Albania Energy Profile 2012

Albania's mineral wealth is substantial, and mining operations have expanded considerably since 1950. Albania is one of the world's largest producers of chromium ore. Chromium ore and nickel and copper ores are the nation's chief exports. Petroleum, natural gas, and coal are also produced. The use and export of hydroelectric power has expanded substantially since 1980.

1.  Overview of Electricity Supply

Albania has historically experienced an abnormally high growth rate of electrical consumption.  A large part of that growth has been artificially stimulated by extraordinarily high rates of electricity theft, nonpayment of electric bills and tariff rates well below cost.  Consumers have failed to conserve electricity or to make adequate use of alternative fuels for the past decade.  The artificially high electricity consumption, particularly for electric space heating, has diverted a valuable resource away from commercial and industrial uses that would otherwise create jobs and contribute to economic growth. 

Looking beyond Albania’s energy economy, around ninety-five percent of Albania’s electricity is produced from hydroelectric plants that are badly affected by droughts.  Since the early 1990’s the energy demand has risen fourfold; on average, each year consumption increases by approximately 3.3 percent.  However, droughts from 2000 to 2002 and from late 2006 to 2007 have caused the electricity output to decrease by 41 percent (TheRegion, 2006).   The figure below illustrates the electricity outages in hours per day and GWh/day.

Electricity Outages from 2002 - 2007

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The supply deficit in Albania has attributed to a social and economic crisis.  Albania’s capacity to import electricity is constrained by a transmission system in dire need of rehabilitation and upgrades to expand its capacity.  The distribution system encounters many technical and “non-technical” losses.  (“Non-technical” losses include electricity that is stolen from the grid.)  In 2007, the total losses were estimated as 35 percent.  Prompted by this energy crisis, in November 2007, the Prime Minister of Albania, Sali Berisha, said the government will support any project that will contribute to the diversification of the energy supply.

The table below provides country summary information about Albania.

Albania Country Summary Table

 The map below displays Albania's transmission system.

Albanian Electrical System

The law stipulates that electricity tariffs should be determined in a transparent and non-discriminatory manner as well as reasonable in accordance with recognized ratemaking principles.  Electricity costs shall be collected in proportion to the cost of serving each customer.  In the past, the tariff methodology favored the residential customers, so restructuring the methodology may put low-income families in a difficult position.  The government plans to subsidize 270,000 vulnerable indentified families and hopes the restructuring will help Albania’s industries and businesses thrive. 

The National Strategy of Energy and Plan of Action, updated April 2005:

This strategy and action plan analyzes and includes the changes necessary to increase the security of the energy supply and the optimization of the energy resources to meet energy demand and achieve sustainable economic development.  Its objectives include

·          Increasing the security and reliability of the energy supply on regional and national levels.

·          Establishing an energy sector that is financially and technically efficient.

·          Establishing an institutional and regulatory framework and restructuring energy companies.

·          Increasing energy efficiency in generation and final use of energy sources with minimal environmental impact.

·          Optimizing the energy supply system based on the least cost planning principle with environmental concerns in mind.

·          Increasing investments in energy sector through capital enhancements provided by International Financial Institution and private lenders.

·          Establishing a competitive electricity market according to EU requirements for the electricity sector reforms.  Also, supporting obligations under the Athens Memorandum to support the energy sector integration into the Southeast Europe Regional Electricity Market and the Union for the Co-ordination of Transmission of Electricity.

As of April 30, 2009, an updated Energy Strategy for Albania has been prepared and is under procedures for approval.

On April 27, 2005 the Albanian Parliament passed an Energy Efficiency Law that:

·          Creates the legal framework required for the promotion and improvement of the efficient use of energy, in whole its energy cycle.

·          Establishes the economical use of energy sources, the establishment of more reliable energy supply conditions, as well as the minimization of impact on the environment.

·          Establishes an Energy Efficiency Fund and Financing of the Fund.

·          Delegates the National Agency of Energy to administer the fund that seeks to implement the increase of energy efficiency and renewable energy systems in all regions.

·          Delegates the Minister to approve the implementation of energy efficiency and renewable energy system programs prepared by the National Agency of Energy.

·          Carries out energy efficiency and renewable energy awareness campaign

The new law on concessions defines the legal basics for private sector participation in public services and infrastructure.  The law specifically includes an energy sector section.  (Law no. 9663, dated 18.12.2006).

Additional energy policy, barriers and incentives include:

·          Energy – Investing in Modernization of the Electricity Sector

·          Energy – Adding new generation to lessen the dependence on hydroelectric

·          Energy – Ensuring energy self-sufficiency

·          All renewables – Difficult economic conditions

·          All renewables – Low electricity prices

·          Hydroelectric – Renovating Existing Capacity

3. Wind

There are no operational wind energy power plants in Albania.  However, Albania does have developable wind potential.  The most promising sites are located along the Adrian coast, as well as the hills and ridges running in the north to south direction along the coast.  The Electricity Regulatory Authority has licensed several companies to develop this potential.  The Terpani Mountain area near the southern city of Berat is also an area that is planned for the development of wind energy.

In Albania, there are some old wind mills still used for grinding wheat or other grains, as well as water pumping. The total number of such turbines and the current operating conditions are unknown. There are a number of opportunities for the installation of large wind facilities.  Additionally, there is the potential for small wind power facilities in the remote zones, where the cost to deliver the fuel for electricity and heat supply is expensive. 

