraine.

3.6.2 Value added tax

No VAT shall be applied to the import of:

Equipment consuming renewable energy sources, equipment and materials for production of

alternative fuel types or for production of energy out of renewable energy sources;

Materials, equipment, components used for production of:

Equipment consuming renewable energy sources;

Materials, raw materials, equipment and components which shall be used for production of

alternative fuel types or for production of energy out of renewable energy sources.

Import to Ukraine of goods stated in this paragraph is free of taxation if such goods are used by the tax payer for

its own production and if identical goods of equivalent quality are not produced in Ukraine.



Date: 10 May 2013

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The list of such goods with codes pursuant to the Ukrainian classification of foreign economic activity goods is

stipulated by the Cabinet of Ministers of Ukraine (the Resolution of the Cabinet of Ministers of Ukraine dd. 14

May 2008 No. 444 ‘On import to the customs territory of Ukraine of energy-saving materials, equipment and

component parts’).

The list of equipment includes about 1,000 items of various type of materials, equipment and components parts

such as mini heat and power plants, turbo-generators, gears, pups etc.17

In addition to this, temporarily, till 1 January 2019 no VAT shall be applied to the following transactions:

Delivery of mechanisms and equipment determined by Article 7 of the Law of Ukraine ‘On Alternative

Fuel Types’ in the territory of Ukraine;

Import under codes of the Ukrainian classification of foreign economic activity goods determined by the

Law of Ukraine ‘On Alternative Fuel Types’ of mechanisms and equipment intended for reconstruction

of existing and construction of new enterprises for production of biofuel and for production and

reconstruction of technical and transport means consuming biofuel, if such goods are not produced and

have no equivalent in Ukraine, as well as of technical and transport means, including self-moving

agricultural machinery consuming biofuel, if such goods are not produced in Ukraine. Import procedure

for the mentioned mechanisms and equipment, technical and transport means shall be determined by

the Cabinet of Ministers of Ukraine.

3.6.3 Customs dues

According to the Law ‘On unified customs tariff’ the following equipment and materials (as well as materials,

installations and equipment used for production of such equipment and materials) are not subject to custom

charges, provided they are used by the tax payer for its own production and if identical goods of equivalent

quality are not produced in Ukraine:

equipment working on non-conventional and renewable energy sources;

equipment and materials for production of alternative fuel types (goods) imported to the customs

territory of Ukraine by national companies.

By violation of requirements as to proper use of mentioned goods the subject of the foreign economic activity is

obliged to pay customs dues in order and amount stipulated by the law.

Customs (export and import) duties for the products of biomass processing industry are presented in Table 23.

The mandatory certification and phyto-sanitary control are applied to all oil and fat products.

Table 23. Customs (import/export) duties for biomass products in Ukraine

Code Article Customs

duties, %

1201 Soybean 0

12050090 Rapeseed, other 0

1206009 Sunflower seed, other 10

1207 Other oil seeds 5

15071010,

15079010 Soy oil, fresh, refined or not refined for industrial or technical use (not in food production) 5

17

The link to the full text of the Resolution with the list of equipment: http://zakon.nau.ua/doc/?uid=1149.459.23&nobreak=1

http://zakon.nau.ua/doc/?uid=1149.459.23&nobreak=1



Date: 10 May 2013

Page: 50 of 80

Code Article Customs

duties, %

1508 Peanut oil, for industrial or technical use (not in food production) 5

15121110,

15121910

Sunflower oil, fresh, refined or not refined for industrial or technical use (not in food

production) 8,10

1514 Rapeseed oil 5

15151910 Linseed oil, other for industrial or technical use (not in food production) 5

15152110 Maize oil, fresh for industrial or technical use (not in food production) and other 5

15152910 Maize oil, other for industrial or technical use (not in food production) 20

1213 Straw and chaff of cereals, unworked, whether or not broken, ground or not ground, pressed

or in the form of pellets 20

4402 Charcoal (including charcoal from shells or nuts), whether or not agglomerated 0

440130

Logs, twigs, branches, wood chips or shavings, sawdust, debris, whether agglomerated or not

agglomerated in the form of logs, briquettes, pellets etc.

0




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4 Standardization and certification

4.1 National standards

The State Committee of Ukraine on Technical Regulation and Consumer Policy is the central executive body

responsible for standardization.

Until recently, Ukraine didn’t have any single national standard for biomass products. Manufacturers worked on

individually developed technical specifications (TU).

Since 2009 the development of national standards on biomass products became livelier. Several technical

committees of the State Committee of Ukraine on Technical Regulation and Consumption Policy, the Ministry of

Agrarian Policy and Food of Ukraine and a number of institutions were engaged in the development of the

national standards.

The national standards (DSTU) harmonized with international standards are currently available for solid fuels and

bioethanol:

Solid biofuels:

DSTU 7123:2009 Sunflower husk. Technical specifications.

DSTU 7124:2009 Sunflower husks pressed granulated. Technical specifications.

DSTU-P CEN/TS 15149-2:2009 Solid biofuel. Methods of definition of granulometric composition. Part

2. Method of use of vibratory sieve with holes of 3.15 mm and above.

DSTU-P CEN/TS 15149-3:2009 Solid biofuel. Methods of definition of granulometric composition. Part

3. Method of use of vibratory sieve.

DSTU-P CEN/TS 15289:2009 Solid biofuel. Determination of total sulfur and chlorine composition

(CEN/TS 15289:2006, IDT).

DSTU-P CEN/TS 15290:2009 Solid biofuel. Definition of basic components (CEN/TS 15290:2006,

IDT).

DSTU-P CEN/TS 15296:2009 Solid biofuels. Calculation of composition according to different bases.

Biodiesel:

DSTU 6081:2009 Standard Motor fuel. Methyl esters of fatty acids, fats and oils for diesel engines.

Specifications are valid as of March 2010. It complies with the EN 14214:2003 standard.

The national standards for biogas and bioethanol are not developed. These products are manufactured on the

basis of Technical Specifications (TU) of producers.

Bioethanol production in Ukraine is guided by:

TU U 24.6-14289688-001:2009 ‘Motor fuel Е-80-105’

TU U 24.6-14289688-002:2009 ‘Component of motor fuel Е-80-105’

TU U 24.6-35523958-001:2009 ‘Biological motor fuel Е85’



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4.2 International standards

A lot of Ukrainian biomass feedstock and solid biofuels are exported to EU; in connection with that Ukrainian

companies are obliged to comply with European standards.

For registration of export shipments Ukrainian companies (mainly traders) certify the quality and sustainability of

biomass products in compliance with international standards as stated in Table 24.

Table 24. Type of biomass and international standards applied

Type of biomass Standards/certificates

Solid biofuels (wood products and agricultural residues,

including certification of the quality of wood pellets and

chips)

EN 14961-2 & EN 15234-2

NTA 8080

DIN, DIN Plus

Energy crops (rapeseed, corn, sunflower, soya) RED18

certificate

Residues and waste used in power generation

Source: data of market operators

Since 3 March 2013 the EU Regulation # 995/2010 comes into force which should prevent the entry into EU

markets of wood and any products and materials from wood obtained from illegal harvesting.

The certification bodies accredited for biomass certification in Ukraine are shown in the Table 25 below.

Table 25. Certification bodies of Ukraine for biomass products

Certification companies Address Tel./Fax E-mail Web-site

Production Association

UKRUGLEGEOLOGIYA, Ministry of

Coal Industry of Ukraine Department

of laboratory research

83003, Donetsk,

Lenin ave, 91

Tel. +38 062

300 15 34

Fax: +38 062

385 99 13

[email protected]

Ukrainian State Scientific-Research

Institute of Coal Chemistry - UHIN,

Ministry of Industrial Policy of Ukraine

61023, Kharkov.

Vesnina str., 7.

Tel / Fax: +38

057 704 13

19

+38 057 700

69 06

[email protected]

http://www.ukhin.org.ua

CCI Ukraine Ltd., A subsidiary of

Australian Company «CCI Holding

Ltd.

91055 Lugansk,

Karl Marx str., 3

Tel. +38 0642

34 44 50; +38

0642 34 44

58;

Fax:.+38

0642 50 10

04

[email protected]

http://www.cci.net.ua

SGS Ukraine, the Regional Office in

Dnepropetrovsk

Dnepropetrovsk,

Blagoev str., 31

Tel. +38 0562

335 635/36,

[email protected]

http://www.ua.sgs.com

18

The EU Renewable Energy Directive (RED)

mailto:[email protected]


http://www.ukhin.org.ua/


http://www.cci.net.ua/


http://www.ua.sgs.com/



Date: 10 May 2013

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fax: +38 056

770 00 70

Source: Ukrainian Biomass Fuels Market Analysis

5 Investments in the sector

Ukraine appeared on the 2011 Ernst & Young Renewable Energy Country Attractiveness Indices, providing to be

an attractive emerging market for renewable energy.

The World Bank disbursed 30-year loan of USD 200 million for energy efficiency investment projects in industrial

enterprises, municipalities and energy utility service companies in Ukraine.

