SUBSCRIBER+EXCLUSIVE INTERVIEW — Ukraine was hit by a fresh round of Russian missile attacks on Thursday, strikes that targeted and damaged the country's power grid infrastructure. The Trypilska Thermal Power Plant, the largest in the Kyiv region, was destroyed, and explosions were reported in Kharkiv, Zaporizhzhia and western Lviv regions.
A day earlier, Russian missile and drone attacks damaged Ukrainian energy facilities in the Black Sea regions of Odesa and Mykolaiv. Ukraine's Energy Minister German Galushchenko said the attacks were part of a Kremlin effort to to cripple the country’s energy capabilities.
Earlier this week, concerns spiked about perhaps the most critical of all elements of Ukraine's energy infrastructure after three drones detonated at the Zaporizhzhia nuclear power plant in eastern Ukraine, the largest plant in Europe. Rafael Grossi, director general of the International Atomic Energy Agency (IAEA), said while there were “no indications of damage to critical nuclear safety or security systems,” this was the first time the facility had been directly targeted since November 2022. “Such reckless attacks significantly increase the risk of a major nuclear accident and must be stopped immediately,” Grossi warned.
Last week The Cipher Brief hosted an exclusive conversation with Galuschenko, the Energy Minister, as part of The Cipher Brief's Kyiv Economic and Security Forum. Galuschenko spoke about the dangers at the Zaporizhzhia facility but also the many other ways he believes Russia has "weaponized energy" in its war against Ukraine. He also painted an optimistic picture of a post-war Ukraine that could serve as a "battery" for Europe.
The conversation with Galushchenko, who has served as Minister of Energy of Ukraine since April 2021, was moderated by Jeremy Hitchcock, Co-Founder and General Partner at New North Ventures.
THE CONTEXT
- Russia launched missile attacks early Thursday against several parts of Ukraine, targeting the country's power grid infrastructure. Ukraine's President Volodymyr Zelensky called the attacks acts of “terror” and called for “air defense and other defense support.” Earlier Russian missile and drone attacks this week damaged Ukrainian energy facilities in the Black Sea regions of Odesa and Mykolaiv.
- A drone attack damaged the Zaporizhzhia Nuclear Power Plant in Ukraine on Sunday. The International Atomic Energy Agency (IAEA) reported one casualty and said the drones hit the plant’s main reactor containment structures at least three times. Russia and Ukraine accused each other of attacking the plant. The IAEA said the drone strike was the first direct attack on the facility since November 2022.
- Russia seized the Zaporizhzhia Nuclear Power Plant, Europe’s largest, in March 2022. The plant is controlled by Russia’s state nuclear power company Rosatom. The facility has been shut down for months but requires power and staff to operate cooling systems and other critical safety features.
- The war in Ukraine is the first military conflict to take place on the territory of a country with large nuclear facilities.
THE INTERVIEW
The Cipher Brief hosted a conversation with German Galushchenko, Minister of Energy of Ukraine, about what's at stake at the Zaporizhzhia nuclear power plant and the impact of Russian attacks on Ukraine's energy infrastructure.
This excerpt of the full Kyiv summit session has been edited for length and clarity.
Hitchcock: Minister, this is a war that, at least from the energy perspective, has been going on for many years. How do you think of this as an energy conflict as much as anything else?
Minister Galushenko: That's a really good question. I would like to start with one example which really shows what all this is about.
From autumn 2021, the Russians started to decrease the flows of gas to Europe. Everyone was anticipating that Europe would face incredible problems in winter with the probable constriction of supply to households. And when the big war started (in February 2022), when they started attacking us by missiles and the Russian army moving ahead, the same night they increased the flows of Russian gas to Europe, almost to contractual volumes.
So, in my feeling, the message of this from Russia was, Guys, you have the problems with the gas? So now these problems are settled. You will have the contractual volume (of gas). Let us play with Ukraine by ourselves. And that is really a good example of how they use it, how they weaponize the energy, and that is really what has happened.
But let's be frank, that has happened because we have allowed it, all of us together. The world allowed Russia to become a key player in this market. And not only to become a key player. I would say that we allowed them to manipulate this market and to manipulate the countries.
I always ask my fellow ministers, How will we discuss a European market, or European gas market, if some country in Europe can receive discount prices for Russian gas? What are the rules which should be called for, for everyone, if one country can get a discount on the gas? And another question: Why does this one country get a discount? Just because they are good guys? Probably yes. But we understand that it is not for free - all this discounting costs something, and that was our feeling.
And it looks like our messages, which we started to send before this war, they were proven by time unfortunately. I remember my talks with a colleague from Germany. I was a minor minister at the time. And when I said, what you are doing, you are increasing and increasing the dependence on Russian gas, and you are trying to speed up this Nord Stream 2 (pipeline of Russian gas), and I remember what he told me. "I don't understand what you're talking about. It is purely commercial."
So again, we took a lesson. The world took a lesson from what happened, unfortunately. I think it's very important that everyone understands that when you have this dependence, it's a threat to national security and it's a threat to the security of supply. So yes, I think it's very harmful.
Hitchcock: One thing we've heard is that Ukrainians have set many examples, and in the Energy Generation Portfolio, you had a pretty good mix of generation that you use for the supply side. What's gone into thinking through the mix that you have between the different sources?
