Newsletter 2019/1

 

ERRA Member Portrait

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ERRA Member News

 


     Public Services Regulatory Commission (PSRC), Armenia

Recent Developments:

Due to the amendments in the RA Law on Energy savings and renewable energy and Law on Energy the procedure of compensations in the framework of the load flow of electrical energy and the model contact of compensation (for autonomous energy generator-distributor) between the autonomous energy generator using renewable energy resources and “Electric networks of Armenia” CJSC. By the new regulations, it is foreseen to calculate the amount of the electricity, which is not a subject of compensation in the framework of the electricity load flow, by the yearly result, instead of monthly calculations set before. The mechanisms for the calculation of the amount of money for compensation has also been reviewed.

Besides that, taking into account the clause of the La on Energy according to which by December 31, 2022 the set capacity of the autonomous generator of solar energy can reach the capacity of the station of their consumers but not more than 500kWt, they are not a subject to regulation during the construction and generation periods. The appropriate amendments were made also to the license.

According to the amendments in RA Law on Energy during 2018 Public Services Regulatory Commission of RA:

  1. Reviewed around 250 licenses in the energy field, bringing them in compliance with the lase and developed and published model conditions of licenses for new types of activities subject to licensing, foreseen by the law.
  2. Amendments were made to a number of legal acts regulating energy market, including the temporary commercial rules of wholesale energy market of RA, network rules of energy system of RA, the model forms of contacts between licensees set by the Commission and in the licensing procedure in the field of energy, which set an appropriate field for the new licensees to enter the market and implement the licensing activities in the period before adoption of the energy market rules. The import and export of electrical energy will be implemented without a license – the appropriate regulations were taken out of the licensing procedures. At the same time import and export of natural gas were included in the same document.
  3. Were set the model contracts for supply and trade (by the electrical energy generator-distributor with the set capacity up to 30MWt set by the law (qualified supplier)) of electrical energy during the connecting the constructing (reconstructing) station to the distribution network and set-up-launching works. The mentioned relations were included in one document, and were set new mechanisms for equal division of risks and mutual responsibility.

Due to cooperation between the Ministry of Energy Infrastructure and Natural Resources and the Public Services Regulatory Commission, the Commission has adopted a number of resolutions, which set the conditions of license in the sphere of renewable energy, in particular solar and wind energy, in order to facilitate the development of renewable energy and to give the investors an opportunity to get actively involved in the appropriate investment programs.

  1. Appropriate licenses will be issued for the construction and exploitation of the solar power plant with the capacity up to 5MWt, with the sum capacity of 100MWt for the period of November 2, 2018 to December 31, 2019, including maximum capacity of 50MWt for the period November 2, 2018 to December 31, 2018.
  2. 5MWt sum capacity limit was set for already issued licensed before November 1, 2018, and licenses issued after November 2, 2018 have no capacity limit for the plants with the capacity up to 30MWt.
  3. New tariffs were defined for solar and wind power plants, which got an appropriate license for the construction and exploitation since November 2, 2018. The latter is equal to the tariffs for small power plants built on the natural water flows (0.0489USD/kWh).
  4. The licenses for generators with capacity of more than 5MWt for solar energy and 30MWt for wind energy will be issued in the framework of public-private partnership.
  5. The licenses for other types of renewable energy (biomass) will be issued without sum capacity limit.

In December of 2018 Public Services Regulatory Commission revised tariffs of electro power system. The revised tariffs entered into force on February 1, 2019.

In particular:

a.) According to the PSRC Resolution N768 on 27.12.2018 revised tariffs were set for the large generation plants, for transmission service and for the services of Electro Power System Operator and Market Operator.

b.) According to the PSRC Resolution N771 on 27.12.2018 were revised tariffs of distribution service for 110kW, 35kW and6(10) kW voltage. According to this resolution were also approved tariffs for consumers of 0.38(0.22) kW voltage.

c.) According to the PSRC Resolution N772 on 27.12.2018 were revised electricity tariffs for socially unsecured families and as a result tariffs were decreased by 26% in average.

In November of 2018 Public Services Regulatory Commission revised tariffs for water and wastewater services, new resolution was adopted by the PSRC (28.11.2018 Re. N434), according which revised tariffs entered into force on January 1, 2019, but as a result of state subsidy the tariffs for consumers remained unchanged.


    
Energie-Control (E-Control), Austria

 
Recent Developments:
  • Forth incentive regulation period of electricity distribution system operators

In late 2018, E-Control laid the foundations for the fourth incentive regulation period of the Austrian electricity distribution system operators. The new incentive regulation model, which will run for a five-year period from 2019, is the result of an in-depth process involving both network operators and customer representatives. The objective was to implement a well-balanced system that guarantees stable conditions for the network operators’ investments while at the same time providing incentives to ensure the efficiency of the system and thus end-user affordability.

  • Split of the Austrian-German electricity price zone

In October 2018 the split of the common electricity price zone between Austria and Germany took place. A congestion management system between Austria and Germany is applied as of 1 October 2018. For cross-border electricity trading between Germany and Austria, transmission capacities must now be booked, which leads to additional costs and different wholesale prices in Germany and Austria. E-Control has always argued against such a step backwards. Nevertheless, this split was unavoidable, not least because of decisions at Member State and European level. After many intensive negotiations, and due to the commitment of key market participants, a compromise was found that will continue to enable large-scale electricity trading between well-integrated markets.

Internal Projects:

In 2018, E-Control was awarded with the implementation of two Twinning Projects.

E-Control, together with junior partner CRE from France and RAE from Greece, was awarded the implementation of another Twinning project in Georgia. The purpose of this Twinning project is to develop the institutional framework for the implementation of regulation of Georgia’s energy market in line with the European Union acquis. The project should further strengthen the capabilities of the Georgian National Energy and Water Supply Regulatory Commission (GNERC) as the independent national regulatory authority through the development of tools and mechanisms based on the best European Union practice with regard to designing incentive-based regulation for service quality and developing regulatory strategy to support roll-out of smart metering. The project started in February 2019.

The second Twinning project, which is implemented in the Ukraine, was launched in March 2019. The objective of the project is to strength capacities of the State Agency on Energy Efficiency and Energy Savings of Ukraine in implementing the national policy and legislation in the area of renewable energy in an economically and environmentally sound manner.


 

State Electricity Regulatory Commission (SERC), Bosnia and Herzegovina

 
Recent Developments:

On 12 June 2018, the State Electricity Regulatory Commission (SERC) adopted a Decision on Transposition of Network Codes on Connection which defined the terms and conditions for transposition of the relevant European Commission Regulations establishing network codes (Commission Regulations (EU) 2016/631, 2016/1447 and 2016/1388) as adapted to the Energy Community legal framework into the electricity sector of Bosnia and Herzegovina. In line with this Decision, on 27 February 2019, SERC adopted Rules on Connection Network Codes which transpose the part of the connection network codes under SERC competence which are to be implemented without delay. The Rules apply to the connection to the transmission network at the voltage level of 400, 220 and 110 kV, and the voltage level of 35, 20, 10 and 6 kV at 110/x kV substations of Elektroprenos Bosne i Hercegovine (Transmission Company), as well as to the connection to the distribution network in the Brčko District of Bosnia and Herzegovina. Furthermore, SERC approved the Grid Code transposing the part of the connection network codes under competence of the Independent System Operator in Bosnia and Herzegovina, which are to be implemented without delay.

An online electricity price comparison tool uporedistruju.ba, which was developed jointly by USAID Energy Investment Activity (EIA) team, National Association of Regulatory Utility Commissioners (NARUC) and the Regulatory Commissions in BiH, was publically launched on 29 November 2018. The first of its kind in Southeast Europe, this application provides customers in one place with instructions for choosing the cheapest supplier in the electricity sector. The application also provides basic information about each of the electricity suppliers, consumer rights and responsibilities, and other educational and useful tips for lowering consumption and energy efficiency. In general, this tool will help customers better understand the electricity sector and, more importantly, save money on their electricity bills.

On 16 November 2018 Guidelines for Investors in the Electricity Sector of Bosnia and Herzegovina were officially presented. Through working groups and subgroups, the Guidelines were developed in close cooperation between the USAID Energy Investment Activity (EIA) team and competent authorities and institutions responsible for issuing permits for construction of power generation facilities at all levels of government. The main purpose of these Guidelines is to help new (and existing) investors find their way in the complex administrative permitting procedures in Bosnia and Hercegovina. The Guidelines contain comprehensive information on necessary permits for construction of power generation facilities and competent institutions and authorities on all government levels in Bosnia and Herzegovina, as well as a description of all administrative procedures. The Guidelines can be downloaded from the following link –  vodic.usaideia.ba.


