Innovative leadership. How Energy Trade Group launched and develops digital services in the Ukrainian energy market

The energy market in any country worldwide is marked by a significant level of bureaucratisation and regulation. This not only imposes burdens on businesses but also complicates the provision of quality services to consumers. The implementation of digital services for customers serves as a solution to this challenge.

The unique innovative development strategy of Energy Trade Group (ETG.UA), launched in 2017, serves as proof of this assertion. Particularly noteworthy is its effectiveness amidst the challenging circumstances of a full-scale war that currently grips the Ukrainian energy market. This strategy has not only facilitated the preservation of businesses but has also provided incentives for their steadfast growth.

ETG.UA's ability to effectively compete for customers, particularly small and medium-sized enterprises, is bolstered by the establishment of a unique digital service ecosystem. This initiative has positioned the company as a high-quality alternative to the energy market monopoly. With a primary emphasis on customer-centric solutions, ETG.UA caters not only to businesses across all regions but also extends its services to clients in the household and public sectors, including hospitals, schools, and kindergartens.

ETG.UA encapsulated the outcomes of its distinctive journey of innovative development in its first  ESG report, which was unveiled in December 2023. "Our achievements, as outlined to our stakeholders in the ESG report, are not merely formalities. We have assessed our accomplishments through the lens of the international ESG report standard. This report signifies the culmination of our ongoing corporate policy. Essential elements of business conduct such as Environment, Social, Governance have been integral since the inception of ETG.UA's development," remarked Volodymyr Shvedkyi, CEO of ETG.UA.

In this review, Mind presents the growth drivers of one of the largest independent players in the Ukrainian energy market.

Digital Innovations. Flexible and Modern Customer Services

The consistent development and digitalisation of energy services allowed ETG.UA to transform from a company that was a typical provider of energy services into a system business based on its own innovative IT ecosystem. All this was a response to a request from customers interested in improving their customer experience.

The ETG.UA team's years-long experience in the market contributed to the success of this important task. In particular, its specialists ensure the secure processing of customer data – the company's entire IT infrastructure is located in the EU. The integration of corporate digital services with the Diya public services portal and cooperation with the SmartTender platform allow ETG.UA to implement transparent and efficient commercial transactions with energy resources in the market.

ETG Billing, the pioneering automated metering system in the Ukrainian retail energy market, plays a pivotal role in optimising the costs associated with natural gas and electricity. This initiative fosters energy efficiency and promotes resource conservation. Furthermore, the ETG.UA mobile application enhances convenience and time efficiency in managing energy payments for users. Additionally, ETG.UA offers maintenance services for gas networks, prioritizing the highest standards of reliability and safety in gas supply.

"Feedback from numerous clients indicates that our strategy aligns with the challenges of the times. We are progressing in the right direction by prioritizing investments in advanced IT developments and service enhancements. This vision enables us to offer the market more than just typical technologies with service; rather, we provide a modern technological service," remarks Volodymyr Shvedkyi.

This approach also mirrors ETG.UA's strategic vision of sustainable business development, emphasising the continual enhancement of business process efficiency, decarbonisation, and the advancement of renewable energy sources (RES). It underscores ETG.UA's commitment to supporting state policies aligned with Ukraine's international obligations to deepen integration with the EU and combat global climate change in accordance with the Paris Agreement.

Green Innovations. Developing Affordable And Clean Energy

Numerous market studies show that modern customers prefer responsible consumption. They want not only to save resources but also to make their own contribution to solving urgent problems of our time, such as the fight against climate change and market abuse. Therefore, citizens consciously choose the companies whose services they consume in the energy market and whom they agree to back with their “own hryvnia”.

By choosing to partner with ETG.UA, customers understand that they are investing in the development of clean energy in Ukraine and a transparent, independent service company that is an alternative to a monopoly.

Benefits of renewable energy, which are a key priority for ETG.UA's business, are based on their safety and availability. Thanks to the decentralised location, renewable generation is able to provide reliable energy supply even in difficult war conditions. That is why the company is developing its own portfolio of green projects with international partners who supply the latest technological solutions for the construction of solar and wind power plants.

ETG.UA's flagship asset is the Solar City project implemented in the city of Zhovti Vody, Dnipropetrovsk Oblast. It is a solar power plant with a total capacity of 55 MW. It was built on the land of a spent uranium mine that was mothballed according to all environmental standards and is not suitable for agriculture or housing construction.

ETG.UA's effective cooperation with the local community during the implementation of this project was recognized with a silver award in the Planet category of the Partnership for Sustainable Development 2023 competition, which was held under the auspices of the UN Global Compact Office in Ukraine.

