tag:blogger.com,1999:blog-44575127085787190272011-08-18T14:18:45.219+02:00The Create Energy Solutions blog is focused on the energy markets and politics of central Eastern Europe and Southeast Europe.Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comBlogger411100tag:blogger.com,1999:blog-4457512708578719027.post-8372421967983306492009-11-12T14:36:00.002+01:002009-11-12T14:50:41.049+01:00

After a few months absence from the Create Energy Solutions due to my hectic private life (i.e. birth of our son) my schedule is now getting back on track. So I have the time to devote again to blogging about energy in the SEE and CEE regions. However, this time I would like to take a slightly different tact and launch a website that has more diverse opinions and facts than those presented by

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-38568516921539888252009-07-17T06:52:00.000+02:002009-07-17T06:53:06.660+02:00

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-21375452079107571382009-07-14T05:59:00.004+02:002009-07-14T06:35:30.768+02:00

To update you on the situation of Emfesz (the Hungarian gas provider and frequently remarked upon company) and the murky world of its operations in Hungary, I would suggest you check out this post on the Jamestown Foundation's website. The deal involves a $1.00 transfer of the company in Switzerland, $1 billion fraud and notably famous Russians like Alexander Medvedev and the Kremlin PR machine.

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-79937851615532673132009-07-08T06:34:00.003+02:002009-07-08T06:48:04.117+02:00

If you are like me and are paying some attention to the climate bill debate in the US and around the world, then maybe you've also thought something is not right. Mainly the right part not actually solving any of our problems in greenhouse gas emissions.Out now is a thoughtful report published by 13 academics about the need to change tack on the current policy of cap and trade. It focuses on

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-10909791674642465932009-07-03T06:47:00.006+02:002009-07-03T07:25:59.663+02:00

I have been waiting for this:Twenty blue chip German companies are pooling their resources with the aim of harnessing solar power in the deserts of north Africa and transporting the clean electricity to Europe. The businesses, which include some of the biggest names in European energy, finance and manufacturing, will form a consortium next month. If successful, the highly ambitious plan could

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-32854918287873460582009-06-18T07:05:00.003+02:002009-06-18T07:23:17.725+02:00

Covering your financial shortfalls with a loan, or with your credit card, or to make you more popular is a trick that even households use. The government of Hungary in the fall of 2008 deferred raising the gas price to reflect the international rise in price. This resulted in E.ON striking an agreement with the government that the price difference would be paid back in the future on loan-like

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-39251184011702855912009-06-12T09:05:00.003+02:002009-06-12T09:19:18.904+02:00

In an era where credit cards are quickly going out of fashion we have the launch of a new 'money saving' credit card (in case you didn't know, debit cards are the new black -at least in America) . Budapest Bank and Fogaz have teamed up to co-brand a credit card that allows the average customer to save up to HUF 13,200 (EUR 47.12 USD 65.88) a year through a 6% discount on their gas utility bill by

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-72393643990844600662009-06-11T08:43:00.003+02:002009-06-11T09:01:37.135+02:00

The fall in GDP in Hungary is staggering. To an extent the fall for other countries is dramatic, but the thing to consider is how many years it will take to rise back to the overall economic level that existed in 2007. If we have a significant drop in GDP this year and in 2010 (even if it stays flat), the ability for Hungarians to reach parity with Western Europeans is even that much further out.

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-71530051740015275012009-06-10T05:51:00.002+02:002009-06-10T06:38:09.371+02:00

Well, even the headline writer didn't believe it 'Bulgargaz Offers 33% Increase in Natural Gas Price' when actually the price will be declining by that much. The cited reasons for the decrease rests on the fall of the wholesale price of gas and the fall in alternative fuels and the exchange rate with the dollar. Now, let's wait and see if other countries also follow through with significant

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-61609897117617957452009-06-05T09:20:00.003+02:002009-06-05T09:26:21.428+02:00

For anyone that has enjoyed bargaining over a Turkish carpet in Turkey, or in my case a engagement ring, the experience is usually pleasant and filled with a lot of back and forth. Thus as the Jamestown Foundation reports via Reuter, negotations with Turkey and their bargaining position of 15% of off take from the Nabucco pipeline are still ongoing.Yildiz was asked about the Nabucco Managing

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-61409713483368596582009-06-04T05:28:00.006+02:002009-06-04T07:38:25.795+02:00

