Documente Academic
Documente Profesional
Documente Cultură
RepublikaKosova-RepublicofKosovo
Qeveria Vlada-Government
Draft
Prishtina, 2013
Ministers foreword
Abbreviation
KEEA
EU
CG
RES
ED
EE
SEE
ENTSO/E
PES
GWh
HPP
EC
KEK
kg
kJ
KEDS
km
KOSTT
ICMM
KfW
kVh
Ktoe
MF
MEI
MESP
MLSW
MTI
MWh
MED
DH
DSO
TSO
MO
PPP
KEEAP
GoK
ECS
TAP
TPP
ENCT
AI
SPO-OPM
TABLE OF CONTENTS
Contents
I.
EXECUTIVE SUMMARY................................................................................................................................6
II.
INTRODUCTION..............................................................................................................................................8
III.
METHODOLOGY.............................................................................................................................................9
IV.
ARTICLE I. ...............................................................................................................................................................13
V.2. ELECTRICITY TRANSMISSION ...........................................................................................................................14
V.3. ELECTRICITY DISTRIBUTION AND SUPPLY ........................................................................................................15
V.4. DISTRICT HEATING ...........................................................................................................................................16
V.5. NATURAL GAS ..................................................................................................................................................16
V.6 LIQUID FUELS ....................................................................................................................................................17
V.7. RENEWABLE ENERGY SOURCES ........................................................................................................................18
V.8. ENERGY EFFICIENCY ........................................................................................................................................19
V.9. ENVIRONMENTAL PROTECTION ........................................................................................................................19
V.10. KOSOVA E RE PROJECT ..................................................................................................................................20
V.11 ENERGY SECTOR RESTRUCTURING ..................................................................................................................20
V.12 ENERGY COMMUNITY TREATY .......................................................................................................................20
V.13 REGIONAL COOPERATION ................................................................................................................................21
VI.
VII.
IX. POLICIES, OBJECTIVES AND MEASURES FOR THE DEVELOPMENT OF THE ENERGY
SECTOR.....................................................................................................................................................................30
PILLAR I. SECURITY OF SUSTAINABLE AND QUALITY SUPPLY OF ENERGY ................................................................30
Objective I.1. Security of electricity supply........................................................................................................30
Objective I.2. Security of thermal energy for heating ........................................................................................33
Objective I.3. Development of the natural gas infrastructure ............................................................................33
Objective I.4. Establishment of the obligatory petroleum reserve .....................................................................34
Objective I.5. Promotion of renewable energy sources .....................................................................................34
Objective I.6. Increasing energy efficiency ........................................................................................................35
Objective I.7. Review and amendments to the primary and secondary legislation ............................................36
PILLAR II. RESTRUCTURING OF THE ENERGY SECTOR ..............................................................................................36
Objective II.1. Enhancement of energy sector competitiveness, through sector restructuring ..........................36
Objective II.2. Establishment of a competitive electricity market ......................................................................36
Objective II.3. Common Kosovo-Albania market ..............................................................................................37
Objective II.4 Tariff reforms ..............................................................................................................................38
PILLAR III. ENVIRONMENT PROTECTION AND SOCIAL ISSUES ..................................................................................39
Objective III.1. Implementation of environmental and social norms and standards in use of energy sources,
construction and operation of energy infrastructure .........................................................................................39
Objective III.2. Addressing social issues ...........................................................................................................39
Objective III.3. Decommissioning of TPP Kosova A .........................................................................................40
X.
I.
Executive summary
Energy Strategy of the Republic of Kosovo for the period 2013-2022 provides guidelines
forrelevant policies for energy sector development. This strategy aims to provide prerequisites
for stable energy supply and provision of qualitative and affordable services for Kosovo citizens,
and to identify key policies and measures to be undertaken to further enhance sector reform and
to attract private investments, ensure environmental preservation, and to achieve prompter
integration of Kosovos energy system in regional and European systems.
The main objective of this strategy is to ensure sustainable and qualitative energy supply at
affordable prices for the customers, with due consideration of environmental protection.
Security and quality of power supply represent a particular focus of this strategy, which
envisages the construction of new electricity generation capacities and rehabilitation of TPP
Kosova B, and development of RES and EE projects, all aiming to ensure a balanced supply with
energy generated from available energy sources.
Also, this strategy addresses the supply of thermal energy for heating, considering that heating
plays a key role in the overall energy balance. The extension and expansion of district heating
systems would relieve the electricity consumption load used for heating purposesduring winter
season.
Increasing the diversity of primary energy sources is considered a very important component for
the overall security and quality of power supply. In this regard, connection into regional gas
pipelines is considered a realistic opportunity for the supply of natural gas in the country.
