Why is a well organized electricity market important and what are the steps toward the forming of markets in the region?

The Energy Community is preparing to transpose the clean energy package, but, unfortunately, not even the Third Energy Package has yet been fully transposed or efficiently implemented in all the countries of the region. Two key challenges remain – price deregulation and regional integration, Naida Taso of the Energy Community Secretariat said at the Trebinje Energy Summit.

Taso was one of the participants in the third panel of this summit, which was dedicated to the topic of the forming of electrical energy markets in the region and the challenges that individual countries are facing on that path.

As Taso pointed out, Serbia has an organized day-ahead market, and tenders for such markets to be formed in Montenegro, North Macedonia and Albania are current as well.

– It is only in BiH that there are no efforts toward that, but I can say that I’m glad to hear that the USAID is undertaking certain activities for BiH to step up the process as well – Taso said.

Ervin Leko, the head of the market sector at EP HZHB, repeated what he had said at the previous Trebinje summit – the legislation in BiH does not even know the concept of this kind of a market. Although his company, EP HZHB, had commented on the concrete law, they never got a response.

Serbia has shown what it looks like when a country starts forming a market with a plan and it was the technical director of the market in Serbia, SEEPEX, Dejan Stojcevski, who presented the practical examples and what they had met with.

As he said, they have existed for six years, they are growing constantly, in annual increments of 10%, and it took slightly over three years for them to become self-sustainable. This is especially important, he said, because they are acting within an isolated regime with the countries of the Western Balkans. He cited the example of Slovenia and Croatia, whose liquidity prior to the market coupling was zero. That is why Stojcevski emphasized that a well organized market contributed to the liquidity of a country’s energy.

The balance market in BiH is one of the rare successes in this field in that country. It dates back to 2015, when, in cooperation with NOS and DERK, a balancing model based on purely market principles was created, emphasized Almir Imamovic of DERK BiH.

– The market started operating in January 2016 and we were praised for being the only balance market in the Western Balkans. We have the capacities – the maximum load of the system in BiH is 1,800 MW, at least as of last year, and the installed production capacities have already reached the power of 4,600 MW. There’s a large margin between the installed capacities and the maximum load and it provides the possibility of putting all those capacities on the balance market.

The advantage of BiH, he says, is that there are three power companies and that there is no monopoly.

He also pointed out that BiH was working on changing the market rules, taking into account the Electricity Balancing Guideline (EBGL). New rules are expected from 2022.

Technology as a partner

Stefan Krneta, founder of the Dwelt startup, which developed the software for Elektroprivreda RS, repeated that the transition of the energy sector and the forming of an efficient market could not be realized without being accompanied by the latest technology. The coronavirus pandemic has only confirmed how important it is to have a strong digital basis in the energy sector.

– A revolution will happen in energy, and it is already happening in fact, the same kind that happened in banking when cryptocurrencies appeared. Retail energy companies used to be an unimaginable concept, and now they are a reality.

Market coupling bringing liquidity

– With the market coupling and the opening of the borders, we will have a single price of electricity for the entire region – from Hungary and Romania all the way to Greece. Then, we will be able to talk about liquidity and a true reference price. Before this happens, launching a market is a big risk. It’s not enough to create a market. The liquidity needs to be maintained as well – said Stojcevski, the technical director of the market in Serbia.

The Trebinje Energy Summit SET 2021 was organized by Elektroprivreda RS and the SET company on May 20-21, under the aegis of the Ministry of Foreign Trade and Economic Relations of BiH, the Government of the Republic of Srpska and the Koncar company, with the general sponsorship of Elnos Group and the support of Infinity Group and Dwelt.

The eKapija portal is the media sponsor of the 2021 Trebinje Energy Summit.

Teodora Brnjos

SET doo Trebinje

DERK BiH

SEEPEX Serbia

EP HZ HB

Dwelt Banjaluka

Energy Community

Naida Taso

Stefan Krneta

Dejan Stojčevski

Elvir Leko

Almir Imamović

balance market

electricity market

electrical energy market

electricity balance market

day ahead market

intra day market

Sofia Declaration

Clean Energy Package

electricity trade

market coupling

CACM regulations

NEMO status

electricity market in Serbia