Delays to TC New Kosovo Can Bring Penalizations

The distribution of the Kosovo Assembly, which is expected to take place on August 22nd, will be unable to approve the financial package needed as state guarantees for construction of the “New Kosovo”.

Resigned Minister for Economic Development Valdrin Luka tells Radio Free Europe, that this project is currently not at risk, but in case of procrastinating the creation of the new Parliament and Government, then there will be delays and then, according to him, financial penalties follow.

Kosovo's “On the part of Kosovo has been carried out most of the procedures we have in contractual responsibility, while we are awaiting a financial conclusion that should be made on the part of properly Contour Global50. This financial closure after it is carried out goes as a financial package in the Kosovo Assembly for approval. The conclusion of this financial package, if it is not with the Kosovo Parliament to be founded and the Government is functional, then it could cause delays on our part, but I believe it has time and by December we have time to be nearly”, Luka says.

He adds that if there is no functional Government and Parliament by December, then delays on the part of Kosovo, which he says would not be welcomed by either side.

The state guarantee of the financial package for the construction of the thermocentral plant “New Kosovo” requires 2/3 of the Kosovo deputies' votes.

The Kosovo government has signed the commercial agreement with the American company “Contour Global” at the end of 2017 for the construction of this 500 megawatt capacity, which will cost 1.3 billion euros.

This project represents the largest foreign investment in Kosovo.

The outgoing minister, Luka, explains that under this contract, by next May of next year the two sides must complete legal procedures and start building the thermal power plant.

But if all procedures are not completed by that time, Luka adds, the punishments, which should by no means occur, begin.

If it drags on because of our problems, the consequences are that we have a financial obligation to the company .Contour Globala, which is 19.7m euros, if we complete the commitments, but the Contour Global) fails to secure the financial package, then they owe Kosovo a total of 17.5m euros”, Luka explains.

On the other hand, business representatives say Kosovo's economy and capital projects are continuing to be hampered by the frequent election cycles in which the country has spent recent years.

The chairman of Kosovo's Economic Ode, Berat Rukiqi, tells Radio Free Europe that it is important that the thermal power plant project is not delayed in procedures either because of penalisations, but also because of investment.

“The thermal power plant Kosovo is one of the only projects expected for greater investments in Kosovo and as such is important for increasing credibility for investments in the country and at the same time for waiting for other investments that could be followed, whether by confidence growth or infrastructure, as we know we have continued electricity problems. It's a last chance to promote investment. We expect a new country, which we hope to be more efficient than the Parliament that has been until now, which is on the verge of distributing”, Rukiqi says.

New Kosovo thermal power plant “” was meant to start building in this year, while operating in 1923. Life expectancy of the “New Kosovo thermal power plant has been estimated to be 40 years.

New Kosovo thermal power plant “has been rejected by some representatives of civil society, who consider it an environmentally harmful project and citizens.

Kosovo has more than 10 billion tonnes of lignite, and as such is the fifth country in the world for the amount of this resources, but with all of lignite's wealth, Kosovo continues to face electricity shortages.