The European Union (EU) has reached a certain degree of influence in exporting internal energy rules beyond the Member States. This growing prominence of the EU energy policy has considerably affected EU relations with its neighbours. In pursuit of its external energy agenda with partner countries the EU primarily uses conditionality to create a network of legal, political and administrative obligations. Georgia, as a Contracting Party to the Energy Community Treaty, is one such partner country influenced by the potential impact of EU energy legislation on its municipal law. This blogpost looks at the harmonisation process of Georgian energy sector, assesses the state of compliance with Energy Community standards and advocates for the course of action at domestic level to be guided by a set of EU energy law principles.
Setting the scene of Europeanisation
It is well-known that implementation of the energy acquis can extend beyond the EU Member States and be incorporated into the legal obligations of non-EU countries. The EU, enjoying the capacity to enter into cross-border international relations, often refers to Europeanisation as a twinned incentive structure between EU policymakers and external stakeholders. Georgia is one such ‘stakeholder’ participating in the European Neighbourhood Policy (ENP) and in a specific eastern dimension of ENP – the Eastern Partnership Initiative (EaP), both political formats for expanding Europeanisation. The conclusion of the EU-Georgia Association Agreement (2014) and the accession to the Energy Community Treaty (2016) alluded to the process of Europeanisation of energy law in a much more cautious tone requiring a higher degree of approximation (i.e. convergence of laws and policy goals) along with political association.
The national legal framework
During the last decade, Georgia’s energy sector has seen a major transformation. The regulatory framework is now governed by the overarching 1997 Law of Georgia on Electricity and Natural Gas. The domestic energy legislation also includes the secondary normative acts and other by-laws adopted by the Georgian National Energy and Water Supply Regulatory Commission. Also part of implementing the EU energy acquis in Georgia is a new Georgian Law on Energy currently being prepared, which will repeal the primary Law on Electricity and Natural Gas. Moreover, draft laws on renewable energy, energy efficiency and energy performance buildings are being elaborated to be submitted to the Georgian Parliament in due course.
Given that Georgia’s present energy legislation and regulatory regime is not yet aligned with modern regulatory standards, the legal harmonisation is an absolute necessity for the country to modernize its energy regulatory framework under the footprint of EU energy law. The incoming laws are seen as instrumental to reforming the energy sector to accommodate the principles of the EU energy law building upon Article 194 TFEU and the five key dimensions and 15 action points of the EU Energy Union objectives. This ensures fulfilling the obligations that has been imposed on Georgia by the Energy Community framework. It also demonstrates the country’s goodwill to foster its energy cooperation with the EU.
The Energy Community Treaty
The launch of the Energy Community represents reinforcement of the EU external energy policy regime and a bold experiment in Europeanisation comprising the EU and nine other Contracting Parties. Georgia’s membership can be considered as an ‘endorsement’ of already-assumed legal obligations under the Association Agreement and the obvious manifestation of a reliable energy partnership with the EU. As a key ‘hard law’ instrument of harmonisation, the Accession Protocol defines a large number of EU legislative acts (directives and regulations) to which Georgia’s domestic legislation should be harmonised in the areas of electricity, gas, energy efficiency, renewable energy, climate change and energy-related environment.
The Energy Community, as “a sector-based multilateralism,” creates a ring of friends which are willing to endorse a single regulatory space for energy among the contracting parties. Therefore, the future prospects of Europeanisation of energy law in the eastern neighbourhood very much depend on the lessons learned from each other. This applies particularly to the Energy Community member Easter Partnership countries (Georgia, Moldova and Ukraine) as frontrunners in the EU’s eastern partnership program.
The Europeanisation of Georgian energy law is orchestrated by the country’s recent accession to the Energy Community Treaty. The explicit recognition of the Energy Community Law’s supremacy and full applicability of EU energy acquis guaranteed by the Georgian Constitution (Articles 6 and 78) is just a stepping stone to harmonise Georgia’s energy sector.
Although Georgia has demonstrated its willingness to establish itself as a successful energy partner with the EU, significant work remains to be done to deliver on the commitments undertaken by the Community membership. EU law must be exported creatively to enhance the capacity of an energy market reform and the transformation should be guided by seven common energy law principles. The effective implementation further requires a consistent course of action to set out on and the positive, ‘Euro-friendly’ reception of general principles of EU law by society, executive and judiciaries.
Irakli Samkharadze (LL.M. Rotterdam) is an International Scholar at KU Leuven’s Institute for Environmental and Energy Law and a Visiting Lecturer & Ph.D. Candidate at Tbilisi State University in Georgia ([email protected]).
This blogpost was written within the ambit of his visiting scholarship at KU Leuven’s Institute for Environmental and Energy Law under the Leuven Centre for Public Law. The aim of the research fellowship is to widen the scope of a Ph.D. Project as originally proposed at Tbilisi State University (Georgia) and continued at Friedrich-Schiller University of Jena (Germany).
This particular blogpost exhibits the outcome of a paper published in Elsevier Energy Policy Journal (freely accessible until 21 May 2019). The paper advances the idea of extraterritorial application of EU energy Law and policy and conveys the following five key messages:
- Georgia’s accession to the Energy Community triggers implementation of the EU energy acquis;
- Challenging adequate and timely implementation calls for a consistent course of action;
- Legal harmonisation is one mechanism for the Europeanisation of energy law in Georgia;
- A gap in the literature on legal harmonisation in third countries should be addressed;
- The state of affairs of Europeanisation in Georgia still leaves ample room for improvement.
Irakli SAMKHARADZE, "Europeanisation of Georgian Energy Law: A Myth or Reality?", Leuven Blog for Public Law, 11 April 2019, https://www.leuvenpubliclaw.com/europeanisation-of-georgian-energy-law-a-myth-or-reality (geraadpleegd op 27 October 2021)
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