SECOND ANNUAL REPORT: OCTOBER 2019 – SEPTEMBER 2020

The program aims to improve the Armenian electricity market and support expanded electricity trade with Georgia. Key energy sector institutions, including the Ministry of Territorial Administration and Infrastructure (MTAI), the Public Services Regulatory Commission (PSRC), the Market Operator (MO), and the System Operator (SO), are working together to adopt legal-regulatory reforms, accelerate market liberalization mechanisms, and strengthen Armenia-Georgia dialogue on cross-border trade. The MLET Program's Second Year Work Plan reflected a coordinated approach developed in close collaboration with these counterparts to support the Government of Armenia's (GOAM) Action Plan for Liberalization of the Republic of Armenia Energy Sector Electricity Market and Development of Cross-Border Trade. The program's technical implementation has been successful, with significant progress toward development and introduction of the new Wholesale Electricity Market (WEM). In December 2019, the MLET team realized the culmination of the program's intensive work throughout its first year, with adoption by the PSRC of the full package of rules, contracts, and associated codes for implementation of the new electricity market. The package included the draft Wholesale Electricity Market (WEM) Rules, WEM Contracts, Retail Electricity Market (REM) Rules, REM Contracts, Electricity System Transmission Network Code, and Reliability and Security Indicators (RSI). The MLET Program has also provided capacity building assistance to the PSRC to support participation of four staff in the training course by the Energy Regulatory Regional Association (ERRA) on Principles of Economic Regulation and Electricity Tariffs. Additionally, the program has organized workshops and training sessions to support the development of the new electricity market, including a highly successful Workshop presentation of the Armenia Least-Cost Energy Development Plan (LCEDP) 2020-2036 and a workshop on Wholesale Electricity Market Rules and the Market Management System (MMS) Software. The program has also adapted to the challenges posed by the COVID-19 pandemic, conducting a teleconference capacity building workshop on "Market Monitoring in the Electricity Industry" which was attended by 20 participants from key sector stakeholders. The MLET Program's efforts have been focused on supporting the development of a modern and efficient electricity market in Armenia, with the goal of increasing competition, improving efficiency, and enhancing the overall performance of the sector.