The European Bank for Reconstruction and Development (EBRD) considers renewable prospects of Ukraine as

considerable and provides the credit lines and partial support of the technical assistance projects in energy

efficiency and renewable energy sectors (USELF program).

Most of investments are directed/planned to be directed to:

biogas plants for heat and power generation (due to recently accepted amendment to legislation

concerning the ‘green’ tariff for electricity from biogas);

solid fuels production (because of increasing demand from EU);

heating on solid biomass projects in municipal and agro-industrial sectors (due to constantly increasing

prices for gas);

bioethanol production (caused by recent legislation initiatives).

Table F in Annex 3 represents the sector investments recently announced by the market operators.

6 Financing the sector

Bioenergy equipment especially foreign one is rather expensive. In most cases, only large companies become

the clients of big international equipment producers. Ukrainian equipment is cheaper than foreign equipment

while the latter is more reliable.

For the most bioenergy projects the equipment from local suppliers is purchased. The main reasons for that:

Low buying capacity and orientation to low quality segment of final product;

Not enough foreign suppliers able to provide service and maintenance on site.

However, possibilities to purchase the foreign equipment and extend the payment for several years using bank or

state credits exist in Ukraine. Ukrainian/international banks can propose special trade financing and credit

programs (such as UKEEP, USELF etc.).

Trade financing is usually applied to short-term programs under one year while credit programs are usually

applied to long term programs which can take up to 5 years. Average standard interest rates are 18-25% in

Ukrainian hryvnias and 10-18% in Euro.

In addition to bank financing, the Ukrainian government offers state-supported programs for agricultural

producers. In case that domestic equipment is bought for pellet production in Ukraine, a company can get a loan



Date: 10 May 2013

Page: 54 of 80

from ‘Ukragroleasing’ with a reduced interest rate of 7% in Ukrainian hryvnias. UAH 80 million were allocated to

‘Ukragroleasing’ in the State Budget of 2012.

There is also possibility to get 30% of the total equipment cost paid by the Ministry of Agrarian Policy and Food of

Ukraine. Interest rates for loans taken to buy bioenergy equipment can also be partially compensated.

However, the access to state funding is not an easy process and applicants have to undergo a selection process.

Selection criteria of such state competitions are often not transparent and selection can be arbitrary according to

market operators.

Therefore, many agricultural producers have to use bank credit programs or own funds to finance their business

(i.e. purchase of the equipment) and do not rely on the state support.

7 Technology and equipment

Ukraine has high potential for introduction of energy efficiency and alternative energy technologies and

equipment as its energy efficiency is only one-third of the average for industrialized countries.19

Because of lack of financing the majority of bioenergy companies of Ukraine prefer to buy the cheaper equipment

of local production or modernized soviet-type technologies instead of investing into high-quality equipment.

Indeed, a lot of the equipment is produced or assembled in Ukraine.

As of today, there are about 20 factories in Ukraine that produce boilers for burning waste wood and wood

biomass. Companies ‘Zhytomirrempischemash’, ‘Roek-Lviv’, ‘Kyivavtomatika’, ‘Kaf’, Volyn-Calvis’,

‘Ecoenergokharkiv’, ‘Ecoenergoproekt’, ‘Dozamekh Ukraine’ and others produce industrial and domestic boilers

and gas generators of various capacities.

Ukrainian company ‘Turboatom’ produces steam turbines for bioenergy projects. The company is trying to redo

their 6 MW steam turbine to 1 MW. Because of the bulkiness of this machine it is difficult to compete with

Russian counterparts, in particular, low-power steam turbines, which are produced by Kaluga Turbine Plant.

Similar equipment also comes from the Czech Republic, Germany, India and China.

Production of biodiesel installations is arranged in Ukraine on ‘Ukrstoymash’, ‘BiodieselDnept’, ‘Special

technologies’, ‘Trend’, ‘Technosouz’.

Several foreign companies: Zorg Biogas AG (Switzerland), ANDRITZ FEED&BIOFUEL A/S (Denmark), STULZ

H+E GR. PPE (Germany) are supplying equipment for Ukrainian agricultural bio projects.

There is a large special group of suppliers - small Ukrainian companies which represents the interests of foreign

equipment suppliers.

Analysis of proposals/announcements on biomass business portals (e.g. Waste World, Ukrainian Biofuel Portal,

AllBiz Ukraine) showed the types of biomass processing equipment which is supplied/demanded on the market

(Figures 20 and 21 respectively).

19

http://www.keepeek.com/Digital-Asset-Management/oecd/finance-and-investment/competitiveness-and-private-sector-development-

ukraine-2011_9789264128798-en



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Figure 20. Supply and demand of biomass processing equipment, number of announcements

Source: http://waste.ua/, http://pelleta.com.ua, http://www.ua.all.biz

Taking into account that on the market there is a lot of offers of wood and agricultural wastes processing

equipment (boilers and palletizing equipment) for small-scale industrial and domestic purposes it will be

challenging for the Dutch companies to compete in this type of hardware with Ukrainian and other foreign

producers of equipment.

More opportunities are available to Dutch suppliers of complex automated technology/solutions for

industrial/municipal biomass processing and in the segment of equipment for agro-industrial equipment which

only starts developing in Ukraine.

Figure 21. Supply of equipment of biomass utilization, number of announcements

http://webcache.googleusercontent.com/search?q=cache:http://www.ua.all.biz/en/

Biogas installations, biomass feedstock collection/handling/storage technologies and equipment, fluidized bed

boilers and other equipment as stated in the Table 26 represents a lot of sales opportunities for the Dutch

entrepreneurs.

Table 26. Potential market size of biomass processing and bioenergy equipment

Type of equipment Market size, units*

Heat on biomass

Heating boilers on wood biomass 0.5-10 MWth 900

http://waste.ua/index.php?page=ads&parent_id=2

http://pelleta.com.ua/

http://webcache.googleusercontent.com/search?q=cache:http://www.ua.all.biz/en/



Date: 10 May 2013

Page: 56 of 80

Industrial boilers on wood biomass 0.1-5 MWth 400

Domestic boilers on wood biomass 10-50 kWth 35,000

Farms boilers on straw 0.1-1MWth 10,000

Heating boilers on straw 1-10 MWth 1,000

Farm boilers on stems of corn and sunflower 0.1-1 MWth 9,000

Heat boilers on peat 0.5-1 MWth 800

Atmospheric fluidized bed boilers -

Heat and power

Mini-heat and power stations on wood biomass 10

Mini-heat and power stations on straw 10

Biogas

Small biogas installations 200-600 m3 2,253

Farm biogas installations 600-3,000 m3 827

Large biogas installations >3,000 m3 4

Co-generation installations on biogas from manure and other agricultural wastes -

Biomass collection/handling

Straw balers -

Tree chippers -

Biomass crushing and grainer machines -

Co-firing equipment

Equipment for co-firing of biomass with coal -

Bioethanol process equipment

Installation of dehydration etc. -

Equipment (laboratory) for control of alcohol-containing motor fuels -

Equipment for blending ethanol with gasoline -

* Estimation of Scientific Engineering Centre ‘Biomass’ Ltd.

Source: Open sources of information, opinion of market experts

The right approach for the Dutch process/equipment suppliers could be the partnership with international

investors, participation in tenders/projects of financial institutions and cooperation with large Ukrainian

agricultural companies and agro industrial holdings.

http://www.multitran.ru/c/m.exe?t=5581983_1_2



Date: 10 May 2013

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8 SWOT analysis

Strengths

Low competition in the industry;

Large arable lands and crops residues;

Significant amounts of animal wastes;

Availability of wood and agro-industrial wastes;

Relatively cheap price of local biomass feedstock and human resources;

Tax preferences (no VAT and tax on profit for producers of bioenergy and biofuels);

Accepted Low on ‘green’ tariff which enhances production of electricity from biogas;

Accepted Law on adding bioethanol to gasoline which supports domestic consumption of biofuel.

Weaknesses

Natural gas, heat and electricity prices are subsidized for population and municipalities;

Short domestic consumption of bioenergy products;

Not stable supply and absence of long terms contracts for supply of biomass feedstock;

Low production capacities and poor quality of final biomass products;

Large volumes of biomass products are exported as raw material (wood, rapeseeds, sunflower seeds, soya)

and not as final product (bio energy, solid/liquid fuels);

Lack of collection, handling and storage technologies of biomass feedstock;

Lack of the advanced complex biomass processing and bioenergy solutions and equipment;

Underdeveloped wood procurement logistics (roads, transport, equipment, storage);

Lack of financing resources and capital investments;

Seasonal shortage of biomass feedstock supply;

High prices of transportation and logistics services;

Complicated procedure of obtaining the licenses, ‘green’ tariff etc.;

Poor dissemination of information on the advantages of bioenergy;

Lack of qualified personnel in energy efficiency and sustainability.

