March 8, 2026
by in News

Albania Moves Toward Oil Security Reserves Amid Global Energy Volatility

The Albanian government has been working for several years to pass legislation governing the creation, maintenance, and management of minimum security reserves for crude oil and its refined products.

According to international standards, these emergency stocks are calculated at either 90 days of net imports or 61 days of average daily consumption, whichever is higher. These reserves are designed to be deployed during extraordinary circumstances, such as physical supply shortages or geopolitical crises.

The initial draft, proposed in February 2019, introduced a co-management formula between the state and the private sector—a departure from the current model where reserves are held entirely by private companies and refineries. Under the proposed framework, a public entity would manage 60 days of average consumption, while the remaining 30 days would remain the responsibility of private operators.

The legislative proposal envisioned the creation of a dedicated public body named the State Agency for Oil Security Reserves, operating under the jurisdiction of the Ministry of Infrastructure and Energy (MIE).

The Cost of Energy Security

The draft law stipulated that the agency would be self-financed through a dedicated fee levied on every liter of fuel purchased by refineries and wholesale companies. This mechanism would essentially introduce a new fiscal obligation, which is expected to translate into higher pump prices for final consumers.

While the project has undergone various internal government discussions since 2019, it was only in October 2025 that it was formally released for public consultation. The current draft maintains the previous structure: a non-profit public entity, now dubbed the Security Reserve Authority, under the MIE.

Key administrative details include:

  • Article 10: Fees for obligated parties will be collected by the Customs Authority during the collection of excise duties.

  • Article 11: Payers are required to submit payment data within 30 days of the end of each calendar month.

Despite the fact that the project has yet to be finalized, market operators anticipate additional costs totaling hundreds of millions of euros. These costs cover the procurement, storage, and logistics of the security stocks—burdens that are expected to increase operational costs for companies and, ultimately, prices for the consumer.

Global Context: Iran Conflict Risks New Energy Crisis

As Albania formalizes its domestic security measures, the escalation of conflict in the Middle East—specifically involving Iran—is sending shockwaves through global energy and financial markets. International economic analysts warn that a prolonged conflict could trigger severe supply disruptions, oil price spikes, and renewed inflationary pressures worldwide.

A primary concern is the potential for conflict to damage regional energy infrastructure or obstruct oil transit through the Strait of Hormuz, one of the world’s most critical energy corridors.

Market Analysis

In a recent analysis titled “War with Iran is a Nightmare for Oil and Gas Markets,” Bloomberg noted that a broad regional conflict has long been considered the “worst-case scenario” for the energy sector. The report emphasizes that the Persian Gulf remains a cornerstone of global energy supply, and any disruption there triggers an immediate market reaction.

Similarly, The Economist has warned of a significant shock to global markets. In an article titled “War in Iran Could Trigger the Biggest Oil-Market Shock in Years,” the publication highlights the extreme sensitivity of energy markets to regional tensions. Any disruption to tanker traffic could drastically reduce global supply and drive energy prices to record highs.

Financial and Economic Ripple Effects

The geopolitical tension has already impacted financial markets:

  • Safe-Haven Assets: Investors are pivoting toward gold and bonds.

  • Volatility: Stock markets are experiencing fluctuations as geopolitical risk premiums rise.

  • Inflation: Analysts warn that high oil prices ripple through the economy by increasing costs for transport, manufacturing, and food production.

Experts conclude that countries dependent on energy imports are the most vulnerable. European and Asian economies, in particular, face the prospect of surging production costs and new inflationary cycles if energy prices remain elevated.

February 28, 2026
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Albania’s Solar Surge: Capital Inflows, Grid Pressures and a Market in Transition

Photovoltaic energy is attracting capital at an accelerated pace in Albania, emerging as a new investment pillar for both traditional energy players and diversified business groups. With licenses granted for nearly 980 MW of solar capacity and hundreds of megawatts already operational, the market is undergoing a structural transformation—shifting from overwhelming dependence on hydropower toward a more diversified generation mix.

Private investment in the sector is estimated at around €1.5 billion, encompassing solar, wind and hydropower projects. Yet the rapid expansion is placing mounting pressure on existing infrastructure, highlighting the urgent need for parallel grid investments. Without reinforcement of transmission and distribution networks, the growth of photovoltaics risks outpacing the system’s capacity to absorb new output. Once again, the private sector appears to be moving faster than institutions.

When Albania first adopted its legal framework “On Renewable Energy Sources” in 2017, few anticipated the scale of transformation that would unfold less than a decade later.

From Slow Beginnings to Accelerated Growth

The early years of renewable development, particularly solar, were marked by bureaucratic hurdles, limited institutional experience and an energy market still in reform. The turning point came through two key developments.

First, market liberalization opened space for self-producers—an expanding segment entitled to install capacities of up to 500 MWp. Second, and more decisively, the global energy crisis that erupted in October 2021 dramatically reshaped market dynamics.

Post-pandemic raw material inflation, surging energy demand driven by economic recovery, and the war in Ukraine—triggering disruptions in Russian gas supplies—sent shockwaves through global energy markets. In 2022, prices reached record highs. Albania spent nearly €500 million on electricity imports, while on the Hungarian exchange—an important regional benchmark—prices peaked at €1,037 per MWh.

Although prices later retreated, volatility remains a defining feature of the market. This climate of uncertainty has become a major catalyst for new energy projects. Authorities report more than €2 billion invested in Albania’s energy sector in recent years. Currently, over 700 MW of private photovoltaic capacity is operational, alongside approximately 400 MW installed by self-producers.

The development pipeline could lift total photovoltaic and wind capacity to around 1,500 MW, while more than 1,600 MW of storage projects are under study or seeking financial facilitation.

Licensing and Market Structure

Despite numerous projects in various administrative stages, only a portion have secured production licenses. The Energy Regulatory Authority (ERE) has issued 71 production licenses for photovoltaic plants, totaling approximately 980 MW of installed capacity.

Most licensed projects fall within the sub-2 MW category, which benefited from a simplified regulatory framework introduced several years ago. These smaller plants were approved through accelerated procedures and supported by reference tariffs set periodically by the regulator. Electricity is purchased by OSHEE Group under a scheme similar to that applied to priority hydropower producers.

At the same time, a growing number of independent producers operate in the liberalized market. Supply liberalization has pushed thousands of businesses to secure electricity via private contracts, creating a stable demand base for new generators.

Solar projects also benefit from technical flexibility: they can be commissioned in phases, allowing electricity production before full completion of investment works.

Production Growth and Flagship Projects

Photovoltaic output rose sharply in 2025. According to preliminary data from INSTAT for January–September, the category “Other Producers”—which includes solar plants—generated 775 GWh, doubling year-on-year. Even compared to full-year 2024 output of 506 GWh, nine-month 2025 production was 53% higher.

Solar accounted for roughly 15.3% of Albania’s net electricity generation during the same period—more than double its 2024 share. This proportion is expected to rise steadily as new plants enter operation.

Among the largest projects is the 140 MW Karavasta solar park, developed by Voltalia. Additional operational projects include Blue (130 MW combined), Nova Solar System (50 MW) and multiple 20 MW facilities in Ersekë.

Projects under development include GreeNNat Solar Park Ballsh (100 MW), Faethon (78.6 MW), Sunny Side Energy (50 MW, part of the Kastrati Group), and the 100 MW Spitalla Solar park, also owned by Voltalia.

The rapid growth of solar capacity is gradually reshaping Albania’s electricity mix—historically dominated by hydropower—reducing exposure to imports and cushioning the impact of extreme price swings in international markets.

Year Energy Production (Thousand MWh)
2019 25
2020 35
2021 40
2022 52
2023 88
2024 506
2025 (9-Months) 775

European Bank for Reconstruction and Development: Strong Potential, Grid Constraints

The European Bank for Reconstruction and Development (EBRD) has been instrumental in supporting Albania’s renewable transition, advising the government on early photovoltaic auctions, including Karavasta—the country’s first large-scale solar plant.

Ekaterina Solovova, EBRD Resident Representative in Albania, has emphasized that the country’s solar potential remains considerable due to favorable geography and high solar irradiation. However, large-scale integration requires adequate transmission infrastructure.

Recent EBRD support includes sustainability-linked financing for OSHEE, restructuring short-term liabilities into longer-term financing to free up investment for grid upgrades. The bank is also cooperating with OST on EU grant-funded technical projects: closing the national transmission loop and modernizing the Fier substation—currently among the most congested solar zones—and developing a new cross-border transmission line with Kosovo to enhance regional interconnection.

Through initiatives such as the Renewable Energy Market Acceleration Program (REMA), the EBRD has supported the allocation of roughly 800 MW of new renewable capacity via Contracts for Difference (CfD) schemes.

Albania stands at a critical juncture: rich in renewable potential but constrained by infrastructure that requires substantial upgrading to ensure system stability.

European Investment Bank: Solar Could Reach 1 GW by 2030

Alessandro De Concini, EIB representative in Albania, notes that while Albania’s green credentials are strong, they remain vulnerable due to hydropower dependence and climate variability.

Solar capacity could reach 1 GW and wind 600 MW by 2030, supported by recent reforms easing licensing and auction procedures. However, climate risks—floods, fires and landslides—could cost up to 7% of GDP by mid-century.

Albania’s energy strategy prioritizes supply security, diversification, competition and environmental protection, aligned with EU legislation. The EIB’s forward plans include infrastructure modernization to ensure year-round supply security and price stabilization.

Investor Appetite and Market Diversification

Government-backed auctions—facilitating land access and streamlining procedures—sparked early investment during the pandemic. Yet a growing number of investors have entered the sector without subsidies, relying instead on private land, private power purchase agreements and market-based strategies.

Besnik Leskaj, founder of Blessed Investment Group, explains that detailed analysis of photovoltaic technology costs and regional price trends pointed to a favorable long-term risk-return profile. The group, alongside Matrix Konstruksion, has invested in fully private solar projects, emphasizing financial discipline and direct market exposure.

The Blue Parks, spanning 230 hectares with 263,000 smart panels, aim to build a 1 GW portfolio over the medium term, with 400 MW currently under development. Wind energy (two 25 MW projects) and battery storage systems are also part of the strategy.

Supporting Industries and Vertical Integration

The solar boom has stimulated domestic supply chains, from workforce training to mounting structure manufacturing. Companies such as Emante sh.p.k have expanded into producing Magnelis steel support structures for ground-mounted systems, supplying projects including Nova Solar (74 MW) in Seman and Info-Telecom (101.5 MW) in Ballsh.

Rapid sector growth is encouraging vertical integration, with firms expanding into mounting accessories and specialized structures to enhance added value.

End-of-Life Challenges

As solar installations multiply, long-term waste management is emerging as a strategic issue. Panels have a 25–30 year lifespan, meaning the first wave of mass installations will soon approach end-of-life. The International Energy Agency estimates panel waste could reach tens of millions of tons by 2050.

