The government signs Agreements for “Kosova e Re” Power Plant
Prishtina, 20 December 2017 - The government of the Republic of Kosovo and the US-based company ContourGlobal have signed Commercial Agreements for the construction of “Kosova e Re” Power Plant. About 1.3bn Euros will be invested over the next four years to build the 500 MW unit. ContourGlobal will put its capital (30% of project value) and arrange debt from international financial institutions to implement the project, the biggest investment ever in Kosovo.
The “Kosova e Re” Power Plant will be a catalyst of economic development by providing sustainable energy for the country, thus bringing an end to the annual loss of 300 million Euros that the domestic economy suffered because of unreliable supply.
The introduction of the additional generation capacities aims to provide energy independence for Kosovo and reduce dependency from unpredictable energy prices in the regional market. Besides energy security supply, the mission of the new powerplant will be to replace the outdated units of TPP “Kosovo A”.
The “Kosova e Re” Power Plant will be built in compliance with the EU’s environmental standards Directives. With new super-critical technology, the unit will have a net efficiency greater than 40.0% with state-of-the-art combustion and air quality systems. Subsequently the plant will burn less lignite and will produce less emissions. Additional measures to control pollution include decommissioning of TPP “Kosovo A” and rehabilitation of TPP “Kosovo B”.
A large number of employers and subcontracted companies will be hired during construction phase. Whereas, hundreds of employment opportunities will arise to manage the new plant once it becomes operational.
The “Kosova e Re” Power Plant will be a strategically critical asset as it will cover nearly half of electricity demand in the country, and will be a long term thermal energy source for space heating in the surrounding municipalities. The implementation of this project marks one of the most important steps towards fulfilling the goals of the state of Kosovo for energy independence of the country.
Various domestic and international studies have supported lignite energy production in Kosovo, including the World Bank. The latter has supported the process of developing “Kosova e Re” Power Plant as the most suitable solution for Kosovo, recognizing that the Renewable Energy Sources (RES) do not provide sufficient capacities.
With no plans to construct additional lignite-fired power plants (after “Kosova e Re” Power Plant), the role of the coal in Kosovo’s energy mix will lose its importance and future generation capacities will have to rely exclusively in RES.
ContourGlobal is also foreseen establishment of the Community Development Fund, whose budget is set to 10 million Euros that will be invested over a seven-year period. The Funds will directly support those impacted by the project to improve their livelihoods and ultimately contribute to sustainable economic development through employment.
In the second phase of the project, following the signing of Commercial Agreements, ContourGlobal, will launch an international procurement process to select the company to construct the new “Kosova e Re” Power Plant. So far, renowned global companies like General Electric, Mitsubishi Hitachi, Siemens, and Doosan have expressed interest in the process.
“Kosova e Re” Power Plant is envisaged to be operational by 2023 while the ownership of the unit will be transferred to the Government of Kosovo after 20 years of operations at no cost. The lifetime of the powerplant is estimated to be 40 years, a period required to make a smooth transition to energy generation capacities from RES.