Energy Market Liberalisation in the EU: Quo Vadis, Croatia?

Abstract

Energy market liberalisation has led to some positive but also to some negative effects in Croatia, as well as in all EU Member States. Although there have been some globally widespread but modest efficiency gains across energy sector, there are in fact no clearly visible direct benefits to households in most countries. Since 1st July 2013, Croatia has become a full EU Member State with its legislation harmonised with Acquis Communautaire, which has shaped current Croatian energy policy and strategy. Although Croatian energy markets are formally fully open, in both competitive activities (generation and supply) there is no sufficient number of market participants to make a real competitive market. Further development of institutional and regulatory settings and transparent functioning of relevant institutions, especially regulatory agency CERA, will be very important because it is necessary to depoliticise pricing policy. Only real energy prices that would comprise climate and environment protection costs could stimulate private investments in energy sector. Therefore, energy prices and costs will rise, but in the long run higher costs could be offset by lower need for energy as a result of increased energy efficiency and technology development.