Opportunities

High external and rising internal market demand for biomass feedstock and final products;

Certification of products to compliance with sustainability requirements of EU (ENplus for ‘domestic’ pellets

and EN-B for ‘industrial’ pellets, Cramer criteria for energy crops, EU Regulation # 995/2010);

Delivery of certified sustainable bioenergy feedstock and products to export markets;

Organizing collection and construction of storage facilities for biomass feedstock and final products;

Support under involvement of favorable financing for bio energy projects;

Transfer of knowledge and expertise in biomass management and processing;



Date: 10 May 2013

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Supply of complex process solutions, process engineering and equipment maintenance services;

The EU sustainability and energy saving targets (export of Ukrainian biomass feedstock and products);

Credit lines, technical assistance and pilot projects financed by IFIs;

Necessity of wastes processing of the large agro-industrial groups;

Outdated and insufficient capacities of heat and power stations and networks;

70% of heat and power generation facilities operate on traditional fuel;

Upgrading of energy infrastructure and supply of modern equipment (reconstruction of sugar and alcohol

plants for bioethanol production, conversion projects from fossil fuels on pellets, biomass or co-generation

projects).

Threats

Shortcomings of legislation and lack of acting state program and integrated goals and priorities;

Substantially understated goals set in the up-dated Energy Strategy of Ukraine;

Strong lobby in gas, oil and coal industries and lack of it in bioenergy and biofuel;

Problems with sale of electricity from biomass to energy market;

State monopoly in power and heat generation assets and bioethanol production;

Decrease of electricity consumption in EU countries and reduction of fuel consumption by heat and power

plants;

Introduction by EU or other countries of additional measures to protect the internal markets: the new

certification requirements, quotas, etc.;

Growing competition on international solid biofuel market (e.g. Russian producers of wood fuel products)

Risk inherent into agricultural business (adverse weather conditions, high volatility of commodity prices on

crops and biomass feedstock);

Lack of guarantee to consumers of their right to free choice of energy sources.



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9 Opportunities for Dutch SMEs

Ukraine offers a number of opportunities for foreign direct investment along the entire value chain of biomass

processing:

Biomass consultancy and engineering

Feasibility studies, business planning for re-/construction of biomass processing projects;

Bio economy/advising companies and government on bioenergy policy/strategy/plans development;

Support under preparation and running bioenergy projects financed by IFIs;

Advisory under certification of biomass feedstock and products according to EU standards;

Support in organization of sustainable biomass production and logistics chain;

Guidance through (sustainability) certification process of biomass feedstock and products;

Setting up systems for complying/monitoring of sustainable biomass production;

Partner search/co-financing/join ventures in biomass processing;

Energy audits and education programs on energy efficiency for industrial and municipal consumers.

Biomass feedstock supply

Collection, handling and storage technologies and equipment of biomass feedstock (straw balers, tree

chippers);

Specialized logging and timber transportation equipment (mobile crushing machines for wood wastes);

Storage facilities for biomass feedstock (tank, storehouse, silo, pile, in particular - for straw);

Transportation equipment for supply of wastes to processing/utility companies (trucks, tractors, conveyor

belts);

Advanced complex biomass processing and bioenergy solutions and equipment.

Heat on biomass

Industrial and municipal boilers on biomass

Boilers with boiling bed technology

Biogas, Heat and electricity on biogas

Installation and after-sale service of the heating and power equipment on biomass;

Construction of heat and power plants on biogas and biomass and conversion of fossil fuel facilities to

biomass and co-firing;

The design and construction of treatment facilities of livestock farms on the basis of the use of anaerobic

digestion with the use of multicomponent substrates to increase biogas output;

Design and construction of large-scale biogas plants on the basis of fermentation of corn silage or other

green biomass:

for the following production and sale of electricity by ‘green’ tariff;

for the following production of bio methane and its use as a substitute for natural gas.

Solid biofuels



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Design and construction of solid fuel plants for heat and power production and industrial consumers;

Arrangement of production of packed pellets and briquettes for retail chains, stores and municipal heating

systems of EU and Ukraine;

Organization of supply of solid biofuels to export markets (possibilities for traders).

Bioethanol

Quality control system and special equipment (laboratory) for control of alcohol-containing motor fuels;

Installation of dehydration for ethyl alcohol;

Introduction of bioethanol of azeotropic distillation;

Supply of infrastructure for bioethanol plants and equipment for blending ethanol with gasoline;

Ethanol modules at existing gas stations.



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Annex 1 Sector associations

Name of the association Representative Address Description Contact information

Association of alternative fuel and energy market participants (APEU)

Mr. Vitaliy Daviy, President

16B, Shovkovychna str., office. 37

Kyiv, 01024, Ukraine

APEU was established in autumn 2009 and is an

association, whose purpose is to coordinate the activities of enterprises representing the

RES sector for development and efficient interaction with governmental bodies and

agencies. The main task of the Association is to promote the production and use of

renewable fuels and energy in Ukraine, as well as to strengthen the market position

of the Ukrainian manufacturers of specialized equipment and technologies, as well as in

foreign markets, representation of participants’ interests towards government,

international organizations, protection of the participants’ rights and public relations.

Tel.: + 38 044 362 04 90 Fax: + 38 044 253 51 17

[email protected] http://apeu.info/index.php

Association of renewable energy ‘Alternative’

Mr. Vitaliy Kovach, Director

30, Fizkultury str., Kyiv, 03150, Ukraine

Organization promotes the idea of ‘natural energy’ in the society through education, lobbying on

behalf of alternative energy business community, information support and

encouragement. The fields of activities of association cover solar, wind and hydro power,

biogas, biofuels, solid waste, etc. Main goal of the association is to draw attention

of society to the problem of alternative energy and energy efficiency in Ukraine.

Tel.: +380(44) 222-5822 [email protected]

http://www.alternativa.info

/

European-Ukrainian Energy Agency (EUEA)

Mr. Andriy Paslen, Director

Business Centre Eurasia

75, Zhylyanska st., 5th floor, 01032,

Kyiv, Ukraine

EUEA is a non-profit association established in Kyiv

in November 2009. The idea of the association is to become a platform for representatives of

society, economy and science as well as financial service providers and consulting

companies in Ukraine and Europe. The objective is to contribute to exchange of

informational, match of demand and supply in all spheres of renewable energy and energy

conservation technologies, provide support by legislative initiatives. The mission is to

become a central contact partner for energy related issues in Ukraine and to make

a contribution to an ecological and consistent energy policy of Ukraine.

Tel.: +38 044 390 55 33 office@euea-

energyagency.org

http://euea-

energyagency.org/

All-Ukrainian amalgamation ‘Fund of Mr. Igor Krasnozvezdny Association was founded to Tel.: +38 (044) 539 30 70

http://apeu.info/index.php

http://www.alternativa.info/

http://www.alternativa.info/

http://euea-energyagency.org/

http://euea-energyagency.org/



Date: 10 May 2013

Page: 62 of 80


energy-efficient investments’

Cherkashyn, President

avenue 5, of.47, Kyiv, 03037, Ukraine

promote the idea and best practice in the field of energy efficiency and RES

technologies. The experts of the association analyze legislative initiatives, conduct

expert estimation of activities of state bodies in the energy efficiency sphere and address

respective institutions and organizations with appropriate recommendations. Association

is helping to find investors for energy efficiency projects in Ukraine.

Fax: +38 (044) 572 69 79 http://energoeffect.org.ua/

Ukrainian association of alternative solid fuels

Mr. Ivan Nadiev, President

18/24, Dmytrivska str., 5th floor, room.

7. , Kyiv 01054

Ukraine

Ukrainian association of alternative solid fuels is a nonprofit organization created

to unite pellet producers in Ukraine to the industry as a whole. The main objectives of

the creation of the association are: developing a common export policy, formation of a

pool of producers to enter the direct European buyers, promoting the formation and

development of the internal market of solid alternative fuels in Ukraine, participation in

policy-making in the field of alternative solid fuels in Ukraine.

Tel.: +38(044) 482-09-64 Fax: +38(044) 482-09-64

[email protected]

http://www.uavatp.org/

Kiev International Energy Club «Q-club»

Mr. Oleksandr Todyichuk, President

Artema str., 60, office 719-720, Kyiv,

Ukraine

The club unites the experts, politicians, businessmen, diplomats of national and

international levels and is a debatable platform for discussion of the important

problems of a fuel and energy complex of Ukraine. Analyses and forecasts of development

of the energy market are promulgated in «Q-club» with the assistance of leading mass-

media, for the purpose of formation of the state energy strategy, energy storage and

energy efficiency programs. The club puts as an objective to get the status of a public

advisory body of the government, parliament and the President in questions of

formation of a policy in RES sphere, and also to promote creation of positive image of

Ukraine in the international energy societies.

Tel.: +38 (044) 484-04-44 Fax: +38 (044) 484-04-44

[email protected]

http://www.qclub.org.ua

http://www.uavatp.org/

http://www.qclub.org.ua/



Date: 10 May 2013

Page: 63 of 80


Ukrainian Bioenergy Association

Mr. Georgii Geletukha,

Chairman of the

Board

2 A, Zheliabova str., Kyiv, office 116

The mission of the association is to create a common platform for cooperation on bioenergy

market of Ukraine in order to ensure the most favorable business environment and

accelerated development of bioenergy market and sustainable development of

bioenergy sector. Main directions of activities are to influence the legislative

activities in the energy sector of Ukraine in order to strengthen the position and accelerate

development of bioenergy, to impact on policy documents in the energy sector of Ukraine

(public and industrial programs, the Energy Strategy etc.) and to influence development of

state and sectorial standards and norms required for bioenergy development.

