Belarus hopes to export electricity to Russia from 1 January 2024
<p> MINSK, Jul 15 - PrimePress. On 8 July 2021, after a meeting with Belarusian Energy Minister Viktor Karankevich in Moscow, Russian Energy Minister Nikolay Shulginov said that Belarus and Russia intend to launch a common electricity market within the framework of the Union State. This will be done in two stages - from January 1, 2024 through trade between the authorized organizations, and from January 1, 2027 through deeper integration in the electricity sector. </p> <p> According to Shulginov, the launch of the common energy market in the Union State of Belarus and Russia is envisaged by a relevant Union Programme (formerly referred to as ‘roadmap’) on the formation of the unified electricity market, which was signed and approved by the governments of the two countries. </p> <p> The energy sector in Belarus, as in Soviet times, remains a natural monopoly, which includes a vertical of all economic activities, including electricity and heat production, transmission and distribution, and sales. Belarus does not yet have wholesale electricity market entities, but one monopolist that generates, distributes, transports and sells electricity - Belenergo SPA. </p> <p> A law on the electricity sector, which envisages a reform of the energy system, was drafted many years ago, but has never been adopted. </p> <p> Commentary </p> <p> Belarus and Russia plan to launch a common electricity market within the Union State from January 1, 2024, without waiting for the launch of a common electricity market in the Eurasian Economic Union (EEU - Armenia, Belarus, Kazakhstan, Kyrgyzstan, Russia), where it is expected to be operational from January 1, 2025. </p> <p> Letting authorised operators to trade in that market, as stated by the Russian energy minister, allows the Belarusian authorities to independently appoint them, represented, for example, by Belenergo, without resorting to industry reform. The formation of a common electricity market in the EEU implies that competitive market operators, rather than designated authorised companies, should be allowed to enter the market. </p> <p> The Belarusian authorities are trying to fast track the creation of a common energy market with the Russian Federation in the expectation that it will allow Belarus to solve, if not completely, then significantly mitigate the problem of electricity surplus that will arise after the launch of two units of the Belarusian NPP (BelNPP, Astravyets, Grodno Oblast). </p> <p> BelNPP is planned to reach its design capacity in 2023. It will generate 18.543 billion kWh of electricity per year, which will amount to 42.8% of the country's electricity consumption (gross), which by that time is expected at the level of 43.2 billion kWh. </p> <p> Given the lack of realistic prospects for electricity exports due to the EU blockade, Belarus will have to balance the electricity system and may have to resort to limiting electricity generation by the existing CHP and TPPs. This scenario is undesirable because of the technical difficulties and economic and social problems that such a decision may entail. Therefore, the Belarusian authorities pin special hopes on the opening of the Russian energy market. </p> <p> It is worth reminding that in September 2020, Russian Prime Minister Mikhail Mishustin and Belarusian Prime Minister Roman Golovchenko discussed electricity supplies from the BelNPP at the talks in Minsk. Then the prime ministers instructed ministries concerned to work out the issues related to the operation of the power systems of the two countries. An agreement was reached to set up a special interdepartmental working group to work on these issues. It can be assumed that in the stalemate for Belarus, the Kremlin suggested that the problem of electricity oversupply after the launch of the BelNPP should be solved in conjunction with deeper integration within the framework of the Union State. </p> <p> In fact, this scenario is now being implemented. Moreover, it is being implemented in the way needed by Minsk, which does not require it to reform the existing energy monopoly. </p> <p> It is obvious that the transition from 1 January 2027 to deeper integration in the power sector, which was announced by Russian Minister of Energy Nikolay Shulginov, will require a serious reform of the Belarusian power sector. In order to exercise full-fledged trade in electricity in the union market rather than through authorized operators, Belarus needs to create a wholesale and retail electricity market, entities of this market, as well as divide the energy monopoly by activity type - electricity generation, transportation and sales. </p> <p> </p>
2021-07-15
Primepress
Belarus hopes to export electricity to Russia from 1 January 2024
MINSK, Jul 15 - PrimePress. On 8 July 2021, after a meeting with Belarusian Energy Minister Viktor Karankevich in Moscow, Russian Energy Minister Nikolay Shulginov said that Belarus and Russia intend to launch a common electricity market within the framework of the Union State. This will be done in two stages - from January 1, 2024 through trade between the authorized organizations, and from January 1, 2027 through deeper integration in the electricity sector.
According to Shulginov, the launch of the common energy market in the Union State of Belarus and Russia is envisaged by a relevant Union Programme (formerly referred to as ‘roadmap’) on the formation of the unified electricity market, which was signed and approved by the governments of the two countries.
The energy sector in Belarus, as in Soviet times, remains a natural monopoly, which includes a vertical of all economic activities, including electricity and heat production, transmission and distribution, and sales. Belarus does not yet have wholesale electricity market entities, but one monopolist that generates, distributes, transports and sells electricity - Belenergo SPA.
A law on the electricity sector, which envisages a reform of the energy system, was drafted many years ago, but has never been adopted.
Commentary
Belarus and Russia plan to launch a common electricity market within the Union State from January 1, 2024, without waiting for the launch of a common electricity market in the Eurasian Economic Union (EEU - Armenia, Belarus, Kazakhstan, Kyrgyzstan, Russia), where it is expected to be operational from January 1, 2025.
Letting authorised operators to trade in that market, as stated by the Russian energy minister, allows the Belarusian authorities to independently appoint them, represented, for example, by Belenergo, without resorting to industry reform. The formation of a common electricity market in the EEU implies that competitive market operators, rather than designated authorised companies, should be allowed to enter the market.
The Belarusian authorities are trying to fast track the creation of a common energy market with the Russian Federation in the expectation that it will allow Belarus to solve, if not completely, then significantly mitigate the problem of electricity surplus that will arise after the launch of two units of the Belarusian NPP (BelNPP, Astravyets, Grodno Oblast).
BelNPP is planned to reach its design capacity in 2023. It will generate 18.543 billion kWh of electricity per year, which will amount to 42.8% of the country's electricity consumption (gross), which by that time is expected at the level of 43.2 billion kWh.
Given the lack of realistic prospects for electricity exports due to the EU blockade, Belarus will have to balance the electricity system and may have to resort to limiting electricity generation by the existing CHP and TPPs. This scenario is undesirable because of the technical difficulties and economic and social problems that such a decision may entail. Therefore, the Belarusian authorities pin special hopes on the opening of the Russian energy market.
It is worth reminding that in September 2020, Russian Prime Minister Mikhail Mishustin and Belarusian Prime Minister Roman Golovchenko discussed electricity supplies from the BelNPP at the talks in Minsk. Then the prime ministers instructed ministries concerned to work out the issues related to the operation of the power systems of the two countries. An agreement was reached to set up a special interdepartmental working group to work on these issues. It can be assumed that in the stalemate for Belarus, the Kremlin suggested that the problem of electricity oversupply after the launch of the BelNPP should be solved in conjunction with deeper integration within the framework of the Union State.
In fact, this scenario is now being implemented. Moreover, it is being implemented in the way needed by Minsk, which does not require it to reform the existing energy monopoly.
It is obvious that the transition from 1 January 2027 to deeper integration in the power sector, which was announced by Russian Minister of Energy Nikolay Shulginov, will require a serious reform of the Belarusian power sector. In order to exercise full-fledged trade in electricity in the union market rather than through authorized operators, Belarus needs to create a wholesale and retail electricity market, entities of this market, as well as divide the energy monopoly by activity type - electricity generation, transportation and sales.