The day-ahead market on the Electricity Exchange (BELEN), which was established last month, contributed to greater transparency and competitiveness, while smaller, local players were enabled to get involved and offer their products, the Ministry of Capital Investments announced.
State Secretary in the Ministry, Admir Šahmanović, commenting on the importance of launching the electricity market Day in Advance, which started on April 26th, said that from the very first day, the government department put a lot of focus on creating a favorable business environment for attracting investments in the energy sector, with with a special emphasis on renewable energy sources.
This is one of the most significant activities, which will greatly improve the energy market and send a clear signal to local and regional and foreign investors that Montenegro follows European trends and is a safe destination for investment – said Šahmanović.
Speaking about the Day Ahead market, he added that colleagues from BELEN made great efforts and managed to create a functional stock exchange, which made the process transparent and competitive, while, on the other hand, local players were enabled to join the market.
We have provided a much more favorable arrangement for local merchants, in terms of lower costs compared to fees allocated for trade. In this way, we rounded off a beautiful story and created good preconditions for integration into the European market – explained Šahmanović. As he stated, as of May 17th, the turnover on the stock exchange was a little more than 21,000 megawatts (MW), which is a little over 2 million EUR.
We are completely satisfied with that and it shows the liquidity of this market – said Šahmanović.
According to him, the stock market operates a day in advance, which means that the lowest offered price is chosen on the supply and demand curve every hour, which is then considered the marginal price in that hour and at that price the energy for tomorrow is traded.
There are 15 merchants from Montenegro and abroad, and their list can be found on the BELEN website – Šahmanović added. He particularly emphasized the importance of the Day in Advance market for renewable energy sources in Montenegro, as it enables even smaller players to enter the market and offer their product on the stock exchange.
This greatly simplifies the procedure and gives them the opportunity to access trade themselves. On the other hand, in the last two weeks, observing the movement of prices on the electricity market, we see that they are much higher than those that small hydropower plants receive through their incentive schemes. Therefore, I believe that in the foreseeable future, this very fact will motivate small producers to leave the scheme of incentive measures – said Šahmanović.
Speaking about the importance of Day in Advance Market for the European integration process of Montenegro, Šahmanović announced that in the context of Chapter 15, the ultimate goal of the state is integration into the European market, where all participants have the same rights.
It is, as he explains, a very complex procedure, consisting of three steps.
The first step is the formation of a local energy market, and the next is integration into the regional market – which can be on the one hand with Italy, and on the other with Serbia. The third step would be integration into the European market, so we are well on our way to achieving that goal as well – asserts Šahmanović.
Comparing Montenegro and its day-ahead market with the countries of the region, Šahmanović believes that we as a country are not lagging behind in that segment. This is not a simple process at all and it was necessary to meet certain conditions. I think we are right on time and that there will be no shortage of good results – Šahmanović concluded.
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