Electric power market liberalization procedures launched in Armenia

ArmInfo. Works on electric power  market liberalization and interrnational trade contribution are  initiated in Armenia, the press-office of the Armenian Ministry of  Energy Infrastructures and Natural Resources informs.

Following the source, an appropriate works program, aimed at various  discussions with stakeholder entities, is already  developed in  cooperation with the experts of US International Development Agency.  After summarizing the project in the first semester of 2017, the  document will be submitted for the Government approval. According  Areg Galstyan, the Deputy Minister of Energetic Infrastructuires and  Narural Resources of Armenia, simultaneous  works in respect to  modifications and variations to the Energy Law are  in progress.  'Exactly with this a transition from a simple model to the market   liberalization model will be implemented," Galstyan accentuated,  expressing also an opinion , that the energy power framework in  Armenia nowadays needs an improvement and a  rapid liberalization   within the purpose of the trade relation development with neighbor  countries. 

Recently we have got all the necessary preconditions capsulated here  in our country for that, Minister went on. Despite the wholesale  market still gives restricted opportunities for competitiveness, as  well as the essential difference between the tariffs for generating  entities, these factors cannot appear as obstacles to reject the  Single Client model. It is necessary to  set conditions for  involvement of various clients  into the market. Establishment of a  complete competitive market is quite feasible from the point of   joint regional market  area. It is well known, that appropriate steps  are already made in this field. Upon the implementation of number of  project, having a regional importance, it is expected to establish  the basis for this process by 2019.

The Public Services Regulating Commission of RA has already approved  the Concept on  Energy Framework Improvement Tools Implementation. An  appropriate mechanism of  responsibility  both for suppliers and  consumers is defined to set forth.  Nowadays neither the power  suppliers nor the consumers bear any liability for sales and  consumption volumes (ordered capacities), which could cause an  unlimited variations  in tariff regalement.  Within the best  international practices, the liability of suppliers and large  customers for ordered and actually used volumes should become the  basic concept. 

According to Galstyan, on the way to the market liberalization it is  necessary to create an electronic (web) stock  and to set new  structures at the power energy market. Particularly,  it is  stipulated to  set the market operator entity, which would be the key  responsible unit for the energy trade. The tariff policy is also to  be improved. "Particularly, the matter is the day/night tarification,  their values, and the timetable of implementation. Within the purpose  of tariffs diversification, we are intended to differentiate the time  by seasons, pic or night items, loading items etc., Deputy Minister  added.

To Areg  Galstyan's opinion, the market liberalization will  immediately impact the tariffs. "We do expect, that the  implementation of competitive elements will promote the tariffs  decrease. And in such conditions every market player will try to  reduce own  costs and expenses - just to get to  a better position at  the market selling own production," Deputy Minister said.