First Gas-Fired Units Successfully Deployed

In a significant move toward energy resilience, Metinvest Group activated its inaugural gas-fired power plant on April 15, installing four generating units with a combined capacity of 10 MW supplied by Turkish manufacturer Dalgakiran. This milestone development strengthens the energy security of Kametstal, one of the company's key steel production facilities that requires up to 150 MW of power for full operations. The successful deployment represents the first concrete step in Metinvest's broader energy independence strategy, which has become increasingly critical amid Ukraine's war-damaged power infrastructure. According to Chief Operating Officer Olexander Myronenko, this initial installation provides essential backup capacity that can maintain critical operations during grid outages while also reducing dependence on Ukraine's strained national power system. The gas-fired units offer rapid deployment advantages and operational flexibility that make them particularly valuable in the current unstable energy environment, allowing Metinvest to maintain production continuity despite external challenges.

Rapid Expansion Underway at Multiple Sites

Metinvest's energy independence initiative is accelerating rapidly, with an additional 19 MW of gas reciprocating units scheduled for commissioning by the end of May at the company's Northern and Central Mining operations. These installations feature advanced generating equipment from industry leaders Jenbacher and Cummins, with four units totaling 11 MW and 8 MW respectively at the two sites. The new generators have already completed installation and are currently undergoing final testing before being integrated into the operations' power systems. This swift deployment timeline demonstrates Metinvest's urgency in establishing energy resilience across its production network. The company has undertaken comprehensive infrastructure preparation to support these new power sources, including constructing access roads, pouring concrete foundations, installing transformers, upgrading electrical equipment, and establishing dedicated gas supply lines. Notably, the installations incorporate specific security measures against potential military threats, with physical protection against shelling and strategic dispersion of generating assets to minimize vulnerability to single-point attacks.

Substantial Solar Investment Planned for 2025-2026

While gas generation provides Metinvest's immediate energy security solution, the company has unveiled plans for significant renewable energy development in the near term. According to the investment roadmap, Metinvest will commit $18.1 million to construct 37 MW of solar power capacity at Central Mining and Kametstal during 2025-2026. This solar initiative represents a strategic pivot toward sustainable energy sources that can provide predictable generation costs while reducing the company's environmental footprint. The solar projects will complement the gas-fired generation, creating a diversified energy portfolio that balances reliability, cost, and environmental considerations. By incorporating substantial renewable capacity, Metinvest positions itself to benefit from Ukraine's abundant solar resources while hedging against volatile fossil fuel prices. The dual approach of gas and solar reflects a sophisticated energy strategy that addresses both immediate resilience needs and longer-term sustainability goals, demonstrating the company's commitment to a balanced energy transition despite challenging circumstances.

Strategic Path to 50% Energy Independence

Metinvest's ambitious energy program aims to achieve 50% energy independence within three to four years under favorable conditions, according to COO Myronenko. This target represents a dramatic transformation for a company that consumed an average of 672 MW in 2024, down from 1,405 MW in pre-war 2021. The feasibility of this goal depends on several external factors, including investment climate improvements, access to favorable financing terms, and the evolution of the war situation. The company is currently developing a comprehensive strategy for its optimal energy mix, balancing various generation technologies against their respective costs and benefits. This strategic planning process involves detailed analysis of consumption patterns across different production facilities, evaluation of suitable generation technologies, and assessment of implementation timelines. The 50% independence target strikes a balance between self-sufficiency and continued grid integration, recognizing that complete energy autonomy would be prohibitively expensive while the current level of dependence creates unacceptable operational risks.

