Albania: The energy sector in inherited financial crisis

, SEE Energy News

Although previous year has been one of the best in terms of electricity production volume, owing to heavy precipitation and the market entry of private producers, Albanian power system is still vulnerable in terms of a quality guarantees and prices of services for citizens.

The power system is in long lasting financial crisis inherited from the previous period. The lack of efficiency is due to accumulated debts between public enterprises in this sector and a number of loans taken for solving this crisis. Lack of efficiency leads to increased service costs and has a negative impact on the macro-economic indicators.

Third parties tiabilities to distribution operator are decreasing but are still too high. In 2013, debt amounted to EUR 870 million and it decreased to EUR 774 million in 2016.

Total mutual debts between companies KESH, OSHEE and OST, on 20th of September 2016 amounted to EUR 590 million. OSHEE debt to KESH company for electricity supply is EUR 370 million. Under long term loans, this indicator is EUR 83 million.

OSHEE liabilities to OST for power transmission and loans amount to EUR 60 million.  OST owes EUR 75 million to OSHEE for supplied electricity and loans.

OSHEE remaining liabilities to CEZ company amount to EUR 42.7 million.

Last year, for the first time since 2010 Albania has been a net exporter of electricity due to heavy rains, decreased consumption and increased production of private operators.

KESH has announced that it exported 700 million KWh last year it. According to Energy Regulatory Authority electricity consumption fell by 2.3% in 2016. Data show a significant reduction in consumption at high voltage. Enterprises, whose consumption in 2016 decreased by 17% compared to the previous year, from 610 to 503 million KWh fall into this category.