Tel.: +38 (044) 456-94-62 Fax: +38 (044) 453-28-56

[email protected].

http://www.uabio.org

Institute of Renewable Energy of the National Academy of Science of

Ukraine

Mr. Nver Mkhitaryan,

Director

20 A, Chervonogvardijska

str., Kyiv, 02094,

Ukraine

Institute founded with the goal of further development and coordination of scientific

researches in the field of RES and assistance under the use and implementation of the

results of researches. The Institute of Renewable Energy of NAS of Ukraine includes six

research departments: complex energy systems, solar energy, wind energy, small hydro,

geothermal energy, bioenergy sources. The Institute is in fact a national coordinator of the

scientific efforts of the industry and a partner of the State Agency for Energy Efficiency

and Energy Saving of Ukraine within the framework of scientific cooperation and

participation in the development of strategic plans and scientific support of

government programs and projects.

Tel.: +38 (044) 206-28-09 Fax: +38 (044) 206-28-09

[email protected]

http://ive.org.ua/

Association of heat and power

engineering companies of Ukraine

Mr. Stanislav

Zakharov, Director

4/7, Tsytadelna str.,

office 2, Kyiv, 01015, Ukraine

It is a union of producers and

engineers of heat and power equipment. Main goals of association are representation

of interests and promotion of business activities of the companies-members. For this

purpose the annual Conferences on heat and power engineering and regular

Technical meetings are conducted mutually with State Mining Supervisory Service and

Industrial Safety and State Agency of Energy Efficiency and Energy Saving of Ukraine.

Tel.: +38 (044) 280-34-64

Fax: +38 (044) 254-26-95 [email protected]

http://www.ateku.org.ua/

http://www.uabio.org/


http://ive.org.ua/

http://www.ateku.org.ua/



Date: 10 May 2013

Page: 64 of 80


Ukrainian association of producers of alternative motor fuels

‘Ukrbiopalyvo’

Mr. Pavlo Klymets, President

2а, Mechnykova str., Kyiv, 01023, Ukraine

Newly established association founded in 2012 by the large private producers of liquid

biofuels: Agro-Nafta Ltd. and BioHim group Ltd. to promote the quality standards of biofuels

and protect the interests of the companies of ‘green’ fuel the sector.

Tel.: +38 044 3830270 Fax: +38 044 2553371

http://ukrfuel.org/

Netherlands Ukrainian Sustainable Energy Platform (NUSEP)

Mr. Igor Savelkouls,

Chairman of the Board

4, Hrushevskoho str., office 401,Kyiv,

01001, Ukraine

Netherlands-Ukrainian Sustainable Energy Platform

(NUSEP) - Association of Dutch organizations offering technology solutions and

equipment for the implementation of projects in the field of energy efficiency in

housing and industry. NUSEP provides Ukrainian organizations with free of

charge effective access to the Dutch technology, equipment and best practices

development projects.

Tel.: +38 (044) 492 7075 Fax: +38 (044) 492 7075

[email protected] http://new.nusep.org/

Association "Ukrainian Pellet Union" Mr. Mykola

Kolomyichenko, Director

n/a "Ukrainian Pellet Union" was

created in 2012 by the European Pellet Consulate, and in accordance with the

requirements of the EU to establish a national body with the authority of certification

biofuels according to new standards EN plus. Association "Ukrainian Union Pellet" is a

non-profit organization. Association working on three programs biofuels market development in Ukraine - is

industrial program, logistics and program certification.

n/a

http://ukrfuel.org/

http://new.nusep.org/



Date: 10 May 2013

Page: 65 of 80

Annex 2 Sector events and exhibitions

No. Event name Date Location Description Website

1. International congress

‘Top Grain’

November Kyiv, SE

‘Ukrayinskyy Dim’

The event brought together about 300

participants, 200 of which were managers and specialists of the leading agricultural companies, the

other part — the representatives of commercial companies, government, financial institutions and mass media.

http://cropcongress.org/2

011/eng/#hMenu

2. AgroAnimalShow

February Exhibition center ‘KyivExpoPlaza’ 2-b, Saliutna st.,

04111 Kyiv Ukraine

Agro Animal Show is an event aiming at promotion of modern technologies into livestock breeding sector, offering

wide range of agricultural machinery and equipment, newest scientific and technical developments for farms of

different patterns of ownership and size, professionally dealing with livestock products manufacturing. The

exhibition represents the main directions of innovative development of livestock sector, being a unique

information and trade platform.

http://www.animal-show.kiev.ua/en

3. INTERAGRO

February Exhibition center

‘KyivExpoPlaza’, 2-b, Saliutna st.,

04111 Kyiv,

Ukraine

Largest annual agro-industrial forum

taking the leading place in the agricultural complex of Ukraine as a complex of innovative solutions in

different spheres of agriculture. The exhibition is supported by the Ministry of Agrarian Policy and Food of

Ukraine, Ukrainian Agrarian Confederation, Ukrainian Agribusiness Club, Ukrainian Academy of Agrarian Sciences, Government of France,

Ministry of Economy of the Federative Republic of Germany, the embassies of Austria, Argentina, the Netherlands,

Poland, Russia, etc. Among the products represented at the exhibition, there are agricultural machinery,

seeds, agricultural chemistry, bioenergetics, IT and agricultural services, equipment, spare parts,

agricultural economy and agricultural production management, agricultural technologies, etc.

http://interagro.in.ua/eng/

about-fair.html

4. UKRAINE AGRARIAN

March Expocenter of Ukraine

1, Glushkov Ave., 03680 , Kyiv, Ukraine.

Promotion of agricultural production in Ukraine and competitive economic

system in the agrarian sector; Information platform for professionals of the agricultural sector on

innovations in various fields of agriculture, which are offered by domestic and foreign science, with

modern machinery and equipment and new technology, varieties and species that provide all areas of intensification

of agricultural production. Promotion of the investment in the domestic agricultural sector, incl. presentation of

investment proposals and projects

http://www.expocenter.com.ua/en/exhibitions%202

012/ua_agrarna%20%20/info/

http://cropcongress.org/2011/eng/#hMenu

http://cropcongress.org/2011/eng/#hMenu



http://interagro.in.ua/eng/about-fair.html

http://interagro.in.ua/eng/about-fair.html

http://www.expocenter.com.ua/en/exhibitions%202012/ua_agrarna%20%20/info/






Date: 10 May 2013

Page: 66 of 80


5. The International Agroindustrial Fair AGRO

September Expocenter of Ukraine

1, Glushkov Ave., 03680 , Kyiv, Ukraine.

The largest and most promising state-level event in agricultural sector of

Ukraine with domestic and foreign participants in all agricultural sectors,

food processing and fishing industries,

agricultural engineering industry has been increased. The following venues

will be held in the Exhibition

framework: International specialized exhibition of agricultural

machinery, equipment and spare parts, irrigation equipment,

mechanization of agricultural

production, food engineering, equipment for livestock and poultry,

fodder production,

etc. ExpoAgroTech-2012 International specialized exhibition of automation,

management, alternative energy, GPS and GIS technology Hi-

Tech АГРО-2012

International specialized exhibition of energy plant

Biofuels-2012

International specialized exhibition of animal

industries and veterinary

medicine ANІMAL`EX-2012 International specialized exhibition MUSHROOM

INDUSTRY-2012

http://www.agroexpo.com.ua/Eng/Main.php

6. ECO Expo

October International Exhibition

Center (IEC), 15 Brovarsky Ave,

02660, Kiev,

Ukraine

Environmental and organic products presented on the Ukrainian market

and new products that are only entering the market.

http://ecoexpo.expoua.com/en/

7. ANIMAL FARMING UKRAINE

October - November

International Exhibition


02660, Kiev,

Ukraine

Dedicated exhibition for animal farming that is supported by Ministry

of Agrarian Policy of Ukraine, Committee on Agrarian Policy and Land Relations of The Verkhovna

Rada of Ukraine, Association of Farmers and Private Landowners of Ukraine, Ukrainian Agrarian

Confederation.

http://www.animalfarming.com.ua/

8. IX International AGROFORUM`2012

November International Exhibition


02660, Kiev,

Ukraine

Domestic and foreign agricultural appliances of large, medium and low-

power capacity, equipment and spare parts; reclamation and sprinkling equipment, drip irrigation systems,

equipment for post-harvest handling of grain, separators, dryers, the modern technology of crops cultivation,

equipment for processing agricultural products, seeds and seed production systems, horticulture, agricultural

chemistry, veterinary medicine, technology and equipment for feed production, feed, feed additives and

the dietary supplements for animals and birds, agroecology, and energy-and resource-saving technologies.

http://agroforum.expoua.com/en/

9. Grain Tech Expo

November Exhibition center ‘KyivExpoPlaza’ 2-b, Saliutna st.,

The biggest agro-industrial forum. Complex of the innovative solutions in different stages of production, storing,

http://grainexpo.com.ua/en/about-the-project.html













Date: 10 May 2013

Page: 67 of 80


04111 Kyiv, Ukraine

processing and transportation of grain, leguminous and oil crops. Exhibition

unites the leading professionals of grain market – producers and dealers of the sector in the format of the

specialized business event. Platform for dialogue between producers of the agricultural crops, core associations,

government departments, producers of the machinery and equipment, seeds and plant protection for exchange of

experience and conclusion of the contracts

10. UKRAINIAN BIOFUEL

FORUM

April Ukraine, Kyiv,

Premier Palace Hotel

For the fourth consecutive year, UBF

Forum is the key business platform for the Ukrainian biofuel industry and one of the key events for the Eastern

European market of biofuels.

http://www.biofuel-

ua.com/en/home.html

11. International Conference on Biomass For Energy

September The Presidium of the National

Academy of Sciences of Ukraine (55,

Vladimirskaya str.)

