EU-Eastern European Partners Cooperation in : Achievements, Barriers and Prospects The INOGATE Programme: Achievements and Current Developments BUILDING PARTNERSHIPS FOR ENERGY SECURITY

www.inogate.org The challenge

To secure adequate, clean and reliable energy resources, at affordable prices, for citizens in both the INOGATE Partner Countries and the EU Targeted energy sectors

Energy Statistics INOGATE Policy Framework 1996-2012

INOGATE Focus of the Project

• Creation of favourable investment climate for energy infrastructure and sustainable energy; • Achieving tangible progress in the key areas set out in the Astana Roadmap: – Energy market convergence, safety & security, sustainable energy and investment attraction . • Delivering tangible and measurable results to the PCs INOGATE Project: Inception Visits Summary • Low tariffs is major issue in many countries and significant barrier to increased energy efficiency and development of RES. • Investment in energy sector is key issue for PCs. But: – Lack of proper legislation – Lack of capacity (investment attraction, SE development, energy interconnection and trade) – Low tariffs – compounded by inadequate subsidisation and significant losses. – Varying degrees of political commitment AM – Needs & Interests • Huge appetite for capacity building • System of standardisation in harmony with EU

• Cross-border trade – SHPP and nuclear. • Energy statistics AZ – Needs & Interests

• Legislative and regulatory aspects

• Creating more favorable climate for developing RES sector

• Particular interest in wind (main RES direction)

• Begin developing biogas GE – Needs & Interests

• Energy links with EU • Maximizing RES use • CDM • Profitable economic model of energy sector • Electricity interconnection with (EnC implications). • Diversification of energy imports. BE – Needs & Interests • President: BE to be a green economy. • Contradiction of interests: – Green: Attracting investment to SE sphere – But: very low energy tariffs (gas) reduce SE incentives and investment attraction. • Reducing energy intensity/ GDP to level of developed countries • GHG trading (including inventory & monitoring) • International RES legislation & norms MD – Needs & Interests • Energy statistics in policy and decision making • Unbundling • Market convergence • Bank training • Corporate governance structures • Tariffs reform to advance domestic energy production UA – Needs & Interests

• Priority: Develop UA biomass potential (400 MW electric, 9000 MW thermal capacity • Mutual trade with EU • Awareness raising to show public EU practices in energy saving INOGATE in numbers 1996-2011 Thank you [email protected] INOGATE Project Impacts Commended by Stakeholders Project Title Impact (if stated) number Recommendations based on Project contributed to primary the best practices of the EU legislation under consideration of countries with respect to rules Council of Ministers in March and procedures for connection 2012. to the grid and connection tariffs GHG projections for the Ministry of Nature Protection Republic of Belarus to 2020 and uses report data for further 2050 and energy sector analysis. mitigation options Supported BY climate change talks INOGATE Project Impacts Commended by Stakeholders

Project Title Impact (if stated) number Capacity Building: Development Training led to development of an ESCO business ‘EE financing Operations Manual’ prepared by local staff (AM). Georgia Opportunity Study for Implementation of the renewable energy cross-border recommendations of the Project trade with EU countries Report recommendations is continuing INOGATE Project Impacts Commended by Stakeholders

Project Title Impact (if stated) number Tariff for gas transport and transit Project outputs considered helpful in developing transit tariff structure Moldova Increasing payment collection Recommendations followed rate and considered instrumental in improving energy revenue collection

Ukraine Capacity building in development Strengthened the participating of EE and RES projects banks position in SE financing Capacity 3 Study tours on energy markets Focused sessions, good handout Building convergence materials, effective training delivered INOGATE Project Impacts Commended by Stakeholders

Project Title Impact (if stated) number Harmonisation of Gas Technical 32 oil and gas standards Standards and Practices in harmonised with those of EU Central Asia (KG) 5 standards in gas are adopted (KZ) Audit analysis for Bankable Training was considered Belarus Projects extremely useful. However, no objective use: low tariffs and/or runaway inflation reveal no more feasible projects (BY) Enhancement of Environmental Movable gas laboratories Protection Measures in the helped to decrease in gas Oil/Gas Industries of Central Asia losses from pipeline network (EPMOGI) by 200% INOGATE Project Impacts Commended by Stakeholders

Project Title Impact (if stated) number Reduction of non-technical Prevention of the loss of 50 natural gas losses in transmission mln m3 of gas from the gas pipelines system and gas pipeline system (amounts to a distribution networks saving of nearly €9 million and the prevention of harmful methane leakages into the atmosphere)