Georgia to launch Electricity Market Model Concept in September
The Government of Georgia has been reforming the country's electricity market since 2019, when a new Law on Energy and Water Supply entered into force and established a general legal framework for further implementation of the European Union directives and regulations. Photo: NIno Alavidze/Agenda.ge
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A new Electricity Market Model Concept will be launched in Georgia on September 1, Deputy Economy Minister Romeo Mikautadze announced on Tuesday at a sitting of the Parliamentary Committee on Sectoral Economics and Economic Policy.
The official said the Market Concept introduced general principles for organising and functioning of the wholesale trade market of electricity and aimed:
- To establish attractive environment for investors and to provide free options for consumers by way of developing competitive and transparent electricity markets
- To form organised electricity markets, inter alia, day-ahead and intraday markets, as well as balancing and ancillary services market, and the market for bilateral agreements
- To provide clear distinction between duties and responsibilities of the entities functioning in the energy sector
- To form competitive and liquid market price
A sitting of the Parliamentary Committee on Sectoral Economics and Economic Policy. Photo: Ministry of Economy.
The current reform of the electricity market envisages a qualitative change in the existing market model, both at the wholesale and retail levels. As a result of this reform, competition in the electricity market should be gradually developed through a gradual opening of the market. A market model must be established that will give the right price signals to both generation investors and consumers," Mikautadze said.
The Government of Georgia has been reforming the country's electricity market since 2019, when a new Law on Energy and Water Supply entered into force and established a general legal framework for further implementation of the European Union directives and regulations.
The Law on Energy provides a legal basis for power-related secondary legislation, the main pieces of which are the Electricity Market Model Concept and the Electricity Market Rules. The Electricity Market Rules have not yet been adopted, while the Government adopted the Electricity Market Model Concept on April 16, 2020.
Mikautadze said at the meeting that switching to hourly balancing, and therefore hourly trading, was a “cautious reform” process.
“It is important that the positive expectations toward this market are in line with reality. For this, it is necessary for all market entities to be fully prepared," he concluded.
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