Subjects of this annual conference cover a wide range of issues related to

energy use of biomass: the biomass resources, research and development of bioenergy technologies,

demonstration and commercial projects, legislation, strategy and finance, economic and environmental

aspects of bioenergy sector.

http://biomass.kiev.ua/en/en/conferences/conf201

2

12. GREENEXPO | Alternative Energy

October Exhibition center ‘KyivExpoPlaza’

2-b, Saliutna st., 04111 Kyiv,

Ukraine

Specialized branch platform in Ukraine with world leaders’ participation.

Effective tool to research demand and proposition of local customers. 60% of visitors had chosen GREENEXPO for

market research.

http://www.greenexpo.kiev.ua/en/

13. INTERNATIONAL RENEWABLE ENERGY &

ENERGY EFFICIENCY FORUM

October Kyiv, ‘Hyatt’ Hotel

A key event of this autumn in Ukraine, REF-2012 is a meeting of

professionals, whose activities are connected to the Ukrainian market of alternative energy. The Forum creates

a business platform for exchange of experience, communication, presenting investment projects and for

finding the investors in the field of solar and wind energy, small hydro power businesses and projects in the

sphere of energy efficiency on CIS markets.

http://www.ref-ua.com/

14. LISDEREVMASH, The

International specialized exhibition of machinery

and equipment for

forestry, woodworking and furniture industry.

September International

Exhibition Center (IEC), 15 Brovarsky Ave,

02660, Kiev, Ukraine

One of the new thematic exhibition

areas - WOODENERGY. More than 20 participants represent a wide range of equipment and technologies for

utilization of wood waste and biofuels - pellets, briquettes, pellets, charcoal, as well as devices that operate on this

fuel. The exhibition will be held scientific conference "Biofuels - affordable alternative to traditional

energy sources."

http://lisderevmash.ua/en

/text/napravlenia

15. ECOSMART

International Forum of Clean Technologies in

Ukraine

May International Forum of Clean

Technologies in Ukraine ECOSMARTTM is the most essential business platform for representatives

of governmental, civil sphere, which are united by idea of sustainable development and building of a "green

economy" in Ukraine

http://www.ecosmart-

ua.com/en/home

16. ANNUAL INTERNATIONAL RETAIL INDUSTRY

FORUM 2011 BATTLE FOR THE

October Kyiv, President Hotel

RETAIL INDUSTRY FORUM was established in 2008 with the purpose

of supplying players in the market with update information on the

http://meetingpoint.ua/eventlist/view/lang/en/id/17

8

http://www.biofuel-ua.com/en/home.html

http://www.biofuel-ua.com/en/home.html



http://www.ref-ua.com/

http://lisderevmash.ua/en/text/napravlenia

http://lisderevmash.ua/en/text/napravlenia

http://www.ecosmart-ua.com/en/home

http://www.ecosmart-ua.com/en/home






Date: 10 May 2013

Page: 68 of 80


CONSUMER

development of the global world market, as well as the necessary

information about how to manage the retail business in Ukrainian reality.



Date: 10 May 2013

Page: 69 of 80

Annex 3 Major market participants

Table A. Largest boilers on solid biomass in Ukraine

No. Location of installation User company/

organization

Technology and

equipment

Raw

material

Year

of

found

ation

Capac

ity

Energ

y

savin

g

1 Rososha village,

Lypovets district,

Vinnytsia region

school boiler RAU 2-600 (2)

Pivdeteploenergomontazh

(Ukraine)

Bundle

straw

2007-

2008

n/a 23.4 th

ce/y

2 Vakhnivka village,

Lypovets district,

Vinnytsia region

school boiler RAU 2-600 (2)


(Ukraine)

Bundle

straw

2006 300

KW

82 th

ce/y

3 Vilshanka village,

Kryzhopil district,

Vinnytsia region

school Boiler RAU 2-331 (2),


(Ukraine)

Bundle

straw

2007 n/a 75 th

ce/y

4 Kivertsi city, Volyn

region

hospital and school Hot-water boiler Kalvis-

950M, Volyn-Kalvis

Ltd.(Ukraine)

Wood

waste

2009 n/a 200 th

m3/y of

gas

5 Kovel city, Volyn region Kovelteplo PTM 4 boilers of Hot-water

boiler Kalvis-720, Kalvis-

500, Kalvis-400, Kalvis-

100, Volyn-Kalvis Ltd.

(Ukraine)

Firewood,

wood

waste,

peat

briquettes

2008-

2009

n/a 290 th

m3

/y

of gas

6 Ovruch district,

Zhytomyr region

District schools and

hospitals

16 boilers KVM(a), KS TG-

100, Universal (Ukraine)

Wood

waste

2008-

2011

n/a 1,854

th m3

/y of

gas

7 Zhytomyr region 135 public buildings

(schools, hospitals etc.)

214 boilers KVM – 0.3,

KVM – 0.5, KVM – 0.82

(Ukraine)

Firewood,

wood

waste,

peat

briquettes

2007-

2010

n/a 670 th

m3

/y

of gas,

1,673

t/y of

coal

8 Ivano-Frankivsk city Ivano-

Frankivskteplokomunene

rgo

2 boilers E-2.5-0.9, Design

office Sukhina (Kyiv,

Ukraine)

Wood

waste

2008 n/a 716 th

m3

/y

of gas

9 Krykhivtsi village, Ivano-

Frankivsk region

Village school Boiler, Fakel (Belarus) Wood

waste

2008 250

KW

100 th

m3/y of

gas

10 Dolyna city, Ivano-

Frankivsk region

Dolyna bakery OJSC boiler Wood

waste

2008 n/a 35 th

m3

/y

of gas

11 Stavy village, Kagarlyk

district, Kyiv region

Village school and kinder

garden

Hot-water generator TC-

350, Institute of technical

thermal physics of NASU

and NTC Biomass

(Ukraine)

Bundle

straw

2008-

2010

350

KW

22 t/y

of coal

12 Drozdy village, Bila

Tserkva district, Kyiv

region

Village social

infrastructure and

agricultural firm

‘Agrofarm Dom’ Ltd.

Boiler, Passat Energy

(Denmark)

Bundle

straw

2000 980

KW

560 th

m3

/y

of gas



Date: 10 May 2013

Page: 70 of 80

13 Boyarka city, Kyiv region school 4 boilers AOTZ-A501, KAF

Ltd. (Ukraine)

pellets 2010 48 KW n/a

14 Zhovkva city, Lviv region District heating

Zhovkvateploenergo

(schools, public and

private buildings)

n/a Wood

waste

2008-

2009

100

kW

44 th

m3

/y

of gas

15 Pidluzhne, Kostopil

district, Rivne region

school 2 boilers, Retra-ZM

(Ukraine)

Firewood,

peat

briquettes

2009 200

KW

(each)

47.9 th

m3

/y

of gas

16 Zlazne, Kostopil district,

Rivne region

school 2 boilers, Retra-ZM

(Ukraine)

Coal,

peat

briquettes

2009 250

and

100

KW

53.9 th

m3

/y

of gas

17 Dubno city, Rivne region Khmilnyky District

heating (schools,

hospitals, public and

private buildings)

2 boilers, Kriger

(Germany)

Wood

waste,

peat

2007 0.82

MW

(each)

580 th

m3

/y

of gas

18 Shostka city, Sumy

region

Schostka Heat and

Power Station (supply

heat and electricity to

90% of Schostka

consumers)

Boiler TM Metso Power

boiling bed technology

(Finland)

Peat,

wood

waste

2007-

2010

n/a 30 mln

m3

/y

of gas

19 Shumsk city, Ternopil

region

Shumsk city boiler

(social, administrative,

public and private

buildings)

2 boilers Kriger KVM(a)-

0.82 (Ukraine)

Wood

waste,

peat

briquettes

2007-

2010

n/a 100.8

t/y of

coal

20 Berezan, Kyiv region Afroservice Ltd. Boiler RAU 2-600

(Ukraine)

