Losses and damage to Ukraine's energy sector due to Russian shelling exceeded USD 56 billion - KSE

Losses and damage to Ukraine's energy sector due to Russian shelling exceeded USD 56 billion - KSE

As of May 2024, losses and damages to Ukraine's energy sector as a result of Russia's full-scale invasion exceeded USD 56 billion.

This estimate was published by the Kyiv School of Economics (KSE), Ukrinform reports.

"As a result of Russia's full-scale invasion of Ukraine, the energy sector suffered direct losses and indirect financial losses of USD 56.2 billion, while the recovery needs, which include the complete reconstruction of destroyed facilities on the principle of "rebuilding better than it was", amount to USD 50.5 billion," the report says.

According to KSE analysts, direct losses in Ukraine's energy sector as of May 2024 amounted to more than USD 16.1 billion.

The largest losses were caused by the destruction of electricity generation facilities (USD 8.5 billion), main electricity transmission lines (USD 2.1 billion), and oil and gas infrastructure (USD 3.3 billion).

Read also: Ukraine, France renew agreement on peaceful use of nuclear energy

Indirect losses in the energy sector are estimated at almost USD 40.1 billion, with the bulk of this amount coming from lost revenues of energy companies - USD 39.6 billion. Another USD 0.5 billion is the cost of debris removal and dismantling of damaged facilities.

"KSE's analytical team has preliminarily estimated the total recovery needs of Ukraine's energy sector at USD 50.5 billion, including the financial need to fully rebuild the destroyed and damaged energy infrastructure, taking into account the principle of "Build Back Better" (USD 48.5 billion). The rest includes meeting the liquidity needs of energy companies as a result of lost revenues due to the war (USD 2 billion)," the analysts concluded.

As reported, massive Russian attacks on energy facilities resumed on 22 March. In particular, the Burshtyn, Ladyzhyn, Zmiiv, and Trypillia TPPs and hydroelectric power plants were damaged. Overall, the government estimates the loss of generating capacity at 8 GW. The power deficit in the grid will persist for two years.

Photo: Getty images

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