Galushenko: I think it's important, and it’s also one of the lessons I discuss with my colleagues in different countries. Of course, we are all following the green transition goals. I'm really an advocate of nuclear energy and I was always an advocate of nuclear, even in hard times.
After two years of attacks on the energy infrastructure, these massive attacks, we could never have survived without nuclear. That is our experience, so that's what we see. I mean, of course we could say that they could shell the nuclear stations during that time. They didn't, but they captured Zaporizhzhia. But we feel quite safe and (nuclear power) has allowed us to go through two years of winter.
Now we are, again, going through another wave of massive attacks from the Russians, to the energy infrastructure, and we still have the light.
It's also very important that we have a really good mix. Before the full-scale invasion, up to 70% of all electricity produced in Ukraine was decarbonized. Now, Russians have sped up our green transition dramatically. I always said that the war is also giving us the opportunity. It's very important not to lose this time, not to lose the chance.
We already lost 11 coal mines. Not through the transition, but through the Russian tanks.
Hitchcock: Could talk about the Zaporizhzhia Nuclear Power Plant, the ZNPP? What’s the current status of what's happening there.
Galushenko: In February 2022, for the first time in the history of Ukraine, the ZNPP produced more than six gigawatts in the system. It was incredible work done. It's the biggest nuclear power plant in Europe. We did a huge modernization inside. We used a diverse supply of fuels — 50% of the fuel came from TVEL from Russia, and 50 from Westinghouse Fuel.
Russia captured [ZNPP] using tanks, vehicles, artillery. I remember this night, it was the 21st of March, 2022. The next night, the Board of Governors of the IAEA condemned them for the capture of the Chernobyl NPP (nuclear power plant). And asked them to immediately withdraw their troops from Chernobyl NPP — and the next night they captured Zaporizhzhia. And the story was, they (the Russians) know what they're doing. The story was that the same night, they're supposed to capture two nuclear power plants — one is the Chernobyl NPP and the other is South Ukraine NPP.
And if we had lost, you could imagine, the energy system loses two nuclear plants, it would be really a problem, a dramatic problem for us, from the point of view of power generation. But luckily, South Ukraine NPP is under Ukrainian control. But Zaporizhzhia, the (Russians) managed to do this. So it's already two years, and the situation becomes worse and worse.
We are moving towards a nuclear accident, and I think it's very important to understand. The two questions which I cannot answer: When and what would be the trigger of this?
We did training, in case of an accident at Zaporizhia NPP. Each year we’ve done it. What is really important to understand is they do not have staff there, qualified staff. Ukrainians are not allowed to come anymore, they took them from the station. So, the Russians do not have enough staff and they have leakages there almost every two weeks. That is verified by the experts.
The second question: They do nothing to maintain the equipment, and the nuclear station is not operational since September 2022. So, without maintaining, you've got the debilitation of equipment and that is what is happening. They had no chance to connect it. Even if you could imagine that they could restart the operation of at least one unit, they cannot connect it to the Russian units.
To restart even one unit, it's a huge problem because of the lack of water, due to the Kakhovka Dam explosion (in 2023), what the Russians did there. And now they're drilling, they're trying to get more water and that's another insane behavior. They’re responsible for nuclear safety and security, they control the station.
Another, more difficult question: Where to store the fuel, and how to store this fuel? Because that’s Westinghouse fuel, that’s not TVEL (from Russia). And there is one storage, which is in Ukraine territory, which we built in 2021, where we store Westinghouse fuel.
So, the number of problems only increase every day. So of course, [IAEA Director General] Rafael Grossi, he understands what all this is about. And he's trying, he was in Kyiv many times for meetings with our president, he had meetings with Putin recently in Sochi. And he shared with me his mission.
The awful thing in my story is that we are now all talking, a lot of countries talking about the renaissance of nuclear industry. And if even a small accident happens at the Zaporizhzhia NPP, I am absolutely sure about this: It would stop the renaissance everywhere. No matter how far I am from Ukraine, or if you aren't bothered about Ukraine and Russian war. But if you want to increase other nuclear power plants, that would be the end for it.
Hitchcock: Agreed. What can private industry best do? Where can people play a role today in to increasing the resiliency, and helping to position Ukraine as an exporter of energy for Europe?
Galushenko: We developed last year a new energy strategy till 2050. And the framework of this strategy, is Ukraine is the energy hub for Europe. And this is not just slogans. I don't like slogans, frankly speaking, from Soviet times when all the slogans were for the best future.
But that's not a slogan because that is the real story, the real story for wartime, and the real story for success for after wartime.
The Russians (attack us because they) want to achieve a blackout of the country, that's for sure, but one reason was that in 2023 we increased dramatically the export to Europe of electricity, during the war. For us that is about money, and the possibility to invest again in repairing Ukraine and everything we do. For Europe, that is also a way of saving on Russian gas. And for Russia that is a bad situation, and that's why they started to attack our energy.
Ukraine could easily become this battery for Europe. That's why we are talking about the energy.
We also have a great opportunity for offshore wind energy, which is absolutely new for us. But of course that's for after the war. We need Azov Sea and Black Sea offshore wind possibilities. So, we can become the producer for European market.
The same story with the gas. We have the biggest gas storages in Europe. And this year first, this year we managed to get up to 3 BCM (billion cubic meters) of non-residential gas here in the winter, some of which was used in Europe. I think that's very important, and I am just giving you the story of wartime. So let's think about the possibilities after.
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