ECONOMY

Common energy market for SE Europe

A crucial step toward creating a single regional market for electricity and natural gas in Southeastern Europe was taken at an interministerial meeting last Monday in Athens. Development Minister Dimitris Sioufas did not hide his satisfaction with the result of the conference. «With the decisions made, one more decisive step has been taken for the creation of an integrated regional energy market, with mutual benefits for all countries in the region,» said Sioufas, who chaired the meeting. Sixteen countries participated, five of which are EU members (Greece, Italy, Austria, Hungary and Slovenia). Prospects for completing the plan are more positive than ever after the meeting, as for the first time a legally binding plan for developing the market was examined. This ambitious plan, supported by the EU, sets up a competitive energy market that will alter the currently closed national systems of electricity and natural gas. This precludes the formation of single and common rules for commercial transactions, to allow the promotion of energy investments and the realization of financial transactions to the benefit of all members. The process of creating this market also contributes toward accelerating the harmonization efforts of non-EU members with the Union’s acquis communautaire and becomes yet another stabilizing factor in the region. For Greece, new development horizons are opening in these two energy sectors and the ministry’s leadership is already moving in this direction, making the most of its dual position in SE Europe and in the EU. The plan has been promoted for nearly a decade by the European Commission and is included in the deregulation framework of the electricity market, as well as the forthcoming natural gas deregulation. During the meeting, it was agreed that Greece would be the seat of the region’s Regulatory Council. This has particular significance as the Council will set the pricing methods and all essential regulations and interventions, along with standards and rules for securing the operation of a free, transparent and competitive electricity and natural gas market in the region. It was also agreed that Athens will be the seat of the forum for the development of the electricity market in the region, while Sioufas tabled a suggestion to the EU, which was accepted, about staging a broad conference in spring 2005 in Athens, in cooperation with the chambers and the productive bodies of countries participating in the SE Europe Energy Community. The conference will evaluate the positive effects of the single energy market on the competitiveness of companies in the region’s states. This initiative has now passed to the EU, which has launched an implementation plan. The Energy Community’s other institutions have been distributed as follows: the Forum for Oil in Trieste, Italy, the Technical Center and Information Center in Sofia and the Secretariat of the community in Vienna. Ministers from the 16 countries accepted the general accord on the draft treaty to create a single market, also adopting the name «Energy Community» for this process. The meeting further agreed on the need for an information center for energy and asked the permanent high-level group (PHLG) to adopt a proposal based on a detailed study. The ministers asked the GEER work group for SE Europe and its successor, the Regulatory Council for electricity and natural gas, to propose instructions about the operational evaluation of infrastructure programs with a cross-border dimension. The report for each proposal must be submitted to the PHLG. It was also decided to begin preliminary discussions on whether it would be desirable to broaden the community to include oil. Another decision by the ministers regards the creation of a work group on natural gas, composed by government representatives and international financial foundations. Finally, the meeting provisionally accepted the compromise EU proposal over the draft treaty on the environment. The plan’s provisions will be examined in detail by the Negotiating Conference to arrive at a complete agreement.