SARAJEVO (Bosnia and Herzegovina), November 26 (SeeNews) – Bosnia needs to amend primary legislation without further delay in order to remove major legal and contractual obstacles to establishing organised electricity markets and market coupling, the Energy Community said.
Bosnia has until March 2016 to legally organise its electricity markets, but the prospects to comply with the deadline are currently not good due to the disagreement between its two entities, the Serb Republic and the Muslim-Croat Federation, the Secretariat of the Vienna-based organization said on Wednesday in a Monitoring Report.
Bosnia has made no progress in adhering to a power exchange or, if economically justified - considering liquidity and economic viability, creating an own power exchange by July 2016, the Energy Community noted.
In terms of the legal and functional unbundling of distribution system operators and supply companies, a commitment it took on as part of its membership in the Energy Community, Bosnia’s distribution is still bundled with supply throughout the country and with generation in two utilities.
“Legislation in place requires legal unbundling, but is not sufficient for functional unbundling. It needs to be amended immediately. Preparatory activities for unbundling have started in the utilities but are not at a level sufficient to keep the deadlines,” the report said.
Bosnia also obliged itself to ensuring the independence of national energy regulatory authorities based on pre-defined indicators by January 2016. This requires legislative changes at state and entity levels in line with the EU’s Third Package. However, efforts in this respect are not sufficient, the report said.
The Energy Community earlier warned Bosnia over not making serious efforts in reforming its energy sectors. In late-October the organization said the country urgently needs to establish an expert working group that will focus on meeting the obligations undertaken through membership in the Energy Community.
The working group is set to meet in end-November at the headquarters of the Vienna-based organization where they will seek to find solutions to outstanding issues and to ensure commitments are met that have been undertaken in the energy sector, including establishing a state level energy strategy and applying regulations under the EU’s Third Energy Package, the Community said.
The Energy Community was established by an international law treaty in October 2005. As of July 1, 2013, the parties to the treaty are the European Union and Albania, Bosnia and Herzegovina, Croatia, Kosovo, Macedonia, Moldova, Montenegro, Serbia and Ukraine. The key aim of the organization is to extend the EU internal energy market to Southeast Europe and beyond on the basis of a legally binding framework.