The Licensing/Competition Committee met in Vilnius, Lithuania on May 13-15 for their first committee meeting in 2001. The event was co-hosted by the National Control Commission for Prices and Energy in Lithuania. All 15 members of the newly formed ERRA - Energy Regulators Regional Association - were represented by their committee members at the meeting.

Prior to the committee meeting, two working group sessions were held on Sunday. The "Monitoring/Controlling of the Licensed Activities" Working Group comprised the representatives of 9 countries: Albania, Estonia, Hungary, Kyrgyz Republic, Latvia, Lithuania, Moldova, Romania and Ukraine. The group was led by Mr. Endre Slenker, an advisor of the Hungarian Energy Office. The Monitoring Working Group is compiling different monitoring policies implemented by the member organizations. Based on the available policies, the group is planning to give an overview of the existing policies and, if possible, put forward suggestions for improved monitoring activities as well as a uniformed benchmarking system.

The "Regional Markets" Working Group was led by Mrs. Maria Manicuta, Director of the Romanian National Electricity and Heat Regulatory Authority. The four members of the working group (Hungary, Lithuania, Romania and Ukraine) examined existing experiences with regional interconnections and in their final paper will seek to describe recent and future regional market developments.

As set forth during the Annual Conference in December 2000, the Licensing/Competition Committee has started studying three major issues of the licensing process. These issues are the following:

As in the past, draft outlines of the issue papers were prepared by Mr. Walter Hall, Energy Restructuring and Regulatory Specialist of the United States Agency for International Development. These drafts have been discussed by the committee members in detail and will be finalized with the active participation of the members.

Regulator's Role in Electricity Market Operation

The final version of the paper will describe recent market developments in Central/Eastern Europe and Eurasia. In addition, it will examine the issues of cross-border trade, contracts employed, and approaches to gradual market implementation. In its Appendix, the authors will give an overview of the adoption/modification of statutes, secondary legislation, market rules and grid codes. The Appendix will also study the establishment of market organizations and rules that could facilitate power exchanges, bilateral, forward or futures contracts in electricity.

As an issue closely related to the main theme of the paper, Dr. Marian Slifierz, Advisor of the Polish Energy Regulatory Authority explained the idea of the Compensation Payment System implemented by his organization.

Unbundling of Electric Sector Functions to Separate Monopoly and Competitive Activities

This paper seeks to analyze the possible approaches of separation in different market segments: separation of monopoly transmission and dispatch services, of generation and distribution functions. The paper will also try to define the role of market codes of conduct.

Measuring and Assuring the Competitiveness of Energy Markets

The draft of the third issue paper outlines statutory, normative acts, and policies designed to promote the competitiveness of energy markets. Subsequently, the analysis will include various approaches assuring this competitiveness (such as the concept of market power, monitoring of market power and anti-monopoly regulation).

The committee members had the honor of welcoming two guest speakers at the meeting: Chairman Thomas Welch from the Maine Public Utilities Commission and Mr. Jon Sagen from the Norwegian Water Resources and Energy Directorate.

As in the past, the guest speakers were asked to contribute their experiences to the issue papers under elaboration. With regard to the issue of Unbundling, Chairman Welch presented Maine's practice in the divestiture process. As a separate issue, Chairman Welch spoke about the experiences of the Maine/New England and Maine/Canada cross border trade. As a contribution to the third issue paper, Mr. Sagen gave an overview of organized markets in the Nordic countries. In addition, the Norwegian regulator outlined the market developments in the Nordic countries in detail. Last but not the least, Chairman Welch gave a presentation on the Californian crisis trying to explain the problems leading to the current situation and also seeking to give an outlook for the future.

