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Albania has accused the power giant, CEZ, of causing a loss of $1 billion (€760 million) as a result of its poor management of a local electricity distribution branch.
“CEZ a.s. has failed to fulfill its main obligations, as specified in the privatization contract... damaging Albania to the level of $1 billion,” the Economy Ministry said in a statement on Wednesday.
CEZ Shperndarje, the local subsidiary of the Czech electricity company, has been locked in rows over debts with Albania’s state-owned electricity producer, KESH, and with other public enterprises.
CEZ claims that public institutions and companies owe it more than €165 million in unpaid electricity bills, which it says has brought the company to his knees.
In return, CEZ has stopped making payments to KESH for more than a year. According to KESH, CEZ owes the electricity producer more than €208 million.
CEZ is now looking to opt out of its investment in CEZ Shperndarje, which it bought for €102 million. The company says it has faced a substandard business environment in Albania.
However, Albania's government blames CEZ for the situation, arguing that the company failed to invest and cut theft of electricity, as it had promised to, during the privatization process.
“Losses [in the grid] have reached 50 per cent for 2012, while, under CEZ Distribution's contractual obligations, this level [should] be no more than 24 per cent,” the ministry said.
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