Identifier
Created
Classification
Origin
10BELGRADE88
2010-01-19 11:14:00
UNCLASSIFIED//FOR OFFICIAL USE ONLY
Embassy Belgrade
Cable title:
SERBIA SAYS KOSOVO ELECTRICITY OFFER IS INSUFFICIENT AND
how-toVZCZCXYZ0020 RR RUEHWEB DE RUEHBW #0088/01 0192244 ZNR UUUUU ZZH R 191114Z JAN 10 FM AMEMBASSY BELGRADE TO RUEHC/SECSTATE WASHDC 0614 INFO EUROPEAN POLITICAL COLLECTIVE RHMCSUU/EUCOM POLAD VAIHINGEN GE
UNCLAS BELGRADE 000088
SENSITIVE
SIPDIS
E.O. 12958: N/A
TAGS: PREL PGOV ETRD ENRG KV SR
SUBJECT: SERBIA SAYS KOSOVO ELECTRICITY OFFER IS INSUFFICIENT AND
INSINCERE
REF: PRISTINA 23 AND PREVIOUS; 09 BELGRADE 1314
SUMMARY
-------
UNCLAS BELGRADE 000088
SENSITIVE
SIPDIS
E.O. 12958: N/A
TAGS: PREL PGOV ETRD ENRG KV SR
SUBJECT: SERBIA SAYS KOSOVO ELECTRICITY OFFER IS INSUFFICIENT AND
INSINCERE
REF: PRISTINA 23 AND PREVIOUS; 09 BELGRADE 1314
SUMMARY
--------------
1. (SBU) Serbia's lead electricity negotiator, Assistant Minister
for Kosovo Dragan Petkovic, insists Serbia wants to find a solution
to the ongoing electricity dispute in northern Kosovo, but says
KEK's proposal is insufficient and its willingness to reconnect the
north is insincere. While Petkovic claims Serbia's electricity
company EPS could now efficiently meet energy demand in the north,
he acknowledged that Serbia's actions - particularly the billing of
customers - were on shaky legal ground. While he acknowledged KEK
had normalized and improved service in the south, he said he
suspected that KEK would cut off customers in the north in order to
extract payment if the north were reconnected to KEK's grid. While
Serbia continues to call for goodwill on both sides to resolve the
dispute, it is clear that the GoS is more concerned with saving
face and expanding influence rather than meeting the needs of
Kosovo Serbs. End Summary.
Serbia Claims to Be Working Toward Solution
--------------
2. (SBU) Serbia wants to find a solution to the ongoing
electricity dispute in northern Kosovo (refs),Assistant Minister
for Kosovo Dragan Petkovic told us and Ben Crampton, Deputy of the
EU's Personal Representative Office, on January 14. Petkovic said
he and EPS would meet the week of January 18 with KEK
representatives "in order to harmonize positions." Petkovic
admitted that although KEK had presented the Serbian side an energy
services contract (ESCO) proposal in May 2009, the GoS had yet to
respond in writing with a counterproposal and had only made verbal
suggestions to date. Petkovic acknowledged Serbia needed to put a
proposal in writing to show it was sincere about resolving the
issue and said he was currently doing so. He said, however, that
Serbia could not use the KEK proposal as a starting point, since
that proposal had only dealt with a possible ESCO for the enclaves,
before that issue had been resolved.
3. (SBU) In defining Serbia's position, Petkovic said Serbia
ideally wanted to establish a secondary service provider for all
Serb areas of Kosovo. He said at a minimum, Serbia insisted that
it be more than just a bill collector for KEK and cover more than
just the north of Kosovo. Petkovic said Serbia had no objection to
registering the company in Pristina. He said he hoped that EPS and
KEK could reach an agreement somewhere between those two points,
saying both sides needed "to swallow something" if there were to be
an agreement. However, he said both sides had dug in on their
positions, leaving a significant gap between them. Ultimately, the
GoS "needed to have its needs met," Petkovic said, suggesting any
solution had to be political. "We can not have a situation in
which KEK gets everything and we get nothing. If that is the case,
then there will be no solution," Petkovic said.
