Secretariat’s WB6 04/2017 Sustainability Charter Monitoring Report

 In the lead up to the WB6 Summit in Trieste (12 July 2017), the Western Balkan 6 countries have achieved progress in a number of measures of the Sustainability Charter. According to the Secretariat’s monitoring report published on 12 April, the market for energy services is advancing fast in Serbia, with the adoption of secondary legislation and project tendering in public buildings and street lighting. Work on implementation of the Energy Performance of Buildings Directive (EPBD) is also ongoing in all WB6 countries and recent progress was achieved by Albania and Kosovo* with the adoption of EPBD laws.

In February 2017, the EU’s signature of EUR 50 million grant for the Regional Energy Efficiency Programme II (REEP Plus) and the Green for Growth Fund (GGF) will support building rehabilitation to reach minimum energy performance standards and implementation of other Sustainability Charter measures. In addition, several WB6 countries are working on establishment of national energy efficiency revolving funds. Nevertheless, more country ownership and political support is definitely needed to make full use of the existing programmes and develop national instruments for specific market segments.

On smart support measures for renewable energy deployment, decisive progress has been made in Albania since the last reporting period, with the adoption of the Law on Promotion of the Use of Energy from Renewable Sources. The law – which introduces for the first time a competition-oriented auction procedure for the allocation of future renewable energy capacities as well as net-metering schemes – allows renewable self-consumers to generate, store, sell and consume their own electricity. Other WB6 countries are also starting to analyse their markets and assess possibilities to move towards market-based support in the future, although at different pace and without effective strategies and legislation allowing citizens to play an active role in the energy system.

With respect to climate action, countries are generally fulfilling their reporting obligations to the UNFCCC. Albania and Bosnia and Herzegovina ratified the Paris Agreement. GHG emission inventories and the greenhouse gas monitoring mechanism regulation (MMR) are being implemented on an informal basis in most of the Western Balkan 6 countries, due to the lack of clear institutional arrangements and proper legal basis defining responsibilities in this area. However, draft legislation on climate change and MMR has been prepared in Albania and in a number of other countries; a key remaining barrier to further progress is the limited capacity in terms of human resources as well as the lack of mainstreaming of climate policy across sectors.

Activities of the various national authorities dealing with investment promotion are not satisfactory, as they provide little support for investors confronted with the highly bureaucratic administrative systems of the WB6 countries. More investments in the renewable energy sector will gradually increase the complexity of the business relations in the region, and bring a new, challenging perspective on the role of the state authorities. An important step towards enhanced confidence in the WB6 markets was taken by the Secretariat in October 2016, with the establishment of the Dispute Resolution Centre, focusing on mediation of both commercial and investor-state disputes. The Centre aims at preserving the relations between parties to a dispute by working together for a solution which is mutually acceptable.