AYFB Ready to Discuss Energy Exchange Problems with Prime Minister
The Energy Exchange problems are not dully analyzed and the Government should be more concentrated on this issue, Giorgi Kapanadze, head of the Association of Young Financiers and Businessmen (AYFB) noted.
The Georgian energy sector development prospects largely depend on the efficient inauguration of the Energy Exchange, he said.
“The efficient operation of the energy exchange is the key precondition to successfully launch the market’s new model. The key matter is to move to the hourly trading system without problems and impose the corresponding responsibility on the market participants for misbalance. The Energy Exchange management has failed to satisfy this very condition within the reform-determined timeframes and the platform could not be launched on July 1, 2021.
As a result, the Government had to reschedule the platform inauguration for January 1, 2022. Regretfully, even the new date seems to fail as a result of several factors, including the winter period deficiency on the energy market, when only importers are represented on the market, and when prices go volatile. Furthermore, Enguri HPP water resources drop to a critical minimum in the winter period and even this locomotive of the Georgian energy sector cannot efficiently participate in the everyday operation of the Energy Exchange, even more so, Enguri HPPs resources stay ejected from the exchange because of the fixed tariffs.
The key challenge is that in the remaining 6 months there are no practical capacities to tackle problems with small and medium HPPs. The majority of fail to bring the infrastructure in order and install corresponding meters in order to determine their own supply capacities. Consequently, to avoid sanctions, they will have to artificially narrow real supply capacities and these companies will bear substantial losses. The country also lacks the due legislative framework for the efficient operation of wholesale and retail markets. Problems exist in relation to wind and solar power stations too. Satellite supervision platforms are also absent. All these factors disable the market players to efficiently engage in the Energy Exchange trading system, Kapanadze said.
These issues should be discussed at the highest level, the AYFB president noted “We have been supervising the process over the past 4 months and we have concluded that these essential issues are not dully perceived and the Government should be more concentrated to these issues.
Therefore, our organization shows full willingness to discuss and analyze the research results, real prospects and our visions for taking consecutive steps with the Prime Minister of Georgia. We believe that only the Prime Minister’s personal engagement can draw due attention to the above problems”, Giorgi Kapanadze noted.