While recycling is technically feasible, it is often not yet economically competitive. The European Union mandates extended producer responsibility for collection and recycling, while China is scaling industrial recycling plants. The US and Japan are experimenting with high-value material recovery models.

Albania will need to address this issue proactively to ensure sustainability extends beyond generation.

Credit Growth and Corporate Performance

Energy and tourism have been the most dynamic sectors in recent years, reflected in rising bank lending. According to the Bank of Albania, outstanding credit to the energy sector grew 19% to 47 billion lek (€470 million) by December 2025, representing 9% of total business lending.

Karavasta Solar, managed by Voltalia, generated revenues of 3.5 billion lek in 2024 and profits of approximately 2 billion lek, with a 57% margin. The plant produced 258.3 GWh last year—3.2% of domestic net output and more than half of total solar generation, according to ERE. Under its 15-year contract, 70 MW is sold at a regulated tariff (€24.89/MWh) and 70 MW on the free market.

Spitalla Solar (100 MW) follows a similar structure, though progress has been slower.

Blue 1 (50 MW), commissioned in May 2024 at Sheq Marinas, Fier, operates entirely in the free market—one of the first large projects outside support schemes. Owned 51% by Blessed Investment and 49% by Matrix Konstruksion, it generated revenues of 680 million lek and profits of 380 million lek in 2024, producing around 72,000 MWh—roughly 15% of total solar output.

Other players, such as EZ5 Energy and Nova Solar System (50 MW), are reporting rapid revenue and profit growth, underscoring solar’s emergence as one of Albania’s most profitable and strategically significant industries.

Company Revenue (2023) Revenue (2024) Pre-tax Profit (2023) Pre-tax Profit (2024)
KARAVASTA SOLAR 450 17,000 408 2,000
EZ-5 ENERGY 412 1,422 83 265
SPV BLUE 1 266 679 102 379

Albania’s solar expansion reflects a decisive shift in its energy landscape—driven by private capital, catalyzed by crisis and increasingly supported by multilateral finance. The next phase will depend on grid modernization, storage deployment and responsible lifecycle management. If these elements advance in tandem, Albania could consolidate its position as a regional renewable energy hub.

February 23, 2026
by in News

The Asphalt Mirage: Corruption, Catastrophe, and the Cost of Albania’s Infrastructure

The investigation into Albania’s infrastructure sector reveals a systemic pattern where corrupt procurement, tailored tendering, and political nepotism directly cause structural failures and environmental catastrophes. Evidence suggests that billions in public funds are funnelled to a narrow circle of contractors through inflated contracts and non-transparent amendments, leaving a trail of collapsed bridges, sinking highways, and devastated river ecosystems. 

The Infrastructure Investment Boom: A Macroeconomic Mirage

Albania has recently undergone an unprecedented phase of capital expenditure, centered primarily on the expansion of its national road network and the modernization of urban infrastructure. This boom, however, has been built upon a foundation of Public-Private Partnerships (PPPs) and concessionary models that international financial institutions have repeatedly criticized for their lack of transparency and high fiscal risk. The mechanism of “unsolicited proposals” has effectively allowed private entities to dictate the government’s investment priorities, often resulting in projects that serve political interests rather than economic necessity.

The scale of this spending is vast, with the 2024 budget alone showing a projected increase in PPP contract payments from 13.1 billion ALL to 14.3 billion ALL. These payments are increasingly detached from physical progress; in several high-profile cases, the state continues to remunerate contractors for projects that are years past their delivery dates or which have suffered catastrophic structural failures before completion. The Department of State and the IMF have noted that these contracts are frequently awarded without genuine competition, a trend that has fostered a culture of impunity among politically connected companies.

The Librazhd–Prrenjas Collapse and Southeast Paralysis

The national road linking Librazhd to Prrenjas — a vital segment of Corridor VIII and the primary connection between Albania’s interior and the southeast — suffered a catastrophic collapse in mid-February 2026 that consigned the axis to full blockade for days. The collapse occurred near Arrat e Gurrës, where heavy rainfall, ground instability and riverbed pressure combined with ongoing works on the corridor.

Environmental and infrastructure failure:

  • Authorities and local media report that traffic on the Librazhd–Prrenjas national road was completely blocked, with only emergency vehicles allowed on the scene after a large landslide destabilised the carriageway.

  • A bridge immediately adjacent to the collapsed section reportedly continued to sink and shift even days after the initial failure measurements indicating an additional ~7 cm vertical displacement in a single morning — raising fears of full structural failure.

  • Alternative routes, such as the Maliq–Lozhan–Moglicë–Gramsh axis, were also impacted by secondary landslides blocking traffic and stranding motorists for 12 hours.

  • Gravel (inert) extraction deepens the channel and destabilises banks. Several academic and NGO reports and local investigative pieces  document how removal of gravels lowers the bed level, increases the river’s erosive power and causes lateral migration of the channel. For the Shkumbin and Vjosa basins, case studies and expert commentaries describe a direct linkage between large-scale extraction and increased flood and erosion risk.

    Shkumbin river bank

    Shkumbin river bank

  • Diverting small branches or altering floodplains without hydrological re-design undermines resilience. Journalistic reporting from Elbasan/Librazhd shows road alignments moved small tributaries and branches; experts quoted in coverage warned that ad hoc diversions, if not modelled, change sediment loads and scouring patterns downstream. An analysis by Citizens.al quotes hydrology and environmental experts who called the interventions “alarming.”
  • Inadequate protective works / as-built gaps. The World Bank / ARRSH environmental & social management documents for bridge and road resilience emphasize dikes, cross-drainage and designed retention structures. KLSH audits and field reporting noted that in several cases what was built on the ground did not match the originally planned protections, or supervision contracts were weak — a recipe for early degradation under flood conditions.

Local response and ongoing crisis:

A rural alternative rural road via Spathar–Antike Egnatia–Dardhë–Hotolisht quickly became the main lifeline for crossing to the southeast Albania after the collapse. However, heavy traffic revealed severe structural degradation on that route as well, with potholes, cracks and failing pavements undermining its reliability. Local users threatened to block the road unless urgent repairs were undertaken by responsible institutions.

Alternative secondary road Maliq-Gramsh collapses

Alternative secondary road Maliq-Gramsh collapses

Companies and works implicated:

The Librazhd–Prrenjas axis, before its collapse, was under maintenance and partial expansion activity by ANK sh.p.k.  the same company involved in other Corridor VIII lots while maintenance was previously under 2T sh.p.k.. Media accounts underscore that works were ongoing when the collapse occurred.

Journalistic field reporting described dredgers and heavy machinery operating in the Shkumbin River channel adjacent to the failed section even after the collapse, with interviews and video suggesting continuing erosion of the riverbed at that location.

The collapse effectively paralysed southeast Albania, halting passenger and freight transport for multiple days, forcing detours via less suitable rural roads, and incurring substantial economic disruption for cross-regional traffic. Emergency services, including ambulances and fire brigades, were at times not permitted to pass the blocked section due to safety concerns.

As of late February 2026 no official procurement or contractor statement responding specifically to the collapse had been widely disseminated in public reporting, though journalists repeatedly referenced previous tender histories and alleged links with political actors  , highlighting the need for direct replies from contractors and state agencies.

Qukës — Qafë Plloçë (Elbasan–Pogradec corridor) — long delays, amendments, maintenance tenders and infrastructure distress

A long-running mountain route linking Qukës to Qafë Plloçë, completed only after more than a decade of start–stop works and repeated contracts. It was presented as a major connectivity project when parts were inaugurated in 2025.

Deviation of the river

Deviation of the river

Procurement records & audits (selected):

  • ARRSH listings show “Mirëmbajtje me performancë e segmentit rrugor Qukës – Qafë Plloçë” (reference entries) with 2T sh.p.k. named as a winner for a maintenance contract (value reported ~29,359,200 ALL). Open procurement entries list the supervision and maintenance tenders with reference numbers (for example REF-62907-09-29-2025 for a supervision/maintenance notice).

  • The Supreme Audit (KLSH) produced a final audit report specifically on the Qukës–Qafë Plloçë road project; that audit documented contract delays, unconcluded milestones, and questionable contract modifications extending execution and funding beyond original schedules. The KLSH report is explicit: long time-lags, repeated addenda and inadequately justified time extensions.
  • Some lots were repeatedly modified and re-tendered, or winners were allowed to execute extensive “complementary” work after the original award. Journalists and auditors flagged the granting of addenda and follow-on maintenance tenders shortly after the road’s inauguration, raising questions about whether the original contract fully reflected the works required.

Technical failures & environmental consequences: within weeks of completion and inauguration, local journalists and watchdogs reported early settlement, need for new maintenance tenders, and concerns about whether river-bank protection and drainage had been implemented according to design — in other words: observed performance problems consistent with inadequate soil stabilization and river works in mountainous terrain. Expert commentary (below) links insufficient river protection and gravel extraction to downstream erosion risk.

New Roads Collapses in Albania

New Roads Collapses in Albania

Community impact & institutional posture: residents and local activists complained about recurring closures and the need for extra maintenance; ARRSH has issued routine statements saying the road is in operation and that maintenance tenders are normal post-completion actions. Auditors and watchdogs call those repeated tenders a sign of procurement and planning weakness.

The Rruga e Arbrit and the Murriz Tunnel Crisis

The Rruga e Arbrit (Arbri Road) was envisioned as a strategic corridor linking the capital, Tirana, with the eastern Dibër region and the border with North Macedonia. Instead, it has become the most prominent example of how geological negligence and financial expansionism coexist within Albanian public works. The project, which was initially promised to be completed by April 2021, remains a work in progress, mired in technical failures and escalating costs. 

The Murriz Tunnel Structural Failure

The primary bottleneck of the Arbri Road is the Murriz Tunnel. Technical assessments indicate that the choice of the tunnel’s path was made with insufficient geological data, leading to encounters with highly unstable soil and fragmented rock formations. As the contractor, Gjoka Konstruksion, attempted to drill through the mountain, the structure began to shift, threatening total collapse. 

Despite attempts to reinforce the tunnel with heavy piling and reinforced concrete, the movement remained uncontrollable. This led to a drastic and expensive pivot: the abandonment of the original path in favor of “Alternativa B,” a new tunnel bypass constructed in a different geological zone. This technical failure was not borne by the contractor but by the taxpayers, with the government approving an additional 20 million Euro payment to cover the redesign and new construction.

Financial Expansion through Secondary Tenders

The Arbri Road project demonstrates a sophisticated method of cost inflation known as the “secondary tender” or “revitalization” scheme. Once the initial PPP contract valued at approximately 40.3 billion ALL was locked in, the government began issuing secondary contracts to the same contractor for works that should have been covered by the original project’s risk assessment.

