Liberalization of the energy market, businesses seek support and extension of the deadline

The Energy Regulatory Office's (ERO) request that consumers with over 50 employees or who have a turnover of over 10 million euros enter an open energy market has caused numerous concerns among Kosovo businesses.

Companies warn of increased costs and economic disruption if this liberalization of the energy market occurs too soon.

Starting June 1, large businesses in Kosovo are required to choose their own electricity suppliers. While ERO has acknowledged that this requirement may cause concerns for businesses and has emphasized the need for a careful process and support during this transition.

One of the representatives of a large company in the country emphasizes that the transition to a free energy market, especially when prices are high, could have significant negative impacts on businesses.

"It hurts us, of course. If it had been on the open market, we would have gone out at a time when electricity prices were more affordable, we know that going out on the free market at this moment is not affordable for businesses. We don't know how much of an impact it could have, because we don't know at what price electricity can be purchased on the free market. But it is more certain that electricity will increase by about three or four times," he says.

The representative of a large company in the country, Vigan Salihu, emphasizes that the transition to a free energy market, especially when prices are high, could have significant negative impacts on businesses.

"It hurts us, of course. If it had been on the open market, we would have gone out at a time when electricity prices were more affordable, we know that going out on the free market at this moment is not affordable for businesses. We don't know how much of an impact it could have, because we don't know at what price electricity can be purchased on the free market. But it is more certain that electricity will increase by about three or four times," Salihu tells KP.

The owner of another company in the country, Shaqir Palushi, also says they are not prepared for this rapid transition. According to him, this requirement will be "the biggest attack on companies."

Businessman Palushi wants this request to be postponed until the end of the year, and expects that there will be other companies in the country that will offer electricity distribution services.

"What is worrying is the warning from KEDS (that from June 1st all companies employing over 50 workers will enter the open market)... I don't know if we are still prepared for this change that is expected to happen and perhaps this will be the biggest attack for us companies, especially manufacturing ones. We hope that we have understanding and that this will be extended until the end of the year, so that we can also prepare, because only KEDS is still operating in Kosovo, and we expect that there will be other companies that will offer electricity distribution services... At least until the end of the year it should be postponed", Palushi underlines.

The president of the Kosovo Chamber of Commerce and Industry, Skënder Krasniqi, also says that there were complaints from other businesses about this "quick" request.

While he says that they will request an extension of the deadline, he underlines that the liberalization of the energy market from June would be another blow to businesses, as, as he says, it would also jeopardize their existence.

"We are for a free market as businesses, but we are for these phases to be prepared. For a long time, years, we have been asking to move to a free market, but it has not happened. Even when prices have been very low, and our prices have been very high. We buy as businesses about 130 euros per megawatt, while a few years ago, especially before COVID-19, the market price was about 40 or 50 euros, and that has hurt us a lot. We have asked, but it has not been realized, businesses, firms that would deal with the sale and purchase of electricity and offer it cheaper to businesses and citizens have also been established, but that has not happened. Now a quick decision is coming as of June 1, and this decision has found both businesses and companies that deal with sales and purchases unprepared. They should be announced at least a year in advance, so that companies that purchase and sell electricity can be created, be functional and businesses can prepare for the market... We will request an extension of this deadline, because time is running out. In this situation, it will also be a blow to businesses because they will also risk their existence... The damages are such as the increase in the price of production, the increase in costs. Therefore, for this, precautionary measures should be taken by the government and the effect and counter-effect of a decision should be seen. The Kosovo government should not allow an immediate decision as has happened", emphasizes Krasniqi.

While the Energy Regulatory Office (ERO) in a written response to KosovaPress admits that this process may cause concerns for some businesses, which may face various challenges, but, according to them, market liberalization is a necessary step.

"ERO is obliged to take steps to facilitate this transition, ensuring that all consumers have the opportunity to choose their energy supplier in accordance with the principles of an open market. We understand that this process may cause concerns for some businesses, which may face various challenges; however, market liberalization is a necessary step to ensure long-term development and efficiency in the energy sector, enabling healthy competition and the possibility of choosing a supplier by consumers. We are committed to taking into account the requests and concerns of businesses during this process and to provide opportunities for additional support and information to help them adapt to the new changes. ERO will also continue to monitor the implementation of this process and take measures to minimize negative impacts on businesses," the ERO response states.

According to ERO, consumers entering the open energy market can be supplied by any local company that holds a license or by foreign companies.

Energy Supply Operator KESCO is the main licensed supplier of electricity in Kosovo.

Although ERO has not provided a response, it is learned that 18 other companies are licensed in Kosovo.

Meanwhile, KESCO, in a written response to the KP, said that they only execute decisions that come from ERO.

"KESCO is a company licensed to supply electricity in Kosovo by ERO. Consequently, we only execute decisions that come from ERO," it is stated in the written response from KESCO.

KESCO, in an announcement on March 5, announced that at the request of ERO, customers who have over 50 employees or who have a turnover of over 10 million euros will enter the open market - meaning they will be obliged to choose their own supplier, KosovaPress reports.

According to the announcement, this is effective from June 1, 2025 and is at the request of the Energy Regulatory Office (ERO).

In addition, the Energy Regulatory Office (ERO) on Friday proposed that the price of electricity be increased by 15 percent starting in April of this year.

ERO's proposal comes after weeks ago, KOSTT, KEDS and KESCO requested an increase in electricity tariffs.