While securing territory is the Kremlin’s most obvious motivation, annexation is also tied to strengthening Russia’s energy position both regionally and globally.
By John P. Ruehl
After Russian forces seized Ukraine’s Kherson region at the beginning of its invasion, a Ukrainian official named Kirill Stremousov was installed as the new government’s deputy head.
In a YouTube video posted in May, Stremousov stated his intention to have Kherson join Russia, declaring, “We will integrate as much as possible into the Russian Federation. All those citizens in the Kherson region will have the right to obtain Russian citizenship [and] Russian passports so they can be a part of a state that has the potential to provide stable social assistance and security.”
Official annexation, like in Crimea, would play into the Kremlin’s strategy of highlighting the local support for Russia in southeastern Ukraine and portraying Ukraine’s government as ineffective across much of its border region. Additionally, Russia would likely use annexation to legitimize nationalizing the valuable Ukrainian energy infrastructure that Russia currently holds.
Across the country, Russian and pro-Russian forces have relentlessly targeted Ukraine’s energy industry. Days before the invasion began, pro-Russian militants attacked the Luhansk thermal power plant (TPP) and destroyed a railway bridge in Vasylivka in southern Ukraine that supplied the plant with coal. Russian forces briefly seized the Chernobyl nuclear power plant (still used for nuclear waste processing) hours after the war began, while a power plant in Okhtyrka was damaged beyond repair on March 5.
The Kryvorizka thermal power plant in the town of Zelenodolsk was also recently attacked by Russian and pro-Russian forces, resulting in a fire that damaged operations. And in Mariupol, where Russian forces recently gained full control after laying siege to the city for three months, the Azovstal steel plant located in the city was heavily damaged during the conflict.
Ukrainian fuel storage facilities have similarly been frequent targets of the Russian armed forces, along with substations, generators, and energy lines. Cyberattacks by Russia have also severely disrupted electricity flows in Ukraine.
But the fate of Europe’s largest nuclear power plant near the Ukrainian city of Zaporizhzhia shows the Kremlin’s true ambitions with Ukraine’s energy infrastructure. While Ukrainian officials were able to contain a fire at the plant that began shortly after the war began, the facility came under Russian control by the first week of March.
On May 18, Russian Deputy Prime Minister Marat Khusnullin said Russia would integrate the Zaporizhzhia nuclear plant into Russia’s energy system if Ukraine did not pay for the electricity it produced. The Kremlin’s intention to connect the station to Russia’s electricity grid was described as “wishful thinking” by Leonid Oliynyk, a spokesman for Energoatom, Ukraine’s nuclear power operator.
But with only two of its six reactors currently operating, the developments at the Zaporizhzhia power plant have further undermined Ukraine’s ability to secure access to energy. The plant generates around half of Ukraine’s nuclear power and a fifth of the country’s electricity. Even if Ukraine maintains control over most of the electricity lines stemming from the plant, they will be useless if Russia shuts it down and is later able to integrate it with its own grid.
The seizure of Ukrainian energy infrastructure has been replicated across Russian-occupied areas of the country. Russian forces also gained control over the Kakhovka hydroelectric power plant and the combined heat and power plant in Luhansk. Much of Ukraine’s industrial heartland lies in the east, which is also where its enormous coal, oil, and gas deposits are located. Additional energy deposits in the Black Sea, as well as Ukraine’s port infrastructure in the eastern region, have fallen even further under Russian control since February.
Until 2014, Ukraine was reliant on Russian fossil fuels and other sources of energy. Though it has significantly reduced this dependency since then, Ukrainian companies remain unwilling to give up the transit fees that Russian resources exported to Europe generate by passing through Ukrainian territory. This is despite Russia’s growing leverage, which it has gained through the construction of new transit routes to Europe in recent years, notably the TurkStream and the original Nord Stream pipeline networks.
Following the election of Western-leaning former Ukrainian President Viktor Yushchenko, who took office in 2005, Ukraine attempted to reduce its energy dependency on Russia in other ways. This included plans to synchronize Ukraine’s energy system with the Continental Europe Synchronous Area (CESA) electrical grid by 2026, a plan that accelerated following the annexation of Crimea in 2014. The Ukrainian war has, however, sped up this process even more quickly, with an “emergency synchronization” being initiated in March.
The completion of this project will permanently remove Ukraine from the Russian-dominated IPS/UPS system and allow it to receive electricity from Europe.
It was therefore no coincidence that Russia’s invasion of Ukraine occurred at a critical moment in this process. On February 24, as part of a three-day trial, the Ukrainian power grid was disconnected from the Russian electrical grid that it had been connected to for decades. Within a few hours, Russian forces had begun their invasion, with Ukraine unable to rejoin the IPS/UPS system.
This necessitated the trial synchronization of the Ukrainian and Moldovan power systems with CESA on March 16, but full synchronization is likely years away. It will require transmission operators to work out frequency control capabilities, additional safety tests, regulatory and power market agreements, and other measures to ensure long-term interoperability. Nonetheless, the Russian invasion has significantly accelerated this initiative.
While the Kremlin no doubt knew it could not stop this development, its military campaign is part of a wider strategy of cementing its energy influence wherever it can. Expanding its energy grid into Ukraine and seizing local infrastructure will complement Russia’s influence in other post-Soviet states. This is particularly prevalent in Belarus, which is still heavily reliant on Russian resources to function and has lucrative transit fee agreements with the Kremlin.
Additionally, during the Soviet Union, “the transportation and other logistical infrastructure of Central Asia was directed toward European Russia,” meaning resource-rich Central Asia’s access to European markets depends heavily on Russia’s goodwill. And through the Russian-led Eurasian Economic Union, Russia intends to introduce a common energy market across member states. Seizing control of some of Ukraine’s most valuable energy infrastructure and reserves will help ensure Russia’s regional energy dominance.
Without Western assistance, Ukraine’s energy sector would have already crumbled, which would have made it unable to continue with the war. The Kremlin is therefore intent on making the West pay for Ukraine’s volatile energy situation as energy prices continue to rise. The United States Congress recently approved $40 billion for Ukraine, its sixth aid package since the war began.
Europe’s Energy Community also recently created a Ukraine Energy Support Fund that will be financed by the EU, international financial institutions, and private companies and corporations. Ukraine’s energy ministry stated that the funds “will be used to restore the energy infrastructure that was damaged or destroyed as a result of hostilities on the territory of Ukraine.”
But the war will continue to have an escalatory effect on the price of energy, and this effect will be felt more acutely in countries without significant reserves. Russia will keep targeting Ukraine’s energy infrastructure, and Kyiv cannot rely on Europe for electricity flows if its situation worsens. Synchronization with CESA could also put the entire grid at risk if Ukraine is destabilized.
But Russia also aims to preserve as much of Ukraine’s energy infrastructure as possible, so that it can be used in Russia and the regions it annexes. While Russia will have to spend significant resources to upgrade and integrate this infrastructure, the immediate and long-term benefits of shoring up its own energy security and undermining Ukraine’s energy security this way are clear.
Pricing and payment disputes between Russia and European resource customers have increased significantly since the start of the invasion. But Russia’s vast reserves have allowed it to make inroads with countries such as India and China, helping it to build on top of years of expanding energy trade. By offering its growing Asian clientele competitive prices for vital resources, Russia is hoping that much of the international community looks the other way as it attempts to expand its energy empire in Ukraine.