"It is thanks to the help of the private sector that we have additionally repaired roads, updated computer equipment and modernized classrooms in schools. Only by joining forces can we do much more. Let's keep the rear together," commented Dmytro Khanis, Mayor of Zhovti Vody, on ETG.UA's contribution to the development of the region.

To address the shortage of generation sources caused by the hostilities and support the country's energy sustainability, ETG.UA is investing in the restoration of the power system in the most deficient energy hub in Kyiv Oblast. In October 2023, the company began construction of solar power plants in Berezan, a town with agricultural, cement, and light industry enterprises. For the construction of the Berezan Solar project, which consists of eight PVs with a capacity of 7.3 MW, Ukrgasbank issued a loan of UAH 100 million under the Affordable Loans 5-7-9% government programme.

On January 26, 2024, the plant became operational, and on February 1, the company began supplying green electricity to customers in Kyiv Oblast. Since its launch in February 2024, this green generation will help reduce 5 200 tonnes of carbon emissions annually and improve the region's ecosystem through the use of nature and climate-friendly technologies. In this hub, the company plans to develop an energy cluster with the construction of energy storage systems and gas piston plants to balance the power system. A sufficient number of industrial enterprises also enables supplying green energy directly to consumers.

The generated electricity is to be supplied to ETG.UA's client portfolio, namely small and medium-sized businesses. "This is the first case since Ukraine's independence when renewable energy will be supplied to the company's own SME portfolio without the support of a green tariff," says Volodymyr Shvedkyi.

Another significant asset in ETG.UA's investment portfolio is the Wind of Independence project. In the second quarter of 2024, the company plans to complete the project preparation stage for construction.

"Wind of Independence is set to construct wind farms adjacent to major industrial enterprises in the Petrove Community in Oleksandriya Rayon, Kirovograd Oblast. The company aims to inaugurate the initial phase of wind farms, boasting a capacity of 100 MW, by 2025. Subsequently, the second stage, featuring a capacity of 330 MW, is slated for completion by 2027. Notably, the energy generated from these wind farms will be integrated into ETG.UA's own customer portfolio, which encompasses small and medium-sized businesses. As a result, by 2025, the company endeavours to furnish its entire customer base with green energy, marking a significant stride towards sustainability.

"Contrary to skeptics who vocalise doubts about the viability of renewables amidst the energy crisis, my team and I remain steadfast in our conviction that they represent the future. Renewable generation stands poised to sustain Ukraine through the ongoing conflict and drive economic recovery post-victory. This unwavering belief fuels our continued investment in its development, confident that our efforts will yield meaningful returns," explains Volodymyr Shvedkyi ETG.UA's visionary strategy.

Innovations in Corporate Governance. Priorities That Determine Sustainable Business Development

Сorporate structure is another key element of ETG.UA's vision. It is a horizontally integrated group of companies that delivers value to its customers who need quality service and sustainability in their energy supply. Its business is located at the intersection of three energy sectors: energy trading, clean energy investments, and providing high-quality services to customers ranging from large corporations to households.

ETG.UA's sustainable growth and competitiveness are ensured not only by providing quality services to customers tailored to their needs, but also by effective corporate governance, which creates incentives for business evolution and team development.

Along with client services, ETG.UA digitises internal business processes. This helps to implement responsible resource use practices. In particular, digital document management helped to eliminate paperwork. The company's clients have the opportunity to sign contracts, invoices, and acts electronically. Moreover, today it is possible to become a client of the company without leaving your own office or home. The vast majority of ETG.UA clients (85%) use the company's innovative digital services.

To improve corporate governance in the field of sustainable development, ESG management was integrated into its system, taking into account the best international practices adapted to the goals and needs of ETG.UA.

In addition, the company's organisational and business structure was updated. Business units were formed in this structure and their strategy for 2024-2026 was approved. The company introduced corporate governance institutions, including a supervisory board of directors and a management board.

"ETG.UA is a company that sets the pace, introduces innovations, and works to create a transparent, open, sustainable energy market. Our team systematically advises communities and public sector companies. We make constant proposals for recovery. We see that the development of the state will be primarily driven by transparent rules of the game and continuous market development, and we are actively contributing to this," Volodymyr Shvedkyi says.

A focal point in ETG.UA's corporate culture development is its commitment to combating corruption. "As a socially responsible business, we proactively implement leading anti-corruption practices, uphold integrity policies, and maintain transparency in our operations to foster trust and respect for the company among clients, employees, partners, international organizations, and the public," summarises Mr. Shvedkyi. He asserts that this approach facilitates swift adaptation to evolving market conditions driven by Ukraine's integration with the EU and Western countries.

 

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