Regional countries strive for gasification

30/03/2013

By turning from electricity to gas, countries in the region aim to save money and obtain energy stability.

By Miki Trajkovski for Southeast European Times in Skopje -- 30/03/13

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Countries in the Balkans are seeking energy stability through gas usage. [AFP]

In an effort to achieve energy stability and combat high electricity prices, several countries in the region are turning to gasification.

Some of the countries have implemented the switch from electricity to gas, but others are just starting the process.

Two Macedonian municipalities, Kumanovo and Strumica, recently started to use gas as fuel for heating in public and educational institutions.

Strumica launched a so-called virtual gas pipeline following the example of some municipalities in Bulgaria. The gas is being brought to the municipality by tanks from Bulgaria and then is being compressed and distributed to its final users through a 20-kilometre gas network that the municipality invested in.

Strumica schools and the municipal building are connected to the network.

Zoran Kitanov, director of Strumica Gas, told SETimes that the municipality is making an effort to link households in the municipality to the network.

"Right now we have more than 350 requests from households for a contract. We started with construction of [a] secondary network throughout the settlements, but we can't answer all the requests, because that is a long process. When [a] central network is built, we will only need a small pipeline to connect [homes] with it," Kitanov said.

The Strumica government said that by 2020, the municipality will save 25 million euros by using gas instead of electricity in heating public institutions. The use of natural gas will enable development of the local economy and draw domestic and foreign investors.

Serbia recently drafted a national action plan to switch the country to gas by 2030.

The autonomous province of Vojvodina in Serbia is one of the most developed regions of the Balkans when it comes to gasification. Vojvodina started the gasification process more than 15 years ago, and according to Deputy Prime Minister Goran Jesic, there is only a small part of the province that still needs to be switched over.

"Vojvodina is a major producer of oil and gas. The biggest number of households in Vojvodina is using gas a fuel for heating, as are industrial [facilities]. … Serbia Gas with its capacities can cover one part of the users of gas, while the other part of the gas is being imported from Russia, through Ukraine," Jesic told SETimes.

Currently the largest reservoir of natural gas in the region of Banatski dvor in Vojvodina is being finished. Through the reserve, Vojvodina can provide its citizens with gas for few months with no problems, Jesic said.

Countries from the region should follow the example of Vojvodina and invest in a national gas network, he said.

But Konstantin Dimitrov, president of the Centre for Energetic Efficiency in Skopje, told SETimes that the regional needs for gas should be satisfied through the connection to the South Stream gas pipeline project.

"We have our own sources of oil and gas and coal is on the edge of being used up. That is why we have to have source, and the gas is much better fuel. The most important [issue] for Macedonia is that Russia is guaranteeing 4 billion cubic metres of gas for the next period," Dimitrov said.

The South Stream Pipeline will originate at the Russian Black Sea shore in the area of Anapa, cross the Turkish Exclusive Economic Zone of the Black Sea and land on the Bulgarian coast near Varna. The pipeline will extend through northern Serbia into Hungary, Slovenia and Austria.

A southern branch will connect Bulgaria with Greece and Italy, and branch pipelines from Serbia into Bosnia and Herzegovina and Croatia also are planned. The first commercial deliveries are scheduled for late 2015.

Damir Novotny, an economic analyst and former member of the governors' council at the Croatian National Bank, said that the construction of the pipeline through Croatia would improve the industry and safety standards in the country.

"The construction will bring benefits to the local construction firms and also open some new jobs. Croatian industry will have safer delivery of gas. As for the final cost of gas, it will probably remain the same as in the market, but will reduce gas distribution costs, which will reduce the monthly bills for gas to citizens and businesses," Novotny told SETimes.

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"The most important issue for us is to have a stable energy system. This represents pragmatism for the benefit of the citizens of Macedonia," Finance Minister Zoran Stavrevski said.

Macedonia has a 100-kilometre long gas system that was built 20 years ago, which provides gas to 10 industrial buildings in the capital city. In order to further its efforts, the country is planning to build a gas line to south Macedonia this year.

"With the construction of this section begins the process of allocation of funds for construction of all the other sections. The first one is 96 kilometres long, and the biggest part of the network should be built in six to seven years. It is a strategic investment for the country," Krste Miladinov, director of Macedonian energetic resources, told SETimes.

The project, which envisions the total gasification of Macedonia, will cost about 300 million dollars, and will be realised in three stages, depending on funding.

This content was commissioned for SETimes.com.
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