The connection to gas will be ten times cheaper than the current one
Bajram Redzepi, director of National energy resources (NER)
Gas is considered as the one of the most environmentally friendly fuels, that doesn’t pollute the environment and although in one part of the country there is an access to gas, a small number of companies use it in their production. Why the use of gas in the country is so low and when the citizens could connect to the gas pipeline network and many other questions will be discussed with the director of National energy resources, Bajram Redzepi.
Will the lower prices and attractive loans increase the interest for using natural gas in the households? Although one part of the state territory has been provided an access to gas for a very long time, through the main ring coming from Bulgaria, the households located there are still not connected. What accounts for this, lack of interest in connecting or other factors?
-There is a big interest in the entire country. But unfortunately the citizens have no possibility to connect. At the moment we have only two distribution operators, in Kumanovo and Strumica. A very small number of households and companies in these two municipalities have the possibility to connect to these distribution networks in both municipalities, compared to the households in all other municipalities in the country that don’t have this possibility. Currently, the price for connection is very high, around EUR 800, but also the price per 1 m3 is not so attractive. This is due to the low consumption, unregulated distribution system, undeveloped transmission system, the lack of alternative for natural gas supply… I think that all the prerequisites have been created for fast development of the gas market and fast growth of the consumption, by which the using of gas will become attractive both from an economic standpoint and environmental aspect.
-That is exactly our goal. I expect the connection price to be nearly ten times cheaper than the price paid currently. All prerequisites have been created in order to decrease the transmission and distribution tariffs and of course our interconnection with the Greek Desfa, will allow us to have an access to cheaper gas. But in order to increase the number of new connections it will be essential to help the households in adjusting their internal installation for using gas. The Government’s plan is with a combined model for subsidizing and providing credit lines under much favourable conditions, to stimulate the fast growth of gas connections in the households, the industry and the companies. The fast growth of the consumption will affect the prices drop.
What are the expectations regarding the development of the gas pipeline in the future. When will gas be available for the households in Skopje or the other larger cities?
-The construction of the transmission network on both branches Prilep-Bitola and Tetovo-Gostivar is nearing completion. The last year ended with very successful realization. We had around 95% realization of the fiscal plan for capital investments. According to the current dynamics, both branches will be built entirely until the middle of this year and will become operational until the end of this year. But this is not enough. It is necessary the distribution network to be built rapidly. The Government has already approved the tender documentation for designing, construction and maintenance of the distribution network. It will be a public-private partnership (PPP) in the entire territory of the country, at one tariff. I expect the call for the first phase of this procedure to be published very soon and be closed until fall. The first consumers in the distribution network could perhaps connect until the end of this year but next year there will be definitely intensive construction and massive connecting in most of the cities in the country.
You are joining with GA-MA very soon, what will this mean for NER and for the citizens, what are the benefits?
-That results from the new Energy law and should happen as soon as possible, given that the process has been already delayed. But this does not depend on NER. The postponement of solving this issue has already created big problems. That means we cannot put into operation the section from Klechovce to Negotino and generate revenues from the activity, since the only license for transmission is in possession of GA-MA, while the Law prescribes only one licence. The merging of NER and GA-MA means normal functioning of the transmission system and the failure to solve this issue will mean that big sections will remain unfunctional and NER will need budget resources, which makes no sense.
How gasification will be conducted on the ground to the households and the companies, whether the installation will be built by the municipalities, the state through NER and who will manage in the future the distribution of gas to the consumers?
-With the decision of the Government, as mentioned above, this issue is already closed. The designing, construction, development and maintainance of the distribution network will be built with PPP. The country will not need any investments, neither the municipalities. That will be borne by the private partner. The gas market is fully liberalized and the distribution to the consumers will be conducted by more operators. To be clear, a comparison with the electricity market should be made. It will be very similar. This is the case in almost all other countries, where there is a successful and functional model.