Efforts to fulfill obligations deriving from the Energy Community Treaty represent another
important dimension of this Strategy. To this end, a series of measures are envisaged to complete
the energy sector reconstruction and reformation process, in line with EC directives and
applicable domestic legislation, to attract private investments and to ensure a significant
contribution to an accelerated and sustainable economic and social development of the country.
Increased energy efficiency and use of renewable energy sources are considered important
elements of this Strategy. Clear policies and measures applicable for these two important
segments are delineated below.
The Strategy aims to supplement further the comprehensive legal and regulatory infrastructure,
which will create an enabling environment for attraction of private investments in the energy
sector, while assisting in the promotion of investments in other sectors as well. This strategy
reviews three options for security of electricity supply.
Option 1
This option envisages maximal utilization of the country's main energy resource lignite.
According to this option, all existing capacities will be operational and new lignite-based energy
generation capacities will be constructed, to fulfillthe domestic demands, and export an amount
of electricity to fulfill event regional market demands. In addition to lignite capacities, renewable
energy sources are also planned to be developed.
Option 2
Under this option, electricity supply is planned to be provided by TPP Kosova B, TPP Kosova e
Re, while TPP Kosova A shall be decommissioned within the timeline planned in line with
EnCT requirements. Electricity gap as a result of increased demand shall be mainly covered by
imports and potential RES capacities.
Option 3
This option envisages electricity supply from TPP Kosova B, TPP Kosova A (until the
commissioning of TPP Kosova e Re), TPP Kosova e Re and RES. Electricity gap and required
reserves shall be covered through the optimization of two electricity systems of Kosovo and
Albania.
This strategy is founded on three fundamental pillars. These pillars comprise the framework for
the compilation of policies and action plans on future energy sector development.
First pillar:Security of sustainable and qualitypower supply
Provision of uninterrupted, quality and affordable supply of electricity for customers is the
fundamental principle of this pillar.
To ensure qualitative and quantitativesupply of power to consumers, new energy generation
capacities must be developed. Necessary investments in transmission and distribution network,
as well as in increasing energy efficiency, will also be ensured.
Second pillar:Restructuring of the energy sector
Kosovo will continue its energy sector restructuring endeavors, in order to ensure competition in
the energy market, in line with general principles of open competition, non-discrimination,
transparency, equality and respEnCTfor consumer protection.
Third pillar:Due consideration of environment protection and social issues
In accordance with ECT, Kosovo is committed to implement the AcquisCommunautaireon
environment and social issues, in terms of exploitation energy resources, construction and
operation of the energy infrastructure.
The abovementioned pillars are further broken down into policies, objectives and measures to be
implemented towards for the development of the energy sector.
II.
Introduction
Energy Strategy of the Republic of Kosovo 2013-2022 is the main document outlining energy
policies and development objectives of the energy sector, in line with international standards on
sustainable development, environmental protection and social wellbeing, which aims to
maximize profits from the use of the countrys energy resources.
The review of the Energy Strategy of the Republic of Kosovo 2009-2018 is conducted in
accordance with the Law on Energy No. 03/L-184, and based on a series of documents, studies
and relevant analyses, paying particular attention to its compatibility with the EU Acquis, as an
equal member of the Energy Community Treaty.
The Energy Strategy aims to establish effective mechanisms for the implementation of
requirements set in this strategy, taking into account the effective management of existing energy
resources and environmental protection. It focuses on enhancing the security of supply in line
with European standards and diversification of energy sources. This strategy aims to encourage
rational use of energy and increased energy efficiency, utilization of renewable energy sources,
introduction of new technologies, while respecting international standards of environmental
protection and community care.
This strategy covers a 10-year period. Policies, strategic objectives and measures identified in
this document for each subsector are also aimed at creating a guideline basis to draft the
Implementation Program of the Energy Strategy for the period 2013-2016.
The Energy Strategy of the Republic of Kosovo 2013-2022, after its adoption by the Government
and approval by the Assembly of the Republic of Kosovo, will be implemented by all relevant
stakeholders of the energy sector.
The authority responsiblefor coordination and supervision of the implementation of this Energy
Strategy is the Ministry of Economic Development.
III.
Methodology
Pursuant to legal requirements set forth in Law No. 03/L-184 on Energy, respectively Article 3
thereof, the Ministry of Economic Development initiated the review of the Energy Strategy of
the Republic of Kosovo 2009-2018. A working group has been established for this purpose,
comprising representation from MED, SPO-OPM, MF, MESP, MTI, MEI,ERO, ICMM, KEK
J.S.C., KOSTT J.S.C.,DH Termokos, and University of Prishtina'sFaculty of Electrical
Engineering and the Faculty of Mechanical Engineering. During this period, the working group
held working meetings to prepare the draft Energy Strategy 2013-2022. The main actor in all
activities undertaken during the drafting process, including reviewing comments and suggestions
of working group members and technical processing of documents throughout the strategy
drafting process was the Division for Sectorial Strategies of MED.