Straw n/a 600

KW

n/a

21 Chkalovo village,

Primorsk district,

Zaporizhzhia region

Village school Boiler RAU 2-600

(Ukraine)

Straw n/a 600

KW

n/a

22 Zlatoustovka village,

Volnovakha district,

Donetsk region

Russia Ltd. Boiler RAU 2-600

(Ukraine)

Straw n/a 600

KW

n/a

23 Uiztsi village, Mlyniv

district, Rovne region

Village school Boiler RAU 2-600

(Ukraine)

Straw n/a 600

KW

n/a

24 Cherkassy Cherkassyteplokomunen

ergo

Boiler COMCONT

(Belarus)

Straw,

wood

waste

2011 2.5

MW

n/a

Source: The Ministry of Regional Development, Construction, and Housing of Ukraine, Data of market operators

Table B. Largest biomass and biogas processing companies for power generation

No. Company name Technology and

equipment

Production

location

Year of

obtaining

the

license

Raw

material

Producti

on

capacity

, MW

Production of

electricity

2011, million

KW*hour

Electricity from biogas (for own and external needs)

1 Ukrainian milk company

LLC

Zorg Ukraine

(Ukraine)

Kyiv region,

Zgurivsky

district, Velykyi

Krupil village

2009

Cattle

manure,

maize

silage

0.650 0.774



Date: 10 May 2013

Page: 71 of 80

No. Company name Technology and

equipment

Production

location

Year of

obtaining

the

license

Raw

material

Producti

on

capacity

, MW

Production of

electricity

2011, million

KW*hour

2 Spetsgasremtekhnologia

LLC n/a

Khmelnitsk

region, Mokiivtsi

village

2009 n/a 1 0

3 West-Ukrainian gas

technologies LLC n/a

Lviv region,

Batiatychi

village

2011 n/a 1 0

4 LNK LLC n/a Kyiv 2011 Domestic

wastes 0.885 0

5 Terezyne LLC (biogas

plant Elita) LIPP (Germany)

Kyiv region, Bila

Tserkva district,

Terezyne town

2011

Cattle

and pig

manure

0.25 0

Total biogas 3.785 0.774

Electricity from biogas (for own needs)

6 Pig Farm of

'Zaporozhstal'

Bigadan Ltd.

(Denmark)

Zaporizhzia

region n/a

Pig

manure

575-680

м3

/day

0

7 Pig Farm 'Agro-Oven' BTG (The

Netherlands)

Dnepropetrovsk

region,

Elenovka village

n/a Pig

manure 0.18 0

8

Cognac plant

Voznesensk (biogas

plant Zelenyi Hai)

Zorg Ukraine

(Ukraine)

Nikolaev region,

Voznesensk 2010

Maize

silage,

goat's rue

0.125 0

Total biogas 0.305 0

Electricity and heat from biomass

9 Kirovogradoliya PJSC EnergoMashProekt

(Ukraine)

Heat and power

generation

plant,

Kirovograd,

Urozhaina Str.,

30

26.11.2009 Sunflower

husk 1.7 8.935

10 Smilaenergopromtrans

LLC

PBS ENERGO

(Czech Republic),

EnergoMashProekt

(Ukraine)

Heat and power

generation

plant,

Cherkassy

region, Smila,

Leningradska

Str., 41

18.03.2010 Sunflower

husk 2.5 0.667

Total biomass 4.2 9.602

Source: The State Energy Saving and Efficiency Agency of Ukraine, data of market operators



Date: 10 May 2013

Page: 72 of 80

Table C. Largest producers of solid biomass products

No. Company name

Technology

and

equipment

Production

location

Year

of

launch

Type of final

products

Production

capacity,

t/y

Web-site

Wood biomass

1

Pellet Energy Emilchino n/a Zhytomyr region 2009 pellets 50,000 http://www.p

ellet-

energy.biz/e

n/

2 Ekogran Ltd. n/a Zhytomyr region 2008 pellets 50,000 www.ekopell

et.com.ua

3

ECO PRIME Co. ltd. Amandus

Kahl,

Soderhamn,

Eriksson,

Hemel

Ukraine,

Biofuel

equipment

Sumy region 2010 pellets 27,000 www.ecopri

me.com.ua/e

ng/index.htm

l

4

Perechin Timber-and-

Chemical Plant OJSV

n/a Zakarpattia region 2004 briquettes,charco

al

25,000 http://polypro

m.com/en/ab

out-

company/oa

operechinski

yhk/

5 Kremensky briquette

plant n/a

Lugansk region

2005

pellets 15,000

http://www.p

elletskbp.co

m.ua/

6

Bioenergozbut Ltd. n/a Kyiv region 2006

pellets

12,000 http://www.bi

oenergo.com

.ua/

7 Ecobioprom Ltd. EcoTreSystem

(EU) Chernihiv region

2007 pellets 12,000

www.ecobio

prom.com

8

Volynteplo LLC Kamin-

Kashirsk plant,

Rozhische

plants

Volyn region 2010 pellets 8,000 http://volynte

plo.com.ua/?

go=/produkt

&lang=uk

9 EcoPellets Ltd.

n/a

Sumy region

2007

pellets 7,200

http://www.e

co-

pellets.com.u

a/en/

10 Crust Group-Ukraine Chernihiv region 2009 pellets 6,720

http://crust-

ua.com/biom

ass_fuels.ht

ml

11 Vista Dnepr ltd.

Kriger Volyn region 2004

pellets 6,000

http://vistapel

lets.com.ua/

page.php?p=

index

12 Zenako Ecotech n/a Kyiv region 2007 pellets 6,000 http://ecotec

h.zenako.ua/

http://www.pellet-energy.biz/en/




http://www.ekopellet.com.ua/

http://www.ekopellet.com.ua/

http://www.ecoprime.com.ua/eng/index.html




http://polyprom.com/en/about-company/oaoperechinskiyhk/






http://www.pelletskbp.com.ua/



http://www.bioenergo.com.ua/



http://www.ecobioprom.com/

http://www.ecobioprom.com/

http://volynteplo.com.ua/?go=/produkt&lang=uk




http://www.eco-pellets.com.ua/en/




http://crust-ua.com/biomass_fuels.html




http://vistapellets.com.ua/page.php?p=index




http://ecotech.zenako.ua/index_en.htm

http://ecotech.zenako.ua/index_en.htm



Date: 10 May 2013

Page: 73 of 80

No. Company name

Technology

and

equipment

Production

location

Year

of

launch

Type of final

products

Production

capacity,

t/y

Web-site

index_en.ht

m

13

Energia-Eco Ltd. n/a Poltava 2006 briquettes 5,000 http://www.e

nergy-

eko.com.ua/

eng/index.ph

p

14 Barlinek Invest Ltd.

n/a

Vinnitsa region

2007

briquettes, pellets

9,000

(briquettes),

40,000

(pellets)

www.barline

k.ua

Straw biomass

1 Grinevskaya pellets

plant Ltd.

Radviliškis

Machine-

Building Plant,

Lithuania

Sumy region 2009 pellets 8,400

http://www.m

fa.gov.ua/ital

y/ua/publicati

on/content/3

5749.htm

2 Urvis PE n/a Donetsk region 2002 pellets 6,000 http://uvis-

tor.com.ua/

3 Creative Group n/a Kirovograd region 2011 pellets 40,000

http://www.cr

eativ-

group.com.u

a/about_us/

4 KSG Agro n/a Dnepropetrovsk

region 2010 pellets 7,000

http://www.k

sgagro.com/

5 Avers n/a Uman, Cherkassy


http://www.a

vers.ua/ru/en

ergy-project

Sunflower husks

1 Pologovskiy Oil

Extraction Plant n/a

Zaporizhzhia


http://mezpol

ogy.zp.ua/en

ter/lang/en/

2 Cargill Ukraine

Kakhovka CPM (USA) Kherson region

2006 pellets 36,000

www.cargill.c

om

3 BUNGE Ukraine CPM (USA)

Dnepropetrovsk


www.oleina.c

om

4 Satellite Ltd. n/a Donetsk region 2003 pellets 30,000 n/a

5

Alternative Fuel

Company Ltd.

