Registration as an Electricity Market Participant

Procedure for Registering as a Participant in Ukraine’s Electricity Market  

It is also necessary to obtain a paper extract from the VAT register, as it is required at almost all subsequent stages. At this point, you can not only open the special-purpose account but also register it with the NEURC. Why? We’ll explain below.

If you have already opened an escrow account with the balance responsible party, you can submit documents to conclude an imbalance settlement agreement and gain access to the MMS platform. Notification of signing this agreement is a key step that allows the process to move forward. After completing this stage, you can begin signing agreements with the regional energy distribution companies (oblenergos).

Note: Recently, suppliers and traders are no longer required to sign a dispatch management agreement with Ukrenergo.

The electricity market essentially consists of several separate markets called segments. Each segment operates independently, following its own rules and pricing. 

You can choose the market segments that best suit your interests. For example, if you plan to make "short-term" agreements (buying today and selling tomorrow), registration in the Day-Ahead Market and the Intraday Market will be sufficient, without the need to obtain accreditation on the Ukrainian Energy Exchange.

About the Special Account (Account with a Special Usage Regime)  

A special account (current account with a special usage regime) is an account opened with an authorized bank and is required to facilitate settlements on the electricity market. In our experience, clients typically open such accounts with JSC "Oschadbank," although it is also possible to open one with JSC "Ukrgasbank."

What are the key functions of a special account?

Settlements in the electricity market involve fulfilling mutual financial claims and obligations between market participants under power purchase agreements and other service contracts, with payment monitoring as a key component.

Under Ukrainian law and the electricity market rules, including those for the day-ahead and intraday markets, buyers must make payments to electricity suppliers exclusively via a current account with a special usage regime. Funds from this account are then automatically distributed to current accounts in accordance with the regulator’s settlement algorithms.

Transactions on special accounts held by electricity suppliers, the transmission system operator, and the market operator cannot be suspended. These accounts are protected from enforcement actions, transaction freezes, and seizures. Any outstanding payments for electricity are credited to this account.

Please note! Opening a special account requires the personal presence of the authorized signatories listed in the signature samples (typically the company director or accountant).

How to Open an Escrow Account for Electricity Market Operations

An escrow account is a bank account opened by a market participant at an authorized financial institution. Typically, it is opened at the same bank where the special account was established, for example, JSC "Oschadbank." To operate in the electricity market, two escrow accounts are usually required: one for settlements with Ukrenergo and another for the Market Operator. Escrow accounts are used to accumulate funds that Ukrenergo or the Market Operator then use for: 

• Settlements for purchased electricity
• Payment for services related to electricity trading operations
• Return of uncommitted funds to the participant of the day-ahead/intraday market (via the Market Operator)
• Payment of the authorized bank’s fees for escrow services

In other words, these are accounts where the bank guarantees the receipt and crediting of funds to a conditional (escrow) account on behalf of the account holder and the subsequent transfer of those funds to the beneficiary designated by the account holder.

Please note! Funds held in an escrow account cannot be seized or frozen due to obligations of the bank where the account is opened.

Opening such accounts is a mandatory requirement for participating in the electricity market and engaging in trading activities. Current legislation and regulatory requirements oblige market participants to open these accounts, which in turn provide financial security and ensure proper oversight of financial obligations.

Agreement with Oblenergo: Who Needs It and How to Conclude It

This is required for those planning to provide services to household consumers as well as those intending to supply industrial consumers.

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

Now, the distribution function is performed by PJSCs and JSCs (for example, PJSC "Kyivoblenergo", PJSC "Cherkasyoblenergo"), while the supply function is usually carried out by similar companies, typically named LLC "Kyivoblenergo" or LLC "Cherkasyoblenergo" (hereinafter referred to as the Companies).

Consumers can now choose between the above-mentioned Companies or turn to other businesses that purchase electricity from producers on the markets and exchanges.

Please note! The procedures for connecting to different Distribution System Operators vary slightly by region. However, there are legally established deadlines and procedures that suppliers must follow to connect to the Operators. 

Typically, the specific list of required documents and application forms is posted on the Operator’s website. Submission methods may differ: some accept documents signed with an electronic signature, while others require paper copies only. 

After submitting the documents, the supplier company is added to the registry, which reflects its ability to supply electricity within the relevant territory (region or city). If you plan to supply electricity across all of Ukraine, you will need to sign agreements with the distribution companies (“oblenergo”) in each region, as well as separately with Kyivenergo. 

Terms of Bilateral Agreements in the Energy Market

There is a clear set of rules governing the operation of bilateral agreements and the conditions for their conclusion. For example, all settlements must be made in monetary form, and the contract must specify the term, responsibility for imbalance, delivery, price, energy volume, and other conditions.

The market rules are approved by the National Energy and Utilities Regulatory Commission (NEURC) and may change. To avoid violations, it is important to monitor updates in the regulatory framework, as these directly affect your activity as a market participant.

Regarding contract terms, the law establishes that NEURC can set the maximum duration of a bilateral agreement. The minimum duration must be at least six months.

Energy Market Participant Registration with Our Legal Experts

Our firm has been operating in the Ukrainian legal services market for nearly 20 years and was among the first to thoroughly understand the functioning of Ukraine’s new electricity market. We possess extensive experience and the expertise necessary to effectively support your business.

Our core mission is to make resolving any legal issue simple, secure, and efficient. With us handling your registration in the electricity market, your business will be in reliable hands.

Legal Consultation on Electricity Market Participant Registration 

If, before ordering legal services, you want to understand whether this is the right solution for your situation, clarify procedural questions, or need exact guidance on how to resolve your issue, we offer a legal consultation on electricity market operations. During the consultation, our lawyer will:

• Analyze your situation and the possibilities for a legal solution
• Answer pre-agreed questions
• Explain the procedure and sequence of actions
• Propose the optimal way to achieve your goal

Turnkey Electricity Market Participant Registration

Our company provides turnkey services for registering a company as a participant in the electricity market, from company registration to obtaining the necessary license and market inclusion. By choosing us for electricity market participant registration, you are guaranteed:

• Handling all matters in one place, including obtaining any licenses and/or permits required for your business
• A ready-to-use website and staff training for efficient operation in the electricity market
• A clear understanding of how the market works, the existing retail electricity market rules, and what will be most profitable for you
• We also offer ready-made companies with electricity supply licenses for those who want to start their operations as quickly as possible

Registration on the market with us:

1. All services for a future supplier in one place: from company registration to market inclusion and even reporting to NEURC. Our team of lawyers, accountants, website developers, and electricity market specialists thoroughly understand the retail electricity market rules and how to enter Ukraine’s wholesale electricity market.
2. We take on even complex projects. For example, if you own generating and storage facilities and want to be a hybrid participant in the electricity market (buying, selling, generating, and storing energy), we will explain how to properly organize this process in compliance with legal requirements.
3. We were among the first to obtain NEURC licenses. Our current practice and experience allow us to: 

• Connect you to distribution system operators (Oblenergo) across Ukraine 
• Register you on the EAP platform
• Organize electricity export abroad
• Provide training on reporting to NEURC
• Independently develop a website that meets all requirements
• Offer the best business start options (registration or purchase of a ready company), and more

If you want to learn more about entering the Ukrainian electricity market, the rights and responsibilities of electricity market participants, or if you are ready to order our services, please call us!