Briefing on Energy in Kosovo

Simply put, the energy situation in Kosovo needs to be improved. Power outages are not uncommon, but when they occur in cities, they do not last for incredibly long periods of time - perhaps a few hours. In these instances, one can hear the ringing and grinding of generators, which is not pleasant when trying to eat at a cafe (or watch the World Cup). Also, this strains and disrupts business output and for smaller firms can be an irritating and substantial cost to buying a generator and running it. Kosovo Energy Corporation (KEK) is the only public/private utility company in Kosovo, meaning that although they are a public company now (they became a publicly owned enterprise in 2005 and received 70 million Euros in 2009 from Kosovo's budget according to the World Bank), the government is selling some of KEK's assets to privatize. The World Bank, in the April 29th report on Kosovo titled "Unlocking Growth Potential," believes that privatization of the energy sector will only have positive benefits for Kosovo, but this is not a surprise that the World Bank is pushing privatization.

However it may not necessarily be bad, because funds would be better spent to update old equipment, as you can see from the picture of the small power towers that are used in Kosovo.

Currently, lignite is Kosovo's most abundant energy source, but there is no one efficient source of extracting lignite from the earth, albeit it is mined now and used for energy production at plants Kosovo A and Kosovo B. KEK mines the lignite for both these plants, which it owns, and distributes this electric power around Kosovo. But due to poor tax regulations and consumer unwillingness to pay for electricity in some areas in Kosovo - mainly the North - KEK only receives payment for 40% of the energy it produces. This, as you can see, is a major problem for a publicly owned company.

To the left is Kosovo A, which is 40 years old and pollutes approximately 70 times more than EU standards. Because energy production capacity in Kosovo is poor, the plan is to keep producing energy from lignite at Kosovo A until around 2015.

Below is Kosovo B, which looks like a nuclear power plant but is still a lignite energy plant. It is about 25 years old and according to the 2009-2018 Energy Strategy, this plant will be refurbished and privatized. Unfortunately I do not remember how many litres of water Kosovo B consumes a day to cool its main stack, but it is quite significant. The water comes from Lake Gazivoda in the North, which is the main source of water for Kosovo. Funding and management of both Kosovo A and B is poor, and as of now they are are a huge strain on Kosovo's economy and budget.

However, the plan is to construct a new power plant, named Kosovo C or Kosovo e Re Power Plant, which will be in-line with EU standards. There does not seem to be a target date set to complete the construction of Kosovo C, except 'as quickly as possible.' In Kosovo terms, this means Kosovo C will not be up and running anytime in the next 15 years. There is potential in the energy sector, but there needs to be serious investment - mainly from internationals - and the political will from the government to back investment up by producing reliable energy infrastructure. Perhaps the World Bank is right to assume that privatization is the way to go, but this remains to be seen.