 

Energy Regulatory Office (ERO), Czech Republic

Energy Regulatory Office (ERO) started closer cooperation with the Office for the Protection of Competition – 9/2018

The two offices signed the Memorandum of cooperation, because they found the ways to exchange information – from the very first stimulus to ground work without any delays. REMIT is the classical example. Whenever the Agency ACER comes to suspicious behaviour of the market participant, it reports to the state regulation authority.  Now these two authorities are able to share information to eliminate the frivolous price increase.

ERO published the regulated prices of electricity and gas for the year 2019 – 11/2019

ERO released the Price Decision for gas and electricity, where the regulated part of the price is set.  Regulated prices in the electricity industry at very high and high voltage levels will fall by 4%, respectively. by 2.2%, on the low voltage level an average increase of 2.1%.

Regulated prices in the gas industry for wholesale customers will grow by about 0.5%.

 

Graph: Energy price components for retail customers and households in 2019

 

ERO participated on Roundtable on Unfair Business Practices – 1/2019

In May 2018 ERO, The Czech Trade Inspection Authority and Ministry of Industry and Trade started a common fight with unfair business practices. At the meeting of government representatives and energy traders, they discussed, in particular, how to deal with the practices of fraudulent retailers, the so-called energy tricksters.

ERO imposed a record 4 million CZK fine (156 066 EUR) – 3/2019

ERO imposed a record CZK 4 million fine, to energy company Stabil Energy, for repetitive unfair commercial practices. ERO fined Stabil Energy for committing 1179 offences, including charging customers for services without valid contracts and transferring customers to itself, without their signed approval. While the ERO’s ruling is binding, Stabil Energy insists that the regulator misinterpreted the situation and made factual and legal errors in its decision.


 

Estonian Competition Authority (ECA)

 
Recent Developments:

Estonian Competition Authority participated in the competition for new e-governance solutions

In December 2018 the Estonian Competition Authority took part in the first hackathon for new e-governance solutions, organised by the Ministry of Economic Affairs and Communications. The development campaign, which was carried out from 12 to 14 December at the Telliskivi Creative City, saw nineteen IT companies seeking solutions to real problems in the public sector over the course of 48 hours.

At the beginning of the hackathon each participating state authority had to present their problem during a 90 second pitch. The Estonian Competition Authority set forth an idea to implement a so-called justified price calculation robot that would analyse the undertaking´s historic data, future prognosis and the data of comparable undertakings in the database, also considering e.g. inflation, fuel prices, interest rates etc. The Authority finds it crucial to introduce automated process to the simpler price calculation proceedings in order to dedicate more resources to undertakings with greater economic impact.

The hackathon resulted in prototypes presenting solutions. The Competition Authority worked with the company Vumonic Data Labs that is specialised in price comparison models for the private sector. The project won a special prize for the best data project. The negotiations for further cooperation between the Authority and Vumonic Data Labs are under way.

Study: 82% of consumers switching electricity supplier assess that the switching process went smoothly

The switching process of the electricity supplier has been smooth for Estonian consumers. 82% of those who changed the electricity supplier or package, characterized the switching process positively, as showed the monitoring survey.

Of all the residents who opted for or changed the electricity supplier after opening the market, 64% of the respondents named the price as at least one cause. The main reason for not switching is that the current service is convenient and good. Nearly half of the Estonian population (52%) believe that the information available on the electricity suppliers in the electricity market and on the price of electricity packages offered by them is sufficient. Awareness of the openness of the electricity market, according to the survey, is very high: 90% of the population is aware of the openness of the electricity market, while 9% of the population has probably heard of that.

The Estonian electricity market was fully opened to competition at the beginning of 2013. Electricity consumers can freely choose their own electricity supplier and price package. A person who has entered into a network contract can view their consumption data and contracts through data exchange platform managed by Elering. In the same place, it is possible to give electricity suppliers a power of attorney to view their consumption data, which will allow electricity suppliers to make personal price offers. In addition, there are reference portals in the market for electricity prices that help consumers to compare different offers.

Internal Projects:

Study visit to Ireland in the framework of Ad Hoc Twinning Project supported by ERRA

The Estonian Competition Authority (ECA) and the Commission for Regulation of Utilities of Ireland (CRU) both have a wide range of economic and consumer protection responsibilities in energy and water sectors and are active in regulating water and energy sectors in public interest. ECA and CRU are facing similar challenges and going through similar tendencies in regulated sectors and are therefore very motivated to engage in bilateral cooperation. The study visit of the Estonian delegation to Dublin can be considered a successful kick-off of the cooperation. The study visit took place during Oct 29-Nov 02 2018 and included visiting the Irish Commission for the Regulation, discussions and meetings with the Irish utility companies (electricity and gas Transmission System Operators, etc), Electricity Association of Ireland) and the Irish Competition and Consumer Protection Commission.

The concrete result of the project was improved knowledge in: price regulation of electricity, gas and water networks; renewables integration; electricity and gas market design; cooperation between regulators, competition agencies, consumer protection agencies; ways to improve cooperation between ERRA and CEER.

The partners mainly focused on finding solutions in the currently ongoing developments and aiming at the best practice in broader perspective. The Estonian Competition Authority has a significant experience in the development of smart grids and the vision of future of power Distribution System Operator’s (DSO’s). The ECA also shared experience about the Baltic electricity and gas market model. In the energy sector it is also vital to cooperate in the framework of energy regulators´ associations CEER and ERRA. As the CRU is currently not a member of the ERRA, the ECA presented the advantages and the nature of the ERRA.

As ERRA´s main objective is to increase exchange of information and experience among its members and to expand access to energy regulatory experience around the world, the project aimed at broadening the perspective and also gaining knowledge from outside the ERRA network for the purpose of sharing it within the network afterwards.


    Georgian National Energy and Water Supply Regulatory Commission (GNERC)

Recent Developments:

GNERC implemented Transparency Regulation

GNERC added articles regarding transparency regulation to the Electricity Network Rules that envisage obligation of access/publishing of electricity market data. For the first time the Commission transposed European legislation in to the national legislation. According to the new regulation, Transmission System Operator is obliged to publish regularly and make available for stakeholders the information on electricity system and its technical and commercial parameters. The regulation will increase transparency of electricity market, support implementation of fair and open rules of the game. The information will be published on the websites of Transmission System Operator (www.gse.com.ge) and European Network of Transmission System Operators for Electricity – ENTSO-E (transparency.entsoe.eu).

Cooperation of GNERC and Public Service Hall         

Georgian National Energy and Water Supply Regulatory Commission (GNERC) and Public Service Hall provide the consumers with the improved and high quality standards of service in the energy and water supply sectors. In particular, consumers will be able to get the services related to the registration as a subscriber at the Public Service Hall of Georgia with “one-stop-shop” principle, so communication with the companies for registration as a subscriber will not be necessary any more. For the purpose of providing consumers with prompt and simplified services, the seven largest companies participate in this project under the decision of the Commission. Consumers can change the subscriber registration upon registration of a real estate. The Chair of the Commission, Mrs. Irina Milorava stated: “the Commission is constantly working on improving the service quality. By introducing this new service, consumers will be provided with high quality service. We are planning that in the future the registration as a subscriber as well as other services in the energy and water supply sectors which are now provided only at the offices of the companies, will be provided at the Public Service Hall too”.

Internal Projects:

EU Twinning Project

The EU-funded Twinning project was launched at Georgian National Energy and Water Supply Regulatory Commission on February 1, 2019 concerning “Development of Incentive Based Regulation for Service Quality and Regulatory Strategy to Support Roll-Out of Smart Metering” (ENI/2018/403-468). The project will last for 21 months and its total budget constitutes 1 200 000 Euro. The main purpose of the project is to bring norms related to the service quality and reliability of supply in compliance with the EU acquis and development of the regulatory strategy to support smart-metering roll-out. The project will be implemented by the Energy Regulatory Authority of Austria (E-Control), Energy Regulatory Commission of France (CRE) and Energy Regulatory Authority of Greece (RAE).

