Papers by Aleksandar Kovacevic
US Atlantic Council Policy Brief, 2023
This Policy Brief aims to address growing energy security risk in the Western Balkans and its imp... more This Policy Brief aims to address growing energy security risk in the Western Balkans and its implications to Europe. It is taking into consideration actual condition of the energy infrastructure, emissions and energy security arrangements including a practice to outsource the energy security to third parties. Energy security is placed into the context with climate change, energy efficiency, actual geopolitics, the rule of law, EU accession and the climate change. Complex analyses is followed by policy recommendations.
The contents of this paper are the author's sole responsibility. They do not necessarily represen... more The contents of this paper are the author's sole responsibility. They do not necessarily represent the views of the Oxford Institute for Energy Studies or any of its Members.
Energija, 2022
Rezime-Direktni dalekovod je deo strukture elektroenergetskog sistema koji je uređen propisima Ev... more Rezime-Direktni dalekovod je deo strukture elektroenergetskog sistema koji je uređen propisima Evropske unije o tržištu električne energije. Kroz proces transponovanja propisa pod okriljem Energetske zajednice i proces Stabilizacije i pridruživanja Evropskoj uniji, pojam direktnog dalekovoda definisan je u propisima Republike Srbije koji uređuju oblast energetike. U radu će se uporedno analizirati odredbe propisa Evropske unije i propisa Republike Srbije o direktnom dalekovodu. Biće analizirani efekti regulisanja direktnog dalekovoda u Republici Srbiji i značaj i mogućnosti izgradnje direktnog dalekovoda u kontekstu razvoja prenosnog i distributivnog sistema električne energije. Takođe, analiziraće se efekti propisa o direktnom dalekovodu Republike Srbije na podršku tržištu električne energije i uloga direktnog dalekovoda u razvoju distribuirane proizvodnje električne energije i u energetskoj tranziciji. Na kraju će biti predloženo o čemu bi sve trebalo voditi računa da bi došlo do razvoja tržišta električne energije uz korišćenje potencijala direktnog dalekovoda u postojećem pravnom okviru. Ključne rečidirektni dalekovod, pravo električne energije, distribuirana proizvodnja električne energije, tržište električne energije, pravo energetike Evropske unije
US Atlantic Council Policy Brief, 2023
This Policy Brief aims to address growing energy security risk in the Western Balkans and its imp... more This Policy Brief aims to address growing energy security risk in the Western Balkans and its implications to Europe. It is taking into consideration actual condition of the energy infrastructure, emissions and energy security arrangements including a practice to outsource the energy security to third parties. Energy security is placed into the context with climate change, energy efficiency, actual geopolitics, the rule of law, EU accession and the climate change. Complex analyses is followed by policy recommendations.
South East Europe in Focus (SOGDE) , 2019
The security of demand for fossil fuels (crude oil, oil products, natural gas and coal) in the wi... more The security of demand for fossil fuels (crude oil, oil products, natural gas and coal) in the wider Central Europe is determined by energy intensity of economies, economic activity, access to maritime trade and availability of substitutes. Assuming that the Western Balkan countries are (collectively) potential providers of access to maritime trade and specific substitutes, their collective and individual governance (including cross border cooperation, use of infrastructure, urban planning, etc.) determines the actual use of that potential. If the quality of governance is not adequate, it represents an effective barrier to access for overseas traders (to use existing infrastructure), Central European traders (to trade substitutes) and investors into new infrastructure. The introduction of inadequate governance is device at disposal of incumbent suppliers to ensure the security of demand. The use of this device remains cost-effective as long as the costs are low and the resource rents are high. Incumbent suppliers need a certain degree of coordination and coercive capacity of the state in order to avoid free rides and increase the cost effectiveness of the device. Such barriers to trade tend to simultaneously increase the costs and risks of supplying energy to some EU consumers and the political risks for the EU as a whole. In the context of climate change, these barriers to access limit policy options and increase the social and political costs of transition to sustainable energy. The countries of the Western Balkan collectively refrain from utilizing existing infrastructure and are maximizing demand for boondoggle investments in new infrastructure, resource rents and fiscal liquidity. The likelihood of poverty reduction remains negligible low, while the risks to development aid providers are maximized.
