Focus on Energy, 2010 - Karanovic & Nikolic

to implement the Directive on the Promotion of Electricity Produced from Renewable Energy Sources inthe Internal Electricity Market and the EU Directive on the Promotion of the Use of Biofuels or Other RenewableFuels for Transport 4 . This relates to the promotion of the production of biodiesel and other fuelsfrom RES in the traffic sector.While there is great interest by both Serbian and foreign investors in the exploitation of RES, at this point,except for the hydro-potential, the majority of which has been already used, in other sectors of renewableenergy, the number of constructed facilities for the production of renewable energy is extremely low.Capital invested for these purposes is insignificant and mostly local. The technical and technological levelof the equipment installed in the existing facilities falls below the standards applicable in the EU. Thelow level of investment in this sector of energy is due mostly to the inadequacy of the existing regulatoryframework, complicated administrative procedures, and the long absence of a system of subsidiesto promote investment in renewable energy. Other factors include the absence of licensed producers ofthe equipment needed for the production of renewable energy, and the absence of reliable informationabout the renewable energy capacities in certain locations, which prevent the inclusion of these locationsin urban and spatial plans.PARTICIPANTS IN THE ENERGY SECTORIntroduction24The principal pillars of the institutional framework in the energy sector are the Government and the Ministryfor Mining and Energy, the Energy Agency of Serbia (the “Energy Agency”) and the Serbian Agencyfor Energy Efficiency (the “Energy Efficiency Agency”).FOCUS ON ENERGYOn the local level, certain regulatory functions in the energy sector, primarily with respect to the decentralizeddistrict heating system are assigned to the local municipalities.The majority of the Serbian energy infrastructure is operated by the public enterprises established by theGovernment. This makes public energy enterprises an important factor to consider when examining theoperation and the regulation of the energy sector as a whole.Regulatory BodiesTHE GOVERNMENTThe Government performs the primarily policy-making functions in the energy sector. The Governmentprepares the proposal of the Energy Strategy, and gives its final approval to the Energy Program preparedby the Ministry of Mining and Energy.The Government supervises the energy pricing policy as it gives its approval to the prices of energy asestablished by the energy producers.As the founder of public enterprises in the energy sector, the Government has the final word in their management,and it gives its approval to any significant corporate changes and major investment decisions.THE MINISTRY OF MINING AND ENERGYThe MEM is in charge of the implementation of the energy policy as defined by the Government and theSerbian Parliament. It performs the various administrative, regulatory and supervisory functions in thesectors of energy and mining, electric energy, oil, gas, heating power and nuclear power.The MEM prepares the proposal of the Energy Program and the annual Energy Balance.Within its regulatory functions, the MEM prepares draft proposals of energy laws and issues regulationsfor the implementation of energy laws. The MEM is over the issuance of energy permits for the construc-4 Directive 2003/30/EC