State of compliance
The Energy Regulatory Commission (ERC) is the single regulatory authority with nation-wide competences in electricity and gas. The legal basis for its operation, competences and set-up has been adjusted to the Third Energy Package only in May 2018. ERC is headed by seven commissioners, one of whom acts as president. The term of the commissioners is limited to a period of five years, renewable once.
The management has autonomy in defining the authority’s internal organisation even though its statutes formally require Parliament’s approval. This procedure could potentially put regulatory independence at risk, even though this has not been observed in practical terms so far. The legal reforms adopted in May 2018 did not introduce a selection committee of neutral experts for short-listing commissioner candidates but foresee appointment by Parliament based on a proposal of a governmental commission. The previously existing vague selection criteria, including an “integrity test”, have been eliminated and replaced by clear eligibility requirements. ERC ensures accountability of its activities by presenting its annual report to the Parliament, Ministry and Government.
ERC has proven capability and commitment to develop regulatory rules under time pressure and at high quality and showed ownership to make use of its independence status granted by law. Cutbacks on ERC’s autonomy by intervention of other public authorities are however of continuous concern: the suggestion of a State Audit Office report to reduce salaries to public administration level and the intention to cut ERC’s consultancy budget, undue influence on the financial autonomy of the regulator, could be averted by intervention of the Secretariat. The necessary approval of ERC’s annual employment plan and execution of HR procedures by the Ministry of Information Society proved to be a barrier for hiring staff and has been criticised by the Secretariat from the point of view of functional independence.