Eurasian Integration Yearbook 2012

Aigul Absametova. “Integration Processes in the Electric PowerSectors of the EDB Member States”Advanced Economic Cooperationin Sectors and Industries• electricity transit;• mutual assistance in case of accidents or other emergencies at powerfacilities;• energy efficiency and conservation;• creation and efficient use of reserve resources;• formation of the common electric power market;• setting of a common time for reading electricity meters on interstate powertransmission lines; and• harmonisation of customs procedures for the cross-border transmissionof electricity and operation of interstate power transmission lines withinnational grids.Barriers to creating the common electric power marketMany agreements on parallel operation of the power systems of differentcountries were signed, including the October 2011 agreement on the CIS freetrade area which concerns, among other things, the power sector. However,such initiatives have faced difficulties in recent years (Vinokurov, 2008), whichprevent them achieving their goal quickly.One of the challenges is historical: the power sectors of these countries varyin their level of development and structure. This is a result of the centralisedapproach to locating generating facilities and developing electricity grids underthe Soviet common power system. Power stations were built to facilitate thecentralised supply of power to large areas, regardless of the administrativeborders between the Soviet republics. Generating capacity was determinedaccording to the demand in each of these areas. Transmission lines weredesigned and built to distribute the electricity produced by these power plantsto different power centres, also regardless of borders. After the dissolution ofthe Soviet Union, many transmission lines became trans-border lines. Insteadof system-forming role, they are used to export and import electricity at agreedprices.There is still a need to coordinate the development of generating facilities andelectrical grids in certain CIS countries. Although historical differences in theiravailable energy resources was a driver for cooperation and the formation oftrade ties between them in the power sector, it complicates the coordination ofinvestment policies because of the energy security requirements which arise inthe context of liberalisation of national economies and power sectors.The problems associated with creating a common CIS electricity market arealso linked to the power sector’s status as an important facet of economicmanagement. The power sectors are natural monopolies, which create difficultiesEurasian Development Bank209