$100M stolen from Ukraine’s nuclear proves the choice: Soviet monopolies Moscow corrupts, or green systems it can’t

The recent scandal uncovered at Energoatom—where NABU's Operation Midas revealed a serious and deeply rooted corruption scheme involving $100 million in kickbacks—is not merely a dramatic headline.
It is a warning signal that Ukraine's energy sector remains captive to a Soviet-style model of centralized control, endemic "kick-backs" and rent-seeking, rather than being a driver of innovation, efficiency, and integration with Europe.
Key facts about Ukraine's nuclear underperformance:
- 5 gigawatts of clean nuclear power sat idle annually due to mismanagement
- World's lowest capacity utilization rate at 62.7% (global average: 80-83%)
- Lost generation capacity could have boosted economy and enabled exports to EU
- Instead, Ukrainians burned imported Russian coal in crumbling Soviet-era power plants
The scale of systematic theft
While Timur Mindich's criminal network extracted 10-15% from every Energoatom contract, Ukraine's nuclear power plants—which generate over half the country's electricity—operated at just 62.7% capacity utilisation in 2020. That was the world's lowest rate for nuclear capacity utilisation.
The Mindich tapes now explain failures I documented in 2021: why Zaporizhzhia NPP couldn't run all six reactors simultaneously despite claiming "historic" full capacity, why critical repairs at Burshtynska TPP were delayed until workers died in preventable accidents, and why availability of nuclear generation capacity mysteriously dropped during peak demand in winter 2021/2022.
The answer wasn't technical constraints. It was a criminal enterprise masquerading as state energy sector management.
Operation Midas: 1,000 hours documenting the protection racket
Over 1,000 hours of NABU surveillance documented a protection racket that was running at large inside Ukraine's most critical energy infrastructure while Russia was systematically targeting power plants, grid substations, and gas facilities with aerial attacks to plunge the country into darkness.
What investigators uncovered:
- $100 million total allegedly laundered through the kickback scheme
- Over $4 million in cash seized during raids
- Cash-laundering hub in central Kyiv linked to Derkach family processed the entire scheme
- "Shlagbaum" (boom barrier) system requiring 10-15% kickbacks from all contractors
- 435 million UAH ($10.4 million) contract awarded after agreeing to higher kickback rate
Operation Midas reveals the deep, systemic problems of Ukraine's energy sector, which the Kremlin has exploited for decades to undermine its energy security, reform course, and integration into European markets. "Kickbacks" aren't just corruption—they're paralysis of governance, where strategic decisions are made through envelopes and informal influence networks rather than by competent professionals.
Why decentralization defeats corruption
Four choke points = total control
Energoatom's 15 reactors, located across four sites, create four decision points. Capture those four, and you control half of Ukraine's electricity generation.
The Zaporizhzhia NPP, with its six reactors, was captured in the first days of the full-scale invasion and turned from locomotive of Ukraine's economy to a ticking bomb threatening radiation disaster on a continental scale.

Compare that to a distributed grid based on renewables and energy storage: 1,000+ small projects across hundreds of locations, each with separate developers and contractors. That's 1,000 procurement decisions where competition can expose corruption rather than four centralized points where informal networks operate. The Derkach-Halushenko network demonstrated the vulnerability of the centralized model.
Ukraine's untapped renewable potential
Ukraine's renewable potential is enormous:
- 320 gigawatts of wind capacity available (IRENA estimates)
- 70 gigawatts of economically viable solar by 2030
- €1.1 billion in private investment attracted during 2015-2018 despite war
However, only 2% of electricity was produced from renewables by 2021 while state monopolies dominated. Why? Because centralized monopolies offered better rent-seeking opportunities.

The economics of corruption-resistant infrastructure
The infrastructure economics reinforce this structural difference:
| Why centralized = corruptible | Why distributed = resistant |
| Control 4 nuclear sites = control 50% of power | Need to capture 1,000+ renewable projects = impossible |
| $500M nuclear fuel buys = easy to skim | Sun and wind are free = nothing to steal |
| $1-2B coal through connected traders = kickback heaven | EU equipment markets = transparent pricing |
| Narrow channels concentrate money = Energoatom's "bar gate" kickback scheme works | Spread across hundreds of projects = competition prevents schemes |
Distributed renewables work differently: upfront capital across hundreds of projects, minimal fuel costs, and project economics determined by transparent European equipment markets rather than opaque fuel trading. The clean energy business inherently resists the "Shlagbaum" approach.
"Clean energy" means not only being less polluting and better for the environment, but also being free from corruption.
The compounding damage
The direct theft from just recently documented episodes in Energoatom—$100 million—could have covered approximately 20 Patriot missiles or 40,000 Sting interceptor drones. However, the compounding economic damage vastly exceeds the amount stolen.
That same $100 million could have built approximately 100 megawatts of distributed hybrid solar capacity—generation impossible for Russia to destroy with a single missile strike and far harder to corrupt through centralised kickback schemes.
How Moscow's strategy works
Ukraine's post-Soviet energy inheritance created perfect conditions for the corruption Moscow systematically encouraged. Large centralized monopolies—nuclear, coal, and gas—concentrate decision-making at a few choke points. When those choke points are captured through "informal groups of influence," entire sectors become extraction engines.
The NABU investigation reveals the blatant racketeering. Suspects used codenames—"Carlson" for Mindich, "Professor" for Halushchenko, "Rocket" for Myroniuk—and called their system "Shlagbaum" (boom barrier): an obstacle that moved only when Energoatom's contractors paid 10-15% tribute.
This was not merely mismanagement— it was state capture optimized for private wealth extraction. But not only that. It was state treason.
The Derkach connection: the "missing link" between old pro-Russian capture and today's Energoatom scandal
From 2006 to 2025: How Moscow embedded corruption
To understand why the Energoatom scandal erupted on such a massive scale, one name must be brought back into the spotlight: Andriy Derkach. For years, he operated in the shadows of Ukraine's nuclear and energy sectors.