Specifically, a tender for the “revitalization of slopes” was awarded to Gjoka Konstruksion shpk, effectively serving as an addendum to the original contract. This mechanism allowed the project’s annual cost to rise from 2.8 billion ALL to 3.5 billion ALL in the 2024 budget. Critics argue that these “slope revitalization” works are merely a way to pay for repairs caused by the contractor’s own poor engineering and lack of environmental safeguards during the initial excavation.

The Korçë-Ersekë Highway and the Qafa e Qarrit Collapse

If the Arbri Road represents chronic failure, the Korçë-Ersekë highway represents acute disaster. In February 2024, a massive section of the newly built road at Qafa e Qarrit-Mollas collapsed into a deep ravine, leaving the asphalt suspended in mid-air. The collapse occurred on Loti 2, Part 1, a segment that had been touted as a masterpiece of modern engineering but which failed before its official inauguration. 

Procurement Irregularities and Political Connectivity

The contract for the construction of Loti 2 was awarded to A.N.K. sh.p.k., a company owned by Agim Kola. Investigative media have highlighted that Agim Kola is the brother of Ndue Kola, a former Member of Parliament for the ruling Socialist Party. The tendering process for this project (ID: REF-21837-03-11-2022) exhibited classic “red flag” symptoms: four companies participated, but three were disqualified for minor technicalities, leaving A.N.K. as the sole bidder with an offer just 0.03% below the government’s fund limit.  

The project’s costs have grown exponentially. What was originally discussed as a 1 million Euro per kilometre project eventually reached 5 million Euro per kilometre for specific segments. Despite this massive investment, the structural integrity of the road was compromised by what engineers describe as a “falsified project” that failed to account for soil drainage and the weight of the fill materials.   

The Role of the Project Supervisor

A&E Engineering shpk, owned by Entela Çano, was tasked with both designing and supervising the works on the Korçë-Ersekë road. This dual role created an inherent conflict of interest; the firm responsible for ensuring the quality of the construction was the same firm that had authored the potentially flawed design. SPAK has since taken Entela Çano and several officials from the Korçë and Kolonjë municipalities as defendants, alleging that they certified fictitious or substandard works that directly led to the collapse.

Unaza e Madhe and the “DH Albania” Scandal

The Tirana Outer Ring project, known as Unaza e Madhe, is perhaps the most egregious example of how the Albanian infrastructure sector has been exploited by “ghost” entities. The project’s cost, averaging 15 million Euro per kilometer is widely considered the highest in the region for a road of its class.   

Forgery and Institutional Failure

The scandal surrounding “DH Albania” exposed a profound lack of oversight within the Albanian Road Authority (ARRSH). In 2018, it was discovered that this company had secured an 18 million Euro contract for a segment of the ring road using forged documents from the Secretary of State in Delaware, USA. The documents falsely claimed the company had years of experience and significant capital, allowing it to bypass the vetting process. The fact that such a blatant forgery was accepted by the Ministry of Infrastructure suggested that the “checks and balances” were being bypassed by design rather than by error. 

Predetermined Tendering and Tailored Equipment

The procurement for Unaza e Madhe has frequently been characterized by “tailored criteria.” In one notable instance, a tender required participants to have a 450-ton crane in their inventory. Experts noted that such a crane was entirely unnecessary for the urban roadwork required, but its inclusion served as a mechanism to disqualify any firm that did not have that specific, rare piece of equipment, effectively narrowing the field to one or two favoured companies.  

Further investigations by SPAK into “Loti 4” of the ring road have focused on the communications of Evis Berberi, the former head of ARRSH. Messages retrieved from his phone allegedly show that the winners of these multi-million euro tenders were decided in private meetings long before the official bidding process began. 

Environmental Analysis: River Diversions and Infrastructure Destabilization

The degradation of Albania’s infrastructure cannot be separated from the unchecked manipulation of its river systems. To lower costs and maximize profits, contractors frequently divert rivers to facilitate road construction or to provide a convenient source of free aggregate materials (gravel and sand). These actions, often taken without valid Environmental Impact Assessments (EIAs), have catastrophic consequences for both the environment and the infrastructure itself.

New Roads Collapses in Albania

The Erzen River and the Sukth Flood Pattern

The Erzen River has been subject to numerous “embankment reinforcement” projects that have ultimately failed during peak rainfall. In the administrative units of Sukth and Katund i Ri, the river has repeatedly breached its banks, not due to the volume of water alone, but due to the poor quality of the man-made embankments.   

Investigative reports have documented cases where contractors, hired to build flood defenses, instead used the opportunity to dredge the riverbed, undermining the very banks they were paid to protect. When the embankments fail, the resulting floods do more than destroy crops; they cause road subsidence and the “scouring” of bridge foundations, creating a feedback loop of infrastructure destruction and emergency repair spending.  

New Roads Collapses in Albania

New Roads Collapses in Albania

Illegal Road Works in Protected Ecosystems

The case of the Mayor of Tropoja, Rexh Byberi, illustrates a broader trend of “rogue” infrastructure projects. SPAK’s investigation found that several road projects in the Tropoja region, including the “Palç-Guri i Lules” and “Qafë Murrizi-Qafë Agri” segments, were conducted in total violation of environmental laws. These projects lacked environmental impact reports and were initiated without the mandatory coordination with the National Environment Agency. The resulting landslides and erosion have not only damaged the new roads but have also permanently altered the hydrology of the surrounding slopes.

New Roads Collapses in Albania

The Procurement “Red Flag” Framework

A systematic review of the Albanian public procurement database reveals a consistent set of “red flags” that characterize high-risk infrastructure contracts. These mechanisms are designed to maintain a facade of legality while ensuring that the outcome of a tender is predetermined.

1. The Disqualification Tactic

The most common indicator of a rigged tender in Albania is the disqualification of all bidders except one. Often, these bidders are disqualified for failing to submit a single, non-essential document. This allows the remaining firm the pre-selected winner to secure the contract with a bid that is within 0.01% of the government’s maximum fund limit.   

2. The Use of Shell Companies and “Ghost” Partners

As seen with “DH Albania,” the use of offshore entities or newly formed shell companies allows the real owners (often political figures or their relatives) to shield themselves from public scrutiny.  

3. Systematic Addenda and “Unexpected” Costs

Contracts are frequently modified shortly after being signed. In the case of the Korçë-Ersekë road, a modification was approved for “project revisions” and “taban improvement” just months after the initial award, adding over 432 million ALL to the price tag. This is often used to circumvent the initial “fund limit” of the tender.

New Roads Collapses in Albania

New Roads Collapses in Albania

Tuneli i Llogarasë (Orikum–Himarë / SH8) — supervision contract, disputed procedures and a SPAK probe

Construction of a new Llogara tunnel as part of the SH8 coastal route. The works included an important supervision services contract (fee-based oversight of tunnelling works).

Procurement record (key facts): the supervision tender was issued with a ceiling (fund limit) of 196,240,667 ALL (approx. €1.6–2.0m depending on exchange) under REF REF-12982-11-24-2021; the winner announced was the joint offer Hill International N.V. & NetGroup sh.p.k., with a reported winning value of 194,700,000 ALL. Open procurement records list the tender and the reference number.

Media reporting and documents obtained by prosecutors say the tender’s selection criteria were allegedly adjusted in ways that narrowed the field (for example, lowering experience thresholds in some steps), and that lower monetary bids were disqualified on technical grounds. Investigative articles cite messages and evidence later seized in the SPAK probe.

SPAK opened an investigation into the tender and into a broader set of contracts connected to the same officials; the dossier includes seized documents from the winning supervision firm. Prosecutors have charged several officials linked with road authority decision-making. The public prosecution statements and extensive reporting show criminal inquiries are active.

Technical / environmental consequences: reporting raised questions about the quality and independent oversight of the tunnelling works, and whether supervision met the standard expected for a high-risk mountain tunnel. Local technical correspondence cited in reporting suggests site inspectors flagged deviations. At the time of writing SPAK’s indictments and the technical inspection reports remain the primary sources to verify whether any design or execution defects caused safety issues; these are part of the court file.

Community impact & official response: the tunnel was inaugurated and put into operation; nonetheless, the SPAK investigation and media reports prompted public debate about whether procurement shortcuts and the supervision contract’s selection undermined safety and value for money. The Ministry/ARRSH have provided routine project updates while SPAK holds the criminal file.

New Roads Collapses in Albania

The destruction and structural failure of Albania’s infrastructure are not isolated technical errors; they are the physical manifestations of a compromised procurement system. The evidence demonstrates a clear causal chain: tailored tenders lead to the selection of incompetent but politically connected contractors; these contractors, in turn, bypass environmental and engineering standards to maximize profit; and the resulting infrastructure—built on shifting soil and forged documentation inevitably collapses under the first pressure of nature.

The financial toll on the Albanian taxpayer is immense, with billions of ALL locked into 30-year PPP commitments for roads that may not survive a decade. Furthermore, the environmental damage—ranging from altered riverbeds to decimated forests represents a permanent loss for the nation. Until the “red flag” mechanisms of procurement are addressed through radical transparency and the removal of the “unsolicited proposal” loophole, Albania’s infrastructure will continue to be a façade of modernity masking a hollow core of systemic corruption.

February 20, 2026
by in News

KESH partners with France’s EDF and AFD to develop Albania’s Energy Storage Roadmap

Tirana — In a decisive move toward modernizing its national grid, the Albanian state-owned power utility, KESH (Albanian Electric Power Corp), has finalized a strategic partnership with Électricité de France (EDF) and the French Development Agency (AFD). The collaboration focuses on the development of a comprehensive energy storage strategy, underpinned by a €400,000 grant earmarked by the AFD.

This initiative arrives at a critical juncture for Albania. While the country boasts a near-total reliance on renewable hydropower for domestic production, its lack of grid-scale energy storage remains a significant structural vulnerability. As the global energy transition demands higher flexibility, the partnership aims to bridge the gap between Albania’s current hydro-centric model and a diversified, resilient future.

Engineering Flexibility: The Scope of the Partnership

The primary objective of the agreement is to identify and evaluate the most effective storage technologies suited for Albania’s existing infrastructure. The resulting study will serve as a technical blueprint for the nation’s Energy Storage Strategy, focusing on several key pillars:

  • Renewable Integration: Facilitating the entry of solar and wind energy into a grid historically dominated by water power.

  • System Modernization: Increasing the security of supply and enhancing operational flexibility.

  • Climate Resilience: Improving the long-term sustainability and management of Albania’s vital water resources and assets.

The technical expertise for this transition will be provided by the French state-owned giant EDF, a global leader in low-carbon energy, while the AFD continues to expand its financial and developmental footprint across the Western Balkans.

High-Level Diplomatic Support

The signing ceremony was attended by Nicolas Forissier, the French Minister Delegate for Foreign Trade and Economic Attractiveness. Minister Forissier emphasized that this agreement underscores Albania’s status as a priority partner for France, reflecting Paris’s commitment to supporting the country’s integration into the European Union through the mobilization of technical and financial instruments.

