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news 02 Nov 16

World Bank Still Mulling Support for Kosovo Power Plant

While Kosovo officials claim the World Bank has pledged to support construction of the new Kosova e Re power plant, the bank has told BIRN no such decision has been made.

Die Morina
"Kosova e Re" Power Plant project | Photo: Ministry of Economic Development of Kosovo

A year after Kosovo government announced it had reached an agreement with the World Bank and the US company Contour Global to build a new power plant, the bank is still far from committing itself to the project.

“The World Bank will make a decision whether to support the Kosovo Power Project only when all relevant environmental, social, and technical analyses have been conducted, consultations have been held with the public, and the Bank’s Board and its shareholders have given the project their due consideration,” the bank told BIRN.

The bank further wrote that it is committed to helping Kosovo resolve its energy shortages through a comprehensive strategy that includes increased energy efficiency, development of renewable energy, Kosovo's integration into regional power markets, and supporting new power generation that is both reliable and affordable for citizens.

The government announced in November 2015 that it had reached an agreement with the US-based company Contour Global to build the Kosova e Re [New Kosovo] power plant.

It earlier said that Contour Global had proposed to invest a third of the cash needed for the project, estimated at 1.4 billion euros, while the rest would come from international financial institutions and other lenders.

The role of the World Bank in the agreement was related to a loan, but it remains unclear how much the bank was expected to invest.

Blerand Stavileci, Kosovo's Minister for Economic Development, told BIRN that Kosovo had secured the bank’s support and that the final agreements would be signed within a month, while construction work would start next year.

“With their excellent cooperation, we have managed to obtain a positive answer in terms of support [from the bank] for this project,” Stavileci said, adding that Kosovo has been careful in examining the relevant social and environmental issues in order to ensure the support of all stakeholders involved in the process.

However, Contour Global told BIRN that many issues need to be clarified before the agreements are signed. “We are working diligently in concluding the agreements," it wrote to BIRN.

“In this scale of projects, there are many issues that need to be clarified and determined. This in addition, will ensure the successful implementation of the project,” Contour Global added.

Currently Kosovo has two power plants, Kosovo A, built in 1962, and Kosovo B, built in 1984. The age of the plants and poor maintenance have led to power shortages affecting the health and welfare of many people living near them, as well as users of the power they generate.

The government wants to construct two new plants in total, each generating 300 MW, and the price of each is expected to reach up to 1.4 billion euros.

The Kosovo Civil Society Consortium for Sustainable Development, KOSID, an NGO, has accused the government of lack of transparency over this project, complaining of a lack of information.

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