Model License for Wholesale Electricity Trading

The program aims to support Electricity Market reforms, energy sector strategy development, and promote cross-border trade with Georgia. This includes working towards facilitation of Armenian regulatory practices and harmonization of the Power System standards with the EU directives. The Model License for Wholesale Electricity Trading clarifies rights and responsibilities defined by the Public Services Regulatory Commission for such plants in compliance with the RoA Energy Law requirements. It also defines cases of supervision over license operation and imposition of fines. The Licensee has the right to engage in activities such as importing or exporting electricity, buying and selling electricity from the wholesale market participants, and buying electricity from autonomous energy generators. The Licensee is obliged to guarantee that payments for electricity purchased on the wholesale market are to the benefit of sellers, in procedures defined by the Commission. The Licensee must register with the Market Operator the contracts signed on the wholesale market, as well as contracts on import/export of electricity (capacity), according to the Market Rules. Implementation of a licensed activity must comply with the RoA Energy Law, other laws, this License, Transmission Network Code, Trading Rules, legal acts approved by the Commission, and other legal requirements. The Licensee is not allowed to transfer the License to other entities, alienate, or pledge it unless otherwise defined by the Law. The Licensee is required to ensure access of representatives of the Commission to the property necessary to perform the licensed activity and involved in that activity. In case of alienation, other transfer, or mortgage of 25% and more of shares (stocks, shares) of the Licensee or the rights towards those shares, the Licensee must get an approval of the Commission in procedures set by the Commission. The Licensee must submit to the Commission information and reports on its licensed activity in procedures and forms approved by the Commission. Each year, the Licensee must implement an audit of the previous year's financial reports and submit to the Commission the copies of the auditor's conclusion and financial reports that were audited, as well as publish them at the RoA public notifications official web-site. The Licensee is held responsible for the reliability of reports and other information provided to the Commission. The Licensee must immediately inform the Commission about any circumstance that caused violation of the License conditions or may become a direct reason for such violation. Provision of information pursuant to the License conditions, including submission of documents, shall be carried out in procedures and time-frames defined by the laws. Compliance of the Licensee with the licensed activity is supervised by the Commission. The representatives of the Commission use the right of full access to the Licensee's premises, in procedures defined by the Commission. The Licensee must support the Commission in the process of supervising by the latter and if necessary, provide relevant documents. In case of non-fulfillment or inadequate fulfillment of the RoA Energy Law provisions, legal acts approved by the Commission, or License conditions, the Commission is authorized to give recommendations on elimination of inadequacies and to impose the following types of fines: warning, penalties set forth by laws, termination of the license operation, and suspension of the license operation.