Articles 73-75 of the Treaty lay down the contributions, roles and responsibilities behind the Energy Community budget. The process of adoption of the biannual budget is defined in the applicable legislation (Procedural Act 2014/01/MC-EnC on procedures for the establishment and implementation of budget, auditing and inspection). It is adopted biannually by the Ministerial Council based on a proposal of the European Commission. In the ongoing biennium, budget contributions by the Parties amounted to EUR 4.7 Mio in 2018 and to EUR 4.8 Mio in 2019.
The director of the Energy Community Secretariat has the sole responsibility on the implementation of the budget in accordance with the principle of sound financial management. The Budget Committee supervises and advises the director in the financial management of the operations of the Energy Community.
2018 - 2019 budget
Energy Community Budget 2018 - 2019 (in 1 000 EUR)
Statement of revenue Statement of expenditure Description 2018 2019 Description 2018 2019 Parties' budget contributions 4,513 4,560 Human resources 2,507 2,557 Donors p.m* p.m* Travel 0,368 0,368 Other sources p.m* p.m* Office 0,400 0,400 Other services 1,487 1,487 Total revenue 4,762 4,812 Total expenditure 4,762 4,812
* As the amount of 'other sources' varies from year to year, it is established ‘pro memoria’ (p.m) at the end of each financial year.
source: Procedural Act 2017/01/MC-EnC on adoption of the Energy Community budget for the years 2018-2019
The Energy Community’s activities are financed by the Parties to the Treaty establishing the Energy Community. National contributions are determined by a formula that takes into account a country’s gross domestic product and total amount of primary energy that a country has at their disposal (total primary energy supply). The European Union is the largest contributor to the “core” budget, providing roughly 95% of the total amount. In 2018, the budget established by the Parties contributions amounted to EUR 4.7 Mio.
Parties 2018 - 2019 contributions European Union 94,78% Albania 0,09% Bosnia and Herzegovina 0,20% North Macedonia 0,10% Moldova 0,10% Kosovo* 0,10% Montenegro 0,07% Georgia 0,11% TOTAL 100%
Other sources of revenue
Other sources of revenue
In addition to the Parties’ contributions, the Energy Community gains revenue from other sources, including international donors (i.e. donations) and/or European Union, represented by the European Commission, subject to separate budgetary procedures and/or separate grant contracts. This amount varies from year to year and is established ‘pro memoria’ at the end of each financial year. In 2018, it amounted to EUR 3.1 Mio.
It is the task of the Budget Committee to supervise and to advise the director in the financial management of the operations of the Energy Community. The director shall inform regularly the Budget Committee on all matters relating to budgetary and financial management. To this end, the Budget Committee is empowered to obtain any necessary information or explanations regarding budgetary matters. It is also the Budget Committee's task to approve the Terms of Reference for the designation of an independent external auditor.
Article 81(5) equips the Budget Committee with a reporting obligation. In its report to the Ministerial Council, the Budget Committee is to assess
- the audit of the Energy Community’s annual accounts, and,
- the director’s financial management of the Energy Community budget.
In case of disagreement with the director, the Budget Committee is to report to the Ministerial Council.
Document Name Published on11.11.2019
Pursuant to Article 23 of Procedural Act 2014/01/MC-EnC, the Budget Committee of the Energy Community consists of one member from each of the Contracting Parties and two members of the European Union, represented by the European Commission.
The European Union and each Contracting Party nominate their representatives. The term of office of the Budget Committee is two years. Meetings of the Budget Committee are chaired by the European Commission. The Chairperson may appoint a Co-chair.
The Energy Community Secretariat takes part to the Budget Committee meetings without voting rights.
- Rules of procedure
Rules of procedure
According to Procedural Act 2014/01/MC-EnC, the Budget Committee is to hold at least three meetings a year. It can also convene for an extraordinary meeting at the instance of the Chairperson or at the request of at least one third of its members.
As all institutional bodies of the Energy Community, the Budget Committee is to adopt its internal rules of procedure. These rules were adopted in January 2008, and revised in December 2014.
Any decision by the Budget Committee is to be taken by vote or by written procedure. Budget Committee acts by simple majority of the votes including a positive vote of the European Commission. In case of an equal number of votes, the European Commission shall have the deciding vote.
The Secretariat prepares and assists in the preparation of Budget Committee meetings.
Document Name Published on16.12.2014
Pursuant to Article 75 of the Treaty, the director of the Energy Community Secretariat is responsible for the implementation of the budget. In this role, the director is supervised and advised by the Energy Community Budget Committee.
Article 75 of the Treaty tasks the director to report annually to the Ministerial Council on the execution of the budget. Article 38 of Procedural Act 2014/01/MC-EnC stipulates further the obligation of the annual activity report by the director.
The purpose of the director’s report is to present a synthesis of the budgetary and financial management, as required by the above mentioned legal framework, of appropriations for the period ending 31 December.
Document Name Published on11.11.2019
Each year, the accountant establishes the accounts of the previous year no later than 31 March. These accounts are validated by the director. It is the director's duty, subject to approval by the Budget Committee, to designate an independent external auditor to carry out the annual audit of the Energy Community.
The external auditors submit an audit report and certified accounts, together with a statement of assurance relating to the reliability of the accounts and the legality and regularity of the underlying transactions, to the Budget Committee. The external auditor gives its opinion both in a public report (published on this website) and directly to the Budget Committee of the Energy Community, therefore to the representatives of the Parties to the Treaty.
Document Name Published on12.10.2019
Every year the Ministerial Council examines the Energy Community’s certified accounts and financial statements, the report of the external auditors, for the purpose of granting discharge of the director from his/her management and administrative responsibility. In parallel, it takes account of potential observations by the Budget Committee. This procedure ensures full accountability and transparency and when granted, this discharge leads to formal closure of the accounts for the given year.
The basis for the discharge decision is an integrated financial package comprising:
- annual accounts of the Energy Community;
- external auditors' Report on the Audit of the Financial Statements;
- Energy Community Budget Committee's Report on Audit.
In its report, the Budget Committee is to note any disagreements with the director in the process of his/her financial management and state if it recommends to discharge the director. On this basis, the Ministerial Council grants discharge to the director from his management and financial responsibility.
Document Name Published on29.11.2018