Serbia: Status of Serbia EU energy rules harmonization, unbundling and power market opening, the report

21. August 2013. / News Serbia Energy

Serbia must fully implement the Third Energy Package from 2015, namely the new European regulations in the energy sector, and preparations to adapt the Energy Law are underway. For now Serbia did not late in complying with the EU in the energy sector. The separation of the supply and electricity distribution did change fundamentally anything for households that as always would pay both electricity and network through the bill. These two activities are separated partly due to harmonization with EU regulations, but the main reason is the establishment of a functioning free market.

Serbia is bound to apply so-called Third Energy Package from 2015. The preparations to amend the law with what we did not have in the law are underway and it is the obligation in the EU’s Third Energy Package and probably in the next year, approximately in the first half of the year this new law will be adopted, which will enable the compliance with EU regulations.

As specified, the current Energy Law that was enacted in 2011. covered the entire EU Second Energy Package and parts of the Third Package but did not include big organizational changes or huge investments and from the 2015. New European regulations would have to be fully implemented.

For now Serbia did not late in complying with the EU in the energy sector, steps are being made to prevent them to late in the future, so that Serbia would be ready for full implementation of European energy directives in 2015.

Member of the Council of the Energy Agency said that the supply and electricity distribution were separated partly due to harmonization with European energy regulations, but primarily to allow functionally free market.

The main reason for the separation of supply and distribution (electricity) is that the supply is generally market activity and distribution is natural monopoly and always regulated activity. These two activities had to be separated in the case that distribution had more than 100,000 customers and added that all five distributions in Serbia had more than 100,000 customers.

All countries organized for small consumers, such as households or craft stores, so-called universal service or supply at regulated prices. From the 2015, the households and small consumers will be able to buy (electricity) in the market but if they cannot manage on the market or do not want to deal with it, the state organizes who will supply them at a regulated price. State entrusted also the supply at a regulated price, namely public supply to the newly formed company EPS Supply which would deal with supply.

State might entrust that activity to another licensed supplier and, as expected, it decided for its public company that, offered the cheapest service and supply.

There are more than 60 suppliers on the Serbian market, of which about 27 are active.

Households and small consumers covered by public supply, which is in the EPS Supply responsibility, nothing will substantially change in the electricity charge.

Their supplier, EPS Supply, will pay to the network owner , namely to the distribution and transmission, the part that refers to the network use and will charge from the customers what it paid to the network owner and to the power plants  to ensure that energy.

The bill includes a low supplier cost, which is related to the capacity lease, computers and people, as well as compensation to the supplier for the obligation to purchase energy from renewable sources.

Source; Serbia Energy

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