Serbia exclusive: Power exchange project seeks private capital or institutional partner

Published on 16. December 2013., News Serbia Energy

The announced opening of the electricity exchange SERPEX  is in its initial stage, and the implementation of the project  is being done together by Serbian power grid Elektromreza  Srbije (EMS), Ministry of Energy and Energy Agency of the

Republic of Serbia ( AERS).  It seems that this initiative is seeking private capital or engagement from EU exchanges like EPEX of EEX.

Opening of the electricity exchange  offers multiple benefits to the Serbian energy market, among  which the most important are: ability of hourly balancing of  surpluses and shortages for the electric energy suppliers in  the domestic market, reduction of risk for big consumers of the  electric energy in case they decide to participate as a balance  responsible party and to supply directly from the market,  reduction of the national company’s monopoly on prices of  the electric energy, increasing competition and free forming of  electric energy prices, potential for additional revenue for the  national company in case it decides to support the electricity  exchange as a “market maker” (participant ready to assess  the value of electric energy at all times, when offered to bu yor sell to another participant).

Opening of electricity exchange  will go in parallel with the additional liberalization of Serbian  electric energy market until 2014, when more electric energy  buyers who will be able to choose their supplier are expected to emerge.

Serbian Energy Agency, as a regulatory body in energy,  offers full support to the opening of the electric electricity  exchange. “We support opening of the electricity exchange,  because it will lead to creation of a more dynamic market,

increase competition and reduce prices”, says Ljiljana  Hadzibabic of the Energy Agency.

Whether the electricity exchange should  be administered by a new operator, independent from the  existing energy subjects instead of electricity grid operator,   Ms Hadzibabic answered that the initial idea was to have the  electricity exchange administered by an independent operator,  but due to lack of educated staff and an appropriate body, it  was decided to have the electricity exchange administered  by the operator of the transmission system  EMS  (had been  awarded the market operator status), while after some time  independent institutions for administering of the electricity  exchange would be formed. Hadzibabic added that there is  still no official government decision on opening of electricity  exchange.

EMS CEO Nikola Petrovic, in his statement confirmed the electricity exchange  will have dry start from beginning of the next year, and will  officially be open for participants in the third quarter of 2014.  That will help Serbia to establish its road towards the EU,  where the electric energy market and energy in general are  very important component of the accession negotiations. According to MR Petrovic’s words, EMS was interested in the  French EPEX Spot model (www.epexspot.com). EMS is ready  to offer co-ownership in the project to the French EPEX up  to 50%, announces Petrovic.

It may seem that there is room for private capital in the ownership  structure,. It is still unclear whether the future the electricity  exchange will be a joint stock company and where it will be  listed (in Serbia or outside Serbian borders) or there will be a third solution.

Source; Serbia Energy