Under the leadership of Viola Haxhiademi, who assumed the role of CEO in late December, KESH is positioning itself to manage significant future capacities. Currently, planned projects—including KESH’s pumped storage capacity in the Drin (Drim) cascade and Statkraft’s Moglica project—represent a potential 1.6 GW of storage capacity.

A Continuing Collaboration

This latest deal builds upon an existing relationship between KESH and the AFD. Last year, the two entities signed an agreement focused on the advanced management of the Drin River cascade, the backbone of Albania’s energy sector. By adding a formal storage strategy to this framework, Albania is taking a sophisticated step toward aligning its energy sector with EU standards and the exigencies of the green transition.

February 20, 2026
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Albania as a Regional Outlier: Diesel Dominance Persists Amid Europe’s Green Transition

New data from Eurostat reveals a significant divergence in automotive trends between Albania and the European Union. While the EU moves aggressively toward decarbonization, Albania has emerged as the country with the highest share of diesel-powered vehicles among first-time passenger car registrations in 2024.

This trend stands in sharp contrast to the broader European trajectory, where environmental regulations and technological shifts are rapidly phasing out internal combustion engines in favour of electric and hybrid alternatives.

The Data: A Stark Statistical Divide

According to Eurostat’s latest report on transportation, 66.2% of all passenger vehicles registered for the first time in Albania during 2024 were diesel-powered. To put this in perspective, the EU average for diesel registrations has plummeted to just 14.9%.

The regional comparison further highlights Albania’s unique position:

  • Albania: 66.2% diesel share

  • Moldova: 47.0%

  • Bosnia and Herzegovina: 34.5%

  • Other Balkan neighbors: Generally below 30% (excluding Kosovo and North Macedonia, for which data was unavailable).

In absolute numbers, out of the 85,700 passenger vehicles registered for the first time in Albania in 2024, approximately 56,700 were diesel. Conversely, gasoline vehicles accounted for only 17.6% of registrations—one of the lowest shares in Europe—while electric vehicles (EVs) represented a mere 3.3% of the total.

The European Shift Toward Electrification

The European landscape tells a completely different story. The transition to Battery Electric Vehicles (BEVs) is accelerating, driven by the EU’s ambitious climate goals to reduce the 27% of greenhouse gas emissions currently attributed to transport.

  • Denmark: Over half (51.3%) of new registrations are fully electric.

  • Sweden, Malta, and the Netherlands: EVs account for more than one-third of the market.

  • EU Average: Electric vehicle registrations reached 13.5% in 2024.

Looking back at the decade between 2014 and 2024, the shift is even more dramatic. In 20 representative EU countries, the registration of diesel vehicles fell by 67%, while registrations for fully electric cars grew by 45 times, moving from a negligible 0.3% share in 2014 to nearly 14% today.

Why is Albania Lagging Behind?

The dominance of diesel in Albania is not a matter of consumer preference alone but is rooted in several structural and economic factors:

  1. Second-Hand Market Dominance: The Albanian market is heavily reliant on imported used cars from Western Europe. As EU consumers sell off their older diesel models to switch to EVs, these vehicles often find a second life in the Albanian market.

  2. Initial Cost Barriers: The upfront cost of electric or hybrid vehicles remains high compared to older diesel models, making them less accessible to the average Albanian consumer.

  3. Infrastructure Gaps: The national charging network for electric vehicles is still in its infancy, leading to “range anxiety” and deterring potential EV buyers.

  4. Policy Incentives: There is a lack of robust fiscal incentives or subsidies to encourage the adoption of “green” vehicles compared to the aggressive tax breaks seen in EU member states.

Looking Ahead

While Albania remains a diesel stronghold for now, the European trend is inevitable. As EU emission standards tighten and the production of internal combustion engines scales down, the supply of diesel vehicles will eventually dwindle.

For Albania to bridge this gap, experts suggest a dual approach: investing in charging infrastructure and implementing fiscal policies that make cleaner alternatives more competitive. Without these interventions, Albania risks becoming a “parking lot” for Europe’s aging, high-emission fleet.

February 19, 2026
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Corridor VIII Emerges as a Strategic Pillar for Balkan Integration and NATO Security

TIRANA — High-level officials and international stakeholders gathered in the Albanian capital this week to chart the future of Pan-European Corridor VIII, a multi-billion euro infrastructure project designed to bridge the Adriatic and Black Seas. Billed as a modern successor to the ancient Roman Via Egnatia, the corridor is increasingly viewed by regional leaders and Western allies not merely as a transport route, but as a critical component of economic sovereignty and Euro-Atlantic security.

ECONOMIC FORUM: “Strategic Connectivity and Regional Economic Growth: The Economic Potential of Corridor VIII”

ECONOMIC FORUM: “Strategic Connectivity and Regional Economic Growth: The Economic Potential of Corridor VIII”

The forum, titled “Strategic Interconnectivity and Regional Economic Growth: The Economic Potential of Corridor VIII,” held on February 18, 2026, served as a platform for Albania and North Macedonia to reaffirm their commitment to the project. The discussions highlighted a shift in the corridor’s narrative, moving from a long-delayed logistical ambition to a certified strategic priority.

A Security Necessity: The NATO Dimension

In a significant development for the region’s geopolitical standing, Albanian Deputy Prime Minister and Minister of Infrastructure and Energy, Belinda Balluku, revealed that Corridor VIII has now received NATO certification. This designation elevates the project from a civilian transport initiative to a vital military and security asset for the alliance’s eastern flank.

“Corridor VIII is no longer just a road for the movement of goods and citizens,” Balluku stated during the forum. She characterized the project as a “safe infrastructure for Euro-Atlantic security,” noting that its completion would allow for the rapid deployment of resources between the Mediterranean and the Black Sea—a necessity brought into sharp focus by shifting security dynamics in Eastern Europe.

The certification ensures that the technical specifications of the roads and railways—connecting the port of Durrës in Albania to Varna and Burgas in Bulgaria—meet the rigorous standards required for military mobility, effectively integrating the Western Balkans into NATO’s logistical architecture.

Economic Integration and the EU Path

While security dominated the high-level briefings, the forum’s primary focus remained the economic transformation of the Balkan interior. For decades, the lack of east-west connectivity has been cited as a major bottleneck for regional trade.

ECONOMIC FORUM: “Strategic Connectivity and Regional Economic Growth: The Economic Potential of Corridor VIII”

ECONOMIC FORUM: “Strategic Connectivity and Regional Economic Growth: The Economic Potential of Corridor VIII”

Delina Ibrahimaj, Albania’s Minister of State for Local Government, described the corridor as a “key instrument for European integration and regional stability.” Ibrahimaj emphasized that the project is now a formal part of the Trans-European Transport Network (TEN-T), a status that unlocks significant funding from the European Union.

“The development of this corridor is synonymous with the development of our economies,” Ibrahimaj noted, arguing that the project will reduce transport costs, attract foreign investment, and foster a more unified regional market. Officials at the forum suggested that by linking the ports of Albania with the industrial hubs of North Macedonia and Bulgaria, the corridor would create a “short-circuit” for trade that currently relies on longer, more congested routes.

Strengthening the Balkan Backbone

Representing North Macedonia, Igor Hoxha echoed the sentiment of regional interdependence. He framed Corridor VIII as the “backbone of regional development,” essential for the landlocked nation’s access to international maritime routes.

The cooperation between Tirana and Skopje has intensified as both nations seek to synchronize their construction timelines. The project involves a complex mix of highway expansion and the modernization of ageing railway tracks, many of which have remained dormant since the end of the Cold War.

Corridor VIII connection.

Corridor VIII connection.

“From the Via Egnatia to Corridor VIII, the plan to connect East and West is finally making its definitive stop in Tirana,” noted reports from the forum, highlighting the historical weight of the project. By reviving this ancient trade artery, the participating nations aim to reverse a history of fragmentation and replace it with a corridor of “peace and prosperity.”

Challenges and the Road Ahead

Despite the diplomatic optimism, the path to completion remains fraught with logistical and financial hurdles. The rugged terrain of the Balkan interior requires extensive tunnelling and bridge construction, driving up costs. Furthermore, the synchronization of three different national bureaucracies—Albania, North Macedonia, and Bulgaria—remains a persistent challenge.

However, the consensus in Tirana was clear: the project has reached a point of no return. With the backing of the European Union’s Western Balkans Investment Framework and the newfound urgency of NATO’s security requirements, Corridor VIII is moving from a blueprint to a reality.

As the forum concluded, the message from the Albanian Ministry of Foreign Affairs was definitive: Corridor VIII is the strategic link that will finally anchor the Western Balkans into the broader European family, transforming the region from a “grey zone” of infrastructure into a modern hub of global connectivity.

February 18, 2026
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Albania National Mining Strategy 2026–2040: A Critical Assessment of Strategic Autonomy and Value Chain Integration

The release of the National Strategy for the Development of the Mining Sector 2026–2040 represents a definitive, albeit belated, attempt by the Albanian state to reconcile its socialist-era extractive legacy with the stringent requirements of the European Union’s green transition and digital agenda. As the global economy pivots toward carbon neutrality, the demand for critical raw materials (CRMs) has transformed mineral-rich nations into geopolitical pivots. Albania, positioned as a traditional producer of chromium, copper, and nickel, finds itself at a crossroads where its historical extraction-only model no longer suffices to sustain economic growth or satisfy the regulatory benchmarks of the EU’s Critical Raw Materials Act. The strategy under review outlines a fifteen-year roadmap designed to modernize the industry, but its success is contingent upon overcoming structural deficiencies in human capital, environmental remediation, and institutional transparency that have plagued the sector for decades.

The Geopolitical and Strategic Imperative of the 2026–2040 Framework

The foundational logic of the 2026–2040 strategy is rooted in the “Green Deal” and the necessity of achieving strategic autonomy for the European continent. For Albania, this strategy is not merely a technical document but a primary instrument of European integration. By aligning national mining policy with Regulation (EU) 2024/1252 (the CRM Act), the Albanian government seeks to position the country as a vital node in the European supply chain for minerals essential to renewable energy technologies, electromobility, and defence. The strategy explicitly aims to transform the sector from a source of raw ore exports into an integrated industrial complex that captures high-value downstream processes such as refining and smelting within the national borders.   

The evidence of Albania’s importance is underscored by its persistent global ranking in chromium production, where it consistently remains the seventh-largest producer and the fourth-largest exporter of this strategic mineral. However, the economic impact of this dominance has been mitigated by the low level of domestic processing. Historically, and continuing into the present, the vast majority of extracted ore is shipped to smelters in China and Turkey, effectively exporting the employment and fiscal benefits associated with the metallurgy stage of the value chain. The new strategy identifies this as a critical failure and sets a target to ensure that at least 30% of chromium, copper, and nickel ore is processed domestically by 2030.  

