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LAW OF THE AZERBAIJAN REPUBLIC

of April 3, 1998 No. 459-IG

About power industry

(as amended on 02-04-2021)

Chapter I. General provisions

Article 1. Basic concepts

In this Law the basic concepts in the following values are used:

power industry - the industry of economy which is engaged in development, transportation and distribution of electrical and heat energy;

the company of power supply - the legal entity guaranteeing supply of the population and other consumers with energy on the basis of special permission;

electric utility system - consolidation of power plants, substations, the power lines connected among themselves by single engineering procedure of development, transportation and distribution of electrical and heat energy, and their organizations (systems) of management;

electrical units - the equipment and constructions relating to it which are required for development, transfer and distribution of electrical energy;

district thermal installations - technical equipment and constructions relating to it which are required for production, transfer and distribution of hot water, vapor and other heat carriers within certain territory.

Article 2. Scope and purpose of the Law

This Law determines the legal basis of development, transportation, distribution, purchase and sale and consumption of electrical and heat energy.

Basic purpose of this Law - to provide rational use of energy resources and social and economic feasibility of development of energy, showing care of the environment, and its deliveries to energy market taking into account consumer interests.

Article 3. Subjects of supply with electrical and heat energy

Subjects of supply with electrical and heat energy are:

the state electrical power company - single state electric utility system;

companies of power supply;

independent producers of energy - the legal entities having complete economic and organizational independence and not submitting to single state electric utility system;

energy consumers.

The state electrical power company includes the transfer power networks of high voltage (over 110 kilovolts), the dispatching and managing means subordinated to this company of producers of energy managed from the single center. The company on the basis of agreements buys energy from producers and transports it by means of the networks, conducts transactions on energy exchange with foreign countries.

The company of power supply as the legal entity, buys on the basis of agreements electrical and heat energy from the state electrical power company and producers and sells it to consumers with approval of the corresponding technical and economic conditions. Rules of issue of specifications for connection of the consumer of electrical and heat energy to network of power supply or receipt of additional energy (capacity) by it are established by relevant organ of the executive authority.

The independent power producers belonging to the state, different industries of economy and the private organizations supply consumers with electrical and heat energy on the power networks, and also by means of the state electrical power company and (or) the companies of power supply according to the legislation of the Azerbaijan Republic export excessive part of the energy made by them.

The companies of power supply and independent producers of energy can have any pattern of ownership.

Article 4. Management and the state control in the field of electrical and heat energy

Relevant organs of the executive authority bear responsibility for:

issue of special permission to development, transfer, distribution and sale of electrical and heat energy;

the conclusion of the agreements granting the right within certain territory to transportation and distribution of electrical and heat energy;

price regulation (rates) for electrical and heat energy;

demonopolization of activities for development of electrical and heat energy;

issue of special permission to implementation of transactions on export and import of electrical energy;

conducting the state control of effective, safe and reliable production, transportation, distribution and energy consumption;

determination of general rules and standards on development, transfer, sale, distribution of electrical and heat energy, and also on safe, reliable construction of electrical and thermal units, for conducting control of observance of the specified general rules and standards.

Article 4-1. The payment brought in the structure created by relevant organ of the executive authority

Producers of energy and company for supply with energy bring payment in the structure created by relevant organ of the executive authority. The amount of payment and procedure for its introduction are established by relevant organ of the executive authority after approval of relevant organ of the executive authority.

Chapter II. Special permission to activities in the field of electrical and heat energy

Article 5. Special permission

Types of activity on development, transportation and distribution of energy are performed on the basis of special permission, cases except for established by the legislation.

Special permission is issued to legal entities and physical persons irrespective of pattern of ownership according to the procedure, established by the legislation, way of carrying out tender.

In exceptional cases special permission can be issued by the decision of relevant organ of the executive authority and without carrying out tender.

The special permission connected with activities in the field of electrical and heat energy is issued by the relevant executive authorities of the Azerbaijan Republic on the basis of the address of any concerned party. In the address are reflected:

the description of the main indicators of the provided activities;

documents on the corresponding qualification of the addressing person and his workers;

certificate of respect for social and technical safety;

documents on rules of health protection and safety of the people who are engaged in activities.

After accomplishment of the main requirements special permission according to the procedure of exception can be issued by relevant organ of the executive authority and is conditional. Persons owning special permission in the specified case also carry out the obligations, being guided by this Law and other legal acts.

Article 6. Special permission for construction, creation and commissioning of new electrical units

The installations of high voltage developing, transferring and distributing electrical energy cannot be constructed and put in operation without in advance got special permission, cases except for established by the legislation.

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