Court ruling brings risk of reversal of power market liberalization in Kosovo*

The Commercial Court in Kosovo* supported the claims filed by one company in a complaint, suspending its obligation to purchase electricity in the free market. The ruling follows protests against the controversial liberalization of the power market for larger firms, which came into force on June 1.

Two old coal-fired power plants in Kosovo* account for 92% of domestic production, which is the highest level in the world. Outages often prompt expensive emergency imports of electricity. Just last week, all operational coal units malfunctioned, while one in Kosovo B has been under reconstruction since last month.

Nevertheless, the authorities pushed through a controversial liberalization of the market for companies with more than 50 employees or an annual turnover of more than EUR 10 million. The measure, which came into force on June 1, led to two large protests. Almost 1,300 firms must purchase electricity in the free market.

However, the Commercial Court in Kosovo* suspended the obligation for REKS in a recent first-degree ruling. The company filed a complaint after it wasn’t allowed to use universal supply. It argued that it faced irreversible financial damage.

KEK signs few commercial power purchase contracts

The designated supplier of last resort is government-controlled Kosovo Energy Corp. (KEK). It is the operator of the Kosovo A and Kosovo B coal plants. Corporate consumers can opt for contracts of up to six months with the supplier of last resort.

KEK said a week ago that 360 such deals have been signed and that another 540 were coming. It only had 16 commercial contracts until that point.

Kosovo Chamber of Commerce claims KESCO is favored in liberalization

In the interpretation of the Kosovo Chamber of Commerce (KCC or OEK), the new court ruling means the entire power market liberalization needs to be suspended.

Conversely, the Energy Regulatory Office (ERO) said that last week the Basic Court of Prishtina rejected the motion that the chamber filed challenging the regulator’s public notice on the matter, which it issued in March.

KCC suggested that KESCO was favored in the switch, citing the lack of offers to consumers from other power suppliers. Dozens of other companies have also filed complaints, it added. The chamber called for a fair and feasible transitional phase and the creation of a clear plan that would ensure the stability for businesses and citizens.

Also of note, the Commercial Court said REKS’s gross income last year amounted to just EUR 6.5 million.

In other news, the opposition Democratic Party of Kosovo (PDK) said it would challenge ERO’s decision at the Basic Court because of the potential increase in electricity prices due to the liberalization.