Carbon Reduction Strategy Addresses EU Market Access

Beyond energy security, Metinvest's renewable energy investments serve a critical secondary purpose in the company's carbon reduction strategy. With the European Union's Carbon Border Adjustment Mechanism set to impose carbon taxes on steel imports beginning in early 2026, Metinvest faces significant financial pressure to reduce its carbon intensity. While the planned solar capacity will contribute to lowering emissions, Myronenko acknowledged that equipment modernization and the ultimate transition to electrometallurgy will deliver more substantial carbon reductions. The company has outlined an $8 billion post-war plan to convert to electrometallurgy over a 7-8 year period, representing its comprehensive decarbonization strategy. In the interim, Myronenko expressed hope that Ukraine might receive a 3-5 year postponement of CBAM obligations in recognition of the war's impact on industrial transformation capabilities. This request highlights the tension between the EU's climate ambitions and the practical challenges facing Ukrainian industry under wartime conditions, as companies like Metinvest struggle to maintain operations while simultaneously planning for future competitiveness in carbon-constrained markets.

War-Driven Energy Mix Transformation

Russia's systematic attacks on Ukraine's thermal power infrastructure have dramatically altered the country's energy landscape, increasing the proportion of nuclear and renewable electricity in the national energy mix. This shift creates both challenges and opportunities for large industrial consumers like Metinvest. While cleaner grid electricity theoretically benefits the company's carbon footprint, the unreliability of supply has forced the development of independent generation capacity. The destruction of thermal power plants has created a structural electricity deficit that particularly affects energy-intensive industries, making self-generation increasingly necessary for operational continuity. Metinvest's investments in gas and solar generation represent a pragmatic response to this new reality, allowing the company to maintain production while the national energy system undergoes forced restructuring. The company's approach demonstrates how Ukrainian industry is adapting to wartime constraints through increased self-reliance and technological innovation, potentially accelerating energy transition processes that might otherwise have occurred more gradually.

International Operations Pursue Different Energy Strategies

While Metinvest aggressively pursues energy independence for its Ukrainian operations, the company takes a markedly different approach to its international facilities. According to company leadership, foreign operations currently benefit from stable electricity supplies that don't justify investments in self-generation. However, this doesn't mean renewable energy is off the table internationally. In an interesting development, Metinvest is collaborating with Ukrainian energy company DTEK to explore constructing a solar power plant at its Bulgarian Promet facility, though with a different business model focused on electricity sales rather than self-consumption. This differentiated approach highlights how Metinvest tailors its energy strategies to local conditions, pursuing energy independence where grid reliability is compromised while exploring revenue-generating renewable projects where energy markets function normally. The contrast between domestic and international approaches underscores the exceptional challenges facing Ukrainian industry and the innovative solutions companies are developing to maintain operations despite these difficulties.

Financial and Operational Implications of Energy Transition

The total $44 million investment in energy generation represents a significant financial commitment for Metinvest during wartime conditions, with $26 million allocated to gas generation in 2025 alone. This substantial capital expenditure reflects both the strategic importance of energy security and the company's continued financial capacity despite wartime disruptions. The investment decisions balance immediate operational needs against longer-term strategic positioning, recognizing that energy independence has become essential for business continuity in Ukraine's current context. While the upfront costs are substantial, the investments are expected to deliver multiple returns through enhanced operational stability, reduced exposure to grid disruptions, protection against electricity price volatility, and improved carbon competitiveness for export markets. The company's willingness to make these investments despite the uncertain operating environment demonstrates confidence in Ukraine's industrial future and Metinvest's determination to emerge from the current crisis with enhanced capabilities and competitive advantages in key areas like energy resilience and environmental performance.

Key Takeaways:

• Metinvest has launched a $44 million investment program in energy generation, with the first 10 MW gas-fired plant already operational at Kametstal and an additional 19 MW of gas units scheduled for commissioning by late May at Northern and Central Mining operations

• The company plans to invest $18.1 million in 37 MW of solar power capacity during 2025-2026 as part of its strategy to achieve 50% energy independence by 2030, significantly reducing vulnerability to Ukraine's war-damaged power infrastructure

• Metinvest's longer-term decarbonization strategy includes an $8 billion post-war plan to transition to electrometallurgy over 7-8 years, while the company seeks a 3-5 year postponement of EU Carbon Border Adjustment Mechanism obligations for Ukrainian producers in recognition of wartime constraints