Estimated economic losses of Ukraine after attacks on infrastructure

“More like a psychological effect”

Ukrainian cities are moving to rolling blackouts. Thermal power plants, thermal power plants and a number of substations were damaged by Russian missiles. Without electricity, a number of industrial and transport sectors become useless and suffer losses. The question turned out to be the export of Ukrainian electricity, on which the country’s government made money. Moldova has reported with regret that it is now forced to switch exclusively to Russian electricity.

This morning, the ranks of the defeated thermal power plants and thermal power plants were replenished by the Ladyzhynska power plant near Vinnitsa. Violation of electricity and water supply is observed in Lviv, Volyn, Rivne, Khmelnytsky and Ternopil regions. In Kharkiv, Lvov, Sumy and other Ukrainian cities there are power outages and rolling blackouts. In the Lviv region, due to problems with mobile communications, the head of the region even advised residents to buy radios with batteries or accumulators in order to receive “the latest information.” In everyday life, Ukrainians feel great discomfort, but how big is the damage at the macroeconomic level?

Political scientist Vasily Stoyakin, in an interview with MK, estimated the damage from attacks on the Ukrainian energy system at about 15% of the total electricity generation in the country. “About the same number did not work last year, when there were problems with the supply of fuel to thermal power plants, and then the Ukrainian energy system did not collapse. All these damages are not critical and, most likely, will be fixed within a relatively short amount of time.

As a rule, external distribution devices are put out of action during such shocks, and they change rather quickly. Here the effect is rather moral.

“But if the strikes are more systematic, then the damage will be different,” Stoyakin said. “First of all, strikes should be delivered not at the stations themselves, but at high-capacity substations that ensure the operation of the energy ring and allow energy to be transferred to scarce regions from surplus ones. As far as I know, both yesterday and today, none of these substations was the target of strikes.”

According to the analyst, the cessation of exports will not greatly affect the Ukrainian budget. “The Ukrainian budget is formed and provided by Western partners. Ukraine gets as much money as it needs. From whether Ukraine receives something from exports or not, only the pockets of the beneficiaries, the respective companies, suffer.”

Stoyakin drew attention to the fact that as soon as imbalances arose in the Ukrainian energy sector, the connection between the energy systems of Ukraine and Europe was immediately cut off from the Polish side. “This can really make an extremely unfavorable impression on that part of the Ukrainian population that understood what happened. Because the “good European partners” who support Ukraine do not want to help with electricity. I wonder why?”

“It is impossible to name the exact amount of damage suffered by Ukraine as a result of the strikes,” said Andrei Suzdaltsev, deputy dean of the HSE Faculty of World Economy and International Affairs. “The Ukrainian side itself does not provide complete information. Any power plant is a very complex object, almost a submarine. If you just hit the territory, then this will not have any effect. If they hit the generators, they can be repaired. To completely destroy them, you need a huge power blow. Therefore, the short-term response was strong, but we cannot say with 100% certainty about the long-term consequences.”

The expert noted the internal economic losses of Ukraine. “Almost all regional cities were de-energized. Most of them were left without hot water. In some cases, there is no running water. There were hits in the CHP. Some households will be left without heating, people will solve this issue on their own. Burn wood, heat potbelly stoves. For more specific data, we do not have alternative estimates from there, since there is no opposition in Ukraine. There are only state estimates, and they will be underestimated so as not to frighten the population.”

As for export losses, Suzdaltsev noted that the decommissioning of thermal power plants that generate energy for the same Moldova and Romania will not bring significant economic damage, since we are talking about only tens of millions of dollars.

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