Electricity and gas market opens in Serbia, fast power market liberalization to impact big consumers

, News Serbia Energy

The market for electricity and gas in Serbia will be liberalized starting from January 1, 2013 although all participants are not fully prepared for liberalization. According to the new Energy Law  large industrial consumers will have to buy electricity in the open market starting from 2013, while for households and small consumers it will apply from 2015, but they will still be entitled to a public supplier designated by the Government.

From next year 9.5 percent of the electricity market will be open, which includes 27 large industrial customers and 40 percent of the gas market, it was announced by the board member of the Energy Agency (AERS) Ljiljana Hadžibabić, at a round table on the liberalization of the electricity and gas market.

All consumers, at the open market will be disconnected from the grid if they do not make an agreement for the supply of electricity with the best supplier they chose before January 1, she said, and told them to do so as soon as possible.

Hadžibabić stressed that all by-laws for the liberalization of the electricity market are ready, but a part of methodology and equipment for the liberalization of the gas market is still missing.

Nonetheless, the opening of the market will start from next year, there will definitely be problems in the beginning, but they will gradually resolve, and if the practice shows there should be, there will change in some of the rules, Hadžibabić said at a conference organized by the Internet magazine “Balkanmagazin “.

Deputy Minister of Energy Mirjana Filipovic also said that there won’t be any delays in the implementation of the Energy law, which includes the opening of electricity and gas market, since Serbia has to implement previous commitments and coordinate energy market with the markets of the EU and the region.

She was unable to say whether the large debtors such as RTB Bor, Petrohemija, Serbian Railways, would remain without electricity and how will the problems of these restructuring companies be solved, while pointing out that this matter should be solved by the Government of Serbia.

Electric Power Industry of Serbia (EPS) offered to customers at the open market the price of electricity that is 46 percent higher than the regulated price, although a realistic market price for these customers should be about 60 percent higher than the current regulated price for the industry, said the electricity trading director in EPS Dragan Vlaisavljević.

He pointed out that EPS is ready for the opening of the electricity market, but it is difficult to liberalize the electricity market with the price of electricity, which is the lowest in Europe, averaging at around 5.5 euro cents per kilowatt-hour.

Households and small consumers will be supplied as before by 2015, from EPS at regulated prices, and after 2015 they can but do not have to buy electricityr in the open market.

This law will introduced a new institution of public supplier to the electricity market a, which will be responsible to provide electricity for households and small consumers by 2015.

From 2015 households and small customers will also be able to choose their supplier and find  the one who will sell electricity at the lowest prices, but if they do not want to they don’t have to, because they will still be entitled to public supply.

Public supplier should be determined by the Serbian government, and a reserve supplier category is foreseen  from whom industrial consumers and qualified buyers who are not entitled to public supply, which could not find their way in the open market, will be able to buy electricity for 60 days but at a much higher prices.

Source Serbia Energy Magazine