KOSID and INDEP publish the Analysis 'Review of the Energy Strategy of the Republic of Kosovo 2017-2026'

The fact that for many years now, Kosovo has no strategic unifying document for the energy sector has impaired the development of public policies in the energy sector. The drafting of the Energy Strategy for the ten-year period 2017-2026 is a proper development in the sphere of public policy in Kosovo. However, in the analysis published by the Kosovo Civil Society Consortium for Sustainable Development (KOSID) and the Institute for Development Policies (INDEP), serious deficiencies are noted in the document, which we recommend that need to be addressed in the Kosovo Assembly.

KOSID and INDEP estimate that the draft of the Energy Strategy of the Republic of Kosovo 2017-2026 does not lack the general discussion, but the strategic orientation, as should be the language of such a document. In the document all are presented as a priority and for all is argued that the Government will take measures, but there is no focused approach for the development of the sector that would clearly give priority to a sector or some sectors compared to others .

The strategy on the one hand calculates energy demand based on current consumption figures, and on the other hand recognizes the need for investment and measures to reduce losses and save energy. Energy efficiency is still not considered as one of the important sources of energy for the future, but only as an indispensable target imposed from the outside. 

The government has not made a recalculation of the real cost efficiency for the 'New Kosovo' project. There is a concentration up to an obsession for lignite, but there is no calculation of the real cost of using it for energy production. Other states, such as Germany, have calculated the additional cost that lignite use brings. It is estimated that the environmental and health costs are also at 10.2 cents per kilowatt if lignite is the basis of energy production. Taking into consideration the fact that this strategy largely focuses on this technology, such an analysis would be indispensable.

The strategy lacks an implementation analysis in general. Other countries' strategies have put a great importance to the expected results. In this strategy, on the contrary, no SWOT analysis of the costs, expected results and benefits of the policies have been made. Thus, once again, the document is more focused on overall priorities than being based on measurable figures and results. The strategy also does not take into account long-term trends, such as the European de-carbonization policy, which until 2050 foresees European energy systems freed entirely from fossil fuels.

There is no analysis of the energy price and its affordability across different scenarios. This would be crucial to predict the social cost of energy production and prices. There is no clear division between energy price disruption and cost recovery of building new energy capacities. The social cost should have been predicted on a trajectory because there are ongoing concerns about the impact of the new power plant on the energy price to end consumers. 

An energy strategy that does not foresee a special chapter for oil and does not handle it enough cannot be called a full strategy. Oil supply, especially oil reserves, are almost completely lacking. Kosovo is currently estimated to have oil reserves for only four days of consumption, while European legislation requires to have reserves of at least 61 import days or 90 days of consumption. The current level of oil reserves does not guarantee supply security and this should have been stated in the report. Also, transport policies including fuel transformation and environmental and health protection are not addressed in the strategy.

The integration of energy markets and in particular of the electricity market has not been well elaborated. Such a strategic document would have to elaborate on the costs of such a process, benefits and impacts on market stakeholders, on the current network and especially on the citizens. Market integration and price distortion should have a lasting impact on energy policies in the country, but based on the strategy these are referred to as objectives from the international obligations point of view, but there are no explanations and analyses on their cost-benefit after they occur.

Finally, the strategy even on the case of energy market integration, also on the definition of energy priorities, it is noticed that no different scenarios have been analyzed and no figures have been given which balance the integration and price deregulation with the need or not of new capacities. The strategy needs to be complemented by clear priorities, taking into account all costs and scenarios, and giving Kosovo a clear and consensual direction of energy sector development.

The Parliamentary Committee on Economic Development, Infrastructure, Trade, Industry and Regional Development in its next meeting (December 22) will review the Energy Strategy of the Republic of Kosovo 2017-2026. KOSID and INDEP have sent this analysis to the members of this Commission in order to address identified shortcomings.

Find attached to this link Brief Analysis of the Draft Strategy: https://goo.gl/m575sN

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