For purposes of harmonization and all-inclusiveness, strategic documents approved by the
Government, MED and other relevant actors in the energy sector have been reviewed in drafting
the Energy Strategy, including, Program of the Government of the Republic of Kosovo 20112014, Declaration of Priority Mid-Term Policies 2014-2016, ERO Annual Report 2012, Mining
Strategy of the Republic of Kosovo 2012-2025, Annual Energy Balance of the Republic of
Kosovo 2012, Long-Term Energy Balance of the Republic of Kosovo Republic of Kosovo 20132022, Report of the Study on the security of power supply in Kosovo, and Energy Strategy of the
Energy Community.
This document depicts the current state of the energy sector and covers the legal and institutional
framework, energy generation capacities and ancillary infrastructure. It also provides a SWOT
analysis of the sector, energy forecasts, and analyzes three options for electricity supply.
Three pillars are also presented based on the analysis of the current situation, while strategic
objectives are shown for each pillar separately, accompanied with measures envisaged for their
realization. The realization of short-term objectives will be setin the Energy Strategy
Implementation Program, which will serve as a mechanism for monitoring the implementation of
this Energy Strategy.
In addition, based on the legal requirements of Article 3 of the Law on Energy, and ensuring the
protection of confidentiality of relevant information, the Ministry has issued the draft Strategy
for public consultation for a period 60 days. After reviewing all comments, suggestions, and
proposals and after incorporation of all relevant additions,the Ministry will submit the draft of
the Energy Strategy to the Government of the Republic of Kosovofor review and adoption, and
then to the Assembly of the Republic of Kosovo for approval.
10
IV.
Policy development, organization, regulation and management of the energy sector in the
Republic of Kosova are based on a set of laws that ensure overall compliance with the European
Union (EU) Acquis on energy. Energy sector institutions include government and regulatory
institutions, and energy enterprises.
V.
Electricity generation in the country is mainly provided by the Kosovo Energy Corporation,
operating through its two Thermal Power Plants Kosova A and KosovaB, supplied by open
cast coal mines (Sibovc Southwest and Sitnica sectors) and in smaller amounts from hydro
power plants (Ujman, Lumbardh, Radac, Dikanc and Burim).Installed capacity of thermal power
plants is 1478 MW; however, due to their age, their current operational capacity is around 915
MW. Gross generation of electricity from existing power plants in 2012 was 5,383.981GWh.
Installed hydro capacities amount to 45.84 MW, which have generated in 2012 a total of
95.582GWh.
Table 1 shows installed generation capacities by type and year of commissioning.
Table 1: Installed electricity generation capacities3
HPPUjmani
HPPLumbardhi
HPPDikanci 1
HPPRadavci
HPPBurimi
Total HPP
Wind energy
Total
1,525.91
Generation
units
A1
A2
A3
A4
A5
TPPKososva A
B1
B2
TPPKososva B
Total TPP
Commissioning
1962
1964
1970
1971
1975
1983
1984
1983
1957 (2006)
1957 (2010)
1934 (2010)
1948 (2011)
2010
1,213.58
12
Geological
10, 091, 000,000
2, 244, 830,000
106, 631,000
12,442,461,000
RESERVES (t)
Balance7
8,772,000,000
2,047,700,000
73,188,000
10,892,888,000
Non-balance8
1,319,000,000
197,130,000
33,443,000
1,549,573,000
The Government will continuously and with great care monitor the Carbon Trading trends, when it comes to the
energy production by conventional methods.
5
Revising clause No. 152, University of Prishtina, 2008, on Study for the assessment of research and geological
reserves of coal in Kosovo, Prishtina, 2007, p. 81. Institute INKOS
6
Source: Mining Strategy of the Republic of Kosovo for the period 2012-2025.
7
Balance reserves are those where the calorific value of coal is over 5.450 kJ/kg.
8
Out of balance reserves are those where the calorific value of coal is under 5.450 kJ/kg.
13
Besides its use for electricity production, the government encourages the coal to be used for
other needs, such as gasification, drying, export, etc.
14
Load
MWh
4,035,076
4,428,053
4,559,037
4,682,250
4,768,383
Metered
energy
MWh
2,093,372
2,532,626
2,679,713
2,890,172
3,018,863
Billing
Collection
(000) Euro
165,351
178,295
174,747
188,399
207,878
(000) Euro
118,845
142,110
151,805
168,952
184,541
Collection/billing
ratio
%
71.87
79.70
86.87
89.68
88.77
Electricity demand in 2012 was covered by domestic generation, exchanges and import.
Electricity imported in 2012 was 571,89712MWh.
As part of the unbundling process of vertically integrated enterprises, the Government of
Kosovo, through Decisions No.04/36 and 03/38, ordered the legal unbundling of KEK J.S.C.,
whereby a new entity, KEDS J.S.C., was established, and subsequently privatized by LimakCalikconsortium.
