DTEK Energy suspends operations at DTEK Pavlohradvuhillia and three preparation plants due to the power industry struggle in Ukraine

DTEK Energy suspends operations at DTEK Pavlohradvuhillia and three preparation plants due to the power industry struggle in Ukraine

14.04.2020

In the face of systemic power industry crisis in Ukraine, starting 20 April DTEK temporarily ceases coal mining and treatment, preparation of underground workings and repairs of mining machinery at 10 mines and auxiliary facilities of DTEK Pavlohradvuhillia, Pavlohradska, Dobropilska, Kurakhivska CPPs, as well as at Pershotravensky repair and engineering plant and DTEK's R&D centre. The facilities are to sustain limited operations, with the workers going idle on a payroll as per the collective contract.

The systemic crisis in the Ukrainian energy-generating industry which has been unfolding since last year has crippled the energy grid of Ukraine. Manual regulation of the market, uninformed decision-making, lack of industry-wide coordination completely disrupted the operations of all the collieries. Due to the uncapped energy imports from Russia and Belarus, the demand for the Ukrainian electricity decreased dragging down the coal consumption at power plants. The thermal power plants and mines accumulated over 2.9 million tonnes of unclaimed coal in stockpiles. Around 30 coal mines in the country were suspended, leaving more than 40,000 people idle. The thermal power generation sector incurred losses of UAH 3.1 billion for the last six months. All of the thermal power plants have to operate well below the minimum manpower, with ca. 50% workers remaining idle.

The situation is aggravated by the overall economic downturn and the coronavirus pandemic. Due to the lockdown, the country consumes less electricity, generates less power, thus seeing less payments.

The lack of demand for the Ukrainian electrical energy already forced DTEK Energy to suspend operations at 5 mines of DTEK Dobropilliavuhillia, Bilozerska mine, and Oktiabrska CPP. Unfortunately, with the situation getting more and more critical, it was decided to also suspend operations at DTEK Pavlohradvuhillia, another three preparation plants, Pershotravensky repair and engineering works and DTEK's R&D centre.

From 20 April, around 18,700 workers of mines, auxiliary facilities of plants and works are going idle, while the rest of the personnel will ensure maintenance – ventilation of the underground workings and water pumping, upkeep of production equipment and machinery. This will allow to promptly resume operations once the standing of the industry changes. In compliance with the industrial agreement and the collective contracts, all the idle employees will still be paid their normal basic salary rate, with their length of service uninterrupted.

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