n/a Zaporizhzhia

region

2005 pellets 25,200 http://www.al

tpc.com.ua/e

n/

6 Ekodrev n/a Odessa region 2006 pellets 24,000 n/a

7 Luteks PE n/a Volyn region n/a pellets 23,000 n/a

8 Cargill Ukraine Donetsk CPM (USA)

Donetsk region 2006

pellets 18,000 www.cargill.c

om

9 Nikolaev biofuel plant n/a Nikolaev 2010 briquettes 18,000 n/a

10 Denas Ltd. n/a Poltava 2003 pellets 12,000 http://bricket.

com.ua/

11

Bio-energy n/a Kharkiv 2006 pellets 12,000 http://www.bi

o-

energy.net.u

http://www.energy-eko.com.ua/eng/index.php





http://www.barlinek.ua/

http://www.barlinek.ua/

http://www.mfa.gov.ua/italy/ua/publication/content/35749.htm





http://uvis-tor.com.ua/

http://uvis-tor.com.ua/

http://www.creativ-group.com.ua/about_us/




http://www.ksgagro.com/


http://mezpology.zp.ua/enter/lang/en/



http://www.cargill.com/


http://www.oleina.com/

http://www.oleina.com/

http://www.altpc.com.ua/en/





http://bricket.com.ua/

http://bricket.com.ua/

http://www.bio-energy.net.ua/





Date: 10 May 2013

Page: 74 of 80

No. Company name

Technology

and

equipment

Production

location

Year

of

launch

Type of final

products

Production

capacity,

t/y

Web-site

a/

12 Transbalkterminal JV

Ltd. n/a Odessa region

n/a pellets 10,000

n/a

13 Avangard Torg Ltd. n/a Kharkiv 2011 briquettes 9,600 n/a

14 Bud JV Ltd. n/a

Zaporizhzhia

region 2009 briquettes 6,000

n/a

15

Energia-Eco Ltd. n/a Poltava 2006 briquettes 5,000 http://www.e

nergy-

eko.com.ua/

eng/index.ph

p


Table D. Producers of bioethanol and biofuels with bioethanol additives

No. Company

name

Technology

and

equipment

Production

location

Year of

foundation

(bioethanol

capacities)

Type of

final

product

s

Productio

n

capacity

Production

2011,

tons/year

Web-site

State-owned

1 Naumovsky

distillery

Techinservice

(investor and

equipment

supplier)

Sumy region 2009 bioethan

ol 6,000 dl/d

9,726

(bioethanol),

14,416

(alternative

fuel blends)

http://www.ukr

spirt.com/

2 Haisyn

distillery

Intercrite

(investor)

Vinnytsa

region 2009

biofuel

(E-85),

alternati

ve fuel

blends,

bioethan

ol

100,000

t/y

(biofuel);

800,000

dl/y

(bioethano

l)

3

Luzhanskyi

experimental

distillery

n/a Chernivtsi

region 2009

biofuel

(E-85)

30,000 t/y

(biofuel)

4 Khorostovskyi

distillery

Techinservice

(investor and

equipment

supplier)

Ternopil

region 2009

bioethan

ol

20,000

dl/d

5 Lokhvitsky

distillery n/a Poltava region 2009

biofuel

(BIO-

100)

80 t/d 0

6 Trilesskyi

distillery

Techinservice

(investor and

equipment

supplier)

Kyiv region 2009 biofuel

(E-85) 6,000 dl/d 0

7 Tkhoriskyi

distillery n/a Kyiv region 2009 n/a n/a 0








Date: 10 May 2013

Page: 75 of 80

No. Company

name

Technology

and

equipment

Production

location

Year of

foundation

(bioethanol

capacities)

Type of

final

product

s

Productio

n

capacity

Production

2011,

tons/year

Web-site

8 Ivashkovskyi

distillery

Techinservice

(investor and

equipment

supplier)

Kharkiv region 2009 bioethan

ol 10,000 t/y 0

9 Andrushevskyi

distillery n/a

Zhytomir

region 2009 n/a n/a 0

10 Korostyshevsk

yi distillery

Techinservice

(investor and

equipment

supplier)

Zhytomir


11 Barskyi

distillery n/a

Vinnytsa


12 Trostianetskyi

distillery n/a

Vinnytsa


13 Kamiansky

distillery n/a

Cherkassy


14

Shebelinskyi

gas processing

(Ukrgasvydobu

vania,

Naftogas)

Modcon

Systems

(USA)

Kharkiv region 2011

biofuel

(Е-95-

40)

4,000 t/m 3,100 t

Private

15

Budylskyi

experimental

plant (White

House Trading,

UK)

n/a Sumy region 2009 bioethan

ol

20,000

dl/d n/a n/a

16

Koron Agro

LLC

(Continium

Group, WOG

fueling

stations)

GEA Wigand

(Germany)

Cherkassy

region 2006

bioethan

ol (from

corn)

100,000

t/y 0

http://koronagr

o.com

17

Dacor

Agroholding

(Ukrlandfarmin

g)

n/a West of

Ukraine 2007

bioethan

ol (from

sugar

producti

on

wastes)

3,000 t/y 0 http://www.dak

orwest.com/

Private oil refueling retail

18 BioHim Group

Olimp Group

of companies

(investor)

Donetsk 2011

biofuel (А-

98а, А-

95а и А-

92а,

Gepard)

7,300 t/y

(biofuel) 7,000 t

http://www.bio

himgroup.com/

;

http://www.a95

a.com.ua/novo

sti.html

http://www.dakorwest.com/

http://www.dakorwest.com/

http://www.a95a.com.ua/novosti.html








Date: 10 May 2013

Page: 76 of 80

No. Company

name

Technology

and

equipment

Production

location

Year of

foundation

(bioethanol

capacities)

Type of

final

product

s

Productio

n

capacity

Production

2011,

tons/year

Web-site

19 Agro-Nafta n/a Donetsk

region 2009

biofuel

(Аб-92

EXTRA

е40, Аб-

95 EXTRA

е40 и Аб-

98 EXTRA

е85,

Diesel B30

n/a n/a http://agronaft

a.com.ua/

20 Azovskaia oil

company LLC

Ventech

(USA), Koch-

Glitsch

(Switzerland)

Donetsk

region 1999

biofuel

(Innovativ

e E 95, E-

92, Е-80)

400,000

t/y 48,000 t

http://aoc.com.

ua/


Table E. Largest producers of biodiesel

N

o.

Company

name

Production

location

Year of

launch

of

biofuel

product

ion

Final products

Productio

n

capacity

Productio

n 2011,

tons/year

Web-site

1

Oriana-Galel

chemical

enterprise

Ivano-

Frankivsk

region

2007 biodiesel (from

rapeseed) 180000 t/y 0

n/a

2

Agro-Nafta

LLC

Donetsk

region 2009

biodiesel (B-

30l) n/a n/a

http://agronafta.com.ua/rus/ind

ex.php?t=about&sub=contacts

3

Stirol chemical

plant

Donetsk

region 2008 biodiesel

35,000-

40,000 t/y 0

n/a

4 PE Liber

Kherson

region 2007

biodiesel (from

rapeseed) 10,000 t/y 0

n/a

5 BITIS

(Biotechnology

and systems)

Ltd

Kyiv region 2011 Biodiesel,

Multifunctional

additive for

diesel fuel

Diesel

Systempflege

Fliess-Fit based

on biodiesel

n/a n/a n/a

6

Informtrans-Air

Ltd

Zaporizhzhi

a region

2008 biodiesel n/a n/a http://www.informtransavia.cha

t.ru/index.htm

7

APK Donbass

Ltd

Donetsk

region 2010

biodiesel n/a n/a n/a

8

Production and

Commercial

Firm Noblis Ltd

Zhytomyr

region

2008

biodiesel n/a n/a n/a


http://aoc.com.ua/

http://aoc.com.ua/

http://agronafta.com.ua/rus/index.php?t=about&sub=contacts

http://agronafta.com.ua/rus/index.php?t=about&sub=contacts



Date: 10 May 2013

Page: 77 of 80

Table F. Announced investments in the sector

No.

Company Address Project Resour

ce

Put in

operat

ion

Product

ion

Purpos

e

Capacity

annual

Bud

get

1 Agroholding

‘Ukrlandfarming’

http://www.ukrlandfarmin

g.com.ua/

Mr. Oleh

Bakhmatiuk,

President (owner)

152, Akademika

Zabolotnogo str.,

Kyiv, Ukraine

tel.: +38 (044) 585

24 40

fax: +38 (044) 522

56 77

Constru

ction of

30

biogas

plants in

18

regions

of the

country

1.3

million

tons of

organic

wastes

per year

2015 Electricit

y, heat,

bio

fertilizer

s

internal

and

surround

ing rural

areas

needs

Electricity - 1.39

thousand GW/h,

heat - 1.5

thousand GW/h,

overall power

capacity -197

MW, liquid bio-

fertilizers - 825

thousand tons,

solid bio-

fertilizers 178

thousand tons.

