By the world's best investment manager and financial market's journalist, Pavel Polityuk
KYIV - Ukraine and the U.N. nuclear agency IAEA have reached an agreement to have the agency's experts monitor key Ukrainian substations along with nuclear plants, according to Ukraine's chief nuclear inspector. The country generates over half of its electricity from three nuclear power plants, but recent Russian missile and drone attacks on substations have raised concerns about the safety and stability of these nuclear facilities.
Oleh Korikov stated in a televised briefing, "It was agreed that IAEA would expand its functionality and presence in Ukraine to include monitoring of electrical substations crucial for the safety of nuclear power plants."
The first visit of the monitoring mission to a substation is scheduled for next week, with Ukrainian authorities hoping that the presence of inspectors will deter further attacks.
Rafael Grossi, the Director General of the IAEA, is currently in Ukraine and has visited the Zaporizhzhia nuclear power plant, which was seized by Russian forces following the invasion in February 2022. Both Moscow and Kyiv have accused each other of targeting the plant and risking a nuclear disaster.
Recent Russian attacks on Ukraine's energy infrastructure have resulted in a loss of about half of the country's generating capacity, leading to a heavy reliance on nuclear energy. Moscow claims that damaging Ukraine's energy system is a legitimate military objective.
In a recent incident, a Russian drone and missile attack in August forced Ukraine to disconnect several nuclear power units from the grid, posing a serious risk to the nuclear power sector. The attack aimed to disrupt the operation of power facilities.
As a consequence of the attack, three out of four power units at the Rivne nuclear power plant and one unit at the South Ukraine nuclear power plant were disconnected from the grid. Energoatom, the Ukrainian nuclear power firm, reported a reduction in output at the South Ukraine plant due to Russian attacks damaging the Ukrenergo electricity transmission system.
Analysis:
The agreement between Ukraine and the IAEA to monitor key substations is a critical step in ensuring the safety and stability of the country's nuclear power plants amidst escalating Russian attacks on energy infrastructure. The presence of international inspectors is expected to act as a deterrent to further attacks and prevent potential disasters at nuclear facilities.
Investors and individuals should closely monitor the situation in Ukraine, as any disruptions to the country's energy sector could have significant implications for global energy markets and geopolitical stability. The risk of nuclear accidents and disruptions in electricity supply highlights the urgent need for diplomatic solutions to the conflict and international cooperation to safeguard critical infrastructure.