Albanian Economy to Fluorish with TAP, Officials Say

Albanian government officials have gone on record to promote the Trans Adriatic Pipeline (TAP), stating it will be a good investment for Albania and its economy.

All the necessary documentation for building this project, which will transport gas from the Caspian Basin through Turkey, Greece and Albania before reaching the coast of Southern Italy, is ready with construction expected to start in 2016.

The construction of TAP is not expected to significantly impact the EU's move to reduce dependency on Russian supply; however, it will have an important bearing on the economies of states in southeastern Europe including EU member Greece.

Natural Gas Europe has the opportunity to receive the views of Ilir Bejtja, Deputy Minister of Energy & Resources of Albania on the TAP project and natural gas in Albania.

''This is the opportunity for gasification of the country. Albania will have three connection points for natural gas and this will give us the opportunity to play a key role for supplying Balkan states'', commented the Deputy Minister.

He emphasised that the country will reduce the use of electrical energy, which is now the only source of energy in the country, adding that all political forces in Albania are in consensus on this matter.

Albania plays a key role in the development of the Southern Gas Corridor through the passage of the TAP pipeline. What has Albania done so far regarding the building of TAP and what is it planning to do in the future?

"We have already fulfilled previous obligations, including voting in parliament, voting on the project and track of TAP and – as far I know – we have also concluding the tender for the building of a road for the construction of the pipeline. The government of Albania is also in the process of issuing licences for building TAP.  So far, there are no obstacles to report for this project. Albania will have three connection points for natural gas, and this will give them the opportunity to play a key role for supplying Balkan states which are related to Ionian Adriatic Pipeline with natural gas, and they will get the chance to benefit from their resources and their own production. Albania now only has one source of energy: electricity. With the building of TAP, Albania will have the opportunity not to depend on only one source of energy.  This will make it possible for the economy to grow at a quicker rate.   

What are the characteristics of the Albanian segment of TAP and how will the building of this pipeline impact the country’s economy?

"The pipeline section is 217 kilometers long, there will be three gas connection points, it will involve about 2,000 workers and it is estimated that around 500 million euros will enter the Albanian economy in terms of work, facilities, taxes, etc. Many domestic companies will be involved in the project.  For example, there is now one Albanian-Italian joint venture which will be doing the work on infrastructure for the pipeline. Another benefit will be diversification of energy sources through the gasification of the country. Houses will finally have the opportunity to use gas for personal use. It will also be a part of Albania’s regulatory framework for energy. In general, this will have a big impact on Albania’s economy since this is one of the biggest energy projects in the country.  With this project, it became possible to forge new relationships. Albania is now working with Azerbaijan in order to benefit both countries from this cooperation".

Is there a full political support for building this pipeline in Albania?

"Yes, it has the consensus of all political parties. This project was not initiated by the Socialist party which is now in power, but the former ruling establishment. That being said, the new government has supported this project because it is in the best interests of the country".

At the latest meeting with the officials from Azerbaijan, you agreed that a special working group be formed to undertake a master plan for developing Albania’s gas market. Can you tell us more specifically what this master plan will bring to Albania?

"Right now the country is focused on gas distribution for final consumption in Albania. It is about gasification of the country, which means that the natural gas should come to all areas where it was never before. That means urban areas, industrial areas and in that way the country will increase consumption of gas and reduce consumption of electric energy, impacting directly on projects heavily dependent on energy efficiency. Consumption of electric energy is very much dependent on weather conditions. By having another source of energy that is constant means that Albania will have much more energy. The government plans to redistribute and reallocate investments in this sector and transport it to other sectors which have been left behind because of a lack of funds. That is the main reason behind the creation of the master plan. Albania will consider how to develop this master plan through projects which will be financed from the state budget and from partnership funds."

In 2014, Albania started implementing a package of reforms in the energy sector. What has been done so far?

"Albania has done a great deal of work. To provide a bit of background, in 2013, Albania started with a loss of 217 million dollars in its energy sector. In 2014, this number is planned to be reduced to 180 million dollars. But Albania has moved further: debt has been reduced to 45 million dollars. We achieved this through a series of actions, regulations and modifications. That number will be even smaller by the end of this year. The government is working to change the situation further and to contribute to the state budget in the future and not to take any more money from the budget like it has so far. This year, it is planned to finance the state budget with about 130 million dollars of support. At the end of the year, Albania will definitely be at zero and only contribute to the budget in order to improve its negative account that has been dragging for years. The situation will be quite different. This will help the country to increase its investments in the energy sector and to be much more confident with its relationships with banks and other financial institutions and partners. I do not not believe Albania will be super energy force, but will be positive contributor".

Albania has also taken over the chairmanship of the Energy Community, on January 1. 2015. What will be the goals that the country will try to achieve in the period of one year and where does the country currently stand when it comes to Third Energy package reforms of EU?

"Very soon, Albania will have a new laws. The basic law in the power sector will regulate and consolidate all the renewable energy sources in which the country has been lagging development.  Albania will also introduce a law about hydrocarbons and building efficiency, which is all a part of Third Energy Package. These laws, among others, will be a push forward in its role in the energy sector of the Balkan and European markets. The participation in TAP and IAP is also showing that Albania is playing an important role by pushing forward these two projects which are very important for Western Europe's countries as well. Albania’s participation in the Energy Community will also be useful for other countries to move forward and to changing the energy sector. Albania is also going to liberalise the consumption market. By moving in that direction, the country will have a free competitive market, which is integrated with other countries. Regional projects and cooperation with neighboring countries: Kosovo, Macedonia, Greece and Italy will put Albania in the role of energy dispatcher, which is distributing energy to regional areas".