Since the last ministerial meeting of the Energy Community in December 2022 Albania has achieved the most progress, submitting its draft 2030 energy targets, implementing market reforms, and setting up a Registry of Guarantees of Origin (GOs).
The deadline to submit draft National Energy and Climate Plans (NECPs) for review is June 2023. So far Albania and N. Macedonia are the only Contracting Parties that have submitted their drafts. The rest of the Western Balkan countries are lagging, according to the Energy Community Secretariat.
Serbia is among the countries that have not yet formally submitted their draft to the Secretariat but have made progress. The country’s energy ministry has recently submitted a draft NECP for public consultation open until 28 July. The country plans to reduce the use of lignite in power generation by 25% in 2030 compared to 2019, while the share of renewables in gross final consumption should increase to 33.6% at the end of the decade from 26.3% recorded in 2020. On 14 June the country launched its first competitive auctions to support 400 MW wind and 50 MW solar projects. The auction scheme intends to bring a total of 1.3 GW of new renewables capacity online from 2025 with two more auctions planned.
Bosnian officials presented a provisional NECP draft in April 2023. It included targets for:
The plan also aims to shut down most of the coal-fired plants by 2030 and to develop 2 GW of renewable capacity. In addition, the country plans to introduce the EU ETS model by 2025 to avoid paying the CO2 border adjustment tax and to establish a power exchange.
Kosovo presented a draft NECP in 2022 and currently the plan is being adjusted. Not much information is available on the adjustments.
Montenegro has not published a draft and the public consultation process has not started yet, suggesting that the country will miss the deadline.
Montenegro, Albania, and N. Macedonia made considerable progress by launching their long-overdue intraday and day-ahead markets on exchanges, MEPX, ALPEX, and MEMO in April and May. ALPEX, as Albania’s market operator, has also received the license from ERO, the designated market operator of Kosovo, to launch Kosovo’s day-ahead market within two months of the Albanian launch.
This happened after the adoption of a new Electricity Package in December by the Energy Community that sought to integrate the Contracting Parties’ electricity wholesale markets into the European internal market via market coupling. This will allow for better optimised cross-border flows and better investment signals for renewables development.
Serbia, which has been operating a day-ahead market on exchange SEEPEX since 2016, is due to launch intraday trading between 25 and 28 July. SEEPEX would then work on becoming the first Western Balkan exchange to initiate market coupling with the EU. A prerequisite for this is the transposition of EU rules, including network codes which is expected to happen by the end of the year.
In May, the Secretariat raised concerns about the lack of progress in the unbundling of generation and transmission services in Moldova. Some progress was made by transposing the REDII in April and by preparing to establish market-based support schemes for renewable plants that will improve competition and transparency.
The Community had started a legal case against Albania for the lack of unbundling of distribution and generation services, but this is now closed, acknowledging the progress made on the issue.
Bosnia also appeared to lag in implementing market reforms. There has been no considerable progress reported since the latest Implementation Report published by the Energy Community in December 2022. This report stated that Bosnia has not effectively implemented unbundling of transmission and distribution services from generation. There is a working group assigned to the establishment of a spot market in Bosnia, but no further progress has been reported yet.
All Western Balkan countries established their electronic registries for GOs in 2022. The next step for those registries to become operational according to EU standards is to sign a Registry Service Agreement with Grexel by 30 June 2023.
After becoming operational, the registries will operate in a regional market where all the Contracting Parties will be able to trade GOs with each other.
Albania and Republika Srpska, the federal subject of Bosnia, have already signed a Registry Service Agreement with Grexel. The second federal subject of Bosnia, Kosovo, as well as N. Macedonia, Moldova, and Montenegro, are expected to follow suit soon.
The last step for the Contracting Parties, after their registries become operational, is to become full members of the AIB and the EECS Scheme, something that Serbia has already achieved. The process comprises many steps and may take years to complete. It includes:
After becoming members of both the AIB and the EECS Scheme, Contracting Parties may still not be able to export their GOs to EU members. The Renewable Energy Directive allows imports of GOs from third countries only in case of an international agreement of mutual GO recognition between the European Commission and the third country. This is the case with Switzerland and Serbia (recent developments though precipitated changes).
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