New Kosovo <x0 plant” jeopardises Kosovo's EU integration

The EC, expressing deep concern with the terms of the contract, argues that signing this agreement endangers Kosovo's integration and relations with the European Union.

The EC's position is on the same line as the KOSID position around construction of the power plant, Kosova e Reão.

COMM SID has repeatedly raised concern that the New Kosovo project not only has an unaffordable cost of over 4 billion euros, but will also isolate Kosovo from national and regional integration and will harm the economic, environmental and integration future of the whole country. [View COSID work]

According to the SEC, a number of elements of signed contracts conflict with EU State Assistance laws, which have been banned with European legislation.

The letter of clarification of their position says That “Contour Global” is protected from commercial risks such as: production risk (including investments and variable costs), market risk (the risk of recent users' demand, and price fluctuations), operational risk (the risk of imbalance and planning), regulatory and tax risks of system and tariffs and other taxes, including future carbon taxes, credit risks (danger risk), etc. The same genomic conditions as those offered under this energy purchase agreement cannot be achieved under market conditions. On the contrary, according to the EC, risks are covered by the Government of Kosovo, through the public company (NKEC) and eventually translate into costs for suppliers and consumers or direct and ongoing government subsidies, while Contour Globalbal enjoys a guaranteed and safe profit margin.

“Secretariat is also concerned that contractual agreements will further reduce Kosovo's capacities for participation in the regional market, including the planned market union with Albania,” It says in SK's explanatory letter.

Furthermore, the EC also announces that the agreement has never been brought before the State Assistance Commission before the signing, which itself is the Secretariat headquarters in Kosovo.

We call on the Government of Kosovo to withdraw immediately from this harmful project and lead energy sector policies looking to the future, not the past. Instead of signing billions of contracts for investments in past technology, we call on the Government to implement energy efficiency measures, promote Kosovo's potential in renewable energy sources, and make steps on market liberalisation and its integration. Only so, we can successfully realise the transition, without alternative, towards a clean, affordable and sustainable energy system.