Albania Wind Resource Map (Source: 3Tier)

Biomass energy could be important in Albania’s future, consisting of the following four main resources: urban wastes, agricultural residues, forest residues, and animal wastes. The potential of Urban wastes from the main Albanian cities was calculated as approximately 405615 Toe-ton oil equivalent, predicted for the year 2010.

The energy potential from agricultural residues was calculated at approximately 43,000 GW.  Forestry biomass resources were calculated to be approximately 460 million GJ in 1995. The energy potential from animal residue's was calculated at approximately 12,700 GJ in 1995 with a trend to be increased in the future.  These numbers should be considered estimates; a more comprehensive study should be carried out for real validation.

Albania Biomass Resource Data

The largest solar thermal heating system currently operating in Albania consists of three sets of solar panels totaling 48 m² that are installed from Center of Energy Efficiency (founded by EU and National Energy Agency).

Albania belongs to the sub-tropical belt (zone) as well as the Mediterranean climatic zone.  Overall, the country has a hot, dry summer and a relatively short and mild winter.  Below is a table displaying the solar radiation hours of different cities in Albania. 

Albanian Solar Radiation Hours by City

As shown below, Albania has solar potential in the western portion of the country, with a Direct Normal Irradiation (DNI) value of 7.22 kWh/m²/day and a Global Horizontal Irradiation (GHI) value of 5.4 kWh/m²/day.  These values are considered good solar regime.  In fact, the potential for solar thermal applications in Albania has led the Austrian Development Cooperation and United Nations Development Program (UNDP) – Albania to purchase a common “Solar Test Facility” for researching and certifying solar water heaters.  The facility will be managed by the local “Harry Fultz” Institute in Tirana.  The UNDP – Albania is also implementing a solar water heater project that should be completed in 2010 (UNDP, 2006).

The figures below display the direct normal irradiation and global horizontal irradiation values for Albania.  As shown, Albania has great solar potential throughout the country and particularly in its coastal region.

Direct Normal Irradiation Values for Albania (Source: NASA)

Global Horizontal Irradiation Values for Albania (Source: NASA)

There are many thermal springs and wells in Albania, which represent a potential for geothermal energy.  Currently, steam and hot water from geothermal sources gross approximately 84 TJ of energy (IGA, 2005).

The geothermal situation in Albania offers two directions for exploitation of geothermal energy:

·          The use of thermal water springs and wells of low enthalpy, which covers a wide territory from South, near the Albanian-Greek border to the Northeast districts in Diber region. The water temperatures reach values of up to 60⁰C.

·          The use of hot thermal waters, brought out from deep abandoned oil and gas wells and single wells, for geothermal energy in a form of a "Vertical Earth Heat Probe."  At 2000 m depth the water temperature reaches a value of about 48°C.

In many deep oil and gas wells there are thermal water fountain outputs with a temperature that varies from 32 to 65.5 °C. These waters are from different depth levels (800-3000 m) of limestone reservoirs and sandstone reservoirs.

The thermal springs and wells in Albania are located in three areas:

·          Kruja geothermal area - a zone that has the largest geothermal resources in Albania, with a length of 180 km and a width of 4-5 km. It starts on the Adriatic coast, north of Rodoni Cape in Ishmi region, and continues from Tirana, Elbasani up to southeastern Albanian-Greek border and extends to the Konica district in Greece.

·          Ardenica geothermal area- Located 40 km North of Vlora. The area extends on the part of peri-Adriatic Depression where the Vlora-Elbasan-Diber transverse passes.

·          Peshkopia geothermal area- Situated in northeastern Albania, in the Korabi hydrogeologic zone.

The map below shows the temperature contour and average geothermal gradient map of Albania.  Much of the country has geothermal temperatures of approximately 70 °C. 

 Albania’s Geothermal Potential (Source: International Geothermal Association)

The most important resources are located in the northern part of the Kruja geothermal area, from Lixha Elbasan in the south to Ishmi north of Tirana. The values of the specific reserves vary between 38.5 and 39.6 GJ/m². The southern part of the Kruja area has resources of 20.63 GJ/m².  In the Ardenica geothermal area, the specific reserves amount to 0.39 GJ/m².  Geothermal resources of Peshkopia area have been estimated similar to those of the northern half of the Kruja geothermal area.

In the peri Adriatic Depression, there are areas with a geothermal gradient of 18-20⁰C/km where there are several abandoned oil and gas wells which could be used for single or double ground-source heat pump installations. They are located in the plain area of the country, e.g. in Divjaka and Kolonja where greenhouses could be built to use the hot water for heating.

Albania is known for its enormous hydropower potential. The annual combined water flow of the rivers is 40 billion cubic meters; with full use, this quantity of water has the potential to produce 16 to 18 TWh of energy. So far, the country has exploited one third of the total potential. The amount of energy supplied to KESH customers in 2007 was 5.73 TWh. In terms of hydroelectric power, Albania generated 2.87 TWh from HPP’s on the Drini Cascade, 0.052 TWh from small-to-medium KESH HPP’s, and 0.059 TWh from small HPP’s. The figure below displays the average monthly water flows for an average year, 2001 and 2007.

 Average Monthly Water Flows in Albania