No funding was provided: why Odessa missed out on a floating power plant from Turkey.
Remember the project involving Turkish floating power plants intended to supply the southern part of Ukraine? Well, it’s not going to happen, despite the fact that 300 million hryvnias have already been spent.
To briefly recap the context: the Turkish company Karpowership owns large ships that generate electricity on board and can distribute it to coastal facilities. Ukraine, facing an electricity shortage, has been considering this alternative source since late 2022. Subsequently, a joint memorandum was signed, and the Ukrainian government invested in building infrastructure and developing documentation.
So why did the deal fall through?
According to a source from Forbes within the Ukrainian government, the cornerstone issue was the price demanded by the Turkish supplier. Initially, the Turks agreed to station their vessel in the Danube estuary in Romania, from where power lines would extend to the Odessa region. However, it seems they decided to factor in military risks into the pricing as well.
The same source reports that the electricity price was twice as high as the market price in Ukraine during peak consumption hours. For instance, on February 18, that price would have reached 9,400 UAH per 1 MWh. In other words, the Turks allegedly asked for up to 19,000 UAH per MWh or 43 euro cents per kWh. The usual price at Karpowership is 20-25 euro cents. Thus, the Turks are clearly hedging against military risks.
But it’s not just about the price. Ukrainian authorities expected that the payment to the Turks would be covered by Western partners. The cost of this arrangement is $250 million per year. However, that did not happen.
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