Meeting of the Albanian Regulator with IMF on the energetic situation in the country and the price analysis for 2008

On the 5th and 6th of May 2008 it was held a meeting between the Albanian Electricity Regulator and Mr. Mumtaz Hussain, representative of the International Monetary Fund (IMF).

The goal of the meeting was to inform IFM on the situation of the electricity sector and the methodology for calculation of tariff and prices of electricity for 2008.

From the experts of ERE was held a detailed presentation of the electro energetic situation in the country by presenting comparative data in years concerning generation, import and the performance indicators of KESH. In addition to that, it was made a comparative analysis of the electricity prices in the region, seen under the privatization of DSO (Distribution System Operator) prospect.

After that it was emphasized the main problem and the most concerning one for this sector which is the high level of electricity losses and especially thefts. ERE stressed that IMF should not comply with the idea that the financial strengthening of KESH will be only through an increase of electricity prices.

From IMF representative its was stressed that the progress of KESH, as far as the performance indicators are concerned, is very low in these 8-10 years, but IMF deals the macroeconomic indicators of the Albanian Economy and in this aspect can not judge reasonable the subsidy of KESH from the state budget to confront the difficult hydrological situations and the increase of electricity price for import.

ERE explained that with the tariff and prices approved for 2008 are covered all the forecasted costs for KESH for a supply without load shedding in the country. By assessing the hydrological situation very favorable in the country ERE does not see any argument to justify a new increase of prices in 2008.

In addition to this, ERE experts gave very clear explanations, in details, on the methodologies and data used for the calculation of electricity tariffs for 2008.