Verkhovna Rada has registered a draft law on simplifying the connection of small and medium-sized businesses to power grids

On 3 February 2021, the Verkhovna Rada of Ukraine registered the draft Law of Ukraine "On Amendments to Certain Legislative Acts of Ukraine Concerning the Simplification of Connection to Electric Grids" No. 5009 ("Draft Law"). On 16 March 2021, the Draft Law was included in the agenda of the Verkhovna Rada. According to the authors, the Draft Law will reduce the terms of connection to the grid by 2.5 times if adopted. It should be noted that the Draft Law applies only to connections with a capacity of up to 1 MW with a focus on the development of small and medium-sized businesses.

Among others, the Draft Law proposes the following changes:

Project documentation

The Draft Law indicates that the concept of a linear energy infrastructure facility (LEIF) is applied in the meaning as enshrined in the Law of Ukraine "On Energy Lands and the Legal Regime of Special Zones of Energy Facilities", and is defined as follows:

Also, the distribution system operator (DSO) is determined to be responsible for the development and approval of the design documentation for the linear part of the connection of the customer's electrical installations with a capacity of up to 1 MW, the allocation of land plots for their placement.

Land management project

Regarding the development of the land management projects, the Draft Law provides an opportunity for the development of the land management projects for the allotment of land plots from state and communal property for use for the placement and operation of LEIF without obtaining a permission from the executive authorities or the local government to develop it. In addition, it provides for the possibility of construction without the need to remove them, if such a construction is carried out in accordance with the urban planning documentation.

Regarding the reduction of terms in the field of land management, the Draft Law introduces the principle of tacit consent when approved by the relevant executive authorities and the local authorities of land management projects for the allotment of land plots and their provision for use by the DSO for the construction and operation of LEIF. The Draft Law shortens the period for amending the information of the State Land Cadastre to one day and regulates the issue of refusals in state registration of a land plot in the State Land Cadastre.

The Draft Law tries to resolve the issue of access to geospatial data by expanding the list of entities that are required to make such data public.

Land easement

The Draft Law proposes to define a transparent procedure for concluding an agreement on the establishment of a land easement on state and communal land plots.

Process automation

The Draft Law proposes to introduce a "single window" mechanism for:

- submission by customers and developers of design documentation for the construction, reconstruction and / or technical re-equipment of electrical networks of external power supply of the customer's electrical installations (to the point of connection of the customer's electrical installations) and design documentation for the construction of electrical networks of the linear part of the connection (hereinafter design documentation) applications, requests, obtaining initial data, information and information necessary for the design and implementation of construction and installation works;

- coordination with interested parties, including executive authorities, local governments, enterprises, institutions and organizations of project documentation.

Introduction of the responsibility for state bodies

The Draft Law provides for the responsibility of the DSO and the transmission system operator for non- disclosure of information on the value of the load factors of the transformer substations of the DSO's main network and providing an unjustified refusal to connect customers' electrical installations to power grids. The form and extent of liability is determined by the Regulator on the basis of Article 77 of the Law of Ukraine "On Electricity Market" No. 2019-VIII dated 13 April 2017. The amount of liability is fixed in the amount from UAH 85,000 to UAH 1,700,000.

Also, the Draft Law provides for the responsibility of officials of executive authorities, local governments, enterprises, institutions and organizations for untimely approval or non-approval of project documentation. The Draft Law foresees that for such violations, liability is stipulated by law.

Abolition of a number of requirements

The Draft Law cancels the necessity of the following:

• obtaining a permit for violation of the improvement elements during construction and installation work on the construction of LEIF, replacing it with a notification mechanism about the initiation of such work;
• conducting an environmental impact assessment during the construction of cable lines;
• coordination of materials for topographic and geodetic works with executive authorities and local government bodies;
• changing in the designated purpose of the forest fund land plots, which are in state or communal ownership for the placement of LEIF, is carried out without the consent of the Cabinet of Ministers of Ukraine.

The Draft Law introduces significant positive changes for interconnections with a capacity of up to 1 MW in order to develop small and medium-sized businesses, however, some provisions require revision.

For further information, please contact Asters' partner Yaroslav Petrov and associate Olena Sichkovska.