Cabinet to have more powers in energy regulation

The ministries will be able to comment on new proposals for prices, but there is a risk it would be opposed by the European Commission.

Illustrative stock photoIllustrative stock photo (Source: SME)

The government will strengthen its influence on the Regulatory Office for Network Industries (ÚRSO) as the Economy and Environment Ministries will again be enabled to comment on pricing decisions.

Moreover, the new ÚRSO head will be appointed by the government, according to the amendment to the law on regulation in network industries approved at the cabinet’s March 15 session.

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“ÚRSO will remain the independent authority,” Economy Minister Peter Žiga (Smer) said, as quoted by the SITA newswire.

One of the main changes stemming from the amendment is that the government, not the president will appoint the new head of the regulator.

“The practice has shown that the government bears the biggest political responsibility for ÚRSO’s decisions, thus it is logical that it will be responsible for his appointment,” Žiga explained, as quoted by SITA.

He also defends the return of the competences to the ministries. The Economy Ministry will comment on the decisions on new prices for heat, gas and electricity, while the Environment Ministry will respond to the proposal to change water prices.

“If one of the ministries has comments and the authority will not accept them, it will have to publish them,” Žiga said, as quoted by SITA.

The involvement of the ministries will not violate European directives. The fact however is that back in 2012, after adopting the third energy liberalisation package, it had to change the legislation.

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“We consulted with lawyers,” Žiga explained, as quoted by SITA.

Some observers, however, have a different opinion. Former economy minister Juraj Miškov says there is also the possibility that the European Commission will submit a lawsuit as the change was part of the European directive whose aim was to liberalise the market more, the Sme daily reported.

Read also: Regulator, under pressure, reverses utility price hikes Read more 

Other changes proposed in the amendment suggest that the ÚRSO head will not hold the post of the chair of the Regulatory Council, which is a controlling and appellate body for the regulator, at the same time. The head of the council will be elected from its members, and subsequently appointed by the president.

The Regulatory Council will have six members, three of whom will be nominated by parliament and three by the government, SITA reported.

ÚRSO will also have to prepare impact studies anytime it decides to change its price regulation. It will have to compare the proposed change with the current state, and also evaluate its impact on customers.

“We want to prevent a situation where the government does not have information about the impact of new price regulations,” Žiga explained, as quoted by SITA.

Moreover, the ÚRSO head will have two deputies. Under the new rules, one of them will also have to sign new price decisions, otherwise they will not be valid.

Parliament is expected to discuss the amendment in a fast-track proceeding during the March session. The changes should become valid as of this June.

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