Avtostrada Group LLC, which won 7 of the 10 lots in a procurement process to install backup power systems in Kyiv’s apartment buildings, has reported significant delays in delivering the project. Maksym Shkil, founder of the Avtostrada Group, told LB.ua.
According to him, work under this procurement can begin only after an advance payment is received under the contracts. Shkil’s position is driven by the broader situation in the country regarding payment for works and the State Treasury’s blocking of all payments for capital expenditure.
The Avtostrada Group, known for road contracts, won 7 lots in the procurement to install power systems for high-rise buildings in seven districts of Kyiv, with a total value of about UAH 3.7bn. In three other districts, the work will be carried out by Service Energy Solutions LLC. The project is being implemented as part of resilience plans.
At the first stage, the plan предусматривает the design, procurement and installation of energy-independent equipment (generators, inverters, batteries) for a thousand buildings. The contracting authority is a subsidiary within the Naftogaz of Ukraine NJSC system — Naftogaz Bioenergy – A LLC. The company is currently headed by Ruslan Nichyk, who is linked to former Deputy Prime Minister and adviser to the President of Ukraine Oleksandr Kubrakov.
Under the project, high-rise buildings whose internal networks depend on the availability of electricity were supposed to receive design work and the installation of uninterruptible power supplies in case of outages. Applications and the selection of buildings to take part in the project were collected by Kyiv’s districts back in April. However, the tender was announced only in August, after the comprehensive Kyiv Resilience Plan was formally approved at a meeting of the National Security and Defence Council. The tender winners were determined in early September, and contracts with the winners were signed at the end of September.
At the same time, in the last ten days of September, the government blocked the processing through the State Treasury of all payments for capital expenditure in order to save budget funds for priority needs (defence spending, public-sector wages, social payments). Measures under the resilience plans, regardless of the source of funding (local or state budgets), are also among the temporarily blocked expenditures.
“Since we have not received payments from the state budget for any of our certificates of completed works under road contracts, the timing for starting work under the high-rise tender is currently unknown. All work will begin only after we receive the advance payment — on the same day,” Maksym Shkil told LB.ua. He was among the first to publicly criticise the government for unilaterally halting payments on state contracts without warning.
He said that during the tender preparation stage for power sources for high-rise buildings, other potential contractors proposed delivering such a project over two years. Avtostrada, however, had preliminarily promised to complete the work by December this year — provided it started in late spring.
“When we receive the advance payment, we will start the design work and procurement of equipment for the power sources on the same day, and we will do everything possible to do it quickly,” Shkil assured.