Coal companies are under constant Russian attacks. Which creates danger for miners. In recent months, hundreds of miners have already found themselves in underground traps due to power outages due to shelling. Despite this, the state continues to replenish coal reserves for the winter every day. However, for the needs of industry, coal has to be bought abroad.

 

There is plenty of coal, but there is practically nowhere to burn it

 

With the beginning of the full-scale invasion of Russia, the Cabinet of Ministers of Ukraine closed almost all energy data from the public. In particular, information on fuel stocks in warehouses. According to the ex-Minister of Energy Olga Buslavets, the state has already accumulated more than 3 million tons of coal. This is a record figure for recent years. Usually, up to 2 million tons of solid fuel were enough for the heating season in Ukraine.

The government does not publish the exact figures of the reserves. At the same time, they noted: there is really a lot of coal in the warehouses and it will definitely be enough for the heating season. However, you shouldn't have high hopes for solid fuel. The success of passing the winter depends not on the accumulation of coal, but on whether there will be somewhere to burn it. Solid fuel is used for the operation of TPPs and CHPs. And there is a huge problem with this - the Russians destroyed 80-90% of the thermal generation capacity.

"I will deliberately not announce the volume of accumulated reserves. But it is much larger than in Ukraine over the past 5-6 years. But in this case, this is not the indicator that allows us to say with confidence that the winter will pass calmly and this is a guarantee that there will be no restrictions on electricity consumption due to the impossibility of using this coal due to destruction in the warm season," explained the adviser to the Prime Minister Minister of Ukraine, member of the supervisory board of Ukrenergo.

The installed capacity of thermal stations is now no more than 3-4 GW. Before the full-scale invasion, the capacity of Ukrainian thermal power plants reached 17 GW.

Usually, the state burned a significant part of its coal reserves in the summer. The reason is simple: in the warm months, units of nuclear power plants went alternately for scheduled repairs. This is how they were prepared for active work in the heating season. Instead, thermal stations worked at full capacity so that the state would not experience a shortage of electricity.

This year, the situation developed according to a different scenario. After a relatively calm winter, a new stage of energy terror began in Russia in the spring. Heating stations were also shelled. After the attack on the Trypil and Zmiyiv TPPs, Ukraine finally lost all state thermal generation.

The situation is no better with private thermal power plants: 90% of capacities have been destroyed or damaged. The state is trying with all its might to restore the destroyed objects. But this is a very expensive and sometimes long process. The government is not releasing details for security reasons.

The state company "Centrenergo" does not publish data on coal reserves. Private owners also do not give exact figures, but assured: there is really enough coal for the winter, accumulation is still ongoing and there are reasons for that.

"TPPs damaged or destroyed by shelling use less coal. Then why extract more? TPPs are a part of maneuverable generation. They must be turned on quickly when more electricity is needed, for example, in the morning or in the evening. The stations convert tens of thousands of tons of fuel into electricity per day. Accumulated coal will be used after the restoration of the TPP," DTEK reported.

The installed capacity of thermal stations is currently no more than 3-4 GW, DiXi Group analysts calculated. By the heating season, this figure may increase due to restoration. To understand the scale of destruction: before the full-scale invasion, the capacity of Ukrainian thermal power plants reached 17 GW.

"Coal reserves are quite significant. If compared with 2018-2021, this is generally the largest volume that is in TPP and CHP warehouses. We approached similar volumes only in 2020, when there was a pandemic, respectively - a reduction in electricity consumption. Then there were conditions for such an accumulation, on the eve of the heating season, the reserves were close to 3 million tons. Now, taking into account the fact that we have lost about 80% of the heat generation, it will be impossible to consume such a volume within the country," says DiXi Group's general manager of market development Andriy Ursta .

At the same time, according to the analyst, the state may face another problem: gas-type coal loses its energy qualities due to long-term storage. That is, such solid fuel may become unusable.

 

What to do with excess coal?

 

Ukraine will not be able to burn more than 3 million tons of coal during the winter. In addition, reserves are replenished every day, because both state and private mines continue to work. The Cabinet of Ministers understands the complexity of the situation, which is why they allowed the export of solid fuel. This was done "in order to ensure the work of state-owned coal mining enterprises," explained the representative of the Cabinet of Ministers in the Verkhovna Rada, Taras Melnychuk.
The ban on the sale of coal abroad has been in effect since the summer of 2022. Thanks to this, Ukraine managed to pass the then heating season without importing solid fuel.

Our coal is not very competitive. That is, it is problematic to export it, taking into account the cost price and the price situation on foreign markets...

Now it is possible to sell coal to other countries, but with restrictions. Export quotas for the year were prescribed in the appendix to the government resolution. For hard coal, anthracite, they amount to 1,153,000 tons. Instead, coking coal (only grade "K") can be exported in the amount of no more than 900,000 tons.