GNERC started new phase of “Mystery Shopper” project

The Georgian National Energy and Water Supply Regulatory Commission (GNERC) started implementation of “Mystery Shopper” project at the regions of Georgia. 11 companies operating in electricity, natural gas and water supply sectors will be inspected for compliance of their service quality to the standards established by the Commission. If companies do not eliminate the violations identified during the study, the Commission will use the appropriate penalties. The following services will be inspected: connection of new customer to the network, increase of connection capacity, requesting of personal information by the subscriber, checking of technical parameters, electronic bill, restoration of electricity, call-center service.

Significant Energy News:

GNERC set tariffs for guaranteed capacity of electricity

On December 27, 2018 the Commission set the guaranteed capacity fee and the generation tariff for guaranteed capacity source for Mtkvari Energy LLC, Georgian International Energy Corporation LLC, Gardabani TPP LLC, G-Power LLC.

The guaranteed capacity fee for Mtkvari Energy LLC is 77 121 GEL/day and marginal limit of the electricity generation tariff – 11,646 Tetri/kWh.

The guaranteed capacity fee for Georgian International Energy Corporation LLC is 20 006 GEL/day for #3 energy unit and 21 811 GEL/day for #4 energy unit. The marginal limit of the electricity generation tariff amounts 12,762 Tetri/kWh for both energy units.

The guaranteed capacity fee for Gardabani TPP LLC is 383 971 GEL/day and marginal limit of the electricity generation tariff – 8,322 Tetri/kWh.

The guaranteed capacity fee for G-Power LLC is 47 720 GEL/day and marginal limit of the electricity generation tariff – 11,097 Tetri/kWh.


     Hungarian Energy and Public Utility Regulatory Authority (HEA)

Recent Developments:

In December 2018 the regional electricity market coupling project reached a milestone: the regulatory authorities of Hungary, Romania, the Czech Republic, Slovakia, Poland, Germany and Austria asked together in a joint letter the respective TSOs and market operators to initiate the interim project for a NTC-based market coupling between Germany, Austria, Poland and the so-called 4MMC markets in order to further develop regional integration of day-ahead organized electricity markets. The DE-AT-PL-4M MC Project – if implemented – will merge finally 4M MC cooperation with the MRC Multi-Regional-Coupling project and will represent an important step forward to the extension of the European Single Day-Ahead Coupling. Timely implementation of the project will introduce the benefits of implicit capacity allocation of day-ahead cross-border capacities on the respective borders even before the Core Flow Based Market Coupling Project (FBMC) will go live.

Internal Projects:
  1. In September 2018 HEA published a status report on renewable energy in Hungary. The document covers the period 2010-2016 and analyses the data in accordance with the structure of the EUROSTAT SHARES database.
  2. In December 2018 HEA launched a new series of publications called “Market Structure Analyses”. The aim of these publications is to evaluate structural issues that significantly affect the Hungarian energy markets and energy prices. The first issue of the series deals with the peculiarities of Romanian electricity generation and its effects on HUPX DAM prices.


 

State Agency for Fuel and Energy Complex Regulation at the Government of the Kyrgyz Republic

 
Recent Developments:

Since September 2018, there were no major accomplishments in the field of tariff regulation, licensing, RES, development of the local or regional market, consumer related issues or technological development.

Internal Projects:
  1. Since September 2018, internal trainings were organized for staff members of the State Regulatory Agency for the Fuel and Energy Complex under the Government of the Kyrgyz Republic on the following topics:

– the Law of the Kyrgyz Republic On the Conflict of Interests;

– “Provisional regulation on licensing certain types of activities in the field of the fuel and energy complex” approved by the Decree of the Government of the Kyrgyz Republic as of 03.02.2017, No. 59

– The methodology for determining cost of products (works, services) and designing tariffs for thermal power;

– “Managing public procurement of goods, works and services”;

– Getting familiar with the Code of Violations;

– “The procedure for inclusion of enterprises (organizations) in the lists of: large electricity consumers, consumers – re-sellers of electricity and those of wholesale buyers – sellers of electricity”;

– Law of the Kyrgyz Republic as of August 8, 2012, No. 153 “On combating corruption”

  1. In the framework of implementing the public contract on training of public servants and municipal servants, from September 2018, 5 employees of the State Agency attended trainings on the following topics:

– “Advanced training courses for first-time employees in public civil and municipal services”;

– “Advanced training courses for newly appointed to certain positions”;

– “Managing public procurement of goods, works and services”;

– “Legal framework for analyzing regulatory impact (ARI) and mechanisms of ARI functioning in the Kyrgyz Republic”;

– „Anti-corruption policy”.

  1. In accordance with the Regulation on coordination of training of public servants and municipal servants in the Kyrgyz Republic at the expense of donors’ funds approved by Decree of the Government of the Kyrgyz Republic as of 10.11.2014, No. 631, 8 staff members of the State Agency took part in international activities on the following topics:

– in connection with invitation of the European Program EU4Energy of the International Energy Agency, 1 staff member of the State Agency took part in the “Forum on renewable resources and policy and development related issues” that took place in the city of Samarkand, Uzbekistan, from October 9 to 11, 2018.

– in connection with invitation of the Energy Sector Management Assistance Program of the World Bank (ESMAP), 2 staff members of the State Agency took part in the Information Exchange Forum „ESMAP 2018” that took place in the city of Geneva, Switzerland, on October 30 – 31, 2018.

– in connection with invitation of the European Program EU4Energy of the International Energy Agency, 1 staff member of the State Agency took part in “Forum on Integration of Variable Renewable Source” that took place in the city of Kishinev, Moldova, on November 29, 2018.

2 staff members of the State Agency took part in the workshop on application of the Law of the Kyrgyz Republic „On the basics of administrative activities and on administrative procedures” that took place in the city of Bishkek, the Kyrgyz Republic, on November 29 – 30, 2018.

– in connection with invitation of the European Program EU4Energy of the International Energy Agency, 1 staff member of the State Agency took part in the “Forum on cross-border policy in the field of energy integration” that was held in the city of Tbilisi, Georgia, on February 11, 2019.

– in connection with invitation of the European Program EU4Energy of the International Energy Agency, 1 staff members of the State Agency took part in the “Forum on energy efficiency of buildings” that was held in the city of Tbilisi, Georgia, on February 12 – 13, 2019.


    Public Utilities Commission (PUC), Latvia

Recent Developments:

Natural gas storage tariffs

On 14 December 2018 the Board of the Public Utilities Commission (PUC) approved the application of the natural gas storage service tariffs submitted by JSC “Conexus Baltic Grid” for the 2019/2020 Incukalns underground gas storage cycle, as well as the long-term storage tariff. It provides new values of storage service tariffs and the value of the two-year capacity product.

The maximum tariff value of the applicable bundled capacity product for the 2019/2020 storage cycle is set at 3.52056 EUR/MWh, the minimum tariff value of the applicable market product for the 2019/2020 storage cycle is 1.38000 EUR/MWh, the tariff value of the two-year bundled capacity product for the combined 2019/2020 and 2020/2021 storage cycle is 4.90056 EUR/MWh.

The approved tariffs entered into force on 15 January 2019.

Natural gas distribution system tariffs

New tariffs entered in force on 1 January 2019. Tariffs consist of two parts – fixed part depending on available capacity (cubic meters per hour) and variable part depending on consumption (MWh). The introduction of fixed part increased motivation on evaluation of necessary capacities. To deal with the issue smoothly, DSO came up with new tariff application procedure for big industrial customers, providing an option to reduce capacity “on paper” if certain criteria are met. Firstly, telemetry should be installed in the object – online metering enables DSO to monitor that requested capacity is observed. Secondly, there are limitations for capacity reduction – the limit set is 50% of maximum allowed capacity and the capacity required cannot be less than 66 m3/h.

Regulations for natural gas transmission system connections

On 20 December 2018 public consultation on new regulations for natural gas transmission system connections was started. The main subject of discussions is rights to establish a connection to transmission system for any system user. DSO officially came with concerns on competition between DSO and TSO as the license area overlaps. Furthermore, it made announcements in media on new regulations as a threat for whole gas sector in Latvia. Considering all the arguments mentioned and the fuss created, the discussions are still ongoing. PUC is putting effort to discuss the arguments with each of stakeholders one by one. Nevertheless, estimates made by PUC reject threat for gas sector in case connection rights to transmission system are granted for all parties.

