procedural history

• 16 January 2018: Opening Letter

  Case 

  On 16 January 2018, the Energy Community Secretariat sent an Opening Letter to Albania in accordance with Article 12 of the Rules of Procedure for Dispute Settlement. In the Opening Letter, the Secretariat takes the preliminary view that Albania failed to fulfill its obligations under the Energy Community Treaty

  • by failing to transpose the requirements of Article 26 of Electricity Directive 2009/72/EC on legal and functional unbundling of electricity distribution system operators  in line with the deadline of 1 January 2015 foreseen by the acquis;
  • by failing to transpose Article 26 paragraph 2 litera (c) and (d) of the Electricity Directive requiring independent decision making of the distribution system operator and the establishment of a compliance officer and program; and
  • by failing to adopt, within the prescribed time limit of 1 January 2015, the national measures to ensure legal and functional unbundling of the national electricity distribution system operator, OShEE, in practise.

   

  Procedure

  By its Opening Letter, the Secretariat initiated a preliminary procedure, the purpose of which is giving Albania the possibility to react to the allegation of non-compliance with Energy Community law, and enabling the Secretariat to establish the full factual and legal background of the case. Albania has been given two months to comply of its own accord with the requirements of the Treaty or to justify its position.

  According to the Rules of Procedure for Dispute Settlement, interested parties may be granted access to the case file and may submit written observations on the present case to the Secretariat within one month from 16 January 2018.

• 21 June 2019: Reasoned Opinion

  Steps taken

  On 21 June 2019, the Secretariat sent a Reasoned Opinion to Albania for failing to

  • transpose into national legislation Article 26 paragraph 2 litera (c) and (d) of the Electricity Directive 2009/72/EC requiring independent decision making of distribution system operators and the establishment of a compliance officer and program; and
  • adopt national measures to ensure effective unbundling of the national electricity distribution operator in practice.  In the view of the Secretariat the accomplished registration of separate legal entities responsible for distribution and supply in Albania, still does not sufficiently put in place effective operation of de facto unbundled companies.

  Albania was neither able to remedy the arguments raised in the Secretariat’s Opening Letter of 16 January 2018 nor provided a reply to it.  In its Reasoned Opinion the Secretariat therefore maintains the analysis and view brought forward in Opening Letter.

   

  Reasoning

  Despite that formally legal registration of three daughter companies of OShEE responsible for electricity distribution, universal supply and free market supply has been accomplished, these separate companies exist only on paper without any activities, assets or staff. OShEE still performs both supply and distribution activities in units of its vertically integrated company structure under a common management. Assets or human resources have not been transferred to the three subsidiaries yet. Effective legal unbundling of the distribution company has been formally frozen until 20 December 2019 by decision of the national regulatory authority, ERE. This upholds the illegal status quo of lack of effective legal and functional separation of electricity supply and distribution activities. The mere registration of three subsidiaries without equipping the distribution company OSSH with the necessary human resources to perform its activities is not able to effectively meet the legal unbundling requirements of the acquis. The Secretariat does not agree with the arguments raised by the Albanian side according to which ownership of distribution assets would be a pre-condition for effective legal unbundling or that a review and completion of the legal framework for the Albanian electricity market model, including the establishment of a Power Exchange, would be a pre-condition for effective legal unbundling of the distribution company.

   

  Procedure

  Albania is requested to rectify the issues of non-compliance with Energy Community law identified in the Reasoned Opinion within a time-limit of two months. Depending on the reply from Albania, the Secretariat may submit the case to the Ministry Council for a decision on the non-compliance of Albania with Energy Community law.

   

• 18 April 2023: Closing of the case

  Following the complete transposition of the Electricity Directive’s provisions related to DSO unbundling in national law, the completion of legal unbundling and substantial progress in functional unbundling, the Secretariat has decided to close Case ECS-4/17. The latest measures ensuring functional unbundling were the adoption of a compliance program and the appointment of a compliance officer.