US demands that German Galushchenko be let go
The Energy Minister, German Galushchenko, might lose his job soon. The US wants him to be fired. The minister's actions upset Western partners because of how he manages state-owned energy companies, especially OGTSU and Ukrenergo, reports Ukrrudprom.
On September 13, 2022, US Ambassador to Ukraine Bridget Brink tweeted about a meeting with Energy Minister Herman Galushchenko. She expressed worry about how Ukrenergo and OGTSU are being managed. Then Minister Galushchenko tried to remove the chairman of ODTSU Sergei Makogon and appoint someone else.
Despite the ambassador’s statement, already on September 19, JSC “Main Gas Pipelines of Ukraine” dismissed Sergey Makogon from the post of head of LLC “GTS Operator of Ukraine”.
Meanwhile, the European Union, the Secretariat of the Energy Community, and the World Bank supported Makogon's proposal to reform the OGTSU's corporate governance. This involved creating a new supervisory board in OGTSU, electing a new board for the company through the new supervisory board, and getting rid of MSU as an extra management link.
In 2019, the gas transportation system of Ukraine was transferred from Naftogaz to an OGTSU operator and was sold to MGU. This created a two-tier governance structure – the GTS operator is owned by Moscow State University, which has a supervisory board, but the cash flows are managed by the GTS Operator.
Galushchenko also wants to dismiss Volodymyr Kudrytsky, the head of Ukrenergo, the main electric grids operator.
As reported MonopolistThe most recent attempt was in September 2022, when the company received tens of millions of dollars from the sale of the crossing to export electricity to the EU. From June 30 to October 9, 2022, the total cost of accessing interstate power grids was more than UAH 4.9 billion.
In October, after Russia's first rocket attack on Ukraine's energy infrastructure, the export of electricity was stopped. Western partners started providing energy equipment and funds for Ukrenergo facilities. As the operator focused on recovery, Minister Galushchenko thought about changing the management of Ukrenergo to someone more loyal.
US demands that German Galushchenko be let go
Another reason for Galushchenko's dismissal could be Energoatom's purchases of equipment and consumables at high prices. The head of the Ukrainian nuclear power plant operator, Petr Kotin, is close to the minister.
According to Our Money, which monitors government procurement, during Russian attacks on Ukraine's energy infrastructure, Energoatom held a series of tenders, in which purchases were made at significantly high prices.
Another reason to dismiss Galushchenko is the creation, with the help of the Deputy Chairman of the OP R. Shurma and Galushchenko, of an electricity exporter – the state trader ECU. The company received UAH 0.5 billion of assistance from Energoatom and a 90-day deferral of payment for electricity.
- the creation, on the initiative of the Deputy Chairman of the OP R. Shurma and Galushchenko, of an exporter of electricity – the state trader ECU, which at one time concentrated 50% of the volume of electricity. The company received UAH 0.5 billion of assistance from Energoatom and a 90-day deferral of payment for electricity.
- the failure of the coal accumulation program in the warehouses of the state generating company Centrenergo in sufficient quantities. Therefore, the company switched to gas consumption and accumulated a debt of almost UAH 3 billion to Naftogaz. As a result, the NAC refused to supply gas to the company and it took it unauthorized from the pipe, as a result of which the state-owned GTS Operator suffered damage.
At the same time, Galushchenko himself adheres to the Ukrainian tradition and, of course, blames Russia for his possible resignation:
Energy minister blames Russia for his resignation
Energy Minister Herman Galushchenko links information in the media about a possible resignation to Russian influence, in particular, due to the intensification of Ukraine’s cooperation in nuclear energy with the American company Westinghouse and denies problems in relations with Western partners.
“This is not the first time that we have taken certain steps with our Western partners, primarily from the United States, and after that there are rumors about my resignation or something like that.“, – Galushchenko said on the air of the national telethon United News.
“Last Friday, we made progress, decided that we would forever end cooperation with Russian technologies in the Ukrainian nuclear industry and begin work on technical documentation for the construction of two nuclear power units using Westinghouse technology, and on the same day they began to “fire me“, the minister noted.
According to him, interest in such information stuffing should be sought in Russia.
At the same time, he added that he had just met with the Prime Minister of Ukraine Denys Shmygal with the energy ministers of Europe and the United States, in which the European Commissioner for Energy Kadri Simson also took part. During this meeting, issues of assistance with the supply of energy equipment to Ukraine were discussed.
According to the minister, such a meeting is another proof that there are no grounds to talk about any problems with Western partners in establishing close cooperation with the ministry. At the same time, in his opinion, “there are certain forces dispersing such rumors.”
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