Today, as investigators expose a kickback scheme worth $100 million in Energoatom, Derkach reappears as the "missing link" connecting the pro-Russian corruption of the 2000s with the criminal networks uncovered in 2025.
Derkach is no ordinary corrupt politician. He is a Ukrainian MP turned Russian agent, sanctioned by the US as an operative who worked for Moscow for more than a decade.
Before that, he headed Energoatom and the nuclear holding Ukratomprom in 2006–2007, years when Kremlin influence was quietly but deliberately built into Ukraine's strategic infrastructure.
Under his leadership, Energoatom became a key entry point for Russian political and economic leverage.
NABU uncovers the Derkach family network
NABU investigations show that the old networks never fully disappeared. NABU and SAPO have revealed that the central cash-laundering hub for the kickback scheme — an office in central Kyiv through which roughly $100 million may have flowed — is linked to the Derkach family.
Critical connections exposed:
- Ihor Myroniuk (codename "Rocket") served as both Derkach's longtime aide AND official adviser to Minister Herman Halushchenko
- Halushchenko referred to as "Derkach's man" on leaked surveillance tapes
- Cash-laundering office in central Kyiv linked to Derkach family
- $100 million flowed through this single office
This case demonstrates how the Soviet-style energy system management "kickback" culture — never fully reformed — remained vulnerable to infiltration, manipulation, and exploitation by actors aligned with Russia. Until these structures are dismantled, Ukraine's energy sovereignty will remain at risk.
What EU integration requires
Technical obligations Ukraine has avoided
Ukraine has committed to European energy integration by signing the Energy Community Treaty. That includes obligations Ukraine has systematically avoided—obligations that would disrupt corrupt centralised extraction schemes.
Key EU requirements Ukraine must implement:
- Industrial Emissions Directive: Thermal plants must install modern filtration or close by 2033
- ENTSO-E synchronization: European network codes require transparent market operations
- Standardized procurement systems that prevent informal kickback schemes
- Independent regulatory oversight insulated from political capture
- Digital transparency for all energy sector contracts
Why corruption resists European integration
The Industrial Emissions Directive requires thermal plants to install modern filtration or close by 2033. Most coal plants received temporary "death permits" in 2016. Those hours are running out, but companies delayed decommissioning because closures would eliminate rent extraction opportunities.
ENTSO-E synchronization similarly threatens other extraction opportunities. European network codes require transparent market operations, standardized procurement, independent oversight—technical requirements that make "Shlagbaum" schemes impossible to operate.
This explains the pattern I documented in 2021: synchronization delays, mysterious equipment failures, inability to operate at full capacity. The system wasn't failing technically—it was resisting reforms that would eliminate corruption opportunities.
The time for EU integration is now
What Ukraine must do immediately
Ukraine must treat the Energoatom scandal as a turning point. Corruption in the energy sector is not a secondary problem — it is a structural vulnerability that Russia hpoas exploited for decades to penetrate, influence, and ultimately weaken Ukraine from within.
State capture, patronage networks, and opaque monopolies created the environment in which pro-Russian actors like Andriy Derkach could embed themselves deep inside strategic institutions and continue exporting corruption long after formally leaving office.
Immediate actions required:
- Internationally vetted independent boards in all state energy companies
- Transparent procurement systems with external audits and public oversight
- Forensic audits exposing networks linking current schemes to past Russian interference
- Digital transparency replacing backroom deals in energy sector
- Rapid renewable deployment breaking Soviet-style monopolies
- Full EU market integration with aligned rules, market design, and infrastructure
- Real accountability: prosecutions, asset recovery, European Green Deal commitment
The only real antidote is a full reset of governance and alignment with Europe.
Integrating fully into the EU energy markets — aligning rules, market design, and infrastructure — is essential to severing the shadow ties that still link Ukrainian assets to Russian influence. And this transition must come with real accountability, including prosecutions, asset recovery, and a clear political commitment to the European Green Deal as Ukraine's strategic direction.
Only by building a new, truly clean, decentralized energy system and dismantling the remnants of the corrupt, centralised old system can Ukraine secure an energy sector that Moscow can no longer manipulate.
Oleh Savytskyi
Editor's note. The opinions expressed in our Opinion section belong to their authors. Euromaidan Press' editorial team may or may not share them.
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