Was the energy policy of the Slovak Republic adopted by the Vladimír Mečiar government good? If yes, why do we consider a new one, and if not, what were its mistakes? Ondrej Studenec, the new director general of the Section of energy, raw materials and metallurgy of the Ministry of Economy of the Slovak Republic, answers the above questions in his paper and at the same time he suggests which direction should (or will) our energy sector take in the years to come.

In September 1997 the former government adopted an update of the energy policy for the Slovak Republic until the year 2005. Its main aims were set correctly. The priorities were above all the security of supplies, balance of demand and offer of energy, innovation and restructuring of the production and technical base, and the integration into European energy systems. The energy policy presupposed higher use of renewable sources of energy, decrease in energy intensity and conservation of energy, as well as minimising negative impact on the environment.

The main tools for achieving the set goals were supposed to be the commissioning of new sources of energy, new legislation and new pricing policy for electricity, natural gas and heating. The commissioning of new sources was successful, however, new legislation in the energy sector was only adopted for the business area, but not for the area of energy conservation. The requirements for a new price policy were not implemented at all.

Modifications of prices were unsystematic and the potential social impact was over-estimated. Thus it was above all the prices for industry and businesses that were increased, while the price increase for inhabitants was negligible and did not even cover the inflation.

Today we already know that the last policy, similarly to all previous energy policies, considerably overestimated the increase in the consumption of electricity, in its prognoses of development. This supposed development encouraged the building of new, large energy sources. The installed output in the Slovak Republic at present exceeds 8 GW, while the maximum load is about 4 GW. On the contrary, the consumption of oil products was underestimated, while it has been growing much more rapidly than the policy anticipated.

The new energy policy should reevaluate the prognosis of development of energy consumption in Slovakia. It is inevitable to find out exactly whether further electrical energy production capacities are still necessary and whether it is in our interest to become a country with major electricity exports, while at the same time lacking almost any primary energy sources.

At the same time it is high time to adopt measures which would approximate and coordinate also the energy sector to the principles valid in the European Union. The main principles of EU energy policy are similar to ours, but a new element will be an emphasis on competitiveness of energy companies. This is because at present the process of opening up and liberalisation of markets with electricity and gas is going on in the EU. It has to be our aim to get prepared for the internal market, which means the opening up of energy networks for competition. The opening up of the electricity and gas markets and gradual introduction of competition is dependent on making the prices for all groups of consumers more realistic. In case we opened the market up before making the prices realistic, the distribution companies would lose their wholesale customers which have been paying the realistic prices, and they would only be left with the group of people who pay a price lower than the production cost. Adopting a timetable for the electricity and gas price modification is a key instrument for the start of approximation of this important part of acquis communautaire.

The new energy policy has to decide how to solve the regulation of natural monopolies in the energy sector. The present model, where the energy prices are used to solve social problems, is not sustainable. It causes the energy sector substantial damage, because it hinders its development. The institution building in the energy sector regulation will go in the direction towards setting up an independent regulatory body, which is one possibility of solving the lack of transparency in pricing.

The most important mission of the new energy policy is to create conditions for ensuring reliable supplies of energy for the economy of our republic and that is why for processing the background of energy policy, a transparent selection of researchers will be carried out, in order to eliminate the elaboration of biased background material.