Are investments in the energy sector of Ukraine relevant or not?

3.08.2022
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инвестиции в сэс

Nowadays, many users believe that making investments in a bank is very risky. This attitude to the banking structure is explained by the fact that it is not so stable, and the share of fraudulent transactions is growing every day. All this only confirms the high level of risk, which may exceed the profit. Most depositors have already noticed that banks are gradually reducing the interest rate on deposits, so they are not in a hurry to give their savings to banking structures.

As an option, you can consider investing in real estate or business. However, unfortunately, the cost of housing is now falling, and therefore it does not look as attractive as before. Business investment is also accompanied by high risks, as the current economic situation is very difficult. The ideas don’t end there, because the Ukrainian economy has a lot to offer investors.

Not all domestic enterprises are experiencing a downturn, but there are industries that are experiencing steady growth, so individuals, companies or foreign investors should pay attention to them. Everyone will find interesting and most importantly profitable investment options.

Currently, the best deposit is considered to be:

  • solar power plant;
  • wind farm;
  • energy efficiency projects.

The market for alternative and renewable energy sources (RES) is developing rapidly all over the world. The energy balance of many countries already consists of 20-30% of renewable energy sources. The governments of these countries are not going to stop there, but rather plan to increase them. There are countries and companies that want to completely abandon traditional energy generation options and use an alternative. According to the Ren21 agency, the total global investment in renewable energy is about $ 285.9 million. In the period 2010-2015, the capacity of wind farms around the world increased by 2 times, and SES-by 5 times.

In Ukraine, these processes are not so active, but this does not mean that investors do not show interest in renewable energy. Recently, potential investors, companies and individuals have been asking a lot of questions about investing in renewable energy. Based on this, we will try to briefly explain what is really happening in Ukraine with the renewable energy market.

Investment in Ukraine’s green energy sector

energy investments

Probably, each of us at least once thought about passive income. Why? Everything is simple. Passive income minimizes “everyday work”, while the profit from this kind of earnings can sometimes significantly exceed the monthly income of the average office worker.

There are many types of passive income. Investing is probably at the top of this rating. Investments in the so-called “green” energy sector are of particular interest. Oddly enough, it is this niche of investing that attracts impressive amounts of money, and not traditional energy in the usual sense for us. Almost all investments in this industry are distributed in equal shares between two main areas: solar and wind energy. Less investment is attracted by bioenergy, which specializes in the production of biofuels (obtaining energy from alcohol and manure), and the construction of geothermal plants. This is what trends in the global investment field look like right now. What is happening with investment in green energy in Ukraine?

Last year alone, according to the annual Climatescope 2019 report, this country rose by 55 positions and entered the top 10 of the rating of countries investing in renewable energy. Every month in Ukraine, an average of 12-13 powerful solar power plants start operating, and about 100 — small, point-based private stations that provide solar energy to small settlements and households. An interesting and important fact that motivates investing in alternative energy is the recently demonopolized market, and the level of corruption, which has almost the lowest indicators in comparison with other areas of the Ukrainian economy. It is these factors that have increased and diversified the ranks of investors: now, along with large enterprises, banks and corporations, ordinary private entrepreneurs also make their investments.

It is worth noting that in order to determine the benefits and prospects of investing in “green” energy, there is no need to conduct in-depth research and analysis of statistical reports. This innovative investment industry in Ukraine is a global trend with great potential and many alternative directions that will definitely interest investors. And there is a high probability that the” green ” energy market will continue to develop even more rapidly.

Why choose to invest in solar energy?

investment in Ukraine's green energy sector

Today, renewable energy sources and energy efficiency indicators are very important for Ukraine. This segment of the market is developing at the same speed as IT technologies. At the moment, many global agencies are betting that by 2025-2030, the cost of new energy capacities represented by solar power plants and wind farms will be much cheaper than traditional options. Many countries note that electricity produced from renewable energy sources will be much cheaper than the” product ” of nuclear, gas, and coal-fired power plants.

What is the situation in Ukraine? In the country’s energy balance, the share of product from wind farms and solar power plants is 1%. If we compare this indicator with European countries, it is very small. It is not the first year that our country has been showing the highest energy consumption rates in relation to its output. What to do?

Some energy efficiency projects offer to insulate the premises, reconstruct communication systems. Thanks to this solution, you can reduce utility bills by 2 or even 3 times.

The Ukrainian authorities have repeatedly sat down at the negotiating table with foreign investors, as a result, most of them gave the real reason why they are not in a hurry to make investments in the Ukrainian economy. They are concerned about the current political situation in the state. These areas have a huge potential, which means that investments can bring significant income to the investor.

In words, everything sounds beautiful, but is it really so? What will you get if you invest in renewable energy?

First, these investments have a good economic justification. Renewable energy has potential that will certainly show growth in the long term. The first ones who start working in this direction will receive the most interesting and profitable projects.

Secondly, you will clearly see how your funds are spent. The development of this market cannot be compared with the development of the market of alcoholic beverages, tobacco products, advertising and other industries that our society needs. Your money will work and bring social benefits.

Third, the guarantee of a refund due to the “green tariff”. The bank may become bankrupt, the company’s shares will instantly fall, and the national currency will devalue. With alternative sources, this will not happen as long as there is demand.

Fourth, your decision is completely eco-friendly and moral. Investing in SES is not only a permanent income, but also the fulfillment of the main purpose of a person on Earth – harmony with nature and oneself.

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