After a series of reports that considered the overall performance of the energy sector recovery project to be moderately unsatisfactory, the World Bank, which is also funding it, has revised the assessment. In a recent report the bank notes that the overall project performance is now moderately satisfactory, well above a previous estimate as overall project risk remains high.
“Implementation of the project has accelerated since mid-year review. It is contributing to the reduction of electricity losses in Albania by increasing the reliability of the medium voltage network in Tirana area as measured by the utilization of substation capacities in percentage. Based on the latest status the project implementation rating has been revised upward to moderately satisfactory. The restructuring of the project, which includes an extension of one year, is ongoing, ”says the WB assessment.
The same report underlines that the financial sustainability of the energy sector presents challenges.
“While progress has been made over the last three years by establishing the Albanian Electricity Corporation and Transmission System Operator a relatively stable financial framework, the Electricity Distribution Operator continues to face a financial gap especially in the dry years 2017 and 2019. A Financial Recovery Plan adopted by the Council of Ministers in April 2019 enables orientation on key financial drivers that can help improve Electric Energy Distribution Operator’s financial conditions, especially with a loss reduction trajectory for 2018-2021 and a prioritizing investment with a focus on reducing losses”, underlines WB.
The country’s Energy Sector Recovery Project kicked off in 2015 after approving a 150m-Euro loan granted by the World Bank. The project was expected to end on November 30 this year but now the WB and the government are negotiating the one-year extension.