EPS Supposedly Meeting Energy Demand in the North
-------------- --------------
4. (SBU) Petkovic alleged that EPS was able to fully meet the
demand for electricity in the north, now that it had begun to
collect for payment. Despite EPS' initial claims that electricity
was being delivered as humanitarian aid, Petkovic admitted to us
that consumers could not continue to receive electricity without
payment. Since EPS began meter reading and collection in December
2009, electricity consumption had plummeted 50% in the north,
making it possible to meet demand, Petkovic said. He said bill
collectors had begun collecting payment and were transferring the
funds to EPS.
Serbia on "Shaky Legal Ground"
--------------
5. (SBU) Without explicitly admitting that Serbia's actions were
illegal, Petkovic acknowledged that EPS was operating on shaky
legal ground. He pointed to that as a reason why Serbia wanted a
deal. We need to legalize the situation in the north so there are
no grounds to object, Petkovic said. He insisted that the current
situation could only be temporary and that a permanent solution had
to be found.
Not In Favor of Partition
--------------
6. (SBU) In response to our comments that Serbia's actions to date
had given many in the international community the impression that
Serbia was angling for partition, Petkovic flatly said that was not
Serbia's intention. "We are not in favor of partition and we are
not in favor of partitioning Kosovo's energy sector either,"
Petkovic said. Going further, Petkovic said it was KEK's current
proposal (an ESCO for the north) that smacked of partition, since
it geographically limited EPS' participation north of the Ibar.
KEK Insincere in Offer to Reconnect the North
--------------
7. (SBU) When urged to reconnect the north to the KEK grid and to
allow KEK to provide electricity in the north while talks between
the two sides continued, Petkovic claimed KEK's offer to reconnect
was insincere. If the north was reconnected to KEK, KEK would be
unable to meet the surge in demand and would probably once again
have to begin rationing electricity as it had done prior to October
2009, Petkovic said. As supposed proof that there would be
rationing, he said KEK was currently unable to fully provide
consistent power in the south and any increase in demand would
further aggravate the situation. Even if KEK were able to provide
sufficient electricity to the north, Petkovic said KEK would
immediately cut off power in the north as a way to twist consumers'
arms to immediately start paying for consumed electricity. In
either scenario, Petkovic gauged KEK's offer as insincere and said
it would be difficult for the GoS to allow Serbs in the north to
once again experience KEK power cuts after EPS had "proven" it
could meet their energy needs.
KEK Relations with Enclaves Slowly Improving
--------------
8. (SBU) In contrast to the contentious relationship with northern
Kosovo, Petkovic admitted that KEK's relations with the southern
enclaves had improved since they had begun paying their bills in
the summer of 2009. He said that supply was more stable and there
had been a slight improvement in quality of service. He said,
however, that some of the alleged promises KEK had made to the
enclaves, such as hiring more Serbs, had yet to materialize.
"Where are the jobs KEK promised," Petkovic asked. He repeatedly
emphasized that KEK had only been able to sign up the enclaves
because of his personal involvement and support for doing so in the
spring/summer of 2009.
Manipulators on All Sides
--------------
9. (SBU) Petkovic insisted there were manipulators on all sides
trying to undermine talks and to destabilize the situation. In the
north, he cited efforts by hardliners to influence the situation.
He then pointed to the recent meter reading in Valac as an example
of Albanian manipulation. Petkovic alleged that during past years,
meter reading happened only once or twice a year. Now, he said,
KEK had come twice in the past three weeks to read the meters. He
also insisted KEK officials were misleading the United States on
KEK's intentions. KEK negotiators were under pressure from
Pristina and elsewhere and this was not in anyone's interest,
"including the United States," Petkovic said.
Need Goodwill from Both Sides
--------------
10. (SBU) Petkovic emphasized several times that there needed to
be goodwill on all sides. Asked to define what he meant, Petkovic
suggested KEK providing an ESCO for the EPS subsidiary in Gracanica
or Strpce as a starting point, or having KEK employ more Serbs in
the south. Without providing examples of Serbian goodwill, he
again stated Serbia's maximalist negotiating positions.