Memorandum of understanding on cooperation on the establishment of the FINESTLAT natural gas market between Estonian Competition Authority, Public Utilities Commission of Latvia and Finnish Energy Authority was signed on 14 November 2018.

Internal Projects:

The PUC has hosted the USAID/NARUC Europe and Eurasia Cybersecurity Partnership Workshop on Effective Regulation of Cybersecurity in Riga on 18-19 October 2019.


     National Commission for Energy Control and Prices (NCC), Lithuania

Recent Developments:

The average price of electricity in 2018 and 2019 (cent/kWh, VAT excluded)

The NCC has approved electricity tariffs for household customers to be applied from 1st January, 2019. The price of electricity per kWh increased from 16 (for dual time interval tariff) to 19 percent (for single time interval tariff) for electricity consuming households, that chose the plan “House Plus”. This group of consumers consumes about 314 million kWh of electricity per year.

The electricity tariff increased from 11,3 ct/kWh (including VAT) to 13,0 ct/kWh (including VAT), i.e. 15 percent, for household customers who have chosen the most popular one-time payment plan “Standard”. About 80 percent of household electricity consumption is consumed according to the “Standard” plan (2,3 billion kWh per year).

Higher electricity tariffs for household customers were mainly due to the rising price of electricity purchased on the market as a product in 2018 as this price increased by 20 percent.

 

 

 

 

 

 

 

 

 


From 1st January, 2019 tariffs of natural gas increased for household consumers
. The NCC approved natural gas tariffs for household customers provided by Lietuvos Energijos Tiekimas, UAB for the first half of 2019. For the subgroup I, i.e. consumers using natural gas for cooking, the variable part of the tariff (per cubic meter) increased by 11,86 percent, fixed part of the tariff did not change.

For subgroups II and III, the natural gas tariff variable increased accordingly by 17,95 percent and 18,42 percent, fixed part of the tariff remained the same as in the second half of 2018.

The change in natural gas tariffs for household customers was basically determined by about 25 percent rise of the price of natural gas as a product, as compared to the of the second half of 2018.

On the 15th October 2018 the NCC has coordinated water tariffs for the consumers living in Vilnius, the capital and the largest city of Lithuania. The price of water per m3 to be applied from 1st February, 2019 onwards decreased by 12 percent.

On 20th of December, the Seimas approved the amendments to the Law on Energy from Renewable Sources, establishing a new support model for the promotion of power plants that use renewable energy sources (RES). According to the new procedure, support for RES power plants will be further allocated by way of auctions. The key criteria that will determine new auction winners will be the smallest premium offered to the electricity market price in the Nordpool exchange that will be paid for the period of 12 years. Support will be allocated by way of technologically neutral auctions, which means that power plants using a variety of renewable energy technologies for electricity production will be able to take part in these auctions and compete with one another for the market price premiums.

The new support scheme is being coordinated with the European Commission according to the State aid notification procedures and will be applied having received approval of the European Commission. It is planned, that the new procedure will become effective as of 1st May 2019. There are plans to call the first auction for distributing the quota of 0.3 TWh as soon as on 2nd September.

Electricity producers from other EU Member States, who have a direct connection with Lithuania and who undertake to open part of their support to Lithuanian companies, will also be able to participate in the new auctions. Producers from other countries will be able to compete for a certain part of the overall quota planned to be distributed.

Internal Projects:

On 10th December, 2018 the public presentation for the companies of heat sector was organised.  Heat suppliers and independent heat producers were informed on accounting separation and cost allocation requirements of the heating sector.

Significant Energy News:

On the 23rd of January, 2019 the European Commission has allocated funding for synchronisation of the Baltic States’ electricity grid with the continental European system. The funding will come from the Connecting Europe Facility and will amount to 323 million euros for the projects in all three Baltic states. 125 million euro of this amount will be allocated for the synchronisation projects in Lithuania. This is the largest support that Lithuania has ever received from this fund for energy infrastructure projects.

Initial Cooperation Agreement was signed by the Management Boards/CEO’s of Polish and Lithuanian Transmission System Operators, PSE and LITGRID, being the commitment of both TSOs to undertake development activities in the Preparation Phase of the project of construction of new Polish-Lithuanian submarine HVDC cable “Harmony Link”. Initiation of the works on the “HARMONY Link” is directly linked to the Political Roadmap for synchronizing the Baltic States’ electricity grid with Continental Europe, the agreement signed on 28th June, 2018 by the President of European Commission and Heads of State and Government of Lithuania, Latvia, Estonia and Poland.

On the 18th of December, 2018 Lithuanian Parliament has approved the amendments of laws, which will allow to reduce the annual costs of the liquefied natural gas (LNG) terminal. The Seimas approved the proposal regarding long-term LNG import by acquiring the LNG-FSRU vessel after 2024. This decision to secure continuous supply of LNG enables optimisation and reduction of the annual operating costs of the LNG terminal in the short term – by EUR 23-25 million each year. This reduction could begin as of mid-2019. According to the law, Klaipėdos Nafta, the operator of the LNG terminal, will acquire the ownership of the LNG-FSRU vessel by the 31st of December, 2024 by selecting the most economically beneficial proposal using international tender.

On the 14th of February, 2019 the Lithuanian Parliament has approved the amendments of Energy Law in which the consolidation of energy regulatory authorities is foreseen. The National Commission for Energy Control and Prices (NCC) and the State Energy Inspectorate (VEI) will be merged. Following that the new public entity will take over the tasks of the two authorities and will act as an independent authority accountable to the Parliament and responsible for the supervision, regulation and control of the energy sector. It will perform the tasks of energy control and market surveillance, drinking water supply and wastewater management monitoring, control of technical safety of energy facilities, energy resources as well as transmission reliability and efficiency. It is planned that the new authority will start operating in early July, 2019.


 

Nigerian Electricity Regulatory Commission (NERC)

 
Recent Developments:

121 Firms receive NERC’s ‘No Objection’ to participate in Meter Procurement Process

A total of 121 firms have received the Nigerian Electricity Regulatory Commission’s ‘No Objection’ to participate as Meter Asset Providers in the Nigerian Electricity Supply Industry. This is sequel to the Commission’s invitation from interested investors for ‘No Objection’ to participate as MAP.

The Commission last year approved MAP entrance into the electricity market to facilitate closure of the wide metering gap in the market within three years. The ‘No Objection’ is to qualify intending investors to participate in the meter procurement process in NESI.

The Commission mandates electricity distribution companies (DISCOS) to engage meter assets providers who will fund purchase, installation and replacement of meters to meet their metering obligations to their customers. This is to ensure that all electricity customers are metered thereby reducing incidences of estimated electricity billing to the barest minimum.

Applications and supporting documents submitted by interested investors, are subjected to the Commission’s due diligence before the issuance of ‘No Objection’ to participate in the procurement process for meter assets provision in accordance with relevance regulatory instrument of the Commission.

Interested investors and members of the public can still take advantage of the continuous screening exercise for MAP to participate in the Nigerian electricity supply industry. Full list of No Objection holders are available on the Commission’s website.  

Internal Projects:

Workshops Held on Mini Grid, Meter Asset Provider and National Content Regulations

In order to deepen private investors participation in the Nigerian Electricity Supply Industry and increase Nigerians access to electricity supply, workshops were held on three of our regulations- the Mini Grid Regulation, 2018; Meter Asset Provider (MAP) Regulations, 2018; and the Regulation on National Content Development 2014.

The workshops on MAP were to create awareness for intending investors willing to operate as meter asset provider. The regulation is aimed at closing the wide metering gap in NESI. The Mini Grid Regulation, on the other hand, is expected to improve access to electricity customers who are poorly served and those who are not connected to the national grid.

However, workshop was held on the Regulation on the National Content Development 2014 which intendment is to ensure improvement in the quality and quantity of value addition by Nigerians in the Nigerian Electricity Supply Industry.

During the period fourth quarter 2018 till date, there is no new regulation and order issued by the Commission. However, the Commission is collaborating with the Federal Ministry of Justice, for the review of the Nigerian Electricity Supply and Installation Standards (NESIS) and to gazette the document.

Second Third Stakeholder Meeting with Commission 

The Commission between the last quarter of 2018 till date held two stakeholders’ meetings with core investors and management of operating companies in the Nigerian Electricity Supply Industry with the aim of resolving the challenges in the emerging electricity market in the country.  

