Natural gas, electricity markets spark concern for winter – Đedović Handanović

Serbia’s energy sector is ready for the winter. Still, the developments in the natural gas and electricity markets, driven by the situation in Ukraine, spark a concern regarding gas prices and availability, the country’s minister of mining and energy Dubravka Đedović Handanović said at the ministerial meeting of the Central and South Eastern Europe Energy Connectivity (CESEC) high-level working group, held in Budapest. 

The warning by Dubravka Đedović Handanović is similar to what Prime Minister of North Macedonia Hristijan Mickoski said a few weeks ago. In his view, Europe could face an energy crisis during the winter because of Ukraine.

Đedović Handanović noted that in the last few weeks, the price of natural gas at the Dutch TTF hub increased by about 15% to EUR 42 per MWh. The issue of availability, in her words, is also important for the entire region, especially because of fueling a rise in electricity prices.

According to Đedović Handanović, power price spikes alongside a shortage of available electricity was caused by directing resources toward supplying Ukraine. 

Combined with the projections of a winter not as mild as the previous one, it spells a need to thoroughly analyze possible scenarios and measures to protect the country from energy price volatility and to secure availability, she stressed.

Plans and measures are needed today, not in three months

It is necessary to take into account the prices paid by households and the corporate sector’s competitiveness, the minister pointed out. The plan and measures for the countries of Central and Southeastern Europe are needed today, and not in three months, Đedović Handanović underscored.

She recalled that the construction of the natural gas interconnection between Serbia and Bulgaria created conditions for supply diversification not only for Serbia but for the region and the European Union.

According to the minister, Serbia intends to continue developing regional projects. She expressed the belief that in the next few years, the country will complete gas pipelines with Romania and North Macedonia. However, two major challenges remain, Đedović Handanović added. She explained one is financing, because it is necessary to consider gas as a transitional fuel, and the second issue is securing the quantity and quality of gas.

Amendments to the Law on Energy to be adopted by the end of the year

Đedović Handanović estimated that amendments to the Law on Energy, important for electricity market coupling, would be adopted by the end of the year.

Serbia is cooperating with its neighbors on the construction of electricity transmission lines, development of hydropower plant Buk Bijela, and pumped storage hydropower plant Đerdap 3, she said.

According to Đedović Handanović, Đerdap 3 has great regional significance for the integration of renewables as it would potentially be the largest capacity for balancing variable green energy.

On the sidelines of the ministerial meeting, she spoke with her counterpart from Hungary Csaba Lantos.