Krisztina Kasza, Program Administrator, NARUC/Budapest

Georgia
Georgian National Energy Regulatory Commission
Commissioner Paata Tsintsadze
 Tel: (995 32) 253 394; Fax: (995 32) 253 397

Hungary
Hungarian Energy Office
Dr. Gábor Szörényi, Deputy Director and Head, Licensing Department;
Chair, Licensing/Competition Committee
Tel: (361) 459 7770; Fax: (361) 459 7770

Kazakhstan
Agency of the Republic of Kazakhstan for Regulation of Natural Monopolies, Protection of Competition and Small Business Support
Ms. Svetlana Grigorieva, Deputy Director, Regulation of Natural Monopolies
Tel: (7 3172) 32 36 47; Fax: (7 3172) 32 77 22

Kyrgyz Republic
State Energy Agency under the Government of the Kyrgyz Republic
Mr. Edilbek Bogombaev, Head, Licensing Department
Tel: (996 312) 42 44 27; Fax: (996 312) 54 18 95

Latvia
Energy Regulation Council
Ms. Sarmite Paunina, Chairman's Legal Advisor
Tel: (371) 7013 249; Fax: (371) 7312 763

Lithuania
National Control Commission for Prices and Energy in Lithuania
Mr. Algimantas Budas, Head of Licensing Department
Tel: (370 2) 397 822; Fax: (370 2) 235 270

Moldova
National Energy Regulatory Agency
Mr. Vasile Jitaru, Head, Licensing Division
Tel: (373 2) 21 23 85; Fax: (373 2) 54 05 34

Poland
Electricity Regulatory Authority
Dr. Marian Slifierz, Advisor of the President
Tel: (48 22) 661 6301; Fax (48 22) 66 16 300

Romania
National Electricity and Head Regulatory Authority
Mrs. Maria Manicuta, Director, Licenses and Technical Regulations Department;
Leader of the "Regional Markets" Working Group
Tel: (401) 3032 536; Fax: (401) 312 4365

Russian Federation
Federal Energy Commission
Deputy Chairman Kirill Yankov
Tel: (7 095) 220 6105; Fax: (7 095) 206 8116

Ukraine
National Electricity Regulatory Commission
Commissioner Lubov Goncharova
Tel: (38044) 241 9002; Fax: (38044) 241 9047

United States
National Association of Regulatory Utility Commissioners
Chairman Thomas L. Welch, Maine Public Utilities Commission
Tel: 1 (207) 287-3831; Fax: 1 (207) 287-1039

Norwegian Water Resources and Energy Directorate
Mr. Jon Sagen, Section Head
Tel: (47 22) 95 91 42; Fax: (47 22) 95 90 99

Ms. Krisztina Kasza, Program Administrator - Budapest
 Tel: (361) 477-0455 / 249-0057; Fax: (361) 477-0455

U.S. Agency for International Development
Mr. Walter Hall, Energy Restructuring and Regulatory Specialist, Energy and Infrastructure Division, Bureau for Europe and Eurasia
 Tel: 1 (202) 712-1274, Fax: 1 (202) 216 3389

OBSERVERS

Mr. Feliksas Ksanas, Commissioner
National Control Commission for Prices and Energy in Lithuania
Tel: (370 2) 263 731, Fax: (370 2) 235 270

Ms. Loreta Kimutyte, Head of Public Relations
National Control Commission for Prices and Energy in Lithuania
Tel: (370 2) 239 208, Fax: (370 2) 235 270

Ms. Jurga Barsauskine, Senior Specialist of the Licensing Department
National Control Commission for Prices and Energy in Lithuania
Tel: (370 2) 239 336, Fax: (370 2) 235 270

Ms. Laima Necejauskiene, Senior Specialist of Gas Department
National Control Commission for Prices and Energy in Lithuania
Tel: (370 2) 239 226, Fax: (370 2) 235 270

Mr. Endre Slenker, Advisor
Hungarian Energy Office
Leader of the "Monitoring/Controlling" Working group
Tel/Fax: (36 1) 459-7777

Mr. László Balogh, Advisor
Hungarian Energy Office
Member of the "Regional markets" Working Group
Tel/Fax: (36 1) 459-7777

Ms. Michaela Popescu
National Electricity and Heat Regulatory Authority of Romania
Member of the "Monitoring/Controlling" Working Group
Tel: (401) 311 2244, Fax: (401) 312 4365