Analysis and Prospects for the Development of Regional Energy Integration of the Eurasian Economic Union Countries

Abstract

In the presented paper, it is proved that a new objective trend appears in the current conditions of Eurasian region development. It will strengthen mutual cooperation between the countries of Eurasia and it will enrich regionalization process in the context of world energy markets restructuring, intensification of competition, deglobalization tendencies and other challenges of the world economy. At the same time, fuel and energy complex (FEC) is becoming the main driving force for the countries of Eurasian region and their further development. The concept of regional energy integration of the Eurasian Economic Union (EAEU) countries is offered in the paper. It's based on the strategic advantages of economic integration in relation to the fuel and energy complex. Energy potential analysis of the EAEU member countries is performed. The issues of common energy markets formation in the region are considered. The main problems and a number of uncoordinated tasks between the countries participating in integrational process in this area are highlighted in terms of common gas, oil and oil products market formation, although it is noted that development and approval stage of the Programs for such formation is mostly completed. It is expected that these markets will be fully formed by 2025. It was emphasized that energy integration is one of the most important areas for the EAEU countries development, which is expected to bring significant economic benefits in the long-term period.

Electricity Trading in Energy Market Integration: A Theoretical Review

“…Table 1. A summary of costs and benefits of integrating energy markets [10][11][12][13][14][15][16][17][18].…”

“…Conceptualization of an integrated energy market identifies five major building blocks [10], as summarized in Table 2. Interaction of various participants and their concerted actions towards their goal achievement.…”

“…Provides a foundation for a regional union as whole and strengthens a region's competitiveness [10].…”

“…The common angle involves proponents of trade economics and managerial economics. The trade economics viewpoint (such as [10]) suggests that EMI should adhere to the logical principle of 'the bigger the better'. This view underscores the importance of economies of scale in driving integration.…”

“…This view underscores the importance of economies of scale in driving integration. It is held that once markets are functional, economies of scale will always smooth out possible constraints reactively [10]. On the other hand, managerial economics (such as [20]) espouses a cost argument whose logic is similar to 'biting off what one can chew'.…”