Albania, World Bank sign $150 mln electricity deal

The government had to buy back the power distributor from Czech utility company CEZ in June for 100 million euros ($124.9 million), four years after its sale, following a dispute over prices.

Fully reliant on hydropower, Albania’s electricity sector is beset by debts due to theft, low collection rates, non-payment, corruption and expensive imports, which became indispensable last year during a drought, putting strains on the state budget.

“We aim to turn a sector weighed down by debt … into a financially stable one starting in 2018,” Energy Minister Damian Gjiknuri said on Monday.

Parallel to the World Bank loan, the Albanian government and other parties will provide more than $125 million for infrastructure projects through 2020 that will support the power sector.

About $95 million of the World Bank package will be used to supply new metres for 300,000 consumers, out of the country’s 1.1 million retail consumers in total, and boost the capacity of transformers in the Tirana area, where about one third of Albanians live.

Other investments will include 2,600 kilometres of cables for low and high voltage and a modern billing system to cover 50 percent of consumers.

(Reporting By Benet Koleka)