Albania To Hike Electricity Price in 2010
|Albania is expected to raise electricity prices between 8 and 15 percent in 2010 as part of an agreement over the sale of its state-owned power firm OSSH to the Czech company, CEZ.
|Albania is expected to raise electricity prices between 8 and 15 percent in 2010 as part of an agreement over the sale of its state-owned power firm OSSH to the Czech company, CEZ.“If the price of electricity in the international market remains the same we are expecting a hike of the price of 8 per cent, but if prices jump to last year’s levels, we expect a rise of 15 per cent,” said Demetrios Papathanasiou, a World Bank economist.The World Bank has been advising the Albanian government in the process of the privatisation of the power distributor.The government of Albania and the CEZ Group signed a contract for the sale of 76 per cent of the shares of the state-owned electricity distribution power utility, OSSH, the Czech corporation in March.“The selection of CEZ will significantly improve the supply of electricity in Albania, which will lead to increased customer satisfaction,” said Genc Ruli Albania\'s Minister of Economy, Trade and Energy after the signing ceremony.While for CEZ the acquisition of OSSH it is another step in consolidating their position in the region. “From a long-term point of view analysts expect that the electricity consumption in Albania will grow by 5 per cent each year; a faster rate in the region is experienced only in Turkey where the CEZ Group operates as well,” said Martin Roman, Chairman of the Board and CEO of CEZThe tender for the privatisation of the Albanian company was closed in September 30, 2008. CEZ was the sole interested participant and offered €102 million for the majority stake and promised to invest €200 million in the next four years.OSSH had a book value of €130 million in September 2008 and accumulated debts totalling €150 million. Its balance sheet has never been published while sources from the company said that its financial health languished sharply following the privatisation tender due to the large amount of costly electricity imports.Before the sale agreement was reached the Albanian government transferred debts and canceled unpaid bills of the company for a total amount of €60 million.The opposition considered the debt write-off as “doubtful” and “corrupted”. “Debts are being transferred to KESH, while assets which were created by such debts were transferred to OSSH,” said Andis Harasani, the former General Director of KESH, now a deputy in parliament for the opposition Socialist Party.Albania has been lately affected by a devastating deficiency of electricity, in particular due to the absence of investment in power development in last decades. The annual volume of imported electricity varies according to the availability of hydroelectric power plants in the country; in 2007, Albania imported approximately 40 per cent of its annual consumption.In Albania, the electricity consumption per capita is less than one third of consumption in the Czech Republic (2 MWh versus 6.3 MWh per capita). In comparison with Austria, the Albanian electricity consumption per capita is even less than one quarter of the Austrian consumption.Analysts expect that the electricity consumption in Albania will grow by 5 per cent each year; a faster rate in the region is experienced only in Turkey. In other European countries, the electricity consumption mostly grows roughly by 2-3 per cent a year.From : http://balkaninsight.com/en/main/news/18165/|