Specifically, the third meeting discussed management of the planned outage schedules including communication to electricity customers and timely response to customer complaints, resolution of mismatch at the Transmission Service Provider and the electricity distribution interface points.

The second meeting had discussed the solution to the liquidity squeeze in the Nigerian Electricity Supply Industry, funding of the revenue gap and accumulated tariff deficit in the books of the electricity distribution companies. The meeting further harped on the urgency of closing the metering gap in NESI, completion of the customer enumeration exercise, promotion of embedded generation and creation of new investment opportunities through franchising.   


     Energy and Water Services Regulatory Commission (ERC), North Macedonia

Recent Developments:

In the period October 2018 – March 2019, ERC continued with the process of drafting secondary legislation in accordance with the new Energy Law which incorporates provisions from the Third Energy package. In this period ERC adopted Rules for determining the compensation for the damage caused to the producers and consumers connected to the electricity transmission and distribution systems, Rulebook for determining the regulated maximum income and regulated average tariffs for transmission of natural gas, organization and management of the natural gas market and distribution of natural gas, Tariff system for distribution of natural gas, Tariff system for transmission of natural gas and organization and management of the natural gas market, Natural Gas Supply Rules, District Heating Supply Rules and District Heating Tariff System.

Additionally, ERC approved Rules for purchasing electricity for covering the losses in the distribution system of EVN Elektrodistribucija DOOEL Skopje, Rules for allocation of cross-border transmission capacities at the border between North Macedonia and Bulgaria for 2019, Rules for allocation of cross-border transmission capacities at the border between North Macedonia and Serbia for 2019, Compliance program of the electricity DSO EVN Elektrodistribucija DOOEL Skopje, Rules for purchasing of electricity for covering the losses in the transmission systems, JSC MEPSO-Skopje,       

The process of drafting and adopting new secondary legislation is in the final stage and is expected most of the remaining acts to be adopted/approved by the mid of 2019.

ERC is supported in this process with expertise provided by the Energy Community Secretariat, as well by experts provided by USAID.

In November 2018, ERC signed Agreement for Cooperation with the Water Services Regulatory Office of Kosovo with aim to establish legal frame that will enable exchange of knowledge and information for different aspects of water services regulation between the two NRAs.

In December 2018 ERC adopted Decisions for determining water services tariffs for the last group of Public Utilities for water services on area below 10.000 equivalent inhabitants. With these Decisions the new cost-reflective water services tariffs are applied on the whole territory of the country. 

New tariffs for distribution and transmission of natural gas were adopted at the end of December 2018.

Additionally, in December 2018, electricity DSO EVN Elektrodistibucija DOOEL Skopje, rebranded its name into Elektrodistibucija DOOEL Skopje and fully complied with the provisions of the Energy Law. This ensures a separate corporate identity for the distribution system operator that will not create confusion with other legal entities that are part of a vertically integrated company. By eliminating EVN from the name of the company, the possibility of creating confusion among users is reduced as to whether they are contacting any of the other EVN companies or the distribution system operator.

Finally, in December 2018 electricity TSO MEPSO JSC Skopje submitted Request for Certification in accordance with the Certification Rules and provisions from the new Energy Law. ERC prepared Draft certification decision for the electricity transmission system operator and at the end of March 2019 delivered it to the Energy Community Secretariat for providing their opinion.  

Internal Projects:

ERC continued with the implementation of the joint project with NARUC, supported by USAID, for developing Price Comparison Tool (PCT), and its representatives attended Third Regional Workshop on related topics.

In March 2019 ERC signed a 2-year contract with the Faculty of Electrical Engineering and Information Technologies from Skopje. Primary focus of this project will be upgrade of the ERC market monitoring software with new features, alignment of the secondary legislation for market monitoring with provisions of the new Energy Law, as well implementation of the adapted version of REMIT for the Energy Community Contracting parties.

Additionally, in this period ERC was invited in another USAID/NARUC initiative for the region of Southeast Europe, which is aimed to strengthen NRAs capacities for adequate treatment of cybersecurity issues in the energy sector, as well its representatives participated in numerous other trainings, meetings and other events organized by the Energy Community Secretariat and ECRB, ERRA, as well NARUC/USAID.   

Significant Energy News:

The Government finalized the tender procedure for selection of a Universal Supplier, which will be at the same time Supplier of Last Resort. Consortium of EVN Makedonija JSC Skopje and EVN Elektrodistribucija DOOEL Skopje had better offer that the other competing company ELEM JSC Skopje.

Next steps are signing of the contract between the Government and the winning consortium, registering new company that will be licensed by ERC for electricity supply with public obligation for universal supply and supply of last resort, and finally ERC should determine tariffs of the new regulated supplier.

It is expected that the Universal Supplier will start its operation from July 2019.


 

Palestinian Electricity Regulatory Council (PERC)

Recent Developments:

Consumer:

  • Field visits to electricity distribution companies to check the workflow of complaints.
  • Conduct meetings and workshops with sector major stake holders, trade union, electrician union and many municipalities .
  • Publishing the new connection fees.
  • Publishing solar production projects guide with medium capacities.
  • New amendments to electrical connection fees, in which the last modified was in 2015.
  • New amendments to renewables instructions especially (Net-Metering instructions), still in process before launching.
  • Launching new instructions concentrate on organizing renewable electricity generation projects in Medium capacities (5 – 999 kW).
  • Develop a new committee consist of PERC and DisCos. for developing the complaints resolution policies inside DisCos branches.
  • Intensification of the periodically field visits to the DisCos. branches.
  • Field visits for subscribers who have received financial requests, to check the credibility of the technical solution proposed by DisCos.
  • The number of complaints officers has been increased, which complaints were divided on according to the concession areas of DisCos.
  • Field visits for subscribers who have complaints with DisCos.

Tariffs

  • Made awareness campaign about the modified electricity connection fees regulations.
  • Made recommendation to Energy authority for updating the retail tariff for electricity distribution companies based on changing in the supply tariff.

Licensing:

  • Made recommendation to Energy authority for renewing the ‘distribution license’ for ‘Northern Electricity Distribution Company’ NEDCO for five years.
  • Made recommendation to Energy authority for renewing the ‘temporary distribution license’ for ‘Tubas District Electricity Company’ TDECO for one year.
  • Begin studying the application of the Jenin Industrial City Developer to get ‘distribution license’ in city boundaries.
  • Prepared the Key Performance Indicators KPIs report about distribution sector in Palestine.

Renewable Energy RE

  • Made recommendation to Energy authority for getting the ‘RE license’ for ‘Aljabal Clean Energy Co.’ to produce 1.5MW solar PV.
  • Made recommendation to Energy authority for setting the purchasing tariff of RE medium capacities (below 999KW).
  • Prepared the guide for participation in the RE medium capacities (below 999KW) program.
  • Prepared report about Smart Grids in Palestine.

Market Development

  • Made awareness campaign for Local councils that distribute electricity out of ‘Electricity Law’ to Straightening based on laws and regulations.
  • Participated in preparing report about electricity market and its needs, challenges and missions with other stakeholders and ‘World Bank’.
Internal Projects:
  • Eng. Qais Samarah joined the International Summer School on the Regulation of Local Public Services 21st Edition | Torino, Italy | 3-14 Sept. 2018
  • Mrs. Amaal Burnat joined MEDREG-ERRA training on “Electricity Market Monitoring Tools” that was held in Istanbul in the period between 3-5 December.
  • Mrs. Sireen Kassis joined the first Public Relations Forum that the Arab Administrative Development Organization of the League of Arab States held in Cairo from 17-19 December 2018
  • Produce two TV Spots to aware consumer about thier rights in electricity sector
  • Publishing complaints brochure on the regularity Facebook page to help people making complaints.
  • Advertising campaign about electricity consumption reduction.
  • Advertising campaign about electrical safety in residential applications.
  • Media meetings with different radio and TV stations about electrical safety in winter.
  • Publishing awareness messages by mobiles to help people making complaints.
  • Conduct  Workshops with Military justice commission

 
 
Romanian Energy Regulatory Authority (ANRE)

Recent Developments:

In September 2018, ANRE approved Order no. 167/2018 regarding the ammending and supplementing the Network Code for the National Transmission System for natural gas. The ammendments ensure the alignment with the European regulations in the field, as provided by the ammendments to the Electricity and Natural Gas Law regarding the Transaction in the Virtual Trading Point (VTP), as well as the possibility for the final customers to participate in natural gas transactions for balancing their own consumption.

