Serbia: Presidency over the Energy Community in 2021

, News Serbia Energy

Earlier in December, the Director of the Energy Community Secretariat Janez Kopac said that the Council of Ministers should consider the violation of EnC rules by Serbia, because it did not separate the activities of gas operator Jugorosgas Transport.

Serbian Minister of Mining and Energy Zorana Mihajlovic took over the presidency over the Energy Community (EnC) in 2021 on behalf of Serbia and announced that the next year would be marked by searching for joint answers to energy-related and environmental challenges and better connecting in the region.  Minister Mihajlovic said that the goal for Serbia, as the presiding country, is be an example to other members in 2021, both in adopting and implementing regulations pertaining to energy and climate change and in carrying out reforms and creating modern and efficient energy companies.

Serbia will also work on a quicker regional connecting in the field of energy, which is also important for the region’s road to the EU membership. Only by working together, the region can provide the right answers to the energy and environmental challenges that the whole world is facing.

Kopac said that it was a serious case of violation of EnC energy law and that Jugorosgas Transport, a subsidiary of Srbijagas, was not certified in accordance with the Third Package. He added that the Secretariat is not insisting on an infringement procedure now, since some things have been realized after all. But if Serbia does not take measures to separate activities under the Third Energy Package, the Secretariat will initiate a new procedure against Serbia. He also pointed out that Serbia has been avoiding the implementation of the directive on the maximum share of sulfur in fuel oil for years. Another big issue is the unreasonable support for coal. Kopac reminded that President Vucic signed the Sofia Declaration, which envisages complete decarbonization by 2050, but a month later he announced the construction of a coal-fired thermal power plant Kostolac 3. A coal-fired power plant cannot be depreciated in 25 years and it is completely unreasonable if the promise of decarbonization is serious. According to Kopac, in accordance with the Sofia Declaration, Serbia would have to immediately introduce pricing for carbon dioxide emissions. In the region, only Montenegro has done that so far, and the EU will introduce a cross-border tax for carbon dioxide emissions next year. The Secretariat also has significant objections to the regulatory framework of the Balkan Stream gas pipeline through Serbia (the extension of TurkStream), because the regulator’s decision to exempt the project from the main principles of the Third Package on free access, tariff regulation and separation of activities did not respect the Secretariat’s opinion. Kopac said that the Secretariat’s opinion was not accepted in the part on long-term exempted capacity, monopoly position of Gastrans’ shareholders, the separation of Srbijagas’ activities and, most importantly, Serbia did not introduce any preventive measures against the future monopoly of Gastrans (which is 51 % owned by Russian Gazprom) in the domestic market.