10
15
Installed
capacityMWt
DHTermokos
135.62
DHGjakova
DHMitrovic
DHZvean
38.6
16.9
1.6
Operational
capacity
MWt
135.62
Length of the
distribution
network in km
70
20
23.5
4.5
0.8
No. of
substations
312
275
20
13
16
ownership rights of the line Hani i Elezit Mitrovica, which shall be taken into account when
reviewing the use of this asset.
Another fact to be considered is that the gas pipeline included developments that will hinder the
implementation of a projectthat completely follows the existing pipeline trajectory14.
In 2007, the "Regional Gasification Study - Kosovo Market Report" study was published,
commissioned by the World Bank (WB) and German Development Bank (KfW). This study was
prepared by the Economic Consulting Associates from England.
Kosovo will continue to closely follow all regional projects related to natural gas utilization, and
will strive to become part of projects like TAP and IAP. To this end, it is necessary to conduct
studies that would provide recommendations on specific activities to be undertaken.
14
Source: MEM 2010 Report - Clarification on the trajectory of the existing gas pipeline grid in Kosovo.
17
18
V.10.Kosova e Re Project
Thermal Power Plant Kosova e Re is one of the main projects in the energy sector, which
supports all pillars of the Energy Strategy of the Republic of Kosovo. This thermal power plant
is envisaged to have to units of around 300 MW per unit, and will be built with the Best
Available Technology (BAT).The aim of the projectis to reach security of supply in the most
environmentally-friendly manner, while optimizing the exploitation of available natural
resources. Thermal Power Plant Kosova e Re will be developed while integrating all
requirements of the Industrial Emissions Directive, which stipulates the highest European
environmental standards. The implementation of this standards means that this thermal power
plant will generate electricity while emitting quantities that are acceptable for new thermal power
plants in Europe. Simultaneously, the development of this thermal power plant will enable the
closure of Thermal Power Plant Kosova A, which is one of the main pollutants in the Republic of
Kosovo. The TPP Kosova e Re projectwill be managedandledwhilerespectingKosovolawsand the
higheststandardsoftransparencyandcompetition. Throughoutitsdevelopment, the projecthas
suffered
a
numberofstructuralchanges,
basedoninvestors'
preferences.
Thesestructuralchangescame
as
a
resultof
the
aim
to
ensure
the
widestparticipationofinterestedinvestors,
in
order
to
usecompetition
to
providethatelectricitypricesresultingfromthisprojectare affordable for Kosovo citizens.The
Government of Kosovowillremainengaged in order to ensurethat the procedure
forselectionofinvestorsanddevelopersand
the
projectstructureencouragegreatercompetition,
which,
in
turn,
willprovidefor
the
mostaffordablepricesforenergygeneratedfromthisthermalpowerplant.
It is worth to mention that the Kosovo transmission system represents an important nod for
electricity transmission and interaction with other electricity systems of countries of the region,
as well as for electricity traders. To this end, the Government remains committed to attaining
certain functions from EnCT or EC, towards operationalization of the electricity market in
Kosovo.
21
VI.
SWOT Analysis
The SWOT analysis represents a useful instrument for the identification of external and internal
factorsinfluencing the overall development of the energy sector.
The following table represents internal factors (strengths and weaknesses) and external factors
(opportunities and threats). SWOT analysis is developed after a review of materials, studies and
exchange of ideas with experts and representatives of relevant institutions of the energy sector.
Strengths:
Weaknesses:
Degradation and de-investment in the energy
systems during 1990-1999, which has resulted in a
decline in generation and degradation of the
distribution network;
Current generation capacities are old;
High level of technical and commercial losses in the
distribution system;
Lack of access to manage the energy sector in the
northern part of Kosovo;
Limited access for self-financing of investments;
Delays in investments in modernizing and
developing generation and distribution capacities;
Irregular supply with electrical and thermal energy;
Low share of RES in electricity generation;
22
Opportunities:
Threats:
Unexpected increase in prices of liquid fuels
imported and unexpected interruption of supply with
imported oil products
Possible global financial crisis, with negative
impacts in foreign investments
Continued obstructions by Serbia in the energy
sector
Increased prices of electricity and increased demand
for imports, until the development of new
generation capacities
Lack of electricity available in the region
Non-functioning of open and competitive electricity
market in the region
Non-fulfillment of strategic objectives in the right
time, particularly in reference to sufficient capacities
for electricity supply.
23
VII.
If we analyze the energy consumption in previous energy balances of all sectors, we see that in
2011 the largest consumer of energy in Kosovo was the household sector, followed by the
transport and industry sectors.
The demand for final energy consumption in 2022 is expected to reach 1701.84 ktoe. Measures
for the rehabilitation and construction of the electricity system of and the construction of the
Power Plant Kosova e Re will have their impact on the energy demand in the industry,
services, agriculture and transport sectors, as well as in reducing the increased trend of electricity
demand in the household sector.
