The general purpose of the Regulatory
Statement, approved in Albania firstly by the decision no 12, dated 03.03.2009
of the Board of Commissioners of ERE, was to make possible the calculation of
tariffs of publicly owned generation, wholesale supply, distribution and retail
supply in accordance with the relevant tariff methodologies approved by the
ERE. In regard of regulatory periods, ERE decided that the ones from January 1,
2009 to December 31, 2009 is to be consider as a transitory period, during
which, there will be no change of current tariffs, as defined in the decisions
No 21, dated on February 14, 2008. This will enable the investor to evaluate
the situation within Electricity Distribution Operator (OSSH) and prepare the
application for review of new electricity tariffs not later than September 30,
2009, which will be effective on January 1, 2010.

Then, the first effective regulatory period
started by 1 January 31, and the second goes from 1 January to 31 to December
2011 and the third 1 January 2012 to 31 December 2014. The following regulatory
periods have to be by 3 to 5 years term. According to the above Tariff
Schedule, until June 30, 2014, the ERE have had to approve a Regulatory
Statement for the regulatory periods following 2014. For the avoidance of
doubt, the new Regulatory Statement shall continue to include the Compensation
Mechanism.

Due to the prolong dispute, with the Cez
Company, Albanian Power Regulator postponed the date of the determination of
new tariff of electricity by 1 January. Then on 26 December 2014, ERE-s Board
of Commissioners, after reviewing the application of OSHEE to determine the
electricity distribution tariff of the distribution system users for 2015 and
the report prepared by Prices and Tariffs Directory, decided, with starting
from 1 January 2015 the electricity retail sale prices for tariff customers will
be 9.5 Lek/kWh. The previous paying scheme predicted that householders who
consumed less than 300 kWh of electricity paid 7.7 Lek/kWh and 13.5 Lek/kWh.

The rates went up for business consumers
where the price was determine based on the level of connection, rather than
consumption. In regards to business users tariff, ERE announced that businesses
that use 35kV electricity will pay 9.5 Lek/kWh, businesses that use 20, 10, and
6 kV electricity will pay 11 Lek/kWh (except bakeries – 7.1 Lek/kWh) and those
using 0.4 kV electricity will pay Lek/kWh (except bakeries – 7.1 Lek/kWh).

ERE-s Board of Commissioners, on its
meeting, decided also that the tariff of electricity distribution service for
the distribution system users, with enters into force on 01.01.2015, in the
voltage level of 35 kV will be 1.5 Lek/kWh and the electricity distribution
service average tariff for the distribution system users from January 1, 2015
will be 4.79 Lek/kWh and the transmission tariff of electricity for TSO in
2015, will be 0.65 Lek/kWh.

In more, the electricity tariff for
wholesale public supplier in 2015 will be 3.0 Lek/kWh. The ancillary services tariff
for 2015 of KESH Company will be 158 Lek/kWh. Regard the application of Albanian
Power Corporation (KESH) to determine the electricity generation tariff for
2015 decided electricity generation tariff will be 1.45 lek/kWh. After
reviewing the report submitted to determine the price to sell electricity for
the licensees that generate electricity from new and existing hydro power
plants with installed capacity up to 15 MW, for the years 2013 and 2014,
decided, the unique price of selling electricity for the licensees will
respectively be 9.73 lek/kWh, 7.95 lek/kWh and 7.53 lek/kWh. KESH company shall
afford the financial effects of this decision.

This review come necessary due to the fact the MEI has issued 164
concession meant to build around 500 small, mid-size and big hydropower plants.
Some of the new utilities are already connected to the grid, while others are
in the construction phase. As a result, private production reached 0.916 TWh last
year and is expected to grow even more along 2015. Then the government see
necessary a more realistic formula for the purchase price of electricity
produced by a hydropower plant built through a a concessionary agreements. “The
new formula based on the average price of the Hungarian electricity exchange
(HUPX) plus a bonus of 10%.

Some of Albanian industry representatives argued the rise of power
prices for business consumers is wrong and will affect national economy in a
long run. In my opinion restructuring of the energy fee without making it burden
to until now subsidise consumer is rather hard job, but taking it to fair
parameters is above all a contribution to the future, a contribution to
investments in the energy system and energy security. Moreover, the reform
implementation was necessary in order to take a 150 ml USD loan from World
Bank. In more, it get a hand to KESH with the start by the last days of
December 2014 to liquidated an amount of 11 ml USD to small electrical energy
plants.

The
here communication came within the framework of
the report on liberalisation and organised market in Albania, to be release in
the shortly upcoming period by ACERC. In cases of interest to the directly
cooperation as author with analyses or for any kind of involvement or support
as well as a partner, contact us at the info@albaniaenergy.org. For more keep
update with the EU & WBs / Albania Energy Investments Updates
or visit the Official
Page of ACERC
.