So if Russia turned off all the gas taps to Europe, Europe would be fine, since other alternatives are possible - unless you are Bulgaria. Well, that was the viewpoint of one leading (Western European) academic of at the 6th European Energy Market Conference in Leuven, Belgium. I attended it last week (May 27-29, 2009).To keep you in suspense and to keep you reading, I'll come back to the gas

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-47106737439511366652009-06-01T10:49:00.007+02:002009-06-01T10:59:08.586+02:00

Here is a well written and produced video story about the growth of wind power in Texas and its acceptance. While this story is well known, this is a good overview and touches on a number of topics I'll be writing on in the coming days. I attended an energy conference last week and came away with some strong impressions of the future make up of Europe's energy infrastructure.

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-56865903260331108722009-05-31T12:44:00.007+02:002009-05-31T13:30:53.853+02:00

The report that Vidmantas Jankauskas and I wrote for USAID and NARUC is finally publicly released. I'm very happy to say. It is about the privatization of the electricity distribution companies in Bulgaria, Macedonia and Romania. Through case studies we explore key issues that have influenced the successful or not-so-successful outcomes of these privatizations. The overall objective of the

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-89241023005671442012009-05-21T09:52:00.003+02:002009-05-21T09:54:25.793+02:00

The below discussion is a little out of context, and season, but nonetheless, I thought it was good to put in context the different business models. I'm drawing on something that I'm working on right now, so excuse the out of context nature of the text, but it should still be informative.Gas networks are not national in scope. The discussion of the impact of the Russia-Ukraine gas dispute is many

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-63413941703790369712009-05-08T15:18:00.006+02:002009-05-08T15:47:09.546+02:00

To add to the ongoing saga of what is happening with the shutting down of RosUkrEnergo, here is this very interesting piece in Portfolio.hu describing what appears to be an illegal taking of the whole Emfesz company.Mabofi Holdings Limited has on Thursday claimed it is the “legal owner of 100% of the issued share capital" in Hungarian natural gas trading company Emfesz, which was sold to

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-85150007521662430682009-05-06T07:11:00.007+02:002009-05-06T08:18:10.731+02:00

The arranged demise of RosUkrEnergo (RUE), the intermediary of Russian gas, after the Russian/Ukraine gas dispute in January 2009 was meant to bring clarity to purchasing Russian gas. The contracts held by RUE involved deals with Hungary's Emfesz and Poland's PGNiG. With the shutting down of the company these buyers have had to find another way of buying gas from Russia. It seems though that the

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-406728188894086122009-01-19T13:47:00.010+01:002009-01-19T14:15:14.491+01:00

While going through my PhD thesis, I came across the following section written in 2005, which describes how the utilities helped plunge the US (and the world) into the Great Depression. It reads just like it happened now, but in the financial sector.Do two things while reading this. Replace 'utilities' with 'financial firms and mortgage brokers' and you'll find out, how through the gaps in the

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-13303157100177953142009-01-09T07:45:00.006+01:002009-01-09T08:16:21.504+01:00

Hungary has decided to send a little gas Serbia's way. While this is certainly a good thing, it can be seen as a reluctant step to help out a freezing neighbor. The question is should Hungary send more to a neighbor that has no reserves and is freezing its butt off now. That is since heating has been turned of for some residential customers? Also, how does contribute to CEE/SEE regional

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-12580633913899766842009-01-07T06:27:00.004+01:002009-01-07T07:04:57.694+01:00

I like the following article for the sheer fact that in this case, the old gasoline and diesel is still reliable.In Bulgaria's top ski resort, Borovetz, which relies on natural gas for heating and energy they are now a bit concerned about getting enough gas. So they sent a letter to thestate-owned gas monopoly Bulgargaz asking them to secure the necessary quantities of natural gas for the top ski

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-26009975921767948222009-01-06T06:45:00.006+01:002009-01-06T07:28:02.961+01:00

The cold seeping into the house can put your mind to work if you imagine what it would be like to have no heat, no gas, and a low alcohol supply. The New Year seems to bring with it not just its seasonal cold but the Russian/Ukraine gas dispute. What is known this is not a new dispute (good article and worth a read). But what I think is new this year is the emphasis in the media about a '

