Industrialists call for no increase in freight transport and electricity tariffs

Such steps could halt plans for economic recovery

Leading industry associations in Ukraine have spoken out against increases in freight and electricity tariffs due to the risk of businesses shutting down or a significant drop in production.

A joint statement was issued by Ukrmetprom, the National Association of Mining Industry of Ukraine, the Ukrainian Association of Ferroalloy Producers, the Union of Chemists of Ukraine, the All-Ukrainian Union of Building Materials Manufacturers, and the Association of Cement Producers of Ukraine.

According to the statement, Ukrainian Railways intends to increase freight tariffs by 27% in 2025 and by another 11% from 2026. And NPC Ukrenergo proposes to raise the tariff for electricity transmission by 15% next year and for dispatching by 11%.

Representatives of industrial sectors have warned that such actions by state monopolies will have devastating consequences for the economy, particularly for export-oriented industries, which are already operating in extremely difficult conditions due to the war. It is noted that the new tariffs will hit the ferroalloy and construction industries particularly hard.

In addition, the pressure of railway tariffs reduces the competitiveness of Ukrainian exports and encourages businesses to switch to road transport.

Steel, mining, chemical, ferroalloy, cement, and construction companies in Ukraine are already operating below full production capacity. High rail freight tariffs, rising energy costs, and the unpredictable policies of state monopolies are pushing Ukrainian products out of global markets.

According to estimates by the state-owned company Ukrpromzovnishchexpertiza, a 37% indexation of freight tariffs alone will lead to a reduction in GDP of almost UAH 100 billion, a loss of foreign exchange earnings of UAH 98 billion, annual budget losses of over UAH 36 billion, and the elimination of at least 76,000 jobs. If they are increased by more than 40%, the effect will be even more negative for the entire economy.

Industrialists pointed to a systemic problem with Ukrainian Railways, namely, shifting the burden of unprofitable passenger transportation onto businesses.

Industry associations appealed to the government, the Ministry of Development of Communities and Territories, and the regulator NEURC with a call not to allow an increase in UZ freight tariffs and to reject the proposed tariffs of Ukrenergo.

In addition to preventing tariff increases, the key proposals regarding UZ also include the following:

• including targeted expenditures in the 2026 state budget to compensate for losses from passenger rail transport in the amount of UAH 25 billion.
• assisting UZ in obtaining the necessary regulatory decisions from the government and parliament that will reduce the financial burden on the operator;
• introducing a program to improve the efficiency of Ukrainian Railways (automation, personnel optimization, digitalization of management);
• developing and implementing a program to improve the competitiveness of rail transport;
• creating a legislative basis for opening the rail transport market and allowing private carriers access to the rail infrastructure.

Proposals for Ukrenergo from industry associations include the following:

• setting tariffs at an economically justified level (electricity transmission – no higher than UAH 733.96/MWh, dispatching – no more than UAH 100/MWh);
• developing state support tools for energy-intensive export-oriented industries as a temporary anti-crisis measure;
• introducing technical and economic criteria according to which enterprises in the mining, chemical, cement, and building materials
• industries would be considered priority industries.

On November 4, the NEURC approved Ukrenergo’s tariff for electricity transmission in 2026 at UAH 786.74/MWh (excluding VAT), which is 14.6% higher than the current year’s tariff. In addition, there are plans to increase the dispatching tariff by 11.3%. The regulator’s decision is subject to further discussion for final approval.