Kosova e Re

Kosova e Re, also known as the New Kosovo project, is a plan of the Government of the Republic of Kosovo to build a new 500 MW power plant near Prishtina, to rehabilitate the existing Kosovo B power plant and completely shut down the Kosovo A power plant which is considered the largest source of pollution in Kosovo. It also includes the development of a new lignite mine in order to meet the needs of the Kosovo B and the newly constructed power plant.[1] It is estimated to cost US$2 billion.[2]

The government has identified the need for additional generation capacities to address long-term concerns about the country's power supply security.[3] Government policy goals, also presented in all Kosovo Energy Strategies, apart from the plans for new generation electricity capacities, also aim at involving the private sector in the Kosova e Re Power Plant (KRPP) infrastructure project. It includes development, design, construction, financing, ownership, maintenance and operation in accordance with IED Best Available Techniques (BAT).

The Kosova e Re Power Plant will provide the country with reliable power supply, the bedrock of future investments that will foster economic development in Kosovo. The construction of the plant will create opportunities for new jobs, as well as long-term employment upon the start of plant operations. The mission of the new unit is to replace the old generation units of the Kosovo A TPP and increase the security of supply, by creating a sustainable source of basic energy. Reliance on domestic resources, such as lignite and renewable energy sources (RES), avoids dependence on imports and price unpredictability on the regional market.

The KRPP will be a key asset in strategic terms, as it will cover almost half the power demand in the country, and will be the long-term source of thermal energy for municipal heating in the surrounding municipalities.

In 2015, the Government of Kosovo awarded ContourGlobal (CG) the status of the preferred provider for the development of the KRPP. The Government of Kosovo and ContourGlobal signed the Commercial Agreements for the construction of the Kosova e Re Power Plant in December 2017. CG is a US-based company specializing in securing and developing long-term energy production for different types of electricity generation and geographic locations.

The KRPP will be built in line with the EU Directive on Environmental Standards for Industrial Emissions and 2017 BATs, with a minimum of 40% efficiency with super-critical technology. The KRPP will be built with full financing from private investments. However, according to the signed Agreements, this power plant will be transferred to the Government of Kosovo after 20 years, at no cost.

The KRPP will simultaneously address the solution of a range of energy sector issues, but also wider issues for the country, such as the security of power supply, the direct impact on sustainability and economic development, as well as the significant improvement of social and environmental aspects.

In 2020, ContourGlobal withdrew from the project and it appears likely that the new power station will not now be built.[4]

History

Plans to address Kosovo's energy situation began in the early 2000s and originally envisioned a 2,000-MW lignite plant that would allow the country to export energy to its neighbours. The government presented the plan in July 2009 and it suggested that all work would be finished by 2015 or at least by 2017.[5] However, the works have not started, mainly because of the opposition from non-governmental organizations.[6] Over the years political and investment setbacks have caused the project to cut down in size.[7]

Financing

To attract investors whom are concerned about political or credit risks, the World Bank offered US$60 million in loan guarantees that would set in if the government failed to meet obligations such as supplying coal or electricity. This means that the World Bank, as well as the biggest shareholder - the United States of America, will need to make an exception in their clean-energy commitments.[1] On the 15th of January 2013, representatives of the European Bank for Reconstruction and Development (EBRD) met with Prime Minister Hashim Thaçi, expressing their interest to support the New Kosovo project.[8] However, on December the 10th 2013 the EBRD employed a new strategy which decreased funding for the coal plants, with exception of rare circumstances.[9] If Kosova e Re will meet the criteria of a "rare curcumstance" remains to be seen.

Supporters

Kosovo’s low GDP per capita of US$3,894 makes it one of Europe’s poorest countries. A major obstacle for the economic growth and development of Kosovo is the inadequate and unreliable electricity supply.[10] The country has the world's fifth-largest reserves of lignite which could, with the current consumption levels, supply the country for another 1500 years.[11] Supporters of the project (at the forefront being the World Bank and the U.S. government) see lignite exploitation as the quickest way out of poverty[1] and a way to procure Kosovo’s energy independence and consequently its energy security.