Albanian Extractive Economy against Regional Neighbours

To understand the realism of these targets, a comparative analysis with Western Balkan peers is essential. While Albania’s mineral sector accounts for approximately 4.2% of its GDP, its production profile differs significantly from neighbours like Serbia and Kosovo, whose extractive industries are overwhelmingly dominated by lignite for domestic power generation.

Indicator (2023/2024 Data) Albania Serbia Kosovo North Macedonia
Minerals Production (Metric Tons)

1,379,939 

33,556,191 

6,930,329 

4,479,894 
Top Mineral Focus

Metallic (Cr, Cu, Ni)

Lignite, Copper 

Lignite (5th global) 

Chemicals, Ores 
Processing Level (Domestic)

20–35% (Cr) 

High (Integrated) 

Limited 

Moderate 
Mining Rent (Royalties)

6–9% 

Competitive 

Varied 

High Reform 

 

Serbia’s mining sector, which saw a production high of over 36 million metric tons in 2022, benefits from a much more integrated industrial base, where extraction is closely linked to large-scale smelting operations like those in the Bor district. In contrast, Albania’s metallic sector has remained fragmented. The strategy acknowledges that while Albania possesses significant geological resources, it ranks lowest in the region for its business environment and institutional quality. This institutional gap is the primary reason why North Macedonia was able to increase its concession fee revenues by 218% in 2025 through tariff reform and better municipal coordination, while Albania continues to struggle with royalty collection and distribution.

Institutional Architecture and the Reform of Resource Governance

The 2026–2040 strategy identifies a critical bottleneck in the fragmented nature of Albanian mining governance. Currently, the administrative burden is distributed across the Ministry of Infrastructure and Energy (MIE), the National Agency of Natural Resources (AKBN), and the Albanian Geological Survey (SHGJSH). This division has historically led to overlapping jurisdictions, lack of data synchronization, and delays in the permitting process. One of the strategy’s most ambitious institutional goals is the creation of a unified digital “DataHub” for mineral and geological information.

The mechanism for this reform involves the consolidation of decades of archived geological data, much of which remains in analog format, into a digital GIS platform that complies with the EU’s INSPIRE standards. The current documented situation reveals that exploration data packages are non-existent, making it difficult for international “junior” mining firms to conduct the preliminary risk assessments necessary to justify greenfield investments. The strategy’s Objective 5 aims to rectify this by providing structured access to potential investors, which is expected to reduce the current high-risk profile of the Albanian mining landscape.

Transparency and the EITI Standard

Governance is further complicated by the history of transparency in the sector. Albania’s membership in the Extractive Industries Transparency Initiative (EITI) since 2009 has provided a platform for mitigating corruption and ensuring that the public can monitor the flow of mining rents. However, the “resource curse” remains a threat; the strategy notes that while mining rents for unprocessed metallic minerals have increased to 6–9%, the actual transfer of the 5% statutory share to local municipalities is often delayed or omitted. In 2015, only 3.6% of royalties were successfully transferred to local government units, despite legal mandates. 

The roadmap for 2026–2040 explicitly ties future funding to the rigorous implementation of the 2023 EITI Standard. This includes the disclosure of beneficial ownership and the publication of detailed environmental impact data—factors that are now prerequisites for any project seeking “Strategic Project” status under the EU CRM Act. Without these governance improvements, Albania remains vulnerable to the types of high-level corruption and money laundering that have led to its placement on international “grey lists” in recent years.

Geological Potential and the Realignment of Reserve Valuation

The strategic pivot toward CRMs requires a fundamental re-evaluation of Albania’s geological endowment. The country currently manages 579 active mining licenses, but the production data from 2018–2024 reveals a problematic reliance on industrial and construction minerals. In 2018, for instance, the output of limestone for inerts reached 38 million tons, whereas metallic ore production, which offers significantly higher economic complexity and value-added potential, remained modest in comparison. This statistical imbalance threatens the long-term viability of the national reserve portfolio. 

Quantitative Analysis of Known Reserves

According to the official data provided by the National Agency of Natural Resources (AKBN), the following metallic and strategic reserves represent the backbone of the 2026–2040 industrial ambitions:

Mineral Category Total Reserves (Tons/Metric) Grade/Content Analysis
Chromium Ore 31,074,927 29.93% Cr₂O₃
Copper Ore 40,250,498 1.45% Cu
Iron-Nickel 247,884,220 44.3% Fe₂O₃
Nickel Silicate 104,096,767 1.16% Ni
Titanomagnetite 78,323,738 6.01% TiO₂
Bauxite 20,029,883 42.03% Al₂O₃
Phosphorites 46,587,088 5 – 33% P₂O₅
Zinc 3,038,211 1.61% Zn

The strategy recognizes that these reserves are currently classified under outdated methodologies that do not align with international financial reporting standards. A major component of Policy 1 is the re-evaluation of at least 80% of these reserves according to the United Nations Framework Classification (UNFC) by 2030. This transition is not merely a bureaucratic requirement; it is a critical mechanism to enable international financing. European banks and institutional investors are increasingly unable to fund projects where the geological risk is not quantified via UNFC or JORC-compliant reporting. 

The Potential for “Secondary Mining”

A second-order insight derived from the strategy is the government’s newfound focus on “mining waste to resources.” For decades, the byproduct of Albanian mining—billions of tons of tailings—was viewed as a purely environmental liability. However, the new strategy integrates these tailings into the circular economy framework. In regions like Rubik and Kurbnesh, historical tailings from the Cold War era contain significant concentrations of copper, zinc, and even rare earth elements (REE) that were technologically impossible or economically unfeasible to extract in the past.   

The strategy sets a target to recover and valorize at least 20% of these existing sterile deposits by 2040. This is particularly relevant for chromium-rich tailings, which offer a sustainable pathway for domestic ferrochrome production without the environmental footprint of new open-pit mining. Reprocessing these legacy sites is expected to generate upwards of €500 million in revenue over the next decade while simultaneously addressing severe acid mine drainage issues. 

Industrial Policy and the Diversification of the Value Chain

The current documented situation in Albania’s mineral processing is one of stagnation. While the country possesses 16 chromium enrichment factories, their capacity is underutilised due to high energy costs and a lack of modern furnace technology. Policy 2 of the 2026–2040 strategy addresses this by proposing the establishment of at least two dedicated “Mining Industrial Hubs” equipped with shared energy, logistics, and environmental infrastructure.

The Nickel-Cobalt-Copper Value Nexus

The most significant industrial project currently underway is the CVMR nickel refinery at Qafë Thanë, which signals a move toward high-purity nickel and cobalt production—essential materials for the European battery industry. The strategy aims to replicate this model in the copper sector. While 100% of copper ore is currently processed to the concentrate level within Albania, the lack of a modern domestic smelter means that the refined metal must be produced abroad.   

The mechanism for achieving deeper integration involves “Strategic Projects” under the EU CRM Act. Albania intends to submit at least three projects for this designation by 2040, which would grant them “overriding public interest” status, faster permitting, and access to European investment instruments like InvestEU. This is a savvy geopolitical move, but the investigative evidence suggests that Albania faces fierce competition from Serbia’s lithium projects and Bosnia’s lead-zinc operations for these limited European funds.

Strategic Metric 2025 Status 2040 Objective Financial & Standards Context
Domestic Cr Processing 20% – 35% 50% Integration Transition to metallurgical-grade ferrochrome.
Recycling Rate < 5% +50% Vol. Increase Focused on CRM/SR circular economy.
UNFC Evaluation < 10% 100% Standardization for EU investor confidence.
EU Strategic Projects 0 3 Projects Alignment with the Critical Raw Materials Act.
Total Strategy Budget — €181 Million Covers technological modernization & R&D.

Safety, Environmental Sustainability, and the ESG Burden

One of the strategy’s most sobering admissions is the state of workplace safety and environmental degradation. In 2024, the mining and quarrying sector accounted for 12% of all accidents and 9% of all fatalities in Albania, with the majority occurring in the underground chromium mines of Bulqizë. The current mechanism for safety inspection—the National Authority for Safety and Emergencies in Mines (AKSEM)—is underfunded and lacks the digital tools necessary for real-time monitoring of gas concentrations, ventilation, and geotechnical stability.   

The strategy proposes a radical shift: mandating the installation of real-time digital monitoring systems in all underground mines by 2040. However, for the hundreds of small-scale license holders who currently operate on thin margins, the cost of these systems is prohibitive. This suggests that the strategy will realistically achieve its safety goals only through the consolidation of smaller units into larger, more capitalised entities—a move that carries social risks in communities that rely on artisanal and small-scale mining for survival.  

The €100 Million Rehabilitation Liability

The environmental debt of the Albanian mining sector is staggering. Approximately 4.1 square kilometres of territory are documented as severely contaminated by heavy metals and acid mine drainage. The World Bank estimates that the cost of full recovery for these sites exceeds €100 million. To address this, the strategy proposes the creation of a National Fund for the Rehabilitation of Mining Areas (Fondi Kombëtar i Rehabilitimit) by 2026.   

The efficacy of this fund remains questionable. Currently, rehabilitation is funded through individual bank guarantees, which are often insufficient and managed in a decentralized, opaque manner. Centralizing these funds is a necessary step, but without an immediate injection of international donor capital, the government will struggle to address legacy sites in Rubik and Përrenjas that have no current owner to hold liable. The integration of the Carbon Border Adjustment Mechanism (CBAM) by the EU adds further pressure; Albanian exports will soon face carbon taxes if they cannot prove their production processes are reaching decarbonization targets.  

The Human Capital Crisis and the Technological Generation Gap

Perhaps the most significant threat to the achievability of the 2026–2040 strategy is the collapse of the domestic technical workforce. The data indicate a catastrophic decline in the number of students pursuing degrees in geology and mining engineering. Since the 1990s, enrollment at the Faculty of Geology and Mining has dropped by over 80%, with fewer than 50 students registered in the 2025-2026 academic year. This has created a vacuum where the median age of the expert workforce is rapidly rising, and there are virtually no young specialists trained in the “high-tech” mining techniques required by the strategy—such as AI-driven sorting, airborne surveys, or hydro-metallurgy.  

The strategy responds with Policy 4, which outlines a “Mineral Brain Gain” program and the creation of a National Training Center for CRMs. While these are sound objectives, they are set against a demographic backdrop of extreme youth outmigration. Albania saw a net migration of -24,472 in 2024 alone. To attract diaspora specialists back to the mines of Martanesh or Bulqizë, the government must offer more than just a patriotic appeal; it must create a professional ecosystem that rivals the salaries and career stability found in the EU.

Fiscal Analysis and the Reality of Option II

The 2026–2040 strategy is costed according to two options, with the government selecting “Option II”—the more ambitious “Variant of Need”. This option carries a total indicative cost of 19,466,891,000 ALL (approximately €181 million) over the fifteen-year period.   