ANRE amended the methodology for setting the tariffs for the natural gas distribution service and for the electricity distribution service provided by concessionary distribution operators, taking into account the evolution of the legislative framework in the field and the experience gained during the 3rd regulatory period, while aiming to ensure the balance between the objectives of the distribution operators and the users’ interests, beneficiaries of the distribution service, by setting justified costs for the 4th regulatory period 2019-2023.

In December, ANRE approved the Order no. 227/28.12.2018 for the approval of the Framework Contract for selling and purchasing  electricity produced by prosumers which own electricity generating units  using renewable sources with an installed power of not more than 27 kW per consumption place and to amend some regulations in the sector electricity.

After issuing the regulation regarding the obligation of the suppliers to update price offers on Electricity supplier comparison data” interface in order to inform final customers, ANRE is working to developed a new web application ANRE, available starting with January 2019, in order to encourage the process of changing suppliers, which allows final customers to compare the (standard) electricity and gas offers of Romanian suppliers.

Internal Projects:

ANRE participated in October at the 17th international conference “Energy Investment and Regulation Conference”, held in Antalya, Turkey by ERRA in cooperation with EMRA.

The workshop “Key Focus Activities on Energy Regulation” with the participation of ANRE’s delegation and AREA’s representatives (Energy Regulation Agency in Azerbaidjan) – Baku, held in October 2018, the meeting envisaged the regulatory process in the energy market. The purpose of the meeting was the transfer of the expertise and good practices based on the Romanian experience regarding the development and functioning of the Romanian energy market.

Participation of ANRE’s staff to the training programs organised by CEER, ERRA, Florence School of Regulation.


     Federal Antimonopoly Service (FAS), Russian Federation

Recent Developments:

The Resolution of the Government of the Russian Federation No. 64 of 30 January 2019 «On Amendments to certain acts of the Government of the Russian Federation regarding the regulation of prices (tariffs) for electricity (capacity) supplied in technologically isolated territorial electric power systems and on the territories that not technologically linked to the Unified Energy System of Russia and/ technologically isolated territorial power systems, and recognition the invalidation of certain acts of the Government of the Russian Federation» aimed at the introduction of long-term regulation in technologically isolated zones (hereinafter – the Resolution). The Resolution provides for the maintaining of cost savings (including saving that associated with the change of kinds of fuels, as well as using renewable energy sources) and the establishment of long-term tariffs for regulated organizations up to 5 years.

Internal Projects:

The All-Russian seminar-meeting “Tariff regulation in 2018 and the tasks of state regulatory bodies for 2019” was held in Yalta from 16 to 18 October 2018.

The issues of coordinating the implementation of functions on tariff regulation of the federal level and the level of constituent entities of the Russian Federation and the issues of improving legislation in the field of state regulation of tariffs were discussed at the event.

The practical seminar “Tariff regulation in the context of digital transformation” was held in Sochi on 5-6 March 2019.

On the seminar were discussed practical issues of the application of legislation in the field of state tariff regulation and regulated procurement. Special attention at the seminar was paid to the topic of digital transformation of tariff regulation.

The key event of the second day was the strategic session on the formation of a package of projects for the digital transformation of tariff regulation in three areas: “Digital Regulation”, “Digital Energy”, “Digital Housing”.

A plenary session and round tables, which were devoted to discussing the practical application of regulations and reporting to the FAS Russia, were also held in the framework of this seminar.  

During this period, 480 employees of the Central Office of the Federal Antimonopoly Service of the Russian Federation and territorial administrations took part in seminars and training events.


     Energy Agency of the Republic of Serbia (AERS)

Recent Developments:
  • On September 29, national energy regulators of Bulgaria, Greece, Serbia, FYR of Macedonia and Montenegro have concluded an Agreement on the Establishment of Permanent Advisory Forum of National Regulatory Authorities of the Balkan Countries (Advisory Forum).
  • On 13/02/2019, the Energy Agency of the Republic of Serbia has announced public consultation on the Development Plan of the Transmission System of the Republic of Serbia for the period 2019-2028 which was submitted to the Agency by the transmission system operator EMS a.d.
  • On the extraordinary session held on March 5, 2019, the Council of the Energy Agency of the Republic of Serbia (AERS) has adopted the final Act on Exemption of the New Natural Gas Interconnector by which the exemption is approved to the GASTRANS d.o.o. Novi Sad company from the third party access to the future gas pipeline which will pass through the Republic of Serbia and will be connected to the Bulgarian and Hungarian national transmission systems. 
  • On the session of March 22, 2019, in line with the Energy Law  and with the Rulebook on Energy Licence and Certification, the Council of the Energy Agency of the Republic of Serbia has adopted a Decision on dismissal of application of November 22, 2018 of the Limited Liability Company “Transportgas Srbija” d.o.o. Novi Sad for the certification in line with the independent transmission operator model pursuant to Articles 232-238 of the Energy Law as incomplete.

 

Regulatory Office for Network Industries (ÚRSO), Slovakia

 
Significant Energy News:

Transport: On September 18, 2018 the ceremonial start of the construction of the Poland-Slovakia interconnection pipeline took place at the compressor station in Veľké Kapušany with the presence of the Slovak prime minister. The Poland-Slovakia Gas Interconnection in the length of 165 km as a European project of common interest constitutes the crucial part of the North South Gas Interconnections in Central Eastern and South Eastern Europe (NSI East Gas) and will contribute to the enhancement of the regional security of supply and integration of the natural gas markets in the region. Construction works are planned to finalise by the end of 2021.

Heating: The Antimonopoly Office of the Slovak Republic (PMU) approved a concentration consisting in obtaining direct sole control of Veolia Energia Slovensko, and. s, Bratislava over five companies. It is about SI Teplo, s. r. o., SI HECU, s. r. o. and GasTrading, p. r. located in Levice, as well as Slovintegra Energy, and Biatec Energy, p. r. o., based in Bratislava. The merger came into force on 1 February 2019.


  Energy Market Regulatory Authority (EMRA), Turkey

Recent Developments:

Other developments regarding Tariffs:

  • A new parameter has been introduced in tariff calculations as a result of the increase in the shares of day-ahead market and bilateral agreements with private power generator companies, and interest rates. As existing Gross Retail Margin for the energy purchases didn’t cover all financial risks, dynamic “Day-ahead market price + X” model has been developed to compensate for additional financial cost of purchases without EÜAŞ and the model started as of 1/1/2019.
  • In calculation of revenue caps of regulated companies for 2019, forecasted rate of inflation for 2019 is used instead of realized rate of inflation in 2018, in order to avoid the risk of deterioration in the cash flows of the companies because of recent changes in macroeconomic conditions of Turkey.

  • For the revised revenue cap calculation of 2018 for the distribution companies, new components have been incorporated into quality parameter for the first time. These components are call center performance (%1), establishment of supply continuity monitoring systems (%0.7), supply continuity performance (%0.7), user satisfaction (%0.7), technical quality obligations (%0.35) and investment target realization performance (%1.05).

  • Remarkable changes in macroeconomic conditions of Turkey resulted in significant deviations on the parameters that are used in the calculation of WACC for natural gas distribution. As a result, pretax WACC is revised as 14.38% instead of %12.85.

Internal Projects:

On November 8, 2018, the 8th Sector Consultation Meeting was organized by EMRA in order to determine the needs of the market and evaluate the opinions of market players to be taken into account in the legislative amendments.

Significant Energy News:

Organised Natural Gas Wholesale Market has started to operate on 1 September 2018. With this organised market, market players can trade natural gas anonymously in an organised liberal market operated under continuous trade principles in the Continuous Trade Platform (“CTP”) of Turkish Energy Exchange (EXIST). The system of supplying the balancing gas from the organised market has been applied for the first time in the Turkey, contrary to the previous practice in which balancing gas used to be priced apart from market mechanism.

Since September, 100 towns in Turkey are supplied with natural gas.  On December 20, 2018, with the supply of gas in Hakkari province, natural gas is currently being used in all 81 provinces of Turkey.



