RENEWABLE ENERGY IN ALBANIAAnita Shushku

Ylliad – General Director

FIAA Vice Chairman of Energy Committee

16 October, 2014. Tirana, Albania

Balkan Energy Finance Forum

ALTERNATIVES FOR RENEWABLE ENERGY IN ALBANIA

Hydro -Energy

Wind Energy

Solar Energy

Biomass Energy

WHY ALBANIA FOR GREEN ENERGY ?

Rich in natural resources of renewable energy (plenty of studies and projects confirming )

Affordable and sustainable source of clean energy Know how, due to history of existing industry of power

production (Hydro 97%) Contribution to a greener Europe

WHY NEW DEVELOPMENTS IN HYDRO ENERGY IN ALBANIA?

Very rich in water resources most of which not used

Hydro-energy is less expensive than the other forms of renewable energy and has good investment returns

Produces more energy for the same capacity comparing with other RE options

Hydro energy does not harm and pollute the environment and has no residuals after production

Well spread all over Albania and develops the region where the plants are constructed making the life of the inhabitants better off

Albania has high qualified expertise in this sector due to the experience in hydro energy production

New capacities of renewable power plants will increase the value of existing power plant with reservoirs

Albania becomes mores independent in the energy production

CURRENT SITUATION

The electricity production in Albania is highly based on hydro-power, accounting for 97% of the total production.

The main producer is KESH sh.a with the state owned hydropower plants Fierza, Komani and Vau i Dejes with a cumulative installed capacity of 1350 MW (KESH sh.a.)

Part of the energy needed is produced from small hydro-power plants which sell their energy to KESH sh.a based on a regulated yearly price (ERE).

The total installed capacity of the operative small hydropower plants is 347 MW. (2013,ERE)

The small hydropower plants are connected to the energy transmission and distribution system in Albania

MAIN CHARACTERISTICS OF RENEWABLE ENERGY - HYDRO PLANTS IN ALBANIA

Situated on all the territory of Albania

Financed , designed, developed and operated by Albanian and Foreign investing companies

Mainly run-of-river schemes

Connected to distribution (OSSHE) or transmission lines (OST)

The production is not programmable due to their characteristics (Cannot be subject of imbalances).

Government regulated energy selling price for hydro plants smaller than 15 MW installed capacity (review every year for 15 years)

PRODUCTION FROM RENEWABLE SOURCES FUTURE PERSPECTIVE

YEAR 2013 2030

KESH and EXISTING HYDRO (MW)

1,531 1,531

NEW RE HYDRO PLANTS (MW) 347 1,300

WIND (MW) 600

SOLAR (MW) 1,400

TOTAL (MW) 1,878 4,831PEAK DEMAND (MW) 1,400 1,800

TOTAL DEMAND (GWh) 8,823 10,800

TOTAL PRODUCTION (GWh) 6,819 12,360

CURRENT ISSUES

No long term regulations to give incentives to the private investors The market model not in coherence with the development in the

energy sector Existing energy law not in line with EU directives and regulations. Missing the Law on Renewable Energy No defined entity for managing imbalances The formula of the selling price not a long term decision (at least 15

years) Totally dependant in KESH payments – may result in “market stuck” as

in the current situation.

WHY IT IS IMPORTANT TO SECURE SUSTAINABLE SELF RELIABLE ELECTRICITY?

An excellent approach to increase incentives to private investors towards industrial development

Increase the efficiency of power production and the value of the energy produced .

Decrease the technical losses in the grid

Excellent job creator

Promote economy development in general

PROPOSED SOLUTIONS

Political will for a sustainable development of energy sector using Albanian natural and intellectual resources

Strategic plan for development of Renewable Energy(RE) sector making it attractive for investors

New energy law to support the development of RE through: Assigning an entity to cover imbalances of run-of-river plants .

Excluding transmission fees for producers .

Offering base price for the energy for at least 15 years for small producers .

Creating a budget fund to pay small producers.

QUESTIONS?

THANK YOU FOR YOUR ATTENTION!