Ministerial Council Takes Decisive Steps on the Future of the Energy Community

On 24 October the Energy Community Ministerial Council adopted the list of 35 “Projects of Energy Community Interest” (PECIs). Fourteen electricity generation, nine electricity infrastructure, ten gas infrastructure and two oil infrastructure projects were selected due to their importance for the development of cross-border energy markets in the region*. The projects will benefit from investment incentives and enhanced regulatory conditions. “I welcome the endorsement of the PECIs list by the Ministerial Council today. The PECI label will help to attract much needed investment into the region – almost 40 billion EUR is required until 2020. However, the lack of progress on achieving effective market opening and the regional integration of energy markets is worrying. The implementation of the Third Energy Package, as an imperative tool to reach these objectives, must become a key priority”, said Mr Günther Oettinger, European Commissioner for Energy.

The Ministers decided to extend the duration of the Energy Community Treaty for a period of ten years. They also established a High Level Reflection Group tasked to assess the shortcomings of the current treaty and make proposals for improvement. Former President of the European Parliament and Prime Minister of Poland, Mr Jerzy Buzek, was appointed as its chairman. The group is to report to the Ministerial Council in autumn 2014. “The Energy Community has proven to be an effective framework for regional cooperation in the energy field and it is clear that its role will be at least, but likely even more, important in the coming years as the Contracting Parties focus on the practical implementation of their commitments under the Energy Community Treaty. This is why the Energy Community requires stronger institutions and instruments to successfully achieve the goals set out in the Treaty. The creation of the High Level Reflection Group is a key step forward in this respect. I further express my satisfaction with the appointment of Mr Jerzy Buzek,” said H.E. Mrs Zorana Mihajlović, Minister of Energy, Development and Environmental Protection on behalf of Serbia as the Presidency in office of the Energy Community.

The Ministers also took two important decisions aimed at further limiting emissions from large combustion plants. Given the large scale of investment required to retrofit existing combustion plants, the Ministers decided to provide the option to apply during a transitional period flexibility instruments for the implementation of the Large Combustion Plants Directive that would facilitate its implementation in the Energy Community without reducing its level of ambition. At the same time, they agreed to implement more ambitious environmental goals of the Industrial Emissions Directive from 2018 onwards for any new investments carried out in the region.

In the first ever dispute settlement case before the Ministerial Council, the Ministers established a breach of Energy Community law by Bosnia and Herzegovina related to its legal framework in the gas sector. The Ministers called on the country to rectify the breach no later than June 2014 and warned that the failure to do so would be considered a serious and persistent breach of the Treaty. In this case, Ministers asked the Secretariat to launch the required proceedings against Bosnia and Herzegovina as envisaged in the Treaty.

* The projects were selected based on a cost benefit analysis methodology, following an extensive public consultation. If a project breaches the Energy Community acquis or national legislation, or an environmental impact assessment has not been performed properly, the PECI label may be removed.

energjia.al, 24.10.2013