Macedonia lags on energy reforms, says EU Energy Community

Macedonia lags on energy reforms, says EU Energy Community
By Valentina Dimitrievska and Denitsa Koseva February 3, 2016

The EU Energy Community has criticised Macedonia for its failure to carry out energy sector reforms that will help create a regional electricity market in the Western Balkans.

Governments from the six Western Balkans countries agreed in August to work on four infrastructure projects as well as so-called “energy soft measures” contributing to the development of a regional electricity market.

In a series of reports issued on February 2, the Energy Community identified Albania, Montenegro and Serbia, which have already adopted the EU’s Third Energy Package, as frontrunners in the region. However, it warned that all six countries should continue their efforts to remove obstacles to the development of a regional electricity market by the deadlines agreed at the Balkan Summit held in Vienna in 2015.

On the infrastructure side, the priorities are construction of the Trans-Balkan Energy Corridor connecting Bosnia, Montenegro and Serbia, and the Albania - FYR of Macedonia Power Interconnection. The “energy soft measures” include the creation of national balancing markets, development of spot markets and implementation of the Third Energy Package.

Increased commitment is required by all the WB6 countries, especially by Macedonia, which has missed two deadlines to introduce the “energy soft measures”, the Energy Community said in a statement.

According to the monitoring report for Macedonia, transmission system operator MEPSO failed to sign an agreement with the Coordinated Auction Office in South East Europe (SEE CAO) on coordinated allocation by the November 2015 deadline. Macedonia also missed the October 2015 deadline to amend its non-compliant energy law.

"The government shows no willingness to rectify this breach of the Energy Community Treaty," the report said.

Bosnia & Herzegovina was also criticised for failing to transform its good intentions into specific reforms.

According to the report, the country lacks the legal framework to remove legal and contractual obstacles to establishing organised electricity markets and market coupling. Bosnia has not made any progress in creating a power exchange or enabling wholesale market trade. Bosnia should also make efforts to ensure competition on the local power market and remove the regulation of power prices for end-users, the report said.

Meanwhile, the Energy Community pointed out that a connection agreement between Serbia’s ENTSO-E and Kosovo’s transmission system operator has not yet entered force.

The Energy Community Secretariat was tasked to monitor the implementation of the measures and report on the progress made at the next Western Balkans 6 Summit scheduled to take place in France in July 2016.

The implementation of the Third Energy Package, which was incorporated into the Energy Community acquis communautaire in October 2011, offers opportunities for market opening and cross-border market integration for the benefit of the industry and energy consumers.

Signatories to the Energy Community treaty, which are mainly EU aspirant states from Southeast Europe, had been given until January 2015 to transpose the Third Package, a set of EU legislation aimed at making the EU’s energy market fully effective and creating a single EU gas and electricity market.