Energy markets in countries of South East Europe-West Balkans still have strong monopolies of state owned dominant market players which operates power generation units. Old units causes overhauls and cross border balancing needs which is essential for each country stability.
One of the main electricity market competition problems in South-East Europe is the existence of many relatively small local segmented markets. In some of them, such as Bosnia and Herzegovina, Croatia and Serbia, a high-concentration of generation units still belonging to state-owned companies can be observed.
In some other countries, such as Montenegro, foreign partners have minority shares in an energy generation company (44%) and transmission operator (22%). The Austrian companies, EVN and Verbund, are involved in hydro-energy projects in Albania, and the Czechs giant, CEZ, has bought a majority share in a distribution company. At the same time, Romania has been much more concentrated on renewables capacities, mainly wind energy. Installed capacity is close to 3 GW and, according to estimations made by Transelectrica, it would be possible to add up to 9 GW of wind capacity.
Even in Greece, where competition on a wholesale level has existed since 2005, PPC holds 75% of total electricity production. Actually, this percentage used to amount to almost 100% in 2009. Independent producers have achieved a share of 20%, mostly from the use of gas-fired power generation technology (Elpedison 8.9%, Mytilinaiosn5.6% and Heron Thermoelectric 5.3%).
The national wholesale market is still highly concentrated, but some competition was emerging until the beginning of 2011 when gas prices went up and, at the same time, energy prices decreased. Nonetheless, as PPC holds in its hands the most competitive fuel mix that includes lignite-fired units and the largest hydro power plants, it will be hard to enable for a level playing field without strong competition with the producers from neighboring countries.
In Kosovo only two large lignite-fired thermal power plants (TPP) exist – Kosovo A and Kosovo B. The latest unplanned outage of the Kosovo A TPP, caused by a hydrogen leak in the electrolysis, showed the vulnerability of the smallest market area in the region. A loss of more than 420 GWh of domestic production led to unplanned emergency imports for which they paid three times more than the regulated price being covered by the country’s end consumers. The event showed that a small system, such as that of Kosovo, is currently coping with problems of system adequacy which could lead to local load shedding. A solution is stronger regional co-operation, especially for continuous intraday trading and balancing, which would ensure higher liquidity and more competitive bidding close to periods of actual energy delivery. The coverage of unplanned outages has to be dealt with over the cross-border balancing mechanism. , transmits Serbia-energy.eu
