AYFB President: Energy Exchange Actors Cannot Efficiently Participate in Deals starting January 1, 2022

“According to the Energy Exchange management, the Exchange has already launched an operation in test regime and the platform actors actively participate in deals, but, to be true, even after six months, the exchange players will not be ready to participate in deals efficiently”, Giorgi Kapanadze, president of Association of Young Financiers and Businessmen (AYFB) told Business Partner.

At this stage, only 56 companies operate on the platform, while other participants are not ready to efficiently engage in deals. I have personally met with the exchange participants to discuss the current problems. They noted that they could not be ready to efficiently engage in deals even starting January 1, 2022, Giorgi Kapanadze said.

“We have met with the exchange participants and in private discussions, they noted that many problems remained unresolved and they were not ready to engage in test operation neither now nor after 6 months. The Exchange management has genuinely fulfilled a huge job, but the fact is that a lot of problems should be still resolved because the project is measured by results. In this case, the efficient inauguration of the Exchange would be a real result, not operating in a test regime. Particular difficulties arise before small hydro plants depending on water flows. They operate without appropriate devices (the so-called meters) to precisely register their supply capacities. Consequently, to avoid sanctions, they will have to artificially reduce the supply and they will have to bear substantial losses. Furthermore, we believe that it is a big mistake to launch the Exchange in the winter period when only importers will be ready and the domestic generation will be deficient.

We believe that the Exchange, first, is to ensure a healthy competitive environment and protect the best interest of the domestic power generation facilities. Therefore, it cannot be disputable that the Exchange must be launched efficiently when transparent, impartial and just regulations run for all participants. Regretfully, there are many reasons why the mentioned challenges cannot be settled by January 1, 2022”, Giorgi Kapanadze noted.

It would be an optimal decision to postpone the Energy Exchange inauguration for 1 year, until July 1, 2022, Kapanadze added. “At the same time, the exchange management should ensure an active communication with the private sector and do its best that all participants of the Energy Exchange get ready for efficient engagement in deals”, Giorgi Kapandze told Business Partner.