The Unnoticed Energy Consensus
March 1, 2013
Assume KOSID and allied civil society organizations will “win” the energy debate, with the Kosova e Re power plant (KRPP) remaining unbuilt. Would that transform Kosovo and bring the kind of future envisioned in, and advocated by, KOSID’s recent media campaign? With clean, secure, and affordable energy from renewable sources? Or would such a “success” end up being a Pyrrhic victory, costly for Kosovo, its economy, and its citizen? Would today’s Energy Strategy—aimed at opening doors to modern technologies and an energy mix—be sacrificed in favor of the continued reliance on Kosovo A and opportunistic investments in this sector, resulting in more rather than less coal-based power generation in years and decades to come? Possibly with power plants being built not to increase domestic energy security but with a view to simply exporting energy, with technologies that are inconsistent with requirements spelled out in the European Union’s environmental acquis communautaire, and with socio-economic consequences not studied in any Environmental and Social Impact Assessment? Good intentions alone will not suffice to secure a coal-free future in Kosovo, even less so when sitting on top of 11–14 billion tons of proven, exploitable lignite reserves (which would, at current consumption rates, last for another 1,500 years). These lignite reserves are no secret, their exploitation is comparatively easy, and potential investors are waiting in the wings, with an array of ideas and plans.
One might regret it, but Kosovo is not endowed with Saharan insolation, tropical precipitation, or the constancy of North Atlantic winds. As such, the country does not have any particular comparative advantage in the use of solar, hydro, or wind technologies. Whether from renewable or fossil sources, imports are expensive and—especially during periods of peak demand—are not available. The regional power grid inherited from Yugoslav times remains north–to-south, not necessarily an advantage for Kosovo. Plans to integrate the regional energy market have suffered setbacks. The investment into the 400-kV transmission line between Albania (with its abundant hydro sources) and Kosovo (with its abundant fossil sources) is being re-tendered for reasons outside Kosovo’s control. There is no question that—together with active demand management and energy efficiency investments—alternative sources of energy will have to play an increasingly important role as complementary source of energy to electricity generated by modern fossil-fueled power stations with best available technology.
The KRPP project, in its current design and embedded into the broader Energy Strategy, appears to reflect a core consensus reached in years and years of debates, analyses, and studies. During this period of time, important changes have been made to the strategy, many proposed and initiated by Kosovo’s civil society. The initial 2,000-MW Kosovo C idea is dead. The tender packages for KRPP and the rehabilitation of Kosovo B have been split. A resettlement framework has been established and is being implemented. Environmental standards, which will significantly reduce air pollution and health impacts, have been enshrined in the draft KRPP Request for Proposal (RfP). The legal, institutional, and infrastructure framework is being prepared to allow for the priority feed-in of alternative sources of energy into Kosovo’s grid.
The long preparation phase and extensive debates were needed and have proven useful in that, throughout this period, a “minimal core consensus” has evolved, viz., to make every effort to tilt the 98-to-2 percent balance between fossil and renewable sources towards the latter. There is agreement to seek to implement an energy strategy that comprises as much coal as is absolutely necessary and as much renewable as is possible (and economically viable). For as long as renewable energy is fed into the grid on a priority basis, the envisaged KRPP investment will not crowd out any investments into alternative sources of energy, and even less so, once a regional transmission network has been made a reality. The 80-20 distribution between fossil and renewable sources of energy generation by the mid-2020s, as projected by the World Bank’s Options Study, is not that far apart from the 66-34 composition voiced as ultimate objective in the recent post-campaign-ad debate in Kosovo and is fully consistent with the objective laid out in a recent Forum 2015 publication:
“Kosovo cannot fully rely on alternative energy sources. No country thus far can. But its water, wind and solar potentials are sufficient enough to bring about tangible changes in the country’s energy supply composition. The introduction of renewables would make the energy sector more diversified, more decentralized and a lot cleaner.”
This core consensus reveals the extent to which the energy debate has evolved from the beginning. Today’s Energy Strategy reflects (i) the increased global and domestic comprehension of respective costs and benefits of various energy alternatives; (ii) a clearer understanding of Kosovo’s ability to attract foreign investment of the quality required to bring to Kosovo the best available technology; and (iii) the plethora of valid inputs from all sides.
With this, most elements have fallen into place that would allow Kosovo to implement—with private-sector involvement—state-of-the-art investments in all segments of economically viable sources of energy that are consistent with EU environmental standards. Most importantly, it would allow for the closing of the highly inefficient and terribly polluting Kosovo A power plant by 2017—the single most important source of air pollution and related health impacts. The default alternative is—almost certainly—the continued reliance on Kosovo A for the foreseeable future, with opportunistic investments outside the current Energy Strategy, further adding to Kosovo’s air pollution. Is that really the objective?
The author is the World Bank’s Country Manager for Kosovo. This article is based on a speech given to KOSID and allied civil society organizations in Prizren on February 28, 2013.
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