Detailed Budgetary Allocation (Option II) (Source: Compiled from Section 9 of the Strategy Report. )

Strategic Policy Total Cost (Million ALL) Total Cost (Million Euro) State Budget % IPA/Donor %
Policy 1: Extraction & Assessment 4,609.9 42.9 40% 60%
Policy 2: Modernization & Recycling 7,573.4 70.4 35% 65%
Policy 3: Safety & Environment 3,292.8 30.6 45% 55%
Policy 4: Human Capital 2,634.2 24.5 50% 50%
Policy 5: Data & Transparency 1,356.6 12.6 30% 70%
Total Strategy 19,466.9 ~181.1 ~40% ~60%

The investigative scrutiny of this budget reveals a heavy reliance on external funding. Approximately 60% of the €181 million is expected to come from EU IPA III funds, Horizon Europe, and international financial institutions like the EBRD. The state budget is only expected to cover about €11 million per year—a significant increase from the historical average of €5.1 million, but still a fraction of the total need. This “funding gap” represents a massive risk. If the global economic outlook slows, as projected by the World Bank for 2026, or if EU accession progress stalls, Albania could find its mining strategy severely underfunded.   

The Energy-Price Risk Factor

A critical omission in the fiscal analysis is the cost of energy for domestic processing. Modern refineries for nickel and copper are highly energy-intensive. Albania is over-reliant on hydropower (over 90% of domestic production), which is susceptible to climate-induced droughts. High electricity prices have historically forced Albanian ferrochrome smelters to suspend production during peak winter months. Unless the strategy is integrated with a renewable energy expansion specifically for mining hubs (such as on-site solar and wind), the 30% domestic processing target will likely remain a documented ambition rather than a realistic achievement.   

Market Forecasts and the Commodity Price Trap

The realistic success of Albania’s mining strategy is deeply tethered to the “Pink Sheet” commodity forecasts of the World Bank. The current outlook for the primary Albanian minerals is a mix of high demand and volatile pricing.

  • Copper: Poised to reach new nominal record highs by 2026-2027 due to its non-negotiable role in clean-energy infrastructure. This supports the strategy’s goal of expanding the Mirditë copper operations.  

  • Nickel and Cobalt: While essential for EV batteries, these minerals face supply chain pressures and fluctuating demand from the Chinese property sector. The success of the Qafë Thanë refinery depends on capturing the European market, which is increasingly seeking “clean” nickel not tainted by the environmental practices common in Indonesian production.   

  • Chromium: As the global steel industry attempts to decarbonize, the demand for high-grade ferrochrome (produced with low-carbon energy) will command a premium. This presents a unique opportunity for Albania to leverage its hydro-based grid as a competitive advantage.   

However, the strategy must navigate a “downside” scenario. If global growth—particularly in China—slows more than expected, the prices for base metals will collapse, rendering Albania’s high-cost, small-scale underground mines uneconomical. The strategy’s lack of a fiscal stabilization fund or a sovereign wealth mechanism to buffer against these cycles is a notable weakness.

Realistic Achievability vs. Documented Ambition

The Strategjia Kombëtare për Zhvillimin e Sektorit Minerar 2026–2040 is a theoretically robust document that identifies the correct strategic pillars for a 21st-century extractive industry. Its alignment with the EU CRM Act is a masterstroke of policy integration that will likely secure substantial pre-accession funding. However, based on the current documented situation, the following conclusions emerge regarding its realistic achievability:   

  1. Governance and Transparency: This is the most achievable pillar. The technical capacity for a GIS DataHub exists, and the EITI framework is already well-integrated into the Albanian institutional fabric. By 2030, Albania will likely have a transparent, digital licensing regime that significantly reduces corruption risks.   

  2. Processing and Value Addition: The target of 30% domestic processing is achievable for chromium but highly unlikely for copper without massive state intervention in the energy market. The “Mining Industrial Hubs” are feasible only if Albania can solve its seasonal energy shortages.   

  3. Environmental Remediation: The strategy will likely succeed in launching three “showcase” rehabilitation projects using World Bank or IPA funds, but the total €100 million liability will remain a shadow over the sector for the duration of the fifteen-year period.   

  4. Human Capital: This is the strategy’s “Achilles’ heel.” There is no evidence that a “Brain Gain” program can reverse a 30-year demographic trend. Unless geology and mining engineering are treated as national priority disciplines with guaranteed elite-level salaries, the industry will face a terminal expertise shortage by 2040.   

In final assessment, the strategy marks the end of the “wild west” era of Albanian mining. It transitions the sector into a structured, EU-compliant industrial framework. While it may not achieve its most ambitious processing and recycling targets due to energy and labor constraints, it will succeed in locking Albania into the European strategic supply chain, ensuring that the country’s mineral wealth remains a central component of its national security and economic identity for the next generation.

February 17, 2026
by in News

Albania’s Solar Gold Rush: Who Profits, Who Pays?

As Albania races to become a net exporter of electricity, dozens of vast solar parks have sprouted almost overnight on fertile farmland and pastures, igniting fierce resistance from local communities. In Fier’s village of Boçovë, a normally quiet farming district near the Seman delta, families woke one day to find heavy machinery digging up fields they had tended for generations. “It turned out a photovoltaic park was being built here, and our lands aren’t ours anymore,” complained Nikoll Ndoi, a local schoolteacher. Ndoi and his neighbours say they gained these plots in the early 1990s under Albania’s land-reform law (Law 7501), but were never issued legal titles and now discover the state has quietly expropriated them for solar panels. More than a dozen families in Boçovë are locked in a fight to reclaim their soil from a new small company, “Brevi Construction”, where it is mentioned in the media that it is affiliated with the family of Pëllumb Salillari. Such clashes are multiplying nationwide as the government greenlights hundreds of megawatts of solar capacity, prompting farmers and herders to denounce an “energy revolution” that is trampling their rights and livelihoods.

Residents of the Levan Administrative Unit protested again in the village of Boçova, after work began on their agricultural lands to install photovoltaic panels by the company "Brevi Construction", with administrator Afërdita Salillari.

Residents of the Levan Administrative Unit protested again in the village of Boçova, after work began on their agricultural lands to install photovoltaic panels by the company “Brevi Construction”, with administrator Afërdita Salillari.

The Albanian government, led by Prime Minister Edi Rama, has made a dramatic pivot from its traditional hydropower surplus to a sun‑driven future. Since 2018, the Council of Ministers approved dozens of solar park projects and the energy regulator (ERE) licensed over 70 private solar companies. The planned PVs are a total of nearly 1,000 MW, about 30% of Albania’s installed capacity and none of it is guaranteed for local use. Instead, most is slated for export to Italy and beyond. Ex-director of Energy Policies at Ministry of Infrastructure and Energy  Gjergj Simaku warns this is a “paradox”: Albania could end up exporting clean power while continuing to import fossil‑fuel electricity during winter. Simaku notes that 1 GW projects have no obligation to sell domestically, leaving local grids and consumers sidelined. Notably, Simaku does not address his own role during his long tenure at the Ministry of Infrastructure and Energy, where he was directly involved in shaping and implementing national energy policies. The governance gaps and regulatory weaknesses he now criticizes were also evident during the wave of small hydropower plant licensing over the past decade—a period marked by widespread concessions, limited oversight, and significant social and environmental consequences for local communities. The current tensions surrounding large-scale solar development bear striking similarities to that earlier expansion, raising questions about institutional continuity and accountability in Albania’s energy policymaking.

Municipal Public Assets Leased by Purpose of Use 2015 – 2024 (in hectares)

This policy u‑turn was codified in 2023 when the government amended the renewables law to allow solar farms on any land even vital grazing areas not just barren terrain. Green activists point out that at least half of Albania’s solar license rush is on former public pastures and forests. A recent survey by the All Green Center found many lease auctions were rushed, with no real competition or community input. “Support for green energy must not come at the expense of natural capital,” says environmentalist Ola Mitre. Birding expert Taulant Bino adds that multiple solar projects have been approved piecemeal, ignoring their cumulative impact on biodiversity. In fertile districts like Fier, dozens of solar parks now ring protected river deltas and migratory corridors. Normally one of Europe’s greenest electricity producers (90% hydro), Albania’s renewable expansion is outpacing environmental safeguards.

Locals report no meaningful consultations. In Boçovë, villagers say a developer quietly re‑zoned their family farms (marked on cadastral maps as “arable” or “forest”) into “unused state land” just as construction began. When the community complained to the Cadastre and Agriculture Ministry, nothing was fixed. In Darzezë (nearby Boçovë), elders who believed promised benefits (new roads, lighting) are now “disappointed,” saying “nothing was done, and they even took our water”. The local mayor’s office in Fier readily absolved itself of responsibility: “These projects aren’t licensed by local government,” Fier’s municipal response notes, adding only that it receives property taxes and nothing else. In effect, powerless villagers have found themselves squeezed: the state offers no legal recourse when it simply rents out “public” pastures to private developers.

A protest by residents of the village of Imshte in the Bubullimë unit in Lushnje.

Across the southwest, similar scenes played out. Last month in Imshtë (Lushnjë), about 70 farmers blocked the road to their police station, demanding authorities halt a planned solar park on 100 hectares they have grazed and farmed for 30 years. They accuse a local businessman, Elton Çekrezi, of quietly buying up the plot once officially designated as non‑transferable state land and forming a shell company SunXpower to install PV panels. MP Erion Braçe, who supports the Imshtë community, blasted the episode on social media as a “robbery of public land” by a clandestine “new agha,” warning that his supporters had been threatened during clashes with men bearing weapons. (Çekrezi’s family insists the land was legally bought at auction from former private owners, and they hold cadaster documents dating back to 1945 and 1998.) In Levan (Fier), villagers of Boçovë protested similarly when the company Bervi Construction began clearing fields they had cultivated for “almost 30 years”. Fourteen families, granted plots under the 1990s land law, but their claims were ignored, and now official records abruptly list the land under Brevi’s name. Farmers like Sandër Mujo have even petitioned prosecutors and the anti‑corruption SPAK agency, warning they will resort to self-vendication if the state does not intervene.

In August 2025, around 40 sheep farmers in Çërravë (Pogradec) held a rally after the local council moved to lease their one communal pasture (35.5 ha) to a solar investor. They decried the measure as a “direct violation of our livelihood” and threatened escalating protests if it proceeded. Independent councillor Arbër Male warned that the vote was a foregone conclusion with the beneficiary company “pre‑selected” by insiders. Such frustrations highlight a growing fear: that the clean‑energy drive is being hijacked by politically connected interests at the expense of ordinary Albanians.