Putokaz ka održivom razvoju, 2011
Poglavlje u knjizi "Putokaz ka održivom razvoju" prikazuje širi teorijski kontekst održivosti ene... more Poglavlje u knjizi "Putokaz ka održivom razvoju" prikazuje širi teorijski kontekst održivosti energetskog sektora.
Power Engineering International , 2006
The European Union (EU) and countries from southeast Europe (Albania, Bosnia and Herzegovina, Bul... more The European Union (EU) and countries from southeast Europe (Albania, Bosnia and Herzegovina, Bulgaria, Croatia, FYR of Macedonia, Romania, Serbia and Montenegro and UN administered Kosovo), signed the Energy Community for the South East Europe (EC SEE) Treaty in October 2005. Negotiations between Turkey and the EU are still under way and it remains to be seen how eventual adoption of this treaty could affect Turkey's accession to the EU. In some ways, the treaty has emerged as a model for countries that are approaching the EU to acquire an advanced governance framework for the energy sector prior to the actual accession process.
Crude and gas from the Russian Federation dominates the South Eastern Europe (SEE) import portfol... more Crude and gas from the Russian Federation dominates the South Eastern Europe (SEE) import portfolio. Russian companies control oil refineries in Romania, Bulgaria, Serbia and Bosnia. Gazprom is the main gas supplier to the entire region and the only producer of domestic gas (and oil) in Serbia. Its gas export is associated with a network of subsidiaries, resellers, agents and sponsorships that are granted special rights in their respective countries of operation. This system is supported by the availability of “on demand” credit resources that contribute to the soft budget constraint and facilitate the operation of low efficiency district heating systems, emergency power generation and inefficient (fertilizer, etc.) industries. In this governance context, and if the current supply and demand structure remains, SEE will have an increased energy security risk due its exposure to a disruption in gas supply via Ukraine. In contrast, the European Union (EU) is looking toward this region ...
Seven years after the ratification of the Energy Community Treaty (EnCT), energy poverty persists... more Seven years after the ratification of the Energy Community Treaty (EnCT), energy poverty persists in most of contracting parties countries. That prevents a more effective use of the available energy assets and puts the security of supply at risk. Energy supply crises - including the crisis from January 2009 - and vulnerability of contracting parties to supply shocks are signals of serious policy failure. We argue that persistent energy poverty is the impediment for implementation of the EnCT, while its eradication is necessary - although not a sufficient - prerequisite for reforms ...
Energy in the Western Balkans, 2008
Oxford Institute for Energy Studies, 2009
Aleksandar Kovacevic is an energy economist based in Belgrade. He has provided consultancy servic... more Aleksandar Kovacevic is an energy economist based in Belgrade. He has provided consultancy services to international companies and institutions in Balkan and CIS countries for almost 20 years. Mr. Kovacevic assisted the UN coordination of international assistance for rapid reconstruction of energy infrastructure in Serbia after the war in 1999/2002. He was principal author of the comprehensive analyses of energy and poverty: Stuck in the Past (UNDP, 2004) that is recognized as the standard work on the subject as well as the energy policy study Energy in the Western Balkans (IEA, 2008).
The Energy Community Treaty establishes that Contracting Parties to this Treaty shall achieve com... more The Energy Community Treaty establishes that Contracting Parties to this Treaty shall achieve compliance of their legislation with the EU acquis on energy infrastructure, followed by implementation of the EU acquis on energy, competition and environment. This will result in making the Energy Community energy market an integral part of the EU energy market. The EU acquis on electricity includes two definitions for the concept of an interconnector. Directive 2009/72/EC establishes that the 'interconnector' is equipment used to link electricity systems. Simultaneously, Regulation ..
Cogeneration & On-Site Power production, 2006
Sustainable urban heating: District heating systems in central and eastern Europe tend to perform... more Sustainable urban heating: District heating systems in central and eastern Europe tend to perform poorly compared with those in western Europe. Ideally, refurbishment should incorporate use of waste heat from nearby power stations and industry. Using Belgrade as an example, this paper examines the options.
