1. Albanian power market ERE- Albania Sokol RAMADANI Chairman E R E
Electricity market design and regulatory issues in Albania and South East Europe Workshop
Albanian power market
Sokol RAMADANI
Chairman
ERE- Albania
1 FEBRUARY 2012

2. Market model Implementation Future development
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Introduction
Legal framework
Market aim
Market structure
Market model Implementation
Future development
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Korrik 2004

3. Legal framework Legal acts designing of the power market in Albania
Law nr date “On power sector ” defines:
the principle of the activities in the power sector
responsibilities of the actors performing in the market
responsible body for the design of the electricity market in Albania.
Government decision 338 date On the power market model in Albania . This document provides:
a framework on the government reform in the electricity sector including the privatization of the distribution sector,
sett clear rules for carrying out transaction in the markets that are transparent and non-discriminatory.
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4. Market aim
Capture the full value of the Albanian hydro resources for the benefit of Albanian tariff customers
To move from a vertically integrated entity to a structure with functionally, legally and financially separate entities.(generation, distribution transmission
Provide bilateral contracts with simple regulated balancing market for energy transactions, which will improve transparency and avoid unnecessary “layering” of transactions.
Move toward consistency with EU Directives and the Energy Community Treaty
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5. Market structure Relations among market participants Flow of Funds
Energy Flow

6. Relations among market participants
Regulated Market (price and other terms and conditions of the contract approved by ERE)
Between KESH Gen and Wholesale Public Supplier (at least for purpose of making transparent of the price charged by KESH Gen to Wholesale Public Supplier);
Between Wholesale Public Supplier and Retail Public Supplier;
Between OST and other market participants for transmission-related services, including ancillary services;
Between DSO and other market participants for distribution-related services;
Between SPPs or IPPs and the Wholesale Public Supplier;
Between Retail Public Supplier and its tariff customers;
Between KESH Gen and Traders, including import contracts for the exchanges of power, which are subject to ERE scrutiny or procurement rules;
Between OST and KESH Gen, SPPs, IPPs and Traders for the transmission losses and Ancillary Services.

7. Relations among market participants
Unregulated market
Between Qualified Suppliers and Eligible Customers;
Between and among SPPs, IPPs, Qualified Suppliers and Traders;
Between Wholesale Public Supplier and IPPs, SPPs, Qualified Suppliers and Traders; and
Between DSO and Traders, Qualified Suppliers, IPPs and SPPs for energy needed to cover losses in the distribution system.

8. SPPs; IPPS; and Qualified Suppliers
Market Structure
Appendix C
Energy Supply Agreements
To cover losses
OST
Distribution Company
KESH Gen
To cover losses
Public Supplier
(Retail)
Electricity Supply Agreement*
Regulated Tariffs and Service
Agreements with Tariff Customers*
Wholesale Supplier
Tariff Customers
Economy Energy Purchases
Traders
Electricity Supply Agreements
Eligible Customers
SPPs; IPPS; and Qualified Suppliers
Electricity Supply Agreements (
Electricity Supply Agreements
Export Markets
Electricity Supply Agreements
Electricity Supply Agreements for Licensed Exports*
* Regulated by ERE
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9. Distribution Company (Disco)
Market Structure
Appendix A
Electricity Flow
KESH Gen
OST:
Transmission System
Distribution Company (Disco)
IPPS
Tariff
Customers
Imports
SPP
Eligible Customers
In Distribution
Areas
Export
Markets
Eligible
Customers
Eligible Customers
Directly Connected
to Transmission Grid
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10. Market model implementation
Market Opening
- liberalization of the retail supply market
- upgrade of the transmission and distribution system (reduce of technical and nontechnical losses)
- Improvement of inter- -connection lines and functioning of the new dispatch center
Adoption of the secondary legislation
- Market rules
- Grid Codes –
- Tariff methodology
- Approval of model agreements
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11. Future development
Approval of the new law in accordance with the EU requirements especially for the security of supply and market opening
Design of a new market model which will reflect the government policy to continue the reform in the electricity sector taking into consideration :
Distribution and Retail Public Supply functionally financially and legally unbundled,
Possible privatization of the public generation
TSO and Market operator functionally financially and legally unbundled,
Enhance efficiency and transparency in the market operation and functioning.
After adoption of the new law and new Market Model by the GOA, the ERE need to reflect the changes in the Market Rules and other secondary legislation related to the market functioning
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12. Future development Enhance efficiency and transparency
Administrative capacity necessary for the implementation
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13. Thank you for the attention
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