The industrial sector will have an intensive increase of electricity demand. An overview of
energy consumption in all sectors is shown in Table 5.
Table 5: Overview of the energy consumption forecast in ktoe for all sectors 15
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
Industry
356.20
376.20
389.37
398.19
398.87
399.93
410.89
420.75
431.71
442.37
Households
503.93
525.84
541.7
555.6
574.25
589.63
607.57
623.32
641.82
658.35
Services
114.51
120.88
125.74
130.54
136.66
142.03
148.11
153.59
159.20
163.95
21.18
21.98
23.18
23.77
24.51
25.16
25.89
26.56
27.29
28.02
342.36
349.21
356.19
363.31
370.58
377.99
385.55
393.26
401.13
409.15
1338.19
1394.12
1436.18
1471.40
1504.87
1534.74
1578.01
1617.48
1661.16
1701.84
Agriculture
Transportation
Total
15
24
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
Average
increase
HIGH SCENARIO
5421
5594
5725
5856
6053
6205
6546
6815
7077
7253
7489
7668
7892
8096
3.20%
BASIC SCENARIO
5421
5594
5725
5742
5821
5966
6176
6311
6552
6716
6934
7100
7307
7496
2.48%
LOW SCENARIO
5421
5594
5725
5720
5704
5757
5805
5932
6028
6179
6379
6532
6722
6897
1.71%
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
Average
growth
PEAK (BASE)
1072
1158
1150
1170
1220
1250
1283
1310
1340
1365
1390
1410
1452
1494
2.41%
PEAK (HIGH)
1072
1158
1150
1182
1244
1275
1321
1349
1394
1420
1446
1466
1539
1584
2.96%
PEAK (LOW)
1072
1158
1150
1158
1208
1238
1257
1284
1300
1324
1334
1354
1365
1404
1.84%
16
17
25
It is known that Kosovo has large capacities of lignite reserves in three locations. Exploitation of
this resource, based on studies, is easy and with low costs compared to other resources. Also,
based on information from the region, energy generation based in Kosovo has advantages over
generation possibilities of other sources in the region because of its low cost.
There is a good experience in exploitation and use of lignite for electricity generation. The price
of electricity is relatively affordable for consumers.
Construction of such capacities will meet the local demand and will ensure a security of supply
as a prerequisite to support the overall economic development of the country.
This option considers that power supply is mainly based on the lignite-based electricity
generation capacities, without excluding generation from RES:
Operation of three units A3, A4 and A5 of TPP Kosova A. These units will be revitalized
and their lifetime usability will be extended;
Operation of TPP Kosova B its revitalization shall be implemented for normal
operation of its units;
Construction of TPPKosovae Re and other new lignite-based capacities new capacities
will meet the local electricity demand and will export an amount of electricity in the
regional market. These capacities will fulfill all needs of security of power supply;
Existing HPPs and other RES. Their capacity shall be notably smaller compared to that of
lignite.
Implementation of this option also introduces other (positive + and negative -)impacts which are
listed below:
Environment protection, social impacts and diversification of energy sources restrict our
country's focus in this option. Hence, the implementation of this option will not be considered in
this Strategy.
Option II
Security of electricity supplyfrom local capacities and import
Kosovo is a signatory party to EnCT, and has committed to fully adhere to ENCT requirements
on the energy sector development, including the electricity sector.
Current capacities for electricity generation are mainly old, particularly TPP Kosova A, which
doesnt fulfill environment protection requirements. To revitalize this thermal power plant and
bring it in line with environmental requirements considerable finances, which Kosovo lacks, are
needed. Hence, it is forced to decommission this plant. As a result of the decommissioning of
this thermal power plant, there will be an electricity shortage. To fill this shortage, new
capacities must be constructed, specifically TPP Kosova e Re. In addition, necessary
revitalizations activities are needed to ensure normal operations in TPP Kosova B, and to also
extend its operational lifetime and meet environment requirements.
One share of electricity shall continue to be generated from existing HPPs, new HPPs and other
RES plants. It is not planned for these capacities to fulfill domestic increasing demand for
electricity, thus the electricity shortage shall be covered from imports. Therefore, Kosovo will
need to import electricity for its consumption purposes, to ensure secondary and tertiary reserves,
and to provide for security of supply.
The quantity of electricity to be imported shall be even greater if TPP Kosova A is
decommissioned prior to the commissioning of TPP Kosova e Re units. Consequently, imports
will be significantly higher if there are delays in the construction of TPP Kosova e Re.
The region has a shortage of electricity, and coupled with the increasing regional electricity
demand, this shortage shall only be higher. This will also have an impact in the prices of imports
(a price which is on average more than twice the amount of local generated electricity) and
without a security of power supply, which would have visible consequences in the country's
economic development and social wellbeing.