Azerbaijan Energy Regulatory Agency (AERA)

 
Internal Projects:
  • 17th ERRA Energy Investment and Regulation Conference – October 2018 / Antalya, Turkey;
  • Workshop in cooperation with the Romanian Regulator (ANRE) on “Key focus activities on the energy regulation” – October 2018 / Baku, Azerbaijan
  • Energy Community/ EU4Energy Governance Regulatory Workshop in the context of Infrastructure assessment and Projects of Eastern Partnership Interest – October 018 / Kiev, Ukraine
  • EBRD/CEER Workshop on “Energy Supply Quality” and “Reforms in the Electrical Energy Sector” – November 2018 / Baku, Azerbaijan
  • NARUC-led technical workshop on the “Regional Balancing Market Integration Project of the Black Sea Regulatory Initiative, Phase II” – December 2018 / Ljubljana, Slovenia
  • “AgTech and Green Energy” International Forum – December 2018 / Baku, Azerbaijan
  • TAIEX Workshop on “Energy Markets Concepts, Design and Operation” – January 2019 / Baku, Azerbaijan
  • Roundtable on the cooperation between public and private sectors on preparing of renewable energy legislation – March 2019 / Baku, Azerbaijan
  • Ernst&Young Workshop on „Energy Market Reforms” and „Power Purchase Agreements (PPA)” – March 2019 / Baku, Azerbaijan
  • EBRD/DNV GL joint workshop on „Support for the functioning of the newly established energy reguatory agency” – March 2019 / Baku, Azerbaijan

     Regulatory Commission for Energy in Federation of Bosnia and Herzegovina (FERK)

Recent Developments:

Tariffs for both public companies that provide universal service in the Federation of Bosnia and Herzegovina stayed unchanged.

Internal Projects:

FERK staff participated in numerous trainings organised by different organisations. The most important of those are as follows:

  • ERRA’s Investment Conference and concurrent meetings in Antalya, 9-11 October, 2018
  • USAID/NARUC 4th Workshop of Europe and Eurasia Natural Gas Partnership in Vienna, 25-30 November, 2018
  • ERRA Customer and Retail Market Working Group in Istanbul, 3-4 December, 2018
  • USAID/NARUC 1st Workshop of SEE Consumer Empowerment and Public Outreach Project, Vienna 3-4 December, 2018
  • USAID/NARUC Conference and Workshop on Energy Efficiency in Sarajevo, 5-7 March, 2019

  Gas Regulatory Authority (GASREG), Egypt

Recent Developments:
  • Issuing 33 licenses for main four gas activities (shipping, transmitting, supplying, distributing).
  • In the process of issuing the tariff methodology for the transmission and distribution activities.
Internal Projects:
  • Hungary 12-16 Nov. 2018

3 participants in the “Principles Of Natural Gas Market Regulation” training program.

Arranged by “Energy Regulators Regional Association – ERRA”

  • London 05-09 Nov. 2018

2 participants in the “LSE Short Course in Regulation” training program.

Arranged by “London School of Economics & Political Science”

  • Italy 03-08 Mar. 2019

5 participants in the “Specialized Training on the Regulation of Gas Markets” training program.

Arranged by “The Florence School of Regulation – FSR””


   Energy Regulatory Office (ERO), Kosovo*

Recent Developments:

TSO Certification

The Board of Energy Regulatory Office (ERO), in its second (II) session for this year, held on 15 February 2019, issued a Final Decision on Certification of Transmission System Operator (TSO –KOSTT).

This Decision follows the issuance of the Opinion by Energy Community Secretariat on Preliminary Decision of ERO Board, issued on 24 September 2018, through which the Board decided that TSO- KOSTT fulfils the criteria for certification as an independent operator for electricity transmission.

Upon the Final Decision on Certification of TSO-KOSTT, which relies also on the Opinion of ECS, ERO confirmed that there is sufficient separation of control on TSO, generation and/or supply of electricity and that the electricity Transmission Operator acts in accordance with unbundling provisions, set in Chapters IV and V of the Directive 2009/72/EC1. These chapters were transposed in Kosovo legislation through Article 11 of Law on Electricity.

With this Decision, ERO verified that TSO executes its functions independently from any other business in the energy sector and consequently provides a free and non-discriminatory approach in the transmission network to all free market operators, operating in the territory of the Republic of Kosovo.

Through this process, ERO fulfilled one of the most challenging obligations deriving from Energy Community Treaty, proving again that it is devoted in the fulfilment of its functions, to ensure a proper functioning of the free market of electricity, in line with EU directives on energy and Energy Community Treaty.

New Electricity Tariffs for industrial, commercial customers and public lightning

On 30th October, Board of Energy Regulatory Office (ERO) has approved the new retail electricity tariffs that are applied by the Universal Service Supplier (USSKESCO). According to this Decision, new tariffs that will remain the same for household (domestic) customers, whereas the tariffs for industrial, commercial customers and public lightning will decrease for 5%. These tariffs are as a result of Maximum Allowed Revenues (MAR) approved for Transmission/Market Operator (KOSTT), Distribution Operator (KEDS) and Universal Service Supplier Operator (KESCO) and reflect the cost of provided service for respective tariff groups.

New electricity supply licences

On 20 December 2018, the Board of ERO reviewed and approved the application of KEK JSC (Kosovo Energy Corporation) on licensing of electricity supply activity. The issuance of this license increases to seven the number of licensees for carrying out the electricity supply activity in Kosovo’s market.

32.4MW of wind in operation

After considering the request of the company “Air Energy” sh.pk the Board has decided to issue a long term license for the production of electricity from the wind turbine “Kitka”. This decision was taken based on the Laws in force and also after the same was issued with the Authorization for construction of the generation capacity for the construction of the Wind Park with a capacity of 32.4 MW.

Thirteen (13) preliminary authorization decisions with a total installed capacity of 171 MW have been issued during 2018, which are expected to be authorized by the Regulator for the construction of new generation capacities by RES within legal deadlines after the completion of legal requirements.

While final authorizations were issued for six other projects for the construction of new generation capacities. Three final authorizations were issued from the hydropower plants and three were for the construction of wind turbines with a total installed capacity of 114.8 MW.

Internal Projects:

ERO discusses with the representatives of Kosovo Manufacturing Club the market opening

ERO, on 11 december 2019 has held a consultation meeting with the representatives of Kosovo Manufacturing Club in order to discuss the possibilities and new obligations provided upon the opening (liberalization) of electricity market. The purpose of this meeting was to discuss in detail the steps that have been undertaken so far in relation with the market opening and discuss the actions that shall be undertaken by costumers in order to contract electricity in an open market. Upon this, ERO representatives explained that following the entry into force of third legislation package on energy. ERO notified the representatives of Manufacturing Club with the possibility provided to each customer to choose their own electricity supplier and with the legal criteria that it has set on deregulation of prices. Representatives of Manufacturing Club raised their concerns in relation with the functioning of the free market and the problems they have regarding electricity supply. Upon this, ERO tried to explain its regulatory and monitoring role in the free market as well as the obligation to protect customers in new circumstances in the open market.

Round Table on Support Scheme of Renewable Energy Generators

On September 19, 2018, the Regulator organized an Open Discussion Table on the Rule on the Support Scheme of Renewable Energy Generators. In order to consult with all interested parties, the Regulator has held this Round Table as part of its activities aimed at the proper functioning of a sustainable energy system, which provides good supply to consumers and a reliable environment for all investors.

NARUC Partnership – PCT tool in progress

The Regulator has continued the partnership activity with NARUC with various projects and workshops.

As a continuation of this project in December 2018, two members of the Regulatory Staff stayed in the Pennsylvania Regulatory Authority in order to look closely at the practices and tools used by this country in addressing vulnerable customers.

The regulator, with the help of NARUC, is working on creating a tool for comparing electricity prices. With this project, the Regulator aims to enable customers in an open market to have a reliable source to compare the prices that will be offered by electricity suppliers who will operate in the Kosovo market.

In this regard, USAID and NARUC have also organized the first workshop of the project “Strengthening the role of consumers and public information in the countries of South East Europe”, a workshop organized as a second phase of the Means of Price Comparison project and communications with consumers. The workshop was held on 3 and 4 December 2018 in Vienna, Austria, and was followed by the Regulatory staff.

The Regulator has also been a participant in the NARUC Project for the Development of Broadcasting Plans and the Project for Transmission Codes and Natural Gas Distribution Codes.

The Regulator has nominated two permanent members of the staff that are part of the project “10 Years of South East Europe Network Transmission Network” by NARUC in order to support South East European regulators in reviewing, approving and monitoring network development plans transmissions that have been developed by the Transmission System Operator (TSO).

