The decrease in prices on the day-ahead market (DAM) before the July state generation auctions was not an attempt to artificially lower electricity prices.
This opinion was expressed by Andrian Prokip, Doctor of Economic Sciences, head of energy programs at the Ukrainian Institute for the Future.
According to him, for those who follow the electricity market, it is obvious that the price dynamics are explained by changes in the balance of supply and demand. In summer, prices are significantly influenced by weather conditions, consumption, as well as import and export volumes of electricity.
“For those who carefully observe the electricity market, particularly the day-ahead segment, and the factors influencing the supply-demand balance, it is clear that the assumption that the price drop is related to the auction schedule is highly questionable,” emphasized Prokip.
The expert noted that in early July, along with a reduction in electricity imports, exports increased, which also indicated a change in market balance. Furthermore, similar price fluctuations have occurred before, notably in the autumn of 2025, when the average price on the DAM also significantly decreased.
Prokip pointed out that the results of the auctions themselves do not confirm the theory of artificial price reduction. According to him, if electricity were truly sold significantly below market value, demand for the lots would be much higher.
“If the price suddenly became so attractive, why didn’t industry actively buy electricity at these auctions? Why, against the backdrop of low competition, did Ukrhidroenergo’s final price remain at the starting level on the first day? Why didn’t Energoatom’s lots significantly increase in price despite competition?” he asked.
Andrian Prokip added that the current mechanism of long-term auctions is only the first step towards the development of forward trading. In his opinion, the Ukrainian market lacks proper price indicators and risk hedging mechanisms that have long been used in EU countries.
Earlier, energy expert Gennadiy Ryabtsev disagreed with the assumption about the possible impact of long-term contract auctions on price collapse. According to the expert, only 2.4% of the total trading volume is realized through this mechanism, so it could not significantly affect the situation in the day-ahead market.
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