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-90272673864663950542008-12-19T06:40:00.004+01:002008-12-19T07:06:18.581+01:00

With all the grim news about the fall in the global economy it is very nice to see that there are positive developments in the energy sector. We can summarize the final year news as 'clean energy'. This bodes well for the future development in the market.First we have the news that Romania finally got its act together and brought the different project partners together, with RWE in the lead, to

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-40696344643705431382008-12-16T05:40:00.003+01:002008-12-16T06:03:06.702+01:00

One casualty according to this article in the FT, is the lack of finance credit for energy projects in the UK, particularly nuclear. The point is made, and we should reflect upon this for the wider CEE market place, that the withdrawal of generation impacts on the ability of countries to meet their climate change goals.“Generating capacity equivalent to nearly a third of current electricity

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-85986305671767033682008-12-11T21:04:00.002+01:002008-12-11T21:07:50.769+01:00

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-9990771007498002502008-12-11T07:06:00.006+01:002008-12-11T07:39:30.985+01:00

The nationalization of banks, investment firms and the automotive companies in the US and elsewhere might lead one to think that the large scale energy industry might be next. Apparently, this is what David Victor thinks in his Newsweek article. Well, I've simplified his argument but essentially what he says, is the market based approaches that have been tried to encourage green energy are not

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-83220009811928446522008-12-10T05:31:00.002+01:002008-12-10T05:54:06.502+01:00

Getting to 20% by 2020 ain't no easy thing. The commitment by the EU to reduce its greenhouse gases by 20% is nearing some negotiation deadline which is this weekend (Dec. 13th). Poland and Germany are looking for solutions to uphold their right to continue on the coal fired power plant route. Their continued heavy reliance on coal and the lack of effective technologies to deal with the gases

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-22073137258497848822008-12-05T06:05:00.002+01:002008-12-05T06:43:18.345+01:00

I know it may take three times to make a trend, but when you speak to two informed individuals in the energy industry, then we almost get to three. So I'll take the two discussions I had with these two people and extrapolate to suggest that people are rubbishing the idea of investing any thought into seeing the future implications of carbon storage for coal.For these two individuals the need to

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-79379940217175765732008-12-02T05:30:00.003+01:002008-12-02T05:59:54.931+01:00

Well, predictions are not always right. Just yesterday I wrote questioning the FT article about the drop off in investments by energy companies - particularly generation. When what do my eyes upon opening the Wall Street Journal yesterday but RWE spending $1.25 billion this year (so far) on greenhouse-gas compliance. Up from Euro 175 million.The article in the WSJ, (subscription only), outlines

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-85332519712290110432008-12-01T05:42:00.006+01:002008-12-01T07:35:21.811+01:00

The financial crisis is impacting the infrastructure investments needed for electricity generation. This brief article in the FT, indicates that there is a perceptible impact that will affect the security of supply and could threaten future generation expansion. As the article predicts, if current trends continue then,when the recovery came and energy demand picked up, the shortfall in

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-47981561908541786652008-11-25T05:38:00.010+01:002008-11-25T05:58:26.424+01:00

I like this story, Ukrenergy wants to get access to the EU through Hungary, but a few weeks ago, they limited how much the Hungarian company System Consulting, could import from the Ukraine on the cross-border capacities to 5 mw, down from 345 mw. Ukrenergy wants to import 450 mw into Hungary from the Ukraine, but MAVIR is only allowing 105 mw. I really like the '105 mw' that magic '5' on the

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-34930270440380780502008-11-24T05:28:00.003+01:002008-11-24T06:15:31.448+01:00

"Cheap electricity, want some cheap and dirty electricity." That's the possibility. Over the past few days the same topic came up with a few people, importing electricity from outside the EU without a 'carbon tax.' The possibility exists that once Europe gets going on the European Emissions Trading System (ETS), that electricity produced further east could serve not only as a place to locate

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-32875423302601725722008-11-21T05:36:00.002+01:002008-11-21T06:02:34.533+01:00

In my relative procrastination to get going and writing my blog this morning, I was flipping through the articles at CNN. When I came upon a review of a report, Trends 2025: A Transformed World. Basically, it lays out the scenario we are in for a rough ride. These are the usual things, that have been pointed out in the past, a rising multipolar world, booming population, pollution, and the

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-69792158198487780402008-11-19T05:41:00.002+01:002008-11-19T06:20:13.529+01:00