Regarding the project “Market Design and Gas Transmission Codes”, the member of Regulatory staff nominated as permanent member of this project during 2018 has participated in two workshops organized within this project. Also as part of Project Assistance a NARUC consultant stayed at ERO for  4-days and also a Regulatory Workshop on Drafting the Draft Gas Code Concept for Kosovo.

ERO signs a MoU with the Chamber of Doing Business in Kosovo

In order to increase cooperation and provide support to economic development in the country, on 29 January 2019, the Energy Regulatory Office (ERO) has signed a MoU with the Chamber of Doing Business in Kosovo (CDBK).

Through this memorandum, ERO and the CDBK have agreed to assist, promote, support and increase the level of mutual cooperation in the function of overall economic and social development.

Also, ERO and the CDBK agreed to exchange information on their activities and member businesses. According to the memorandum, the exchange of information will be made on the basis of the authorized requests of both parties and in full compliance with applicable laws.

ERO, through this memorandum has once again emphasized that the involvement of all parties, the review processes of the Transmission and Distribution network development plans and other regulatory processes of public interest will be a priority.

(*This designation is without prejudice to positions on status, and is in line with UNSCR 1244 and the ICJ Opinion on the Kosovo Declaration of Independence.)

   Peru’s Regulatory Agency for Investment in Energy and Mining (Osinergmin)

Recent Developments:

In October 2018, electricity distribution rates were set for electricity distribution companies in Lima and Ica, as well as for 14 small municipal companies within the country. The result of the fixation was a reduction of the electrical distribution component from 1.5% to 0.6%. This new system produced a change in the determination of rates, in which the investments, costs, and market of the systems of each company were evaluated. In the previous determination, a representative system was used to set the rates of each company. As a consequence of the new system, it is possible to have a better approximation of the efficient costs of each company.

Internal Projects:
  • PAFER (Performance Assessment Framework for Economic Regulators)

In 2018, Osinergmin requested a PAFER review to the OCDE. The first report was presented to the Network of Economic Regulators (NER) in April 2018, while the final report was presented in 02nd April 2019.

  • IV ENERGY FORUM

In November 2018, Osinergmin organized the IV Global Energy Forum. It provided a platform for national and international speakers to discuss about the following topics:

  • Renewable Energy in Peru
  • International experiences for the promotion of the use of renewable energies
  • National experiences in the use of renewable energies
  • Invocation and challenges in the use of renewable energies.

     National Association of Regulatory Utility Commissioners (NARUC), USA

The National Association of Regulatory Utility Commissioners (NARUC) is the national association representing the State Public Service Commissioners who regulate essential utility services, including energy, telecommunications, power, water, and transportation. NARUC members, which include all 50 States, the District of Columbia, Puerto Rico, and the Virgin Islands, are responsible for assuring reliable utility service at fair, just, and reasonable rates. NARUC’s mission is to serve in the public interest by improving the quality and effectiveness of public utility regulation.

Internationally, NARUC Programs seeks to empower the global community of regulators to drive meaningful change in their energy sectors. Working in partnership with U.S. and international officials, NARUC’s projects support real improvements in the quality and effectiveness of regulation in foreign countries through dialogue and collaboration.

Recent Developments:

NARUC Advances Principles on Modeling Energy Storage and Other Flexible Resources: At its annual meeting in November, NARUC advanced a collection of principles to guide action on energy storage. The action comes as declining costs of new technologies have helped drive market transformation within the electric industry and as customer demands and resource options are changing and driving actions by regulators and utilities alike.

The principles are:

  1. Utilities and Utility Commissions should be well educated about the different types of quantitative models that exist today, their capabilities, intended purposes, strengths, and limitations
  2. Utilities should develop, if appropriate, new modelling tools and new planning frameworks that allow for a more complete evaluation of flexible resources, such as energy storage
  3. Planning frameworks and modeling tools that are publicly and commercially available should model the full spectrum of services that energy storage and flexible resources are capable of providing, including subhourly services
  4. Utilities should analyze a range of flexible resource options, such as energy storage, and current cost assumptions in their modelling, due to the diverse characteristics and resource lives of different technologies, with the goal of identifying and pursuing the most cost-effective opportunities that best meet the needs of the utilities’ systems
  5. Regulatory commissions should consider the same basic prudence principles to energy storage investments as to other utility capital plant.

NARUC Calls for Greater Action and Accountability on Water and Wastewater Systems: At its annual meeting in November, NARUC recommended a series actions by the owners and operators of water and wastewater systems. NARUC believes that all water and wastewater systems have a responsibility to provide safe, reliable, and affordable water service to their customers both now and in the future while acknowledging that such systems face a myriad of challenges, including aging infrastructure, cyber and physical security threats, environmental compliance, emerging contaminants, and water supply issues.

NARUC recommended that all water and wastewater systems develop and/or maintain:

  1. An asset management plan that requires the utility to inspect, maintain, repair, and replace aging infrastructure in a timely, prudent, and cost-effective manner
  2. A security plan to protect against cyber and physical attacks
  3. An emergency response plan for natural disasters and other unplanned events
  4. A mitigation plan for water quality issues, including those that result in a Notice of Violation
  5. An annual certification that the system is in compliance with all federal and state laws and regulations
  6. A plan to address short- and long-term water supply issues, if any exist; and that state and federal lawmakers consider and adopt any appropriate laws and regulations to assist regulators in addressing these challenges.
Internal Projects:

NARUC Releases Timely Guides on Liquefied Natural Gas, Carbon Capture Technologies and Emergency Preparedness: In recent months, NARUC has released fresh and engaging scholarship on key issues facing energy regulators in the United States and around the world. These documents are produced collaboratively among NARUC members and showcase the thought leadership of U.S. state utility regulators.

Carbon Capture, Utilization, and Storage: Technology and Policy Status and Opportunities is a valuable tool for regulators and stakeholders to understand current CCUS policy and technology, learn about its successful applications nationally and internationally, and consider actions to bring about more CCUS projects. Developed by NARUC’s Center for Partnerships & Innovation with key contributions from the National Energy Technology Laboratory, the guide examines the state of national carbon issues and offers insights on steps to reduce carbon dioxide emissions from coal-fired power plants and fuel-intensive industrial processes. The guide is available at: https://pubs.naruc.org/pub/09B7EAAA-0189-830A-04AA-A9430F3D1192

The Consumers & Catastrophes Guide offers a comprehensive look at how consumers can better prepare for and recover from natural disasters and understand how their utilities may be affected. The guide is available at http://bit.ly/ConsumerCatastropheGuide. 

LNG: A Local Market–A Global Market, An Introductory Handbook for State Public Utility Commissioners is a tool for regulators and others to understand the basics behind today’s LNG market and facilitate a thoughtful discourse among producers, regulators and consumers. The guide explores the supply dimension of LNG and how new technologies and gas discoveries have shifted the global LNG market in the last decade. The guide is available at:  bit.ly/NARUC2018LNG


 

ERRA Activities

 

Month

Dates

Meetings

Trainings

Other Activities

November,
2018

12-16

 

6th Training Course on Natural Gas Market Regulation
(Budapest, Hungary)

 

30

7th High-level Meeting of Regional Associations of Emerging Markets
(Istanbul, Turkey)

  

December,
2018 

2-4

 

Tailor-made Training for Oman Power and Water Procurement Company
(Muscat, Oman)

 

3-4

ERRA Customers and Retail Markets Working Group Meeting
(Istanbul, Turkey)

  

 3-5

 

ERRA-MEDREG Joint Training: Electricity Market Monitoring Tools
(Istanbul, Turkey)

 

February,
2019

3-7

 

9th Training Course on Principles of Economic Regulation and Electricity Tariffs
(Muscat, Oman)

 

11

  

Ad-Hoc Consultancy for BEA on RAB

Ad Hoc Consultancy Project finalized for the Bhutan Electricity Authority (BEA)

March,
2019

4

  

ERRA Activity Report 2018 cover

ERRA Activity Report 2018 published


11-12

 

1st Educational Workshop: The System Flexibility Challenge
(Budapest, Hungary)

 

25-29

 

4th Training Course: Fundamentals of Water Utility Regulation
(Budapest, Hungary)

 

April,
2019

4-5

 

5th ERRA-NARUC Technical Workshop: Cost-Benefit Analysis of Gas Infrastructure Projects
(Budapest, Hungary)

 

9

  

ERRA has released the 2018 Q3 and Q4 electricity and gas tariffs of its select member countries