Esimated market price, subsidy, and regulated tariff for electricity supply to households

Ukraine’s regulated household electricity tariff increasingly diverges from the estimated market cost of supply. In 2025, the tariff of 4.32 UAH/kWh covered only around half of the estimated cost-reflective price; based on early 2026 dynamics, this share could fall to around 40%.

The gap is covered through the household electricity Public Service Obligation (PSO), creating a large subsidy burden and weakening incentives for energy savings, efficiency investments and distributed renewables. At the same time, the current mechanism channels part of household supply through special Energoatom–USS supply arrangements, reducing liquidity in organised wholesale market segments.

A gradual PSO reform should therefore do three things at once: protect vulnerable households, make subsidies more transparent and targeted, and restore stronger price signals for efficient consumption and investment.