Feed-in Tariff

Updated: 19.12.2017

Author: Tim Sternkopf

The public utility is obliged to purchase electricity from renewable energy sources for a tariff set by the Albanian Energy Regulator (Art. 22, § 4, Renewable Energy Law). The tariff is granted for 15 years (Art. 9, § 8, Renewable Energy Law).

Eligible technologies

All small-scale renewable energy plants are eligible for a support in terms of a feed-in tariff.

Wind energy

Wind energy plants not exceeding 3 MW are eligible.

Hydro-power

Hydro power plants up to 15 MW are eligible (Art. 3 § 1 (j) Renewable Energy Law).

Solar energy

PV plants up to 2 MW are eligible.

Amount

The amount of support for the coming years is defined by ERE in accordance with the Decision of Ministers by assuming a reasonable return on investment (Art. 10, § 3, Renewable Energy Law).

Wind energy

The assumptions for 2017 until 2019 by the Council of ministers are the following:

2017:

 

  • WACC: 8.8%
  • LCOE: € 1.450 per MWh

2018:

 

  • WACC: 8.0%
  • LCOE: € 1.400 per MWh

2019:

 

  • WACC: 7.5%
  • LCOE: € 1.350 per MWh

Solar energy

The assumptions for 2017 until 2019 by the Council of ministers are the following:

2017:

 

  • WACC: 8.8%
  • LCOE: € 1.400 per MWh

2018:

 

  • WACC: 8.0%
  • LCOE: € 1.300 per MWh

2019:

 

  • WACC: 7.5%
  • LCOE: € 1.000 per MWh

Addressees

All legal and natural persons registered in Albania 

Procedure

Process flow

The construction of new generating capacities of up to 2 MW is approved the Ministry of Energy, whereas the generation capacities of more than 2 MW are approved by the Council of Ministers (Art. 49 Power Sector Law). 

Additionally, renewable energy capacities require the license granted by the Albanian Energy Regulatory Authority. The license is granted based on the technical and economic documentation together with the approvals from the relevant bodies including environmental permissions, water usage permission and permissions from TSO and DSO (Licensing Regulation). 

Producers from hydro power-plants of the installed capacity larger than 2 MW can also invest in the project through public-private partnership based on concession (Art. 5 § 1 (i) Law on Concessions and Public Private Partnerships) 

The renewable energy producers with the obtained license conclude a Power Purchase Agreement with the Electricity Power Distribution System Operator (Oshee sh.a.)

Competent authority

Ministry of Energy, Council of Ministers, Energy Regulatory Authority

Cap

Only hydro-power plants of less than 15 MW of the installed capacity are eligible for the support scheme.

Eligibility period

The power purchase agreements are signed for 15 years (Art. 9, § 8, Renewable Energy Law).

Distribution of costs

Consumers

The costs of the feed-in tariff for electricity produced from renewable energy sources are borne by the final consumers (Art. 11 Renewable Energy Law).

Distribution mechanism

ERE approves the fee for the end consumer for the costs resulting from the feed-in tariff. The operator assigned by the Council of ministers is responsible for the collection of money from energy suppliers and the payment to the producers eligible for support. (Art. 11, Renewable Energy Law)

Albania

Further information