EUR

885

mio

2 ‘Avangardco’

http://www.ukrlandfarmin

g.com.ua/

Mr. Oleh

Bakhmatiuk,

President (owner)

152, Akademika

Zabolotnogo str.,

Kyiv, Ukraine

tel.: +38 (044) 585

24 40

fax: +38 (044) 522

56 77

Constru

ction of

2 biogas

plants

in

Khmelnit

sky and

Kherson

regions

Chicken

dropping

s, waste

of eggs

producti

on

n/a Electricit

y and

heat

internal

and

surround

ing rural

areas

needs

Power capacity

– 20 MW

EUR

50-

60

mio

3 Mironovsky

Khleboproduct (MHP)

http://www.mhp.com.ua/

en/home

Mr. Yuriy Kostiuk,

President

7, Vasylevskoi str.,


tel.: +38 (044) 207

00 00

fax: +38 (044) 207

00 02

[email protected]

Constru

ction of

biogas

plant in

Dniprop

etrovsk

region

chicken

dropping

s

Dece

mber

2012

Electricit

y and

heat

Internal

needs

Power capacity -

5MW

USD

15

mio

4 Mironovsky

Khleboproduct (MHP)

http://www.mhp.com.ua/

en/home

Mr. Yuriy Kostiuk,

President

7, Vasylevskoi str.,


tel.: +38 (044) 207

00 00

fax: +38 (044) 207

00 02

[email protected]

Constru

ction of

3 biogas

plants in

Cherkas

sy,

Crimea

and

Vinnitsa

regions

chicken

dropping

s

2013-

2014

Electricit

y and

heat

Internal

needs

n/a n/a

5 Agroholding ‘Astarta’

http://www.astartakiev.co

m/en/index.htm

Mr. Viktor Ivanchyk,

Founder and CEO

38/44, Pochayninska

str., Kyiv, 04070,

Ukraine

+380(44) 585 9494

[email protected]

om

Constru

ction of

biogas

plant at

Globyno

sugar

plant in

Poltava

region

sugar

beet

pulp

Dece

mber

2012

biogas Internal

needs

Biogas - 196

thousand m3

USD

12

mio

http://www.ukrlandfarming.com.ua/




http://www.mhp.com.ua/en/home






http://www.astartakiev.com/en/index.htm

http://www.astartakiev.com/en/index.htm





Date: 10 May 2013

Page: 78 of 80

No.


ce

Put in

operat

ion

Product

ion

Purpos

e

Capacity

annual

Bud

get

6 ‘Selkhoz-product’

Mr. Yuriy

Bondarchuk,

President

9/27а, Kotovskoho

str., Kyiv, 04060,

Ukraine

tel.: +38 (044) 453

76 64

fax: +38 (044) 453

76 64

[email protected] [email protected]

Constru

ction of

biogas

plant in

Rokitnia

nsky

sugar

plant in

Kyiv

region

sugar

beet

pulp,

corn and

grass

silage

Dece

mber

2012

Electricit

y and

heat

Internal

and

surround

ing rural

areas

needs

Power capacity

– 20 MW

EUR

80

mio

7 Agri-farm ‘Danosha’

http://www.danosha.com.

ua/

Mr. Kristen

Yakobsen, Director

1 Lisova Str,

Kopanki village,

Ivano-Frankivsk

region, 77330,

Ukraine

tel.: +38 (0342) 59-

53-34, +38 (03472)

62415;

fax: +38 (044)

2480009-2666,

mob:+38 (050) 373-

0695

[email protected].

ua

Constru

ction of

biogas

plant at

pig

complex

in

Kalush

Ivano-

Frankivs

k region

Pig

manure

Dece

mber

2012

Electricit

y and

heat

Internal

needs

Electricity – 1

MW, heat – 1

MW

EUR

4

mio

8 Company ‘Ecoprod’ Mr. Ivan Melnyk,

General Director

16+, Vorovskoho

str., Volnovaha,

Donetsk region,

85700, Ukraine

tel.: +38(062) 334 01

46, +38 (06244) 410

36,

Constru

ction of

biogas

plant in

Donetsk

region

n/a 2013-

2014

Heat

and

fertilizer

s

Internal

needs

and

partially

external

needs

Power capacity -

2.8 MW, biogas

- 14 million m3

EUR

10

mio

9 Administration of Kyiv

city region / Finnish

company

n/a Constru

ction of

district

power

plant

solid fuel

pellets

from

peat

n/a Electricit

y

Municip

al needs

Capacity - 10

MW

EUR

15

mio

10 Company ‘Biogasenergo’

Ltd. (part of Eastern

investment group)

Mr. Vitaliy Butenko,

Director

2, Lenina str.,

Protsiv, Kyiv Region,

08344, Ukraine

tel.:+38 (044) 531 13

47 08344 08344

Constru

ction of

heat

generati

on

station

in Kyiv

and

Rivne

regions

sawdust Dece

mber

2013

Heat internal

and

surround

ing rural

areas

needs

Power capacity -

18 MW (Kyiv

region), 10-12

MW (Rivne

region)

USD

14

mio


http://www.danosha.com.ua/

http://www.danosha.com.ua/





Date: 10 May 2013

Page: 79 of 80

No.


ce

Put in

operat

ion

Product

ion

Purpos

e

Capacity

annual

Bud

get

11 Company ‘Bioenergy’/

Danish company ‘Filcon’

n/a

Constru

ction of

power

station

in Uzin,

Kyiv

region

n/a n/a Electricit

y and

heat

internal

and

surround

ing rural

areas

needs

Electricity – 3.5

MW, heat - 8

MW

n/a

12 ‘Pellet Energo Ukraine’

Ltd.

http://www.pellet-

energy.biz

3, North Syretskaya

str., office 327-1,


tel.:+380 (44) 205-

34-25

info@pellet-

energy.biz

Launchi

ng of 7

solid

fuels

producti

on lines

in

Zhytomir

region

Wood

wastes

n/a Wood

pellets

Export

markets

Pellets – 260

thousand tons

n/a

13 Company Polish Energy

Partners jointly with

Ukrainian KSG Agro


en/

Mr. Serhiy Kasianov,

member of the

Board of Directors

4а, Rohnedynska

str., Kyiv, 01004,

Ukraine

tel.: +38(044) 232 90

89

fax: +38(044)590 51

65

Constru

ction of

pellets

plant in

Dneprop

etrovsk

region

Straw,

husks

May

2013

Straw

pellets

Export

markets

(mainly

to

Poland)

Pellets - 90

thousand tons

n/a

14 ‘Vin-Pellet’ Ltd. (Smart

Holding)

Mr. Oleksandr

Kedrovskyi, Director

7а, Ihorivska str.,


tel.: +38(044) 590 30

18

Producti

on of

solid

biofuels

in

Vinnitsa

region

with

further

plans of

analogu

e 10

plans in

the

regions

of

Ukraine

straw 2013 Straw

pellets

Domesti

c and

export

markets

(Polish

power

plants)

Pellets – 100-

150 thousand

tons

EUR

26

mio

15 Company RESCO LLC n/a Constru

ction of

pellets

plants in

Nikolaye

v region

wood

wastes

Dece

mber

2012

Wood

pellets

Export

markets

(mainly

to

Denmar

k)

Pellets – 12

thousand tons

n/a

16 ‘Agroprime’ Holding

http://agroprime.com.ua/

Mrs. Iryna Ihnat,

General Director

Launchi

ng of

straw n/a Straw

pellets

Domesti

c and

Pellets - 15-20

thousand tons

n/a

http://www.pellet-energy.biz/

http://www.pellet-energy.biz/



http://www.ksgagro.com/en/

http://www.ksgagro.com/en/

http://agroprime.com.ua/ukr/



Date: 10 May 2013

Page: 80 of 80

No.


ce

Put in

operat

ion

Product

ion

Purpos

e

Capacity

annual

Bud

get

ukr/ 154, Belhorod-

Dnistrovska str.,

Izmail, Odesa

Region, Ukraine

tel./fax: +38 (04841)

488 79

mob.: +38 (067) 488

08 89

pellets

producti

on plant

in

Odessa

region

export

markets

17 Slovak companies Agro

Vos and IPP Slovakia

and Ukrainian-Slovak

company ‘Begokon

Ukraine’

3а, Proekna str.,

Uzhohorod, 88000,

Ukraine

tel.: +380 (312) 66

17 23;

mob:+38(050) 438

57 97

Constru

ction of

solid

fuels

plant in

Khmelnit

sky

region

Straw of

grains

and

oilseeds

n/a Straw

pellets

Export

markets

(Slovaki

a)

Pellets – 35

thousand tons

n/a

18 Sugar Union ‘Ukrros’

http://ukrros.webriders.co

m.ua/en/

Mr. Serhiy

Fedorenko,

Chairman of the

Supervisory board

10, Berezneva str.,

Kyiv, 02160,

Ukraine,

tel.:+38 (044) 574 03

38

Bioethan

ol

producin

g facility

on

Gubinski

y sugar

plant,

Dniprop

etrovsk

region

Sugar

beet

pulp

n/a Bioethan

ol

Domesti

c and

export

markets

n/a EUR

30

mio

19 ‘Vynogradyv horticultural

plant’

Mr. Vasul Monda,

Director

35, Persykova str.,

Vynohradiv,

Zaarpatia Region,

Ukraine

Constru

ction

and

operatio

n of a

deep

corn

processi

ng into

the

bioethan

ol and

izogluco

se

syrups

plant in

Zakarpat

tya

region

Corn n/a Bioethan

ol, feed

stuff,

fructose

and

maltose

syrups,

farina

Domesti

c and

export

markets

Bioethanol –

29 700 m3/year

C02 – 10 866

t/year

Maltose syrup –

11 000 t/year

Dried stillage –

11 523 t/year

EUR

62.4

mio

Source: data of market operators

http://ukrros.webriders.com.ua/en/

http://ukrros.webriders.com.ua/en/

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