Workshop Regional Energy Policy cooperation in South-East Europe - enpg

Workshop Regional Energy Policy cooperation in South-East Europe


Regional energy policy cooperation on gas connectivity in South East Europe (SEE) has been put forward as a priority by the EU, Member States and Energy Community Members in the region. This recognition of the need and importance of coordinated actions to improve the region´s energy security and ability to sustain competitive economies is shared by national governments in SEE. Cooperating on energy policies is a complex task, which would require stable, long-term commitment on national level but also significant European assistance in coordinating and guiding this process. A step forward was made through the establishment of the CESEC Gas Connectivity High Level Group. While this will help Central and South East European states advance particular infrastructural projects to improve the region´s security of supply of natural gas, CESEC would have to evolve further and develop a proper response to three main issues concerning both the natural gas and electricity sectors:


  1. Connectivity: Regional coordination on infrastructure planning will have to be improved in order to achieve physical interconnectivity but mostly to ensure harmonisation with the existing European energy regulatory framework. Small and incremental changes, facilitating cross-border trade in natural gas and electricity could substantially improve the ability of alternative gas supplies flowing to the region as well as lead to a more cost-effective use of existing infrastructure.
  2. Finance: To meet connectivity needs financial resources will have to be earmarked to implement measures, necessary to achieve the above mentioned connectivity. Stimulating private investments, however, would be dependent on implementing the above mentioned actions on regulatory framework harmonisation and market coupling. Mitigating unforeseen negative implications for vulnerable customers groups as a result of market coupling would also require financial resources with public funds being the most likely source of those.
  3. Energy poverty: Market liberalisation and consequent coupling could potentially result in higher electricity prices due to the removal of generation capacity subsidies and regulated prices for households. Thus this process should be introduced in parallel with measures assisting SEE customers, who are sensitive to energy pricing despite, electricity prices being lowest in the EU. A European approach to defining these vulnerable groups is necessary in order to design a response to be deployed simultaneously with actions enforcing connectivity. A specific measure could be redirecting funds previously spent on subsidies to financing the deployment of energy efficiency and innovation solutions for vulnerable customers.


However, regional energy policy cooperation in SEE is not solely a function of stable political mandate and sufficient access to finances. A greater task of finding a common regional voice to respond to energy issues lays ahead of the region. The necessity for a common response is not only important in moments, when one is expected – such as to the announcement of the Nord Stream 2 project, but also in setting the goals and future strategy of the energy sector in the region in general. The development of a common position would require better communication between governments but also a very pragmatic assessment of the energy demand projections for the region as a whole. Deploying a list of selected infrastructural projects without objective assessment of the true future needs in the region would result in either of the two options: 1) vital public capital being locked-in and other promising solutions such as energy efficiency being cast aside or 2) expected market-driven private investments never materialising due to the lack of market signals. A joint exercise in forecasting regional energy demand could offer the necessary environment to conduct a regional assessment of generation capacity adequacy in light of coal installations phase out, the future of district heating facilities, energy security concerns and European 2030 energy objectives as a whole. CESEC could become the platform for this joint action but a vocal and unreserved support of governments in the region is needed to intensify cooperation on energy issues beyond natural gas security.


Lastly, the role and voice of commercial enterprises, interested in participating and growing a free market for natural gas and electricity in SEE, is vital to the above processes. Without communicating their day-to-day struggles and identifying regulatory bottle-necks both on European and national level, they risk to face suboptimal and piecemeal solutions, forced by politics and not markets.


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Energy Policy Group

NOUA ECONOMIE a Uniunii Europene și implicit NOUA ECONOMIE a României este una orientată masiv pe dezvoltare durabilă și cea care va construi o Românie Durabilă. Această NOUĂ ECONOMIE are nevoie de POLITICI EUROPENE EFICIENTE pentru toate statele membre, politici europene care să fie foarte realist conectate cu resursele, capabilitățile și oportunitățile fiecărui stat membru în parte. ... See MoreSee Less

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