The draft law on energy, on which members of the Montenegrin Parliament should declare themselves at the meeting next week, contains a number of problematic solutions regarding the jurisdiction of the Energy Regulatory Agency (ERA), which is allowed to continue with the destructive practice of making decisions about electricity prices in favor of energy companies to the detriment of final consumers, while at the same time the management of the ERA is virtually exempted from liability for making such decisions.
Rather than strict legal mechanisms are prescribed to protect customers against arbitrary decisions of the regulators, for which in recent years they have been damaged millions of euros, with the draft law the management of ERA is given a free hands to create the electricity price in a way that ensures a pure profit to energy companies, which will all be funded by consumers through higher electricity bills.
That stipulates that one of the objectives of the ERA is to adopt “appropriate incentives” for energy companies, while among the elements that make up the methodology for calculating the price of electricity is and the one which says that energy subjects are “adequately motivated in short-term and long-term periods for increasing efficiency, market integration and ensuring security of supply”. Under the “mantle” of such legal provisions, it is more than clear that in the upcoming years the ERA will ensure the profit for the National Electric Company of Montenegro (NECM) and Montenegrin Transmission System (MTS) at the expense of the impoverished Montenegrin citizens and economy, although the basic task of the regulators is to be objective and to determine the real price of electricity, which corresponds to the quality of service.
On the other hand, it is unlikely that leaders of the ERA are virtually exempted from liability for making harmful decisions, and for example, it is eliminated a provision in the existing law that they can be dismissed if Montenegrin Parliament does not adopt an annual report of the regulators.
Also it is paradoxical the provision which stipulates that a decision on the dismissal of the leaders of the ERA can be made only on the basis of a reasoned proposal and after they were able to declare themselves on all the circumstances. Hypothetically speaking, if it is determined guilt in criminal proceeding of the ERA’s leaders, they would be able before being dismissed from office to express themselves on all the circumstances, although previously was conducted criminal proceeding, which would be absurd.
Montenegrin courts have so far repeatedly declared null and void the decision of the ERA because of their illegality, but until now no one from this institution has been found even disciplinary responsible for continuously working at the detriment of public interest. Instead, with the new legal arrangements leaders of the ERA literally are rewarded and are equated with the position of the members of the Parliament, as it is expected that after the function is terminated, in the period of one year, they are entitled to the average salary they earned in the ERA.
It is problematic and the restriction of employment of the ERA’s leaders in the energy entity or company engaged in the production of electricity after the function is terminated, which lasts only one year. This deadline certainly should be longer, since the management of the ERA knows privileged information and it is realistic the possibility of abuse in favor of energy entity that would hire the former head of the ERA.
Also, it is simply unbelievable that the leaders of the ERA are no longer obliged to submit a property statements, and certainly not a statement about the existence of property or control interests in the energy companies, which has the case so far, so one gets the impression that the suggestion for such a provision arrived directly from the regulators.
Finally, the Government fully retains control of the ERA, as it proposes members of the Board of the ERA to the Parliament , and gives consent to the appointment of the executive director. This is particularly problematic when we know that ERA has a number of powers in respect of construction of small hydropower plants and wind power plants, which is a business in which is involved a number of companies linked to relatives and friends of Prime Minister Milo Djukanovic.
MANS has already indicated that the draft law on energy is one of the most controversial proposal of the Government that recently was submitted to the members of the Parliament to decide, and that will be the introduction to a new, drastic increase of electricity prices to the detriment of the final customers. MANS invites the members of the Parliament that in this specific case protect the public interest, and to prevent new attempt of shameless looting of already impoverished Montenegrin citizens.
MANS
