Chapter 1. Strategic and legal aspects of digital transformation of the energy sector of Ukraine: focus on foreign economic policy
Keywords:
digitalization, strategy, decarbonization, climate policy, smart grids, guarantees of origin, energy efficiency, renewable energy sources, Carbon Border Adjustment Mechanism, investments, foreign economic policy
Synopsis
Transformations of national economies under conditions of instability
The aim of this study is to analyze the strategic and legal aspects of digital transformation of the energy sector of Ukraine, determine the connection and specify its impact on foreign economic policy. The study discusses the achievements and shortcomings of the national strategy for the transition to digital energy, as well as substantiates proposals for improving strategic documents. Special attention is given to the analysis of the Concept for the Implementation of Smart Grids in Ukraine until 2035. The study also examines trends in the legal framework for digitalization of the energy sector both in Ukraine and in the European Union. Based on a comparative analysis, some ways to improve national legislation are outlined. Special attention is given to the impact of digitalization of the energy sector on foreign economic policy in the context of tightening the EU's climate policy. Smart grid technologies and electronic guarantees of origin of electricity produced from renewable energy sources are key digital instruments in the energy sector that influence foreign economic policy. These instruments form a single digital mechanism for Ukraine's adaptation to the EU climate and energy policy, aimed at ensuring the most favorable conditions for the export of products for Ukraine and stimulating the inflow of foreign investments. Establishing the appropriate mechanism is a way to mitigate the consequences of the introduction of the Carbon Border Adjustment Mechanism (CBAM) in the EU for the export of electricity from Ukraine to EU countries (by increasing the share of electricity produced from renewable energy sources). It is shown that the deployment of digital infrastructure based on smart grid technologies and the introduction of electronic guarantees of origin of electricity produced from renewable energy sources will have a positive impact not only on the investment climate in the electricity sector, but also on the investment climate in general (access to “green” electricity is an important condition for many international companies to enter Ukrainian markets). In addition, the twin transition to the digital and climate neutral energy system will help reduce fossil fuel imports and strengthen Ukraine's energy independence.
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