GOVERNMENT MECHANISM FOR ENERGY MARKET REGULATION

Abstract

The article provides insights to describing specific features of government regulation of the energy market. The study offers an overview on the evolution of methods, forms and tools of government control of power supply system components across different countries. Domestic and international business practices bear evidence of a number of problems in government regulation which drives the search for their solution by building a new, more progressive model of energy market regulation, in particular, the configuration management model.  This configuration regulation model contributes to more effective implementation of tools and methods of managerial intervention to the energy market at four levels: micro- (companies, households) and meso- (regional) – in shaping demand for certain types of energy resources; on meso- (sectoral) and macro- (national) – in building energy supply patterns. The effectiveness of the energy market configuration regulation model tools  by their functional load is validated through a range of organizational measures (reduction of dependence on the oil and gas market; decommissioning of obsolete facilities; liberalization of the energy market in the area of distribution; further liberalization  as to distributed energy generation); technological measures (building local networks with renewable sources generation; Smart Grid versions –"smart networks"; implementation of passive / active house standards; creating the electricity storage market); financial measures (attracting large investments in the energy sector; implementing project financing technologies to attract long-term investments from the banking system; launching special economic zones to reduce the tax burden on business entities within the framework of the government energy saving policy). The implementation of all these activities will enhance energy efficiency and energy saving systems, as well as contributes to attaining strategic benchmarks defined in the Energy Strategy of Ukraine until 2030.