"We have customs statistics: for the first half of the year, we exported only 284,000 tons. That is, we do not even use the current quota, because it is obvious that our coal is not very competitive. That is, it is problematic to export taking into account the cost price and the price situation on foreign markets." Andriy Ursta noted.

Coal prices on the European market are falling. Currently, according to the former Minister of Energy Olga Buslavets, they amount to 112 dollars per ton. That is, a little more than UAH 4,500. However, reserves of solid fuel in Europe are decreasing. There are now more than 4 million tons in the warehouses of terminals in the Netherlands, which is more than a third less than the average annual norm.

At the same time, there were fewer competitors for Ukrainian coal in the EU. Back in the summer, the European Commission banned the export of solid fuel from Belarus. This decision was taken as part of the strengthening of sanctions against the regime of Oleksandr Lukashenka.

"Ukrainian miners are forced to reduce coal production because there is no sale. And that is why it accumulates in TPP warehouses that do not work. It also accumulates in mine warehouses, but very often mines do not have their own basic storage. 

According to the state plan, production of about 14 million tons was foreseen," said the head of the Confederation of Free Trade Unions of Ukraine, Mykhailo Volynets.

The expert also added: the mines have already exceeded the plan and released more than 16 million tons of coal.

 

The damage from the war to the coal industry is colossal

 

Due to the full-scale invasion, Ukraine has already lost about 20 mines, the Confederation of Free Trade Unions reported. It is hostilities that provoke a general decrease in coal production, if we compare current figures with pre-war figures. Although it is worth noting that demand is also falling. Part of the mines ended up on the front line, so the government developed a plan for the relocation of such mines.

"The government has taken all legal steps regarding the possibility and necessity of relocating equipment and people from mines located near the front line. The Ministry of Energy has received all these government orders and will take measures regarding relocation if necessary," said Prime Minister Denys Shmyhal.

However, the process of moving mines was not without scandals. At the beginning of August, law enforcement officers detained the then Deputy Minister of Energy Oleksandr Hailo. He is suspected of demanding half a million dollars in bribes. According to the investigation, he promised to transfer the equipment of one of the mines of the Donetsk region (presumably Pokrovsk) to a mining enterprise in the west of Ukraine for this money. The investigation continues, the ex-deputy minister is in custody.

The relocation of mines alone does not solve the crisis in the coal industry. At the same time, in this way, you can save equipment, and most importantly, the lives of employees. The Russians shell the mines almost every day. For example, last week a mine in Dobropyla in Donetsk region was under attack. The company was left without electricity. Exactly 151 miners were underground. They had to be urgently evacuated to the surface.

The Ministry of Energy reported that they have drawn up a special schedule and plan for the relocation of mines, but the department decided not to disclose the details.

We have already lost the mines. Four in Lysychansk, the same number in Pervomaiskvugil, two in Vugledar, four mines in Toretsk, the same number in Selidovo, and three mines in Myrnograd. Currently, equipment is being dismantled at the Krasnolymanska mine, as well as in Dobropol. Because the enemy first of all attacks and destroys coal mines. Because it is the basis of industry, it is the foundation," Mykhailo Volynets said.

There is little information about the situation with mining at state mines, as well as about their financial condition in general. The Cabinet of Ministers does not publish data. Back in the spring of 2024, the Ministry of Energy reported an increase in solid fuel production. As of the beginning of April, indicators at state-owned mines grew by almost a quarter since the beginning of the year.

Little is known about private mining during the war. The DTEK group of companies, which owns a number of mines, reported that 14 new coal mines have already been launched this year, and 12 more are planned.

"Since the beginning of the war, that is, since 2014, the losses of the coal industry have been huge. Of course, we have also lost many consumers. That is why it was not so strongly reflected in the coal balance sheet. But the reduction of production occurred several times. State mines operate quite unprofitably. There was an increase in production in the last years before the war by the company "DTEK Energo". Their main association is in Pavlohrad," stated Volodymyr Omelchenko, director of energy programs of the Razumkov Center.

Under such conditions, Ukraine even had to import coal for industry. It is a coke type of fuel. In the first half of 2024, Ukraine bought about 500,000 tons of coking coal abroad, DIXI Group analysts calculated.

Production of this type of solid fuel in Ukraine is limited precisely because of hostilities. At the same time, the Cabinet of Ministers plans that in 2024 it will be possible to sell almost 3 million tons of coking coal. Both the government and the companies that own the mines are convincing: the state has a "plan B". It was developed in case the most powerful coking coal mines fall into a war zone or occupation. However, they are convinced that the industry will be with coal.

                                    Serhiy Barbu, specially for "Ukrainian Energy"