According to this option, the security of power supply shall be ensured through the following:
Implementation of this option entails other (positive + and negative -) impacts which are listed
below:
Imported energy doesnt cause additional pollution in Kosovo;
27
According to this analysis, security of supply under this option carries significant uncertainties
and high costs of electricity supply.
Option III
Operation of TPP Kosova A, until the entry into operation of TPP Kosova e Re units;
Operation of TPP Kosova B its overhaul shall be conducted for ensuring normal
operation of its units;
28
Security of supply;
Diminished need for the development of reserve energy capacities;
Lower supply price;
Balancing of the electricity system;
Respecting environmental norms;
Development of the electricity market;
Higher regional cooperation.
Based on studies and analyses performed, this is considered to be the best option from the
security of electricity supply perspective. This option provides for optimal and efficient
utilization of energy sources, balancing reserves and transmission grid, while providing
appropriate conditions for electricity supply, lower costs of supply, and increasing the reliability
and efficiency of operational reserves. This option will be used as the basic option of this
strategy regarding electricity supply.
29
Three options are addressed in reviewing the security of supply. The best option, which will
meet all requirements in terms of security of supply and with the lowest cost of supply, is option
three, namely the option envisaging the coverage of the electricity supply through domestic
capacities.
Building capacities for electricity generation will be done mainly by private investment and in
certain cases the through Public and Private Partnerships (PPP).
Measures to be undertaken
Maintenance and normal operation of the existing generation capacities
Transmission system development should aim to preserve system security and sustainability, as
required by ENTSO/E, and to provide for a non-discriminatory market in the country and in the
region.
Funding of development projects of the transmission system will be provided by KOSTT's own
budget, through concessional loans (with low interest rates), and through contributions of
generators and industrial loads based on the connection charges methodology; or by potential
donors.
Measures to be undertaken
Continuous development of the network infrastructure and transmission system operation
in line with technical requirements as per the Grid Code and ENTSO/E Manual;
Regional cooperation;
Creation of a common regulatory zone of transmission systems between Kosovo and
Albania.
Signing of agreements with neighboring countries in line with developments and requests
for cooperation.
Continued modernization of support services of the transmission system operation (relay
protection, control/command);
Optimization of transmission system maintenance.
Development of the distribution network
Further upgrading and new investments are necessary in the distribution network to reduce
losses, increase distribution capacities, and improve the quality of supply to end-consumers.
Investments by the private company will improve the security and reliability of the distribution
system, and will help to reduce technical losses and improve the quality of services and
reliability.
KEDSmust increase the number of points of supply, and strengthen all outgoing lines
to110/35kV and 35/10kV substationsand interconnection lines. In addition, network
configuration is required, as well as the configuration of the network, supplier/distribution lines
and transformer stations.
In cooperation with KOSTT, KEDS will decide on new points of supply for 110/10(20)kV, and
shall define the transfer from current voltage level of operation 35 and 10kV to 20kV, and to
develop the medium and low voltage network and implement new technologies for monitoring
and control of network operation, including efficient control of electricity consumption by
consumers.
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Measures to be undertaken
Necessary rehabilitations, strengthening and modernization of the network with the aim
of eliminating bottlenecks, reduction of technical losses and improvement of the security
of supply and quality of electricity for our end-consumers;
To define further needs for new substations and transfers from 20 kV to 10 and 35 kV;
To create conditions for connection in the distribution system of energy generation
capacities, based on renewable sources;
As requested by ERO, the new KEDS Company must draft a five-year action plan for the
reduction of technical and commercial losses, and for increased billing and collection to a
satisfactory and acceptable level.
Objective I.2.Security of thermal energy for heating
Use of thermal energy for heating is of special significance, due to the high participation and
impact it has in the country's energy balance, as well as its impact on national and municipal
budgets due to required subsidies for electricity and district heating purposes. The use of
electricity for heating purposes represents a great burden for electricity supply, therefore, the
development of district heating systems and improvement of the performance of existing district
heating facilities aims to diminish use of electricity for heating purposes.
For the implementation of measures for thermal energy, private, public investments and grants,
and co-financing are envisaged.
Measures to be undertaken
Reduction of electricity for heating, encouraging the development of district heating
systems;
Promotion and development of cogeneration of thermal energy and electricity in all
plants, where possible, including industrial;
Decrease of commercial losses and increased financial sustainability of existing district
heating enterprises;
Encourage the use excess (unused) thermal energy from the industrial sector;
Creating conditions for the use of alternative sources and RES for heating, with a positive
impact in the environment and sustainable development of the sector;
Encourage the use of efficient heating equipment, and increase thermal performance in
buildings.
Objective I.3.Development of the natural gas infrastructure
Government policy is to promote and support the inclusion of Kosovo in regional projects of gas
supply, such as Eastern Europe Ring Project.