Comment
--------------
11. (SBU) Petkovic was firm on the GoS position but tried to
appear conciliatory, as if he thought a commitment to keep talking
with KEK would be sufficient to win points with parts of the
international community. After believing that he had helped KEK
to sign up the southern enclaves only to see GoS influence there
diminish after Kosovo's November 2009 municipal elections,
Petkovic, a Kosovo Serb, may worry that he personally and the GOS
as a whole are losing influence with Kosovo Serbs. Petkovic and
the GoS now appear determined not to lose any further influence
over the fractured Serb community and are willing to use EPS' de
facto control over the northern Kosovo grid as that bargaining
chip. The needs of the Kosovo Serb community will continue to come
second to the political needs of the Serbian government. End
Comment.
PEDERSON
SENSITIVE
SIPDIS
E.O. 12958: N/A
TAGS: PREL PGOV ETRD ENRG KV SR
SUBJECT: SERBIA SAYS KOSOVO ELECTRICITY OFFER IS INSUFFICIENT AND
INSINCERE
REF: PRISTINA 23 AND PREVIOUS; 09 BELGRADE 1314
SUMMARY
--------------
1. (SBU) Serbia's lead electricity negotiator, Assistant Minister
for Kosovo Dragan Petkovic, insists Serbia wants to find a solution
to the ongoing electricity dispute in northern Kosovo, but says
KEK's proposal is insufficient and its willingness to reconnect the
north is insincere. While Petkovic claims Serbia's electricity
company EPS could now efficiently meet energy demand in the north,
he acknowledged that Serbia's actions - particularly the billing of
customers - were on shaky legal ground. While he acknowledged KEK
had normalized and improved service in the south, he said he
suspected that KEK would cut off customers in the north in order to
extract payment if the north were reconnected to KEK's grid. While
Serbia continues to call for goodwill on both sides to resolve the
dispute, it is clear that the GoS is more concerned with saving
face and expanding influence rather than meeting the needs of
Kosovo Serbs. End Summary.
Serbia Claims to Be Working Toward Solution
--------------
2. (SBU) Serbia wants to find a solution to the ongoing
electricity dispute in northern Kosovo (refs),Assistant Minister
for Kosovo Dragan Petkovic told us and Ben Crampton, Deputy of the
EU's Personal Representative Office, on January 14. Petkovic said
he and EPS would meet the week of January 18 with KEK
representatives "in order to harmonize positions." Petkovic
admitted that although KEK had presented the Serbian side an energy
services contract (ESCO) proposal in May 2009, the GoS had yet to
respond in writing with a counterproposal and had only made verbal
suggestions to date. Petkovic acknowledged Serbia needed to put a
proposal in writing to show it was sincere about resolving the
issue and said he was currently doing so. He said, however, that
Serbia could not use the KEK proposal as a starting point, since
that proposal had only dealt with a possible ESCO for the enclaves,
before that issue had been resolved.
3. (SBU) In defining Serbia's position, Petkovic said Serbia
ideally wanted to establish a secondary service provider for all
Serb areas of Kosovo. He said at a minimum, Serbia insisted that
it be more than just a bill collector for KEK and cover more than
just the north of Kosovo. Petkovic said Serbia had no objection to
registering the company in Pristina. He said he hoped that EPS and
KEK could reach an agreement somewhere between those two points,
saying both sides needed "to swallow something" if there were to be
an agreement. However, he said both sides had dug in on their
positions, leaving a significant gap between them. Ultimately, the
GoS "needed to have its needs met," Petkovic said, suggesting any
solution had to be political. "We can not have a situation in
which KEK gets everything and we get nothing. If that is the case,
then there will be no solution," Petkovic said.
EPS Supposedly Meeting Energy Demand in the North
-------------- --------------
4. (SBU) Petkovic alleged that EPS was able to fully meet the
demand for electricity in the north, now that it had begun to
collect for payment. Despite EPS' initial claims that electricity
was being delivered as humanitarian aid, Petkovic admitted to us
that consumers could not continue to receive electricity without
payment. Since EPS began meter reading and collection in December
2009, electricity consumption had plummeted 50% in the north,
making it possible to meet demand, Petkovic said. He said bill
collectors had begun collecting payment and were transferring the
funds to EPS.