Essential to back up a new energy strategy is the development of a fuller infrastructure which extends to the periphery and beyond the borders of the EU. What this means is that the EU must adjust it's energy policy and those of the Old Member States, must revise the energy strategy that was developed before the 2004 enlargement - and they must accept the concerns and development needs of those

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-48199401077353045742008-11-17T05:37:00.008+01:002008-11-19T06:21:46.089+01:00

The EU came out last week with its latest Strategic Action Plan. On a quick read of the highlights I think this goes in the right direction. And while I still must actually read what is planned, it on the surface appears headed in the right direction, particularly since it points to a goal of a "high-efficiency, low-carbon energy system" by 2050. I think it is best if we take this end point and

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-5488200485439351942008-03-11T20:46:00.001+01:002008-03-11T20:49:46.430+01:00

I guess MAVIR needs all the help it could get with electricity prices going up. But do they really need a company communicating on their behalf? Will they be telling everyone about the restricted capacity at the borders? It would be interesting to see if other TSOs also have a communications company working for them. After all, everyone is interested in transmission?On the other hand, maybe

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-75952202312926420002008-02-14T09:16:00.002+01:002008-02-14T09:23:42.425+01:00

Bulgaria has proposed (and will probably) be merging five of its energy companies into one. Part of this plan is is to make it a regional force that can expand beyond Bulgaria. We can now add this government owned company to the list of state owned companies trying to emulate CEZ. Hungary's MVM, is also trying to position and justify its dominate market position in Hungary by rolling out this

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-37261517563664305142007-12-07T10:30:00.000+01:002007-12-07T10:35:04.793+01:00

CEZ is complaining about the monopolistic situation in Romania. Poor CEZ -sometimes regulators are so unfair - especially when you are NOT the incumbent.. I would expect that they will be soon filing a complaint with the Czech regulator about their OWN monopolistic position.It is also awful to see that they only made 34 million in net profits. I wish I had that problemCEZ blames energy

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-23355657129956110952007-10-25T20:48:00.000+02:002007-10-25T20:53:10.663+02:00

The Hungarian government announced in its official gazette Magyar Közlöny on 21 October that it would introduce a HUF 4,426 /MWh (EUR 17.63/MWh) fee for power exports, starting in January 2008. The European Federation of Energy Traders (EFET), a virtual organisation designed to improve the conditions of energy trading in Europe, said it deplores this action for several reasons. It also called

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-26243079561190724412007-10-16T09:54:00.000+02:002007-10-16T10:21:53.290+02:00

I attended the first AmCham First Regional Energy Forum in Budapest last Thursday night and Friday. Besides an impressive line up of politicians and business leaders, the conference can be considered a good kick off to an ambitious goal. I guess :-( that goal in the context of the conference could be defined as seeing regional cooperation to increase the security of supply in the CEE region. A

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-62598025806911742622007-10-11T09:48:00.001+02:002007-10-11T15:16:42.318+02:00

The realization of high electricity prices are going to impact the Hungarian economy and the subsequent jobs and tax revenue may be hitting home. One can only hope that the Hungarian government takes note at what the country's manufacturers are saying.In an FT article:Soaring electricity prices and uncertainty about energy regulation could put a halt to a €220m ($311m, £153m) industrial project

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-90758743683412827702007-10-10T16:53:00.000+02:002007-10-10T19:53:53.910+02:00

This makes a good truism of the day:Hungary's passing of “lex MOL" a law aimed at shielding strategic companies from hostile takeovers, is a brutal attempt by the state to protect private interests, Lajos Bokros, Hungary's former Finance Minister and now deputy chief of Budapest's Central European University (CEU) told the Financial Times on Wednesday.This is from Portfolio.hu, but the summary is

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.comtag:blogger.com,1999:blog-4457512708578719027.post-52490016107940802222007-09-19T12:19:00.000+02:002007-09-19T12:20:41.532+02:00

It is important to understand the movement towards regional electricity markets in Europe. How the coming period of regionalization is quickly becoming a second wave of company and market consolidation in Europe. The goal of a single European energy market must be seen as only achievable if there are smaller steps taken that can eventually lead up to a pan-European market. Let me briefly

Michael LaBellehttp://www.blogger.com/profile/14799940537293696971noreply@blogger.com