A protest in the village of Çërrava, in the municipality of Pogradec

Critics say the evidence of cronyism is hard to dismiss. The Boçovë solar park was nominally awarded to “Albania Solar Power” (a tiny firm with €100,000 capital) owned by businessman Engjëll Agalliu yet locals see it as Pëllumb Salillari’s project in disguise. Likewise, in Imshtë a construction firm once run by Salillari is tied to Çekrezi’s land deal. Journalist investigations have exposed how clusters of permits went to companies tied to a few elite families, often without competitive bidding. (For example, four solar firms controlled by Armand Lilo’s relatives won megawatt‑scale licenses after a brief ministerial review.) The torrent of approvals has largely skipped formal auctions: as energy expert Simaku notes, “auctions have been forgotten; now licenses are given only on the free market, sold to us as if for domestic use but it’s not true”. NGOs also complain that municipalities have merely rubber‑stamped solar leases, lacking clear strategic planning on where solar parks are appropriate. All Green Center warns that so far, zero hectares of new PV forest have a strategic environmental assessment or master plan to guide them.

A protest in the village of Çërrava, in the municipality of Pogradec

Defenders of the solar boom argue Albania urgently needs a new generation after recent blackouts. The government’s National Energy Plan targets 54.4% renewables by 2030, so big solar projects are deemed necessary for “energy sovereignty”. Prime Minister Rama’s infrastructure ministry underscores that thousands of hectares of mostly unproductive land are available for lease; the projects will create green jobs and revenues. Indeed, Albania’s solar push aligns with EU climate goals and avoids new dams (and displacements) for hydropower. Statisticians note that in the past 10 years Albanian municipalities have leased about 6,350 hectares of public land for all purposes, with over a third (2,325 ha) of that just in 2024 mostly for solar parks. In total some 3,750 ha of state land are now contracted for renewable energy projects. Energy Minister Belinda Balluku, who is under investigation by SPAK, insists each plant needed both a Council of Ministers decision and technical approvals and that “everything is lawful, with environmental studies in place,” though she has not publicly addressed the growing protests.

Photovoltaic power plant in Kolonjë, residents in protest

Nevertheless, the ethical question remains stark. Who really benefits from this boom? Many locals answer: not them. Herders point out that solar panels are theoretically compatible with grazing (the technology allows it), yet companies invariably fence off and occupy the land outright. In Kolonjë, villagers say the developer (Turkish firm Fortis Energy & Construction) even redrew cadastral boundaries to claim around 400 hectares of steep pasture and riverbed (“zall”) that herders need for winter grazing. “If they put up panels, our village will have to leave,” one farmer warned, noting the man behind the project quietly acquired neighbouring plots over decades. Such tensions raise hard choices about property rights and the state’s role in declaring some lands sacrosanct for community use or not.

Protest against PV installation by local communities

Protest against PV installation by local communities

For now, many communities are calling for moratoria. Simaku and other analysts urge a strategic pause: map out priority corridors for solar (avoiding protected zones), require genuine public auctions and participatory planning, and bind new plants to domestic needs. Environmentalists warn that Albania’s decades‑old tradition of hydropower should not be cynically traded for a different form of energy dependence. “We risk exporting renewable energy and importing coal,” Simaku says. If that happens, the country may have allowed a green transition to line the pockets of the connected few rather than serve its people’s interests.

In the heated debate over Albania’s clean‑energy path, one thing is clear: expansion of renewables cannot be at the unchecked expense of farming communities. Without transparent governance and respect for local livelihoods, each new solar panel risks deepening rural distrust. Some farmers now speak of taking their case all the way to the European courts. Whether Albania’s solar revolution will shine on as a model of sustainability or become a catalyst for social unrest may hinge on whose voices are heeded in the fields, the villagers who till the earth, or the energy “czars” behind the grid.

February 16, 2026
by in News

Albania’s Energy Sector: Key 2025 Insights and Outlook

Albania’s energy sector in 2025 remains dominated by hydro and oil, but undergoing rapid change. Gross available energy (supply) in 2023 was 2,234 ktoe, against primary production of 1,799 ktoe. Imported oil and electricity cover the gap: the country needs roughly 4–5 TWh of net imports annually. In 2023 final energy consumption was 1,942 ktoe (down 2.8% year-on-year), with industry (~27%), residential (~34%), transport (~22%), services (~11%) and other sectors (~6%) each accounting for a share. Albania’s energy intensity remains fairly low – roughly 0.17 ktoe per million EUR of GDP (–4.0% in 2023) – reflecting both efficiency gains and a modest economic base.

Infrastructure investments are focused on grid upgrades and new pipelines. Two major 400 kV transmission projects are planned or underway: closing the internal 400 kV ring and building a 400 kV Albania–Kosovo* interconnector (both under WBIF support). The long-delayed Elbasan–Bitola 400 kV line (a 2018 Energy Community project of common interest) still awaits completion. On gas, Albania currently has no domestic market – it consumes virtually no pipeline gas today – but this will change. A Fier exit point on the Trans-Adriatic Pipeline (TAP) is under construction (targeted commissioning October 2027), and a planned Fier–Vlora feeder line is in planning. Meanwhile a new Korça gasification scheme (Azerbaijani Azeri gas via TAP) was agreed in November 2024, aiming to extend distribution into eastern Albania. These gas projects could underpin future power and industrial expansion.

2023 Albania Primary Energy Production by Fuel (ktoe) – oil and hydro dominate

Electricity Market: Liberalization and Infrastructure

Since 2023 Albania has made notable strides in power market integration, but wholesale trading remains limited. A day-ahead market was launched in April 2023 and coupled with Kosovo* from January 2024 – the first cross-border market coupling in the Energy Community. Complementary regional intraday auctions (CRIDAs) between Albania and Kosovo* began in December 2024. (Plans for a continuous intraday market are pending.) The Albanian Power Exchange (ALPEX) operates these markets: by 2024 it had 26 registered participants, of which 16 trade intraday, and traded roughly 12% of Albania’s final electricity consumption on the day-ahead market.

However, full liberalization is unfinished. The day-ahead and intraday markets run in parallel with a traditional regulated market. The state-owned utility KESH still supplies universal service customers (low-voltage households) under a public service obligation (PSO) at government-set prices. Regulated tariffs and supply obligations extend to most small businesses and residential clients. Only customers on 10–110 kV networks (large industry) face market prices, with lower-voltage consumers still sheltered under universal service tariffs. Indeed, current regulations keep in place a PSO for KESH (originally a temporary crisis measure) and a supplier-of-last-resort (SoLR) regime for others. Retail prices for low-voltage consumers thus remain controlled (free market entry is limited), and new retail deregulation phases (10 kV by 2025, 6 kV by 2026) are planned. (These interventions still fall short of EU requirements.)

Balancing and ancillary services are developing along European lines. A 15-minute imbalance settlement period was introduced in 2025 (after delays). Balancing energy is procured via a merit-order market operated by OST (the national TSO). Cross-border balancing cooperation is currently minimal: Albania only shares frequency-restoration reserves with Kosovo* under a joint “AK block” agreement. Full participation in European balancing platforms will require transposing the EU Electricity Regulation (2019/943) and Network Code on balancing (2017/2195) – work that has only just begun.

On network infrastructure, the transmission system operator OST is certified (ownership unbundled) and a member of ENTSO-E, but key grid upgrades lag. The TEN-E revision (2022/869) – which would designate new energy corridors – has not been transposed. In the meantime, two grid projects of regional interest are under development: closing Albania’s internal 400 kV loop and a new 400 kV tie to Kosovo*, both backed by EU grants. Investment plans for OST and the DSO (OSSH) are now regularly approved by the regulator ERE; ERE also endorsed the 2025–27 capital plan of OST in 2025, which includes these projects. Distribution network upgrades (smart metering, loss reduction) remain on the agenda but face funding constraints.

[Insert chart: Albania Electricity Market Coupling Timeline (Day-ahead April 2023, coupling Jan 2024, CRIDAs Dec 2024)]

Gas Market: Emerging Supply and Infrastructure

Historically, Albania had no natural gas consumption; electricity and heating ran on oil and biomass. This is changing. Although no domestic gas market exists yet, Albania is transposing EU gas rules in anticipation. The regulator has applied REMIT transparency rules (excluding market rules). Certification under the Third Package is in place: TAP AG (cross-border pipeline) is certified as an exempt TSO, and Albgaz (Albania’s gas TSO) was conditionally certified under ownership unbundling. Albgaz’s remaining unbundling issues have been repeatedly extended (new deadline end-2025), and TAP and Albgaz plan separate network codes once pipelines operate.

Two key pipeline projects will shape Albania’s gas landscape. First, the TAP Fier exit point will link Albania to the Trans-Adriatic Pipeline. Construction is slated to start May 2026 and complete by October 2027. This facility (a pressure-reduction station and meter) will allow Azeri gas from TAP to enter Albanian networks. Second, the Korça Gasification Project – a private initiative by Azerbaijan’s SOCAR – will build a local grid from a new Fier (TAP) connection eastward. A 2024 MoU commits Albgaz and SOCAR to design and build the exit and local pipeline, with a TAP capacity nomination already in place. If realized (final investment decision pending), Korça would for the first time supply gas to industries and possibly power plants in southern Albania by the late 2020s.

Domestic gas demand is expected to grow once these are online (power plants and industry will switch from oil), but there is no wholesale gas trade yet. Secondary legislation to allow retail gas supply exists, but without an existing network to serve, these serve mainly as placeholders. In practice, Albania’s future gas wholesale is effectively TAP-dominated; a functioning national hub or trading platform is still years away.

Renewable Energy and Decarbonisation

Albania’s power system is already very green by global standards, but has room to diversify. In 2024 total renewable electricity capacity reached about 3,005 MW – dominated by small hydropower (<10 MW) at some 2,181 MW and utility-scale hydro (≈375 MW), with 449 MW of solar PV. (Wind and biogas are currently negligible: the report notes only 3 MW of wind.) Renewables supplied most of Albania’s generation in 2023 (hydro plus a modest biomass cogeneration), but exact shares are not broken out in the report. What is clear is that Albania’s 2030 renewables target is ambitious: the adopted National Energy and Climate Plan (NECP) aims for 54.4% of final energy consumption from renewables by 2030, above the 52.0% goal set by the Energy Community Decision. The NECP also envisions sectoral sub-targets (e.g. ~178% for electricity, 34.6% transport, 16.6% heating/cooling) that exceed current EU RED II mandates.

Policy reforms are in motion to boost renewables. The 2023 Renewable Energy Law shifted from fixed feed-in tariffs to competitive auctions (contracts-for-difference/premium) for green power. Two auctions were already held with fixed prices, with plans to transition to pure CfDs once Albania’s day-ahead market achieves liquidity. So far no statistical transfers or joint schemes (EU cooperation mechanisms) have been used. Net metering is enabled (rooftop systems up to 500 kW) and Albania plans to move to net billing (full retail credit) as of 2024. The law also incorporated guarantees-of-origin (GOs) for all renewable generation: an electronic GO registry became operational under ERE in May 2023, laying groundwork for tracking clean energy. However, “renewable energy communities” are still theoretical – no community project has been set up yet.