Serbia on "Shaky Legal Ground"
--------------
5. (SBU) Without explicitly admitting that Serbia's actions were
illegal, Petkovic acknowledged that EPS was operating on shaky
legal ground. He pointed to that as a reason why Serbia wanted a
deal. We need to legalize the situation in the north so there are
no grounds to object, Petkovic said. He insisted that the current
situation could only be temporary and that a permanent solution had
to be found.
Not In Favor of Partition
--------------
6. (SBU) In response to our comments that Serbia's actions to date
had given many in the international community the impression that
Serbia was angling for partition, Petkovic flatly said that was not
Serbia's intention. "We are not in favor of partition and we are
not in favor of partitioning Kosovo's energy sector either,"
Petkovic said. Going further, Petkovic said it was KEK's current
proposal (an ESCO for the north) that smacked of partition, since
it geographically limited EPS' participation north of the Ibar.
KEK Insincere in Offer to Reconnect the North
--------------
7. (SBU) When urged to reconnect the north to the KEK grid and to
allow KEK to provide electricity in the north while talks between
the two sides continued, Petkovic claimed KEK's offer to reconnect
was insincere. If the north was reconnected to KEK, KEK would be
unable to meet the surge in demand and would probably once again
have to begin rationing electricity as it had done prior to October
2009, Petkovic said. As supposed proof that there would be
rationing, he said KEK was currently unable to fully provide
consistent power in the south and any increase in demand would
further aggravate the situation. Even if KEK were able to provide
sufficient electricity to the north, Petkovic said KEK would
immediately cut off power in the north as a way to twist consumers'
arms to immediately start paying for consumed electricity. In
either scenario, Petkovic gauged KEK's offer as insincere and said
it would be difficult for the GoS to allow Serbs in the north to
once again experience KEK power cuts after EPS had "proven" it
could meet their energy needs.
KEK Relations with Enclaves Slowly Improving
--------------
8. (SBU) In contrast to the contentious relationship with northern
Kosovo, Petkovic admitted that KEK's relations with the southern
enclaves had improved since they had begun paying their bills in
the summer of 2009. He said that supply was more stable and there
had been a slight improvement in quality of service. He said,
however, that some of the alleged promises KEK had made to the
enclaves, such as hiring more Serbs, had yet to materialize.
"Where are the jobs KEK promised," Petkovic asked. He repeatedly
emphasized that KEK had only been able to sign up the enclaves
because of his personal involvement and support for doing so in the
spring/summer of 2009.
Manipulators on All Sides
--------------
9. (SBU) Petkovic insisted there were manipulators on all sides
trying to undermine talks and to destabilize the situation. In the
north, he cited efforts by hardliners to influence the situation.
He then pointed to the recent meter reading in Valac as an example
of Albanian manipulation. Petkovic alleged that during past years,
meter reading happened only once or twice a year. Now, he said,
KEK had come twice in the past three weeks to read the meters. He
also insisted KEK officials were misleading the United States on
KEK's intentions. KEK negotiators were under pressure from
Pristina and elsewhere and this was not in anyone's interest,
"including the United States," Petkovic said.
Need Goodwill from Both Sides
--------------
10. (SBU) Petkovic emphasized several times that there needed to
be goodwill on all sides. Asked to define what he meant, Petkovic
suggested KEK providing an ESCO for the EPS subsidiary in Gracanica
or Strpce as a starting point, or having KEK employ more Serbs in
the south. Without providing examples of Serbian goodwill, he
again stated Serbia's maximalist negotiating positions.
Comment
--------------
11. (SBU) Petkovic was firm on the GoS position but tried to
appear conciliatory, as if he thought a commitment to keep talking
with KEK would be sufficient to win points with parts of the
international community. After believing that he had helped KEK
to sign up the southern enclaves only to see GoS influence there
diminish after Kosovo's November 2009 municipal elections,
Petkovic, a Kosovo Serb, may worry that he personally and the GOS
as a whole are losing influence with Kosovo Serbs. Petkovic and
the GoS now appear determined not to lose any further influence
over the fractured Serb community and are willing to use EPS' de
facto control over the northern Kosovo grid as that bargaining
chip. The needs of the Kosovo Serb community will continue to come
second to the political needs of the Serbian government. End
Comment.
PEDERSON