On July 18, 2025, the so-called “open” hearings of the NEURC were held to discuss a draft resolution on setting price caps (price ceilings) for the Day-Ahead Market (DAM), Intraday Market (IDM), and Balancing Market.
Despite the presence of our Union’s Chair and a formal statement clearly warning against the proposed changes, our remarks were not recorded in the official minutes.
Without prior calculations and delivered verbally during the meeting, the NEURC department proposed to raise the DAM evening price cap (from 5:00 p.m. to 11:00 p.m.) to 15,000 UAH/MWh.
That’s nearly double the previous level.
So — does evening now start at 5:00 p.m. in August?
Let’s be honest: August is still a period of active solar generation — daylight lasts until 7:30 or even 8:00 p.m. What justifies this change? How does it align with market logic?
But this is not the main issue. If this decision is adopted, electricity prices will soar unjustifiably, because everything is pegged to the DAM.
The problem lies not only in the form of the decision-making, but in the lack of sequence:
- First, market participants should be provided with forecasting tools and system balance data to plan their purchases.
- Then, forward contracts should be launched to form market expectations and encourage consumers to move from DAM to bilateral contracts (BCs).
- Also, the Public Service Obligations (PSO) mechanism must be urgently revised to match real market conditions — it should not be tied to DAM prices.
Currently, Energoatom and Ukrhydroenergo bear the full burden of supplying electricity to households under the PSO. Yet, they were absent during the hearings.
No one knows whether they can even cope with the new financial pressure once the price caps are raised.
Only after such step-by-step market changes should we consider phasing out price caps altogether — not the other way around.
If the Commission adopts this proposal:
- We will see a price spike in August, because once again all sellers will offer at the DAM maximum. There’s no visibility of system balance — no data. As a result, the Regulator itself triggers a price distortion.
- And that’s despite the fact that most generating blocks are already online, and prices should have stabilized by now. By September, the market would likely have normalized completely.
This will be hidden under phrases like “we need to stimulate imports.” But under the law, only 10% of imports go to the DAM. Most are traded under BCs. So what’s stopping you from temporarily removing the 10% DAM import requirement? You’ve done it before — under a different government.
And if price caps only apply to DAM, then decouple DAM from end-user pricing, because all public procurements (via Prozorro) use DAM as the price reference.
Prices will rise across the board — bread, milk, other essential goods and industrial products. The entire idea of supporting Ukrainian producers will collapse.
Regarding imbalances — the price will rise, and the burden will fall on suppliers, and then directly onto end consumers. Those who don’t do the math now will be surprised by their bills later.
By the time the market realizes what’s happening — businesses will have already suffered losses.
And maybe, just maybe, this whole scenario has been orchestrated to allow “EnergoAtom” to hold auctions at inflated prices, and while the market reacts with outrage, the price cap changes won’t yet be officially adopted — but the trades will already be done.
If that’s the case, we are witnessing direct market manipulation under the tacit approval of the Regulator.