There are also those who support Kosova e Re from the environmental stand point. In the report of Kosova e Re by the Expert Panel of the World Bank, reviewed that the project discovered that particulate matter emissions produced by Kosova e Re would be reduced by more than 90%, Sulfur oxide and nitrogen oxide reduced by around 70% and would be carbon neutral, if not carbon reducing, for each MWh produced.[10] Kjorton Bjornson from the European Commission in July 2009 expressed support for the construction of the new power plant with the view to shut down Kosovo A plant.[5] However, the European Parliament resolution on the integration process of Kosovo into the EU stated that the financial aid provided by the EU should be devoted to supporting renewable energy projects to close down its two highly polluting coal plants.[12] It calls on the European Commission to take action to contest plans such as Kosova e Re that run counter to EU climate commitments.[13]

Opposition

Certain groups and organisations are of the view that the new power plant would mean the continuation of traditional coal-based electricity production. Today Kosovo wastes 30% of available energy due to energy efficiency, 37% due to technical losses, the outdated electrical grid and other commercial losses, such as theft. A study by Dr. Daniel Kammen shows that "Kosovo can cover 38% of its energy consumption from renewable sources". He also specified that this scenario, without including the Kosova e Re power plant, would create 27% more jobs than current scenarios.[14] Energy Community commitments cite that Kosovo needs to source 25% of overall energy from renewable sources by 2020, which will be harder to achieve if the new power plant is to be constructed. The Kosovo Civil Society Consortium for Sustainable Development (KOSID) are questioning the necessity of the costly power plant and instead propose energy efficiency programmes, which tackle of energy losses, renewable energy development and the rehabilitation of the existing Kosovo B Power Station. They also raise the issue of the environmental and social impacts the new project would have on Kosovars. There are 835 deaths per year in Kosovo due to air pollution, of which the lignite power plants are responsible for a substantial proportion. A new power station could make matters worse. KOSID also stressed the issue of water and agricultural land shortage and the resettlement of the local population which consists mostly of farmers who will need compensation for the lost land and livelihoods[15]

References
  1. Rastello, Sandrine. Coal-Fired Plant in Kosovo Tests World Bank Clean-Air Pledge. Bloomberg, June 2, 2014. Retrieved on 2014-16-06.
  2. Kosova e Re lignite power plant, Kosovo. CEE Bankwatch. Retrieved on 2014-16-06.
  3. "Kosova e Re Introduction". Ministria e Zhvillimit Ekonomik. (Ministry of Economic Development). Retrieved 7 June 2018.
  4. Pippa Gallop (17 March 2020). "ContourGlobal finally quits Kosova e Re coal plant". Bankwatch Network. Retrieved 24 May 2020.
  5. Government decides to build the new Kosovo power plant. New Kosova report, July 16, 2009. Retrieved on 2014-16-06. Archived July 14, 2014, at the Wayback Machine
  6. Kosova e Re lignite power plant, Kosovo. KOSID. Retrieved on 2014-16-06.
  7. Friedman, Lisa. U.S. on Both Sides of New Battle Over Assistance to 'Ugly' Coal-Fired Power Plant. The New York Times, January 15, 2013. Retrieved on 2014-16-06.
  8. Prime Minister Thaçi received in a meeting senior representatives of the European Bank for Reconstruction and Development (EBRD). The office of the Prime minister of the Republic of Kosovo, June 17, 2014. Retrieved on 2014-16-06.
  9. Smith, Tierney. European development bank turns its back on dirty coal. The Global Call for Climate Action, December 10, 2013. Retrieved on 2014-16-06. Archived July 14, 2014, at the Wayback Machine
  10. Expert Panel Finalizes its Review of the Kosovo Power Project. The World Bank, February 1, 2012. Retrieved on 2014-16-06.
  11. Salem, Harriet. Kosovo pays a heavy toll for lack of reliable energy. The Guardian, November 19, 2013. Retrieved on 2014-16-06.
  12. European Parliament resolution of 6 June 2013 on the European integration process of Kosovo. Retrieved on 2014-16-06.
  13. European Parliament wants green energy, not coal, as part of Kosovo integration. CEE Bankwatch, April 19, 2013. Retrieved on 2014-16-06.
  14. An Independent Study Challenges Energy Policy in Kosovo. The Institute for Development Policy. Published 02/02/2012. Retrieved 13/07/2014.
  15. Kosova e Re lignite power plant, Kosovo Kosovo Civil Society Consortium for Sustainable Development. Retrieved 13/07/2014.
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