USAID MLET PROGRAM YEAR TWO WORK PLAN

The program's purpose is to help the Ministry of Territorial Administration and Infrastructure (MTAI), the Public Services Regulatory Commission (PSRC), and other energy sector institutions adopt legal-regulatory reforms, accelerate the implementation of market liberalization mechanisms, and strengthen Armenia-Georgia dialogue on cross-border trade. The program's objectives are aligned with the Government of Armenia's (GOAM) commitment to liberalize the energy sector and develop cross-border trade. Following amendments to the Energy Law in February 2018, the GOAM adopted its Action Plan for Liberalization of the Republic of Armenia (ROA) Energy Sector Electricity Market and Development of Cross-Border Trade. The MLET Program Work Plan activities are directed to support the GOAM in developing the needed regulations, rules, codes, and other associated mechanisms to define and introduce the wholesale and retail electricity markets in line with the Concept. The MLET Program will assist in creating an investor-friendly environment to accelerate competitiveness, power sector development, and regional trade, and improve the country's economic development and minimize the potential for corruption. The program will support energy market compliance with western approaches and facilitate expanded electricity trade with Georgia through activities under three tasks and their associated sub-task areas. Task 1: Energy Market Development focuses on legal and regulatory reforms to support market liberalization and an effective electricity trading mechanism. Armenia's Market Operator (MO), System Operator (SO), and regulator will develop and implement a liberalized electricity market model for Armenia following a step-wise approach. The MLET Program will strengthen the MO and SO and Market Participants (MPs) by supporting continued revision of market operating procedures and advisory services to MPs. Task 2: Promote Energy Supply Diversification aims to support MTAI's efforts to transition Armenia's Least Cost Energy Development Plan (LCEDP) model from the MARKAL software to The Integrated Markal EFOM System (TIMES). The program will update the LCEDP to incorporate recent changes in renewable energy and nuclear technology and update the Armenian 2036 Energy Strategy to reflect the findings of the newly updated LCEDP. Task 3: Facilitate cross-border trade will strengthen Armenia-Georgia electricity dialogue through support to the Joint Working Group, promote export and import transactions in wholesale markets, support regional studies on electricity generation and transmission, assist in the development and implementation of non-discriminatory cross-border access to all eligible entities, and support development of cross-border trade mechanisms. The MLET team will continuously monitor activity progress to ensure that any issues that may affect implementation are identified as early as possible and assess how best to advance activities in the Work Plan. This process will be carried out in close consultation with counterparts to ensure alignment with MLET Program objectives, maintain appropriate timelines for deliverables, and address the needs of counterparts.