Georgia to open gas, power markets by 2020 – minister

Aura Sabadus

15-Jun-2016

Georgia is expecting to liberalise its natural gas and electricity markets by 2020 as part of its upcoming membership of the EU’s Energy Community, Mariam Valishvili, the country’s deputy energy minister told ICIS on Wednesday.

Valishvili said the EU’s internal energy market rules would be transposed by 2018 in the electricity sector and by 2020 in the gas sector.

Furthermore, she said the country was looking to establish a cross-border electricity trading platform that would be fully compatible with Turkish and EU market principles.

“The platform will be an important component of a new power market structure. The Platform will be instrumental in properly allocating risk among market participants and assist in providing dependable cross-border transmission capacity rights,” she said. “Other goals for the near future include the [establishment] of Day Ahead Planning, infrastructure and IT development for metering, balancing and market operation, clearing operations and Balancing Market and at the later stage the functioning of Day-ahead market.”

Nevertheless, Valishvilli added that although Georgia would be a fully-fledged member of the Energy Community and would, therefore, be required to align its laws with those of the EU’s internal market, it would be granted a number of exemptions with regards to energy cross-border exchanges.

“Georgia fulfils the requirement of isolated market derogation under the EU Third Energy Package,” she said. “Therefore, specific solutions/exemptions regarding key gas transmission infrastructures mainly used for the shipment of gas through Georgia, including energy cross-border exchanges, have been identified under the Accession Protocol.”

She added that the pipeline, which will transport natural gas from the Caspian Sea to Turkey and Europe when the second phase of the offshore Shah Deniz project comes online by the end of the decade, would be exempt from third party access.

Derogations are also likely to be added in relation to cross-border gas trading with Georgia’s neighbours – Turkey, Azerbaijan, Armenia and Russia – none of which is an EU member.

In an interview with ICIS this week, Janez Kopac, director of the Energy Community Secretariat confirmed that Georgia had completed its fourth a round of negotiations with the European Union represented through the Energy Community in May.

He added that the Georgian parliament was expected to ratify the protocol in October.

Georgia has been an observer of the Energy Community since 2007. aura.sabadus@icis.com

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