To this end, depending on the development of regional gas projects in Eastern Europe under the
EnCT, the Government remains committed, throughout this period until finalization of regional
projects, to develop the legal and institutional infrastructure for the development of the gas with
private investments.
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The implementation of the following measures requires no large additional investments, unless
the development of gas infrastructure in Kosovo is initiated. These investments should be made
by private investors.
Measures to be undertaken
Cogeneration and active participation in regional gasification initiatives;
Promotion and support for regional gas pipeline projects Energy Community Gas
Ring;
Close follow-up of Projects of Energy Community Interest (PECI);
Development of necessary activities to EnCTKosovo with the gas TAP gaspipeline
Completion of the legal and regulatory framework for the gas sector in line with the
Acquiscommunautaire of SEE EnCT;
Creation ofinstitutional and legal mechanisms for the establishment of a gas transmission
system and distributor operator.
Objective I.4.Establishment of the obligatory petroleum reserve
This strategy also aims the establishment of obligatory petroleum reserves, in order to ensure
sufficient and sustainable supply of petroleum products, without being subject to extreme price
fluctuations in the local market. To this end, measures will be undertaken to prepare a long-term
approach to fuel reserve establishment, in line with the relevant EU Directives. MED will also
support MTI in implementing measures for the establishment of obligatory petroleum reserves,
in line with the relevant EU Directive.
This activity envisages the establishment of a respective mechanism within the Ministry of Trade
and Industry for the establishment and management of obligatory petroleum product reserves.
Measures to be undertaken
Preparationoflegislationforobligatoryreservesof petroleum products;
Preparation of the strategy on the establishment and management of obligatory reserves
of petroleum products;
Preparation of the national emergency action plan with obligatory on petroleum product
reserves;
Objective I.5. Promotionofrenewableenergysources
For the promotion of Renewable Energy Sources in the next decade, the goal of the Strategy is
the development of the necessary legal, regulatory and program infrastructure, which will enable
the fulfillment of the mandatory target of 25% RES share in the final gross consumption of
energy by 2020. Also, under this objective, the aim is to fulfill the higher nonbinding target of
29.47% RES by 2020, according to AI on RES targets. To achieve this goal, among other
measures, a simplification of authorization procedures for RES will be introduced, continuous
promotional media campaigns will be organized, and the basis for any calculation will be the
affordability of increased tariffs as a consequence of use of RES for electricity generation.
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Private investment and grants are planned to cover the implementation of measures related to
RES.
Measures to be undertaken
Completion of the relevant legislation to encourage RES investments;
Drafting and implementing the Kosovo RES action plan;
Defining RES targets;
Complete the definition of feed-in tariffs or other support schemes for all RES,
according to set targets.
Simplification of authorization procedures for the construction of energy capacities from
RES.
Objective I.6.Increasing energy efficiency
Increased Energy Efficiency will contribute to significant savings in overall energy consumption
in the Republic of Kosovo, and therefore the security of energy supply to the citizens of Kosovo.
In KEEAP 2010-2018, Kosovo has committed to meeting the savings target of 9% of overall
energy consumption, as set by the EU Directive. Therefore, Kosovo, through the implementation
of EE measures, will realize a saving of 91.89 ktoe, respectively 1068.68 GWhfor energy.
Increased EE requires investment by the private and public sector, and public donations.In order
for this to happen at a great scale, additional studies are necessary, which will show what
measures should be taken, what instruments and mechanisms should be used, including analysis
of the financial implications, to achieve satisfactory results in the field of energy efficiency.
Measures to be undertaken
Functioning of KEEA, with relevant staffing, in line with the Internal Regulation on
KEEA Organization;
Establishment of Municipal Energy Offices (MEO), which will enable the drafting of
municipal energy efficiency measures plans;
Promotion of EE measures through information and awareness-raising campaign;
Construction ofa monitoring system and verification of implementation measures,
according to Kosovos EE plans;
Creation of transparent institutional conditions for the establishment of a EE fund and to
attract domestic and international investments.
Auditing of public and private buildings (non-obligatory audits), by using green
loans/subsidies, obligatory audits for the industry, and measures for increasing efficiency
in the public and private transport sector.
The implementation of EE measures in SMEs, households, services, industry, transport
and agriculture.
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Objective I.7. Review and amendments to the primary and secondary legislation
Kosovo is engaged and committed to further develop primary and secondary legislation on
energy, amending it according to the Third EU Legislation Package.
Measures to be undertaken
Harmonization of primary and secondary legislation according to third energy directives
package.
consumers of both countries by enabling efficiency, lower prices of electricity supply and better
social welfare for both countries.
Measures to be undertaken
Establishment of a common electricity market with Albania;
Opening the electricity market for all consumers:
Creation of conditions conducive for the entry of new electricity suppliers;
Creation and facilitation of conditions for the entry of new generators, including
from RES.