Cogeneration & On-Site Power Production, 2007
A global tax on wasted energy-especially the heat discarded by thermal, power-only generation pla... more A global tax on wasted energy-especially the heat discarded by thermal, power-only generation plants would be a powerful incentive for generators to begin to replace inefficient plant with CHP stations, displace use of natural gas from low grade heat production and enhance energy security. It is to be considered that waste heat contributes to global warming without producing economic outcome while its opportunity cost is form of negative externality: Since the waste heat is not use communities consume original fuels to produce low grade heat. There is a need for tax instrument to enhance investments into use of waste heat. This paper makes the case for such a tax and outlines its likely effects.
IRMO Brief, 2021
The September 2021 edition of the IRMO Brief deals with energy security of the Balkans and the up... more The September 2021 edition of the IRMO Brief deals with energy security of the Balkans and the upcoming changes in the energy security of the region. Year 2023 could bring a dramatic overhaul on the energy map of the Western Balkans countries, as by then the derogation from EU environmental regulation for a number of thermal power plants expires while reliability of lignite mines and power plants deteriorates. As the region’s energy supply is to a large extent dependent on lignite-fired power plants, the 2023 will be a turning point for the Balkans in terms of energy supply. At the same time, the Western Balkan countries are aware of the importance of the EU Green Agenda and that the replacement of coal by other energy sources, is at the core of EU climate policy. The author also analyses the energy map Europe after the completion of the Nord Stream 2 and Turk Stream gas pipeline projects as well as closures of nuclear and coal plants and phase out of Groningen gas field , and positions the role of the Balkans in the overall energy security of Europe. Paper address the risk that developments in Balkans affect credibility of the EU promotion of the rule of law, climate change awareness and human rights. Findings are confirmed by recent failures in gas and power supply across the region and spike in wholesale prices.
The Potential Contribution of Natural Gas to Sustainable Development in South Eastern Europe, 2007
The energy resources of South East Europe (SEE) are below the European average.
Energy intensity ... more The energy resources of South East Europe (SEE) are below the European average.
Energy intensity throughout the region is higher than the world average and several times
greater than the OECD average. However, most of the region’s exports are energy
intensive goods that create difficult problems for the terms of trade and the quality of
economic development. The economies of the region could be classified as foreign aid dependent since all of them have low employment of labor and capital and large trade deficits while exchange rates remain relatively stable. Governance performance, the rule of law, property rights and transparency are all insufficient, despite certain improvements during recent years. Due to the deterioration of indigenous energy resources (forests, lignite, natural gas and crude oil), to seasonal and weather related fluctuations, to low utilization rates of available capital and to poor management, current energy sector trends are not sustainable. The Multilateral Treaty on a SEE Energy Community with the EU provides a framework for improvement that has not yet been incorporated into every day business practice. Infrastructure development planning for the energy sector is based on a continuation of a long established historical pattern which is, for the most part, unsustainable. The prevailing development paradigm is likely to cause further deterioration in the quality of governance although it may lead to favorable nominal indicators of monetary stability and budget deficits. Its continued application could postpone the emergence of a rule of law and appropriate property rights required for sustainable development. If lack of rule of law and poor governance persist, local players could take advantage of
government control over the massive gas transit infrastructure which is projected to be built through the region to extract rents through bilateral bargaining with investors. That is likely to threaten European supply security and the utilization of this
infrastructure. This study contrasts the conventional development paradigm with a ‘turnaround scenario’ in which the gradual development of gas infrastructure is used to enhance physical openness, employment and the emergence of rule of law throughout the region, at the same time as supporting transition towards a more sustainable and efficient energy system.
The contents of this paper are the author's sole responsibility. They do not necessarily represen... more The contents of this paper are the author's sole responsibility. They do not necessarily represent the views of the Oxford Institute for Energy Studies or any of its Members.
