States that have implemented a sector specific regualation to ensure competiveness in their energy sector are for example:
A. EU Member states
I. State A
1. REGULATORY APPROACH
In the last decade Croatian energy sector has undergone significant structural changes in order to meet the legal and institutional EU requirements. It has been liberalized by the implementation of sector specific regulation in order to establish and maintain market competition.
Such approach ensures objective, transparent and non-discriminative carrying out of energy activities and adaption of principles of regulated access to the network/system as well as development of methologies for determination of tariffs systems and tariff itself in order to establish efficient and competitive energy market and protect consumers and energy operators.
In general, there are three basic objectives of the regulatory regime:
1. security of energy supply;
2. competitive energy system;
3. sustainable energy sector development.
Furthermore, the regulator stipulates that a goal of the regulatory approach is to build a sustainable energy system that makes a balanced contribution to security of energy supply, competitiveness and environmental protection and provides security and availability of energy supply to consumers and business sector. Such energy supply is a perquisite for economy and social development.
2. LEGAL FRAMEWORK
The mayor tools for liberalization and market opening were two Acts, Energy Act
Official Gazette (OF) 120/12 and 14/14.
and Act on the Regulation of Energy Activities,
and a number of laws and bylaws regulating specific energy activities.
Electricity, gas, oil and its derivatives, biogas.
All these legal acts create a frame for independent energy regulation fully harmonized with the EU standards.
3. REGULATORY AGENCY
Croatian Energy Regulatory Agency (HERA) is an autonomous, independent and non-profit public institution which regulates energy activities in the Republic of Croatia with the function to establish and implement the regulation of energy sector in order to promote a viable, sustainable and efficient energy sector.
In particular, the Agency is mandated for licensing of carrying out any energy activities, activities aimed at ensuring transparent and non-discriminatory functioning of the energy market, activities aimed at ensuring transparent and non-discriminatory performance of energy activities subject to public service obligation and carrying out activities related to regulation of energy prices to be set on the basis of tariff systems.
HERA’s obligations, authorities and responsibilities are based on the Act on the Regulation of Energy Activity, the Energy Act and other regulating specific energy activities.
The Agency is led by the Board of 5 Commissioners, responsible to the Croatian Parliament, and the Expert Services divided in 5 sectors, providing expert, administrative and technical services for HERA.
4. ADVANTAGES AND DISADVANTAGES OF THE REGULATORY APPROACH
The regulation of energy activities in Croatia promotes efficient and rational use of energy, entrepreneurship and investments in the sector, the use of renewables and protection of environment.
However, a full implementation has not been achieved and not because of insufficient legal framework but for need to overcome traditional bureaucratic inertia and widespread corruption. Lately, a situation has been improved with considerable opening of the market
E.g. from 2013 two new suppliers, outside HEP (Hrvatska Elektroprivreda) RWE and GEN-I decided to offer electricity to households at lower price than HEP-DSO.
and in future competition will continue.
Nevertheless, the major problem of the energy sector is a lack of substantial investments in modernizing the whole energy sector and energy infrastructure and consequently high import dependency.
(written by Ena Ostroski)
II. State B
(written by ...)