Creation of conditions for cooperation in the regional market.
Objective II.3.Common Kosovo-Albania market
Kosovo and Albania are characterized as countries with small electricity markets, lack of variety
of generation capacities, insufficiently developed electricity industries (old assets, lack of
investments), lack of sufficient generation capacities to cover electricity consumption
requirements, dependency from electricity imports from regional non-liquid and non-transparent
markets, and high non-technical losses in the distribution grid.
Both countries lack generation capacities to ensure a safe and reliable electricity supply
throughout the year. For this reason, in certain periods, balancing between consumption and
generation is performed through disconnection of supply for certain consumers. Generation
capacities in Kosovo comprise non-flexible thermal generators (98% in lignite-fired thermal
power plants), which are not a preferred option for covering variable electricity loads. Kosovo
lacks reserve capacities for balancing purposes, respectively for secondary and tertiary regulation
in the electricity system, whereas renewable energy sources are limited and there is no natural
gas pipeline which could be used for import purposes. In Albania, 95% of the electricity is
generated from hydro power plants and reliability of electricity supply is closely related to
precipitation and drought prevalent in different periods of the year.
From the electricity market aspect, both countries are dependent on electricity imports.
Electricity supply companies have long-term supply contracts with state-owned generation
companies. The wholesale market in both countries is dominated by state-owned electricity
generation enterprises and with small competition in the cross-state market, which is dependent
on availability of interconnection capacities and on appropriate conduct of the congestion
management process.
Bearing in mind that the main purpose of both governments is security of supply, and
considering the characteristics of both systems noted above, the establishment of a competitive
and functional market comprises a challenge for both countries, the materialization of which
would send positive signals for investments in the transmission system. Characteristics of
Kosovo and Albania markets suggest that a common market would provide for optimal and
efficient utilization of energy generation sources, balance reserves and transmission grids, would
provide better electricity supply conditions and thus be beneficial for consumers of both
countries. Noteworthy, bearing in mind current capacities, a common market would result in
lower costs for both separate markets.
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The establishment of a common functional market requires great work in harmonizing the legal,
regulatory, trading and operational frameworks of Kosovo and Albania. The establishment of the
common market as a sole trade area for all organizational timelines shall be in harmony with
EC's target model, which also represents an objective of the Energy Community. In the process
of merging the markets with the wider regional market, a common Kosovo-Albania market
would join other trade zones as a sole trade zone in the day-ahead market and in the intraday
market. Cross-boundary capacities of this area would be allocated along with those from other
areas, in harmony with the Forward Network Code, currently being developed by ENTSO-E.
The common market will result in decreased requirements for installation of generation
capacities, as the peak demand in the common market would be significantly lower than the sum
of peaks in both markets separately. The common market will increase reliability and ensure
more efficient use of operational reserves.
Measures to be implemented
Execution of the Memorandum of Understanding between the Governments of Kosovo and
Albania on the establishment of the common market;
Implementation of a feasibility study on the establishment of a common market;
Determination of forms on organization and functioning of:
o Bilateral market
o Day ahead market and power exchange
o Balancing market and ancillary services
Signature of the intergovernmental agreement on the establishment of the common market,
in line with recommendations from the feasibility study;
Establishment of a task force of transmission system and market operators and regulatory
authorities of both countries for the preparation of the legal and regulatory framework that
would enable the establishment of a common electricity market, or the establishment of an
interim entity to oversee full implementation of the common electricity market, with a clear
mandate granted by both governments. The main tasks of this group would be:
o Harmonization of the legal framework in both countries in order to provide for the
establishment of a common market;
o Identification of options and proposal of the regulatory structure of the common market;
o Proposal of the common market design and Market Rules.
Preparation of the implementation plan for the establishment of a common market;
Approval of the implementation plan by governments of both countries;
Establishment of a Common Market Operator for electricity market operation.
Objective II.4 Tariff reforms
Tariff reforms should be made in terms of creating an enabling environment for investments in
the energy sector, but in a balanced manner so as not to be an unbearable burden for consumers.
Under this activity, measures should be undertaken by the Government as well as ERO.
Measures to be undertaken
Review ofelectricity and thermal energy-related tax policies;
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IX.
The implementation of the Strategy requires the drafting of an Implementation Program of the
Energy Strategy for the period 2013-2016. This program shall include all necessary mechanisms
for MED to detail polices, allocate duties, undertake specific actions, and monitor the progress of
the implementation of the Energy Strategy.
Implementation Program shall group activities under each pillar/objective, indicating the time of
implementation, responsible and supporting institution for the implementation of the activity,
cost of implementation of the activity, and the general cost estimated of the period, and source of
financing.
Monitoring of the implementation of the program shall be conducted by MED, through the
preparation of regular annual reports.
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