Serbia drafts changes to Law on Energy

Serbia has drafted changes and amendments to the Law on Energy to regulate the balancing market, allow end consumers to become ‘active buyers’, and introduce dynamic tariff contracts. The proposed changes also mark the return of nuclear power to the Serbian energy sector and introduce certification for installers of renewable energy facilities.

After publishing the draft law, the Ministry of Mining and Energy invited all stakeholders to participate in public consultations from August 21 to September 10.

Public hearings on the draft law will be held in Belgrade at the Serbian Chamber of Commerce on September 2 and at the Novi Sad Regional Chamber of Commerce on September 3. Comments and proposals can be submitted to the ministry at 22-26 Nemanjina Street, Belgrade or by email at energetika@mre.gov.rs.

The ministry stated that the draft law’s primary goal is to transpose European regulations, which should create the conditions for a stable and reliable electricity supply.

The draft law introduces waste-derived fuels

The changes introduce new activities in the energy sector – aggregation and the production and trade of non-conventional fuels.

According to the draft, aggregation will enable end consumers and small businesses to participate in the electricity market.

Non-conventional fuels are liquid or solid fuels produced from liquid or solid non-hazardous waste unsuitable for recycling. They are used as an energy source in cement and lime production, cogeneration, combined heat and power production, and fluidized bed combustion.

Electricity storage already exists as an activity, but the draft law introduces the obligation to obtain a license.

End consumers can enter into dynamic tariff contracts

Currently, consumers can change their electricity supplier free of charge, but the new rules will allow for charging a fee after January 1, 2026.

End consumers will have the right to enter into a dynamic tariff contract with an electricity supplier that supplies more than 200,000 end consumers. Such a contract will reflect price changes in the organized market.

Households and small buyers with projected annual consumption below 100,000 kWh will be entitled to free access to the application for comparing suppliers’ offers.

Net billing and net metering will be abolished

Under the draft law, net billing and net metering, which are regulated by the Law on the Use of Renewable Energy Sources, are to be abolished by December 31, 2026, at the latest.

The draft law introduces certification for installers of renewable energy facilities in line with the European Union’s renewable energy directive (RED II) and the practices of Croatia, Slovenia, and Italy.

An ‘active buyer’ is defined as an end consumer, or a group of end consumers acting together, who uses or stores electricity produced in their own facilities, independently sells it, or participates in flexibility services or energy efficiency measures, provided these activities are not their core commercial or professional activity.

Regulating the balancing market

The draft also stipulates that all market participants are responsible for any balance deviations they create in the power system, that the party responsible for balancing is financially accountable for these deviations, and that the party is obliged to contribute to maintaining the balance of the power system.

It also prescribes the basic rules of the balancing market as well as the procurement of balancing capacities.

The draft also introduces the balancing capacity mechanism for the first time. Under the mechanism, starting on July 1, 2025, balancing services will not be possible from power plants that emit more than 550 grams of CO2 per kWh of electricity produced and more than 350 kilograms of CO2 a year per kWh of installed capacity.

Lifting the ban on nuclear power plants

The draft law stipulates that the law prohibiting the construction of nuclear power plants in the Federal Republic of Yugoslavia shall cease to apply on the day of its entry into force. The law, which banned the construction of nuclear power plants, was passed three years after the Chornobyl disaster.

The ministry expects the proposed changes will enable Serbia to prepare and implement a program for the peacetime use of nuclear energy and establish a directorate for developing such a program.