In the middle of the night on February 24 last year, Maxim Timchenko was awakened by explosions reverberating against the windows of his 26th-floor apartment in Kyiv.
After a quick call urging his parents to evacuate, the chief executive of DTEK, Ukraine’s largest private energy supplier, rushed to his office downtown. His response, he knew, would decide not just the future of his company, but power to the whole country. And if Ukraine did not keep the lights on, its resistance to Russia’s invasion could be fatally undermined.
“Last year was not about money or about profits,” Timchenko says. “It was about survival.”
Almost 18 months since the invasion started, Timchenko is still leading DTEK in a daily fight to keep Ukraine’s energy system running.
War has upped the stakes for Timchenko, who faces decisions that could alter the fate of his country. It has also tested DTEK’s evolution from a company that expanded partly through the acquisition and modernisation of state-owned assets, into one aligned with liberalised western markets.
Timchenko, 47, now travels each month to London where he works on raising funds for Ukrainian reconstruction from the Leadenhall Building, the glittering Square Mile landmark nicknamed the Cheesegrater.
With floor to ceiling windows overlooking the City, his office on the 45th floor feels a world away from Kyiv.
DTEK, started in eastern Ukraine in 2005, is now firmly based in Ukraine’s capital, only briefly relocating last year as invading troops were driven back. It is from Kyiv that Timchenko navigated one of his greatest challenges as a CEO, when Russia directly targeted Ukrainian power facilities last autumn.
Hundreds of missile strikes slammed into Ukraine’s power stations, but apart from one short blackout and a few localised disruptions, DTEK and the state energy companies largely kept power intact.
A repeat attempt, set on cutting Ukraine’s energy ahead of winter, remains a worry. Most of Timchenko’s day-to-day is now focused on fortifying against strikes, from repairing damaged plants to having back-up turbines on standby.
While the war has forced him to at times project confidence amid chaos, he has also adopted new approaches to acknowledge the hard times staff are living through.
That first morning of the invasion, one of his earliest tasks was recording a video message for employees, pledging that the company had a plan and outlining their collective roles.
“Always set high standards and follow the standards by yourself, if you want to lead. But during wartime, empathy becomes more important,” Timchenko says. “During wartime you have to be softer.”
Alongside reports most CEOs receive each morning, Timchenko also reads a spreadsheet of employees killed or injured in combat. About 200 DTEK staff have lost their lives in front-line fighting or in service for the company since the war began.
It is “the worst possible news you can get as CEO”, says Timchenko.
It has been 18 years since Rinat Akhmetov — Ukraine’s richest man who owns 100 per cent of DTEK through his System Capital Management vehicle — entrusted Timchenko to lead DTEK. Recently graduated from a masters degree at the University of Manchester, the young CEO embarked on a modernisation mission, including governance reforms and green transition, that continues today.
“I had a clear message from the owner of this business: we invited you to build a western company,” Timchenko says. “Western by standards, by business practices, by approach, by the way we find, hire and motivate people. Those were good messages, but they were difficult to digest [for people in Ukraine].”
He has focused on overseeing the recruitment of a western advisory board, signing up to EU-style climate commitments, and pushing to align Ukraine’s electricity grid and markets with western Europe.
Russia’s weaponisation of energy supplies, a desire to cement ties with western Europe, and reconstruction costs running to some $45bn for the energy sector alone, make modernisation more urgent.
War has also tested the drive for change. As millions fled and businesses were disrupted, people stopped paying their bills and DTEK faced a cash crunch, with payment rates that would ordinarily mean “financial collapse”.
The company was saved in part by cash reserves built up before the war and its gas and coal production. Even more critical, Timchenko says, was Ukraine refusing calls to move to a command-and-control economy, instead retaining most of the energy market reforms hard-won in preceding years.
“It was a huge debate,” says Timchenko, praising Volodymyr Zelenskyy’s government for holding its nerve. “Either we reverse all our reforms and market liberalisation and bring this war-type management in, placing it in the hands of the regulator or ministry, or we accommodate our liberalised model.”
The gamble paid off. As massive disruption and a huge outflow of refugees drove down domestic demand for energy, DTEK began exporting electricity to western Europe where cut-off Russian gas flows had sent prices soaring.
Profits from its trading division in Zug, Switzerland, helped prop up the company.
“This money doesn’t go to pay dividends,” Timchenko says. “This money goes to support our system. Because if we are crushed, either technically or financially, then we would immediately lose this war.”
The war has also smoothed over other tensions, notably between President Zelenskyy and Akhmetov, who had been targeted by a government “de-oligarchisation” programme.
Akhmetov handed his television channels, which had routinely backed opposition politicians, to the state last year, and has contributed $158mn privately to the war effort and branded Vladimir Putin a “war criminal”.
He is suing Russia in the European Court of Human Rights for damage to his business empire, including the loss of the Azovstal steel plant, a symbol of Ukrainian resistance early in the war.
Last month, officials from Zelenskyy’s office attended a dinner hosted by DTEK in London. UK prime minister Rishi Sunak praised the role of the private sector in Ukraine’s reconstruction, in a message read out at the event.
Critics say tensions have been merely glossed over. Timchenko disagrees. His company has demonstrated “sacrifice in everything that we do”, he says, “for the people of Ukraine. Then what kind of tensions can there be?”
Personal sacrifices have also been made by employees. As well as operators at gas-powered generators and renewables, half of DTEK’s 55,000 staff are coal miners, a legacy of its birth from the privatisation of Ukrainian state-owned facilities.
After Russian strikes knocked the grid offline, some of those miners led their colleagues to safety in pitch darkness from 500 metres underground, Timchenko recalls. On another occasion, an employee rushed out to fight the flames when he saw, from his living room window, that his power plant had been hit.
“In this plant you had hydrogen — there would be a huge explosion if you do not extinguish the fire,” Timchenko adds. “He could have made a different choice . . . These are examples of leadership for me. These are the heroes.”
Yet the CEO also struggles with his own powerlessness, what he calls his “heaviest burden”. “You cannot 100 per cent protect them [your staff]. That’s the situation with all your power and capacity as a CEO of a big company, you cannot do it.”
Now, Timchenko’s long-term focus is on expanding overseas, raising funds for reconstruction and modernising Ukraine’s energy system.
The company is investing in green infrastructure, including a wind farm just 100km from front lines. Though some has been lost for the moment in occupied territory, he believes more renewables will be key in Ukraine’s future energy security, including the ability to export more clean power to Europe.
“We all are learning how to live during the war,” he says. “We need to be leaders for future integration and building a new energy system.”
He plans to use DTEK’s London offices, which says they got a “good deal” on during the pandemic, as a base for Ukraine to attract investment.
“To be honest, I am in a different mode, a different emotional state,” he says of his time in the UK. “[In] Kyiv, your forecast and your planning period is one month, six months, not more. Coming here, we think about future.”