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How can an electricity supplier accede to the Distribution System Operator (Oblenergo)?

By the end of 2019, the electricity market has already had more than a thousand electricity suppliers, who have obtained a license for the relevant type of activity and more than 400 companies have already entered the electricity market as electricity suppliers.

The process of entering the electricity market consists of a number of key stages.

Today we will elaborate on these stages and talk about accession of a power supplier to the Distribution System Operator.

Related article: Electricity Supply Agreement: Practical Importance

Stages of entering the electricity market

The first stage involves signing of the Electricity Transmission Agreement with the Transmission System Operator (Ukrenergo, NPC).

The second stage involves signing of the Electricity Distribution Agreement with the Distribution System Operators (local Oblenergos, DTEK).

Both market players partially perform the function of actual management of power supply activities.

The main difference between these two market participants is that Ukrenergo,  NPC is responsible for:

  • system administration;
  • maintenance and transmission of electric power from manufacturers to consumers via 110 kV-750 kV lines.

While Oblenergo is responsible for:

  • efficient and safe operation, maintenance and development of 110 kV power grids.

Related article: Natural Gas Market For Gas Suppliers: What Agreements Do Market Participants Conclude?

What is the process of acceding to Oblenergo?

This stage is important both for those who are planning to provide services to domestic consumers and for those who are planning to provide electricity supply services to non-domestic consumers.

All Distribution System Operators make public the so-called “registers” of the companies that are connected to the electricity distribution system. This is due to the fact that earlier both supply and distribution functions were performed solely by Oblenergo.

Today, the distribution function is performed by PJSCs, OJSCs (for example, Kyivoblenergo, PJSC, Cherkasyoblenergo, OJSC), and the supply function is performed, as a rule, by similar companies which are usually called “Kyivoblenergo, LLC” or “Cherkasyoblenergo, LLC” (hereinafter referred to as the LLCs).

Now consumers can choose between the above companies or contact other businessmen, who will buy electricity from the producers on the markets and the exchange.

Please note! The procedure for acceding to different distribution system operators varies slightly from region to region regions. However, the terms and procedures for the accession of suppliers to the distribution system operators are established by law.

According to the Retail Electricity Market Regulations, the electricity supplier that intends to join the Distribution System Operator must provide the following documents:

  • An application for accession;
  • A copy of the license (order) to supply electric power to the consumer;
  • A power of attorney for a representative to conclude agreements;
  • A copy of the taxpayer certificate.

In addition, each certain oblenergo may offer another, additional list of required documents. So, it is better to inquire this information from a specific Distribution System Operator.

Following submission of the documents, the supply company shall be registered in the register, which reflects its potential possibility to supply electric power within the respective territory (region, city/town).

In our practice, we had a case when our specialists ensured the inclusion of the Client into the electricity market on a turnkey basis. Following the inclusion, the Client decided to join the distribution system operators from all over Ukraine. And this can be done, moreover - after our consultation on the accession procedure in different regions, the Client managed to join different Oblenergos in a fast and efficient manner.

If you want to learn more about the complete procedure of joining the Distribution System Operator in your region or to order our services for entering the electricity market, don’t hesitate to call us!

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