World Bank Statement on Proposed Lukovo Pole Hydropower Project

January 24, 2014

TIRANA, January 24, 2014 – In 2011, at the request of the Government of FYR Macedonia, the World Bank agreed to consider support for the proposed Lukovo Pole Hydropower Project. The proposed project aims to increase FYR Macedonia’s reliance on renewable energy and improve water storage capacity to reduce vulnerability to variations in rainfall. This would increase electricity generation from three existing downstream hydropower plants that are operating in the Mavrovo area, by building a storage dam with a small reservoir, as well as a small-scale hydropower plant.

Some of the proposed project’s interventions would involve the use of water from the Radika River, diverted into the Vardar River basin. Albania, Greece, Kosovo, and Serbia are riparian nations, and as such would be consulted on the design of the proposed project prior to any decision on World Bank financing. The proposed project is still in the design stage, and no decisions have been taken at this point.

Preliminary assessments indicate that the proposed project would have limited impact on the amount of water diverted from the Radika River. The amount is expected to be well below the 8.0 cubic meters / second ceiling for water diversion established in the 1962 International Agreement between Albania and then Yugoslavia (subsequently ratified by FYR Macedonia) and currently in effect.

Under the management of the Power Generation Company of Macedonia, mixed teams of international and local consultants are currently conducting geological investigations, updating the engineering designs, and finalizing an Environmental and Social Impact Assessment (ESIA) to ensure that the highest standards are met with regards to natural resource management, biodiversity, and plant habitats in accordance with World Bank safeguard policies. This includes compliance with the following World Bank environmental and social safeguard policies: OP4.01 (Environmental Assessment), OP4.04 (Natural Habitats), OP4.12 (Involuntary Resettlement / Land Acquisition), and OP7.50 (International Waterways), as well as OP4.11 (Physical Cultural Resources).

All national, EU, and World Bank standards for due diligence will be met, including notification of all riparian nations when a detailed design proposal is ready. The World Bank is encouraged that the Governments of Albania and FYR Macedonia are strengthening their cooperation in the energy sector, and consulting at an early stage on the design of this proposed project, which increases the efficiency of existing hydropower resources in order to enhance the use of clean, renewable energy in Southeast Europe.

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