The Albanian government has violated the deadline set for the operation of the Albanian Power Exchange. The Socialists have the power trading project even in this term’s list of priorities. Government Program 2021-2025 stated the operation of the Power Exchange in February 2022. Such commitment was not fulfilled and it has even been deleted from the program in question. Ministry of Energy has recently set out a new deadline according to which the Albanian Power Exchange is expected to become operational at the end of this year.
The Government committed itself in its governing program 2021-2025 to make the Albanian Power Exchange fully operational in February 2022.
“Albanian Power Exchange shall become fully operational in February 2022” – stated the program presented by the government on 16 September 2021.
Screenshot of the government program 2021 -2025 (SEPTEMBER 2021)
Such deadline was removed from the 2021-2025 governing program a few months later. The most important part of the commitment cannot be found at the exchange dedicated paragraph.
Screenshot of the government program 2021 -2025 (MAY)
Albanian Power Exchange – ALPEX announces on its official website in February, noting the month when exchange was thought be operational, that market operation is planned to be operational at the end of the year.
“Alpex shall continue working towards the implementation of the European Target Model for the Day-Ahead or Single Intraday Market aiming to become the Nominated Electricity Market Operator NEMO. (Go-live) market operation is planned for the last quarter of 2022.”- was stated in the press release of the company on 10 February 2022.
Screenshot of the official website of the Albanian Power Exchange ALPEX
Two months after following the deadline of fulfilling such commitment, during a meeting held in Tirana with the Minister of Energy and Environment in the Greek Government Mr. Costas Skrekas, the Minister of Infrastructure and Energy Mrs. Belinda Balluku announced a new deadline for launching the first power trade through the Albanian Power Exchange ALPEX.
“The final date of launching operations shall be 23 November this year, where we will perform, thus fulfilling another important condition of Albanian market liberalization,” said Balluku on 13 May this year.
Picture from the meeting held on 13 May 2022
Faktoje asked the representatives of the Albanian Power Exchange about the delays and the progress of such project. Director of Business Development at ALPEX, Mr. Vasil Shpata, responding to our interest, says that delays have occurred due to complicated project procedures.
“Albanian Power Exchange has managed to successfully complete a complex process, such as that of selecting a service provider, in a relatively short time as taking into account the project’s complexity which has now entered the phase of its implementation. Kindly be reminded that Montenegrin Power Exchange – BELEN took approximately 4 years to complete such process, Power Exchange of Northern Macedonia – MEMO although operating for several years now has not yet managed to complete the selection process of the service provider. – wrote ALPEX representative, Mr. Vasil Shpata, to Faktoje.
Even in the annual report of the Energy Regulatory Entity, exceeding deadlines is related to the extended procedures of selecting the Exchange Service Provider.
“Selection procedures were extended beyond the set deadlines, delaying the process of the Exchange operation. At the end of 2021, the selection of the Service Provider has succeeded with the awarding merger of operators led by Athens Stock Exchange “Hellenic Exchanges – Athens Stock ExchangE S.A.”, the Greek Power Exchange Group with its two companies “Hellenic Energy Exchange S.A.” and “Enex Clearing House S.A.” was written in the ERE’s annual report for 2022.
Regulatory Entity report states that power trading of Day-Ahead market will start in November, while some other deadlines are further detailed.
“According to market calendars provided for in the terms of reference, power trading of the Day-Ahead market for Albania’s market shall start in November 2022 and in January 2023 we shall achieve trading for Kosovo market and merging of both Albania-Kosovo’s markets. Meanwhile, intraday power trading is planned to start in December 2023 for the Albanian market and two months later we will have the merger of the intraday markets for both markets. ”- was written in the report of 2021.
The periodic report of the Energy Community Secretariat assessing the progress of energy sector reforms for six Western Balkan countries indicates, in its November publication, the delays of setting up the power exchange in Albania due to tendering procedures on awarding the Exhange Service Provider.
Screenshot from the report of the Energy Community Secretariat
The expert, Mr. Eduard Gjokutaj states that the main problem of delays is related to the optimism-based issues of program’s authors, which according to him, does not coincide with the reality of the power market in Albania.
“This reality disables a functional stock exchange, as long as most of the objectives of the financial consolidation plan have not been achieved. “- stated Gjokutaj for Faktoje.
He otherwise underlines:
“Lack of engagement of current experienced foreign partners (World Bank) or countries investing in generation, as well as fiscal impurities of financial statements of public production companies and transmission and distribution of supply constitute an equally major problem which can be overcome by ministries related to the sector according to the respective areas of coverage. ”- says Eduard Gjokutaj for Faktoje.
However, the expert Lorenc Gordani realizes the procrastinated process of the recent years from another point of view. According to him, deadlines have been deliberately violated.
“Government officials, public authorities, public companies and everyone else would have a lot of work to do and profit is hereby reduced. Since they already are in the market, they are not worried about violating the status quo. However, they will be forced to take these steps, even if they have no interest. “This has practically hindered the process which would have been done in 2017, but has dragged on for years,” told Gordani to Faktoje.
Albanian Power Exchange is not only an ambitious project of the government towards integration in the European Power Market, however it is also one of the key recommendations in Progress Report of the European Union for Albania.
“Continue diversifying electricity production away from hydropower, and ensure a fully operational Power Exchange (ALPEX) and Day-Ahead electricity market” – stated the Progress Report 2021, in the chapter dedicated to Energy.
Given the carried-out verification and the gathered information, we hereby decided to consider the initial promise of the government that Albanian Power Exchange would become fully operational in February 2022 as Unfulfilled.