In the heating sector, Albania is rolling out support for solar thermal collectors and heat pumps. A recent scheme reimburses 70% of solar water heater costs for low-income households (vs. 20–30% for other systems). Draft legislation for broader RES heating/cooling incentives is pending. On bioenergy, Albania has transposed most RED II provisions, but needs secondary rules for verifying sustainability (GHG savings and land-use criteria) for bioliquids and solid biomass used in heat and power.

Overall, the renewables pipeline is robust: capacity grew by +279 MW in 2024 (mostly PV additions). Auctions and net-billing should further drive solar rooftop uptake, especially for homes and businesses now escaping fixed feed-in tariffs. Hydropower will remain the backbone of Albania’s system; future small hydro additions and the potential for wind in the flat coastal plains (not yet tapped) could further diversify output.

Energy Efficiency and Buildings

Improving efficiency is a strategic priority. Albania’s buildings are its largest energy sink, consuming 38% of final energy in 2023. Recognizing this, in June 2025 Albania adopted a new Energy Performance of Buildings law, aligning key provisions with EU directives (including upcoming 2024 requirements). An Energy Performance Certificate (EPC) system is now operational, with ongoing training and software development. Crucially, a long-term renovation strategy (in line with the EU’s Renovation Wave) was approved in February 2025. The government is developing a detailed renovation plan to reduce building energy use, tackle energy poverty, and modernize housing and offices across Albania’s regions.

Albania’s energy consumption is already edging down. Primary energy use fell to 2,141 ktoe in 2023 (–1.5% year-on-year), while final consumption was 1,942 ktoe (–2.8%). For comparison, the 2030 NECP targets are much higher: 2,600 ktoe (primary) and 2,400 ktoe (final). The continuing decline reflects efficiency measures and structural changes. Energy intensity (use per GDP) is among the lowest regionally at ~0.17 ktoe/MEUR. Key upcoming measures include a new Energy Efficiency Law (planned in 2025 to transpose the recast EU EED), full implementation of the energy obligation scheme, and mandatory labelling and standards (a product-labeling law was passed in mid-2024). So far Albania lacks a dedicated EE fund; financing for retrofits has come from budgets and donor programs, with early ESCO activity in the housing sector. Improved access to credit and subsidies for vulnerable households are being discussed as next steps.

Policy, Regulation and EU Alignment

Albania’s legislative framework is being steadily updated to meet EU/EnC requirements, but gaps remain. The Electricity Integration Package (EIP) – the core EU rulebook for electricity markets – is not yet fully transposed. A draft law (May 2025) would implement many EIP provisions (market design, unbundling, RES integration, etc.), but it has not been passed. In the interim, ERE has adopted some CACM rules: a national capacity allocation & congestion management regulation (EUR 543/2013) was approved in April 2025. Albania also uses the SEE Regional Auction Office (SEE CAO) for cross-border capacity. Notably, the EU rule requiring at least 70% of interconnector capacity to be offered to the market is not in force yet.

In gas, Albania’s alignment is behind schedule. The EU’s Gas Security of Supply Regulation (2017/1938) is only partly implemented in law (via amendments to the 2021 Gas Law). A national Risk-Preparedness regulation (EU 2019/941) is due by end-2025; a draft Power Sector Law under discussion could designate the ministry as risk authority and mandate a preparedness plan. On emissions, Albania’s 2021 Law on Climate Change set up GHG inventories and MRV (monitoring/reporting) systems, and a new climate law (expected 2025) will refine MRVA obligations. However, Albania has no 2050 neutrality strategy yet – a critical missing piece. The Energy Community Secretariat notes this as an opportunity: the new climate law is a chance to embed a 2050 net-zero goal aligned with regional climate neutrality. Similarly, the EU’s new targets (at least –55% GHG by 2030 vs 1990) should be written into law; Albania’s NECP-included target of –53.2% by 2030 has yet to be codified.

Installed Renewable Energy Capacity by Type (MW, 2024) – large hydro vs small hydro vs solar

On renewables and energy, many EU directives are in place but not fully enforced. The transposition of RED II’s sustainability criteria for bioenergy remains incomplete (secondary rules are pending). The Energy Efficiency Directive’s Article 5/7 energy savings obligations are being revised (a new Energy Efficiency Law is expected in 2025). ERE, the energy regulator, is largely independent and well-funded (through fees), but it needs more capacity in market integration and surveillance. The Competition Authority and audit agencies are updating rules: notably, Albania’s competition law still lacks a ban on anti-competitive decisions by associations, a gap being addressed.

Challenges and Investment Opportunities

Challenges for Albania’s energy sector are many. The system is highly hydro-dependent, making it vulnerable to droughts (although the report does not quantify this risk, it is implicit). Hydropower output can swing year-to-year; in dry seasons Albania may import costly thermal power. The wholesale market is still tightly regulated: KESH’s PSO obligation and the tariff freeze for households suppress price signals. With only ~12% of demand traded on the exchange, liquidity and competition are low. Energy poverty is acute – in 2023, 34.8% of households fell behind on utility bills – and subsidies for low-income consumers cost the state ~€14.2 million per year (for under-300 kWh relief). Distribution losses remain high (the report’s chart shows ~27% of primary energy lost in losses and transformation). Regulatory delays (EIP, RED II, TEN-E) also pose risks: without quick reforms, Albania could be left out of key EU market frameworks. Finally, the lack of domestic fossil fuel resources (all oil is imported) means geopolitics still loom large.

Yet opportunities abound for investors. Albania’s grid needs modernization: the 400 kV ring and new interconnectors will unlock capacity and relieve bottlenecks. The Western Balkans Investment Framework (WBIF) and EU funds stand ready to de-risk these projects. On renewables, Albania has proven technology potential. Small hydropower already leads capacity, but solar PV has room to grow – rooftop solar in particular is financially attractive given high sunshine hours and net-billing rules. The successful launch of auctions means new wind and solar projects can seek investors. Albania also has significant wind potential along its Adriatic coast and offshore (noted by developers, though not yet realized).

In gas, early movers will find unique first-mover advantage. The imminent TAP exit point and new Korça pipeline will create an Albanian gas market where none exists. Gas-fired power plants (modern CCGTs) could then enter the mix to complement variable renewables and stabilize supply – currently discussions are underway for a planned new gas power plant (with a 2023 EIA completed). Domestic industries (steel, chemicals, cement) will benefit from cheaper and cleaner gas fuel.

The drive toward European integration is another driver. Albania’s commitment to join the EU means it can tap structural funds and grants (as the 400 kV and efficiency projects already do) to lower investment risk. The Regional Electricity Market (REM) in Southeast Europe is expanding; full day-ahead coupling with North Macedonia, Greece, and others is slated for the coming years through the IBWT process. Albanian power can thus access wider markets (raising price realization for producers). New balancing and reserve-sharing arrangements in the synchronous continental Europe grid could also enhance system stability.

Outlook (2025–2035)

Looking ahead 5–10 years, Albania’s energy transition will be shaped by how quickly reforms and investments are realized. If the EIP is transposed and markets liberalized, Albania could see a virtuous cycle: more foreign investment, deeper regional trading, and faster renewables rollout. The TAP exit (online ~2027) will mark a milestone – enabling real gasification of the economy and likely powering a switch away from oil in power and transport. The 400 kV grid projects (current timeline by 2030) will significantly improve domestic reliability and export capacity.

However, several risks remain. Climate variability poses growing uncertainty: reduced rainfall could lower hydropower generation, necessitating backup thermal plants or imports during dry spells. Delays in drafting the 2050 climate-neutrality strategy or failing to meet Energy Community targets could hinder access to green financing. Continued energy poverty and fiscal pressure from subsidies could constrain budgets for infrastructure. Geopolitical shocks (e.g. regional supply disruptions or price spikes) remain possible, underscoring the need for energy diversification.

On balance, Albania’s prospects are positive: an increasingly competitive energy mix is emerging. By 2030 Albania could comfortably meet its 54% renewables share and even push beyond with new solar and pumped hydro. Improved interconnections and market coupling will integrate Albania into the European grid both technically and economically. Enhanced efficiency in buildings and industry will moderate demand growth (the country’s 2030 NECP actually foresees higher consumption targets than today). This combination – rising renewables and efficiency gains – will bolster Albania’s sustainability, reduce emissions, and hedge fossil-fuel price risks.

In conclusion, the 2025 Energy Community Country Report highlights a period of transition for Albania: from a historically state-dominated, hydro-driven system towards a more liberalized, diversified, and EU-aligned energy economy. Achieving this vision will require sustained reform and investment. The payoff – in terms of economic competitiveness, cleaner air, and greater energy security – promises to be substantial for Albania and its regional partners.

Sources: Energy Community Secretariat, Albania – Annual Implementation Report, Nov. 2025

January 22, 2026
by in News

From Austria to Albania: Verbund, Nordex to deploy 105 wind turbines across Europe

Verbund Green Power has forged a partnership with Nordex Group for the potential procurement of wind turbines.

Verbund Green Power, a subsidiary of Austrian state-owned energy utility Verbund, has entered into a multiyear framework agreement with leading wind turbine producer Nordex Group for the potential procurement of wind turbines of up to 700 MW in total capacity, according to a joint press release.

The agreement runs through 2030.

The power plants are planned in six markets

The agreement was officially signed in Verbund Green Power’s Madrid office by Dietmar Reiner, Managing Director of Verbund Green Power, and José Luis Blanco, CEO of Nordex Group.

They expressed willingness to facilitate the supply and delivery of up to 105 Nordex onshore wind turbines for Verbund Green Power’s wind projects. They are are planned in Austria, Germany, Spain, Italy, Romania and Albania, the update reads.

europe verbund nordex Dietmar Reiner José Luis Blanco
José Luis Blanco and Dietmar Reiner (photo: Verbund)

Of note, Christopher Billot, Sales Director for the Mediterranean region of Nordex Group, said at Belgrade Energy Forum 2025 that the Balkans is a key region for his company.

The deal would cover approximately 50% of Verbund Green Power’s wind project pipeline.

Blanco: We’re creating a clear path to deliver reliable, cost-efficient wind energy together with Verbund

Nordex Group CEO José Luis Blanco explained that through this multi‑year framework, the company would provide the turbine capacity to convert an ambitious pipeline into clean generation across six multi‑country markets in Europe.

“With up to 700 MW of our latest 7 MW class onshore turbines slated across Austria, Germany, Spain, Italy, Romania and Albania, we’re creating a clear path to deliver reliable, cost-efficient wind energy together with Verbund through 2030,” he stressed.

Strugl: The collaboration with Nordex strengthens our supply options as our projects mature

Blanco recalled that late last year Nordex received a first order from Verbund for nine N175/6.X turbines for Romania. “We’re expanding our footprint in this country,” he added.

According to Verbund CEO Michael Strugl, the collaboration with Nordex supports his company’s strategic objective of scaling up renewable generation across Europe.

“It strengthens our supply options as our projects mature, allowing us to secure the supply chain in a very competitive environment and deliver on Mission V targets, contributing to a secure and accelerated energy transition in our markets,” Strugl added.

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