Rule of Law in Negotiating Chapter 15 , 2021
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Papers by Aleksandar Kovacevic
Energy intensity throughout the region is higher than the world average and several times
greater than the OECD average. However, most of the region’s exports are energy
intensive goods that create difficult problems for the terms of trade and the quality of
economic development. The economies of the region could be classified as foreign aid dependent since all of them have low employment of labor and capital and large trade deficits while exchange rates remain relatively stable. Governance performance, the rule of law, property rights and transparency are all insufficient, despite certain improvements during recent years. Due to the deterioration of indigenous energy resources (forests, lignite, natural gas and crude oil), to seasonal and weather related fluctuations, to low utilization rates of available capital and to poor management, current energy sector trends are not sustainable. The Multilateral Treaty on a SEE Energy Community with the EU provides a framework for improvement that has not yet been incorporated into every day business practice. Infrastructure development planning for the energy sector is based on a continuation of a long established historical pattern which is, for the most part, unsustainable. The prevailing development paradigm is likely to cause further deterioration in the quality of governance although it may lead to favorable nominal indicators of monetary stability and budget deficits. Its continued application could postpone the emergence of a rule of law and appropriate property rights required for sustainable development. If lack of rule of law and poor governance persist, local players could take advantage of
government control over the massive gas transit infrastructure which is projected to be built through the region to extract rents through bilateral bargaining with investors. That is likely to threaten European supply security and the utilization of this
infrastructure. This study contrasts the conventional development paradigm with a ‘turnaround scenario’ in which the gradual development of gas infrastructure is used to enhance physical openness, employment and the emergence of rule of law throughout the region, at the same time as supporting transition towards a more sustainable and efficient energy system.
Energy intensity throughout the region is higher than the world average and several times
greater than the OECD average. However, most of the region’s exports are energy
intensive goods that create difficult problems for the terms of trade and the quality of
economic development. The economies of the region could be classified as foreign aid dependent since all of them have low employment of labor and capital and large trade deficits while exchange rates remain relatively stable. Governance performance, the rule of law, property rights and transparency are all insufficient, despite certain improvements during recent years. Due to the deterioration of indigenous energy resources (forests, lignite, natural gas and crude oil), to seasonal and weather related fluctuations, to low utilization rates of available capital and to poor management, current energy sector trends are not sustainable. The Multilateral Treaty on a SEE Energy Community with the EU provides a framework for improvement that has not yet been incorporated into every day business practice. Infrastructure development planning for the energy sector is based on a continuation of a long established historical pattern which is, for the most part, unsustainable. The prevailing development paradigm is likely to cause further deterioration in the quality of governance although it may lead to favorable nominal indicators of monetary stability and budget deficits. Its continued application could postpone the emergence of a rule of law and appropriate property rights required for sustainable development. If lack of rule of law and poor governance persist, local players could take advantage of
government control over the massive gas transit infrastructure which is projected to be built through the region to extract rents through bilateral bargaining with investors. That is likely to threaten European supply security and the utilization of this
infrastructure. This study contrasts the conventional development paradigm with a ‘turnaround scenario’ in which the gradual development of gas infrastructure is used to enhance physical openness, employment and the emergence of rule of law throughout the region, at the same time as supporting transition towards a more sustainable and efficient energy system.
Investments to date are almost entirely based on one or another form of sovereign bonds. Effectiveness of these investments in terms of productivity and security of supply remains insufficient.
Accession of the Western Balkans into EUETS with subsequent allocation of allowances for decarbonization or coal phase out, provides an opportunity for non recourse funding scheme that benefits both the Western Balkans and the EU member states.
This presentation results from comprehensive work conducted during few years to envisage potential to restructure Obrenovac Lignite Complex in order to increase its economic viability and reduce immediate environmental impacts. Restructuring envisaged hereby is to be considered as intermediary intervention since it is obvious that Obrenovac Lignite Complex is not sustainable in the longer term and within context of forthcoming climate change regulation. Therefore, restructuring is aimed to increase its economic potential and its actual value added in order to provide ground for investments that are required to convert toward entirely sustainable heat & power generation based on renewable energy.
Furthermore, this restructuring aimed to improve overall economic capacity of Serbia and reduce its energy security risks. Viability of solutions proposed hereby been tested over time by disasters, floods, energy supply crisis and severity of environmental impacts.