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Case Study

Jan 22, 2014

The Future of Hydroelectricity and Coal Consumption in Albania

Albania’s high use of hydroelectricity contributes to its lower carbon emissions. Image Credit: Wikimedia Commons/Idobi.

Albania receives about 90 percent of its energy from a renewable source: hydropower. Like Iceland, Paraguay, and other high-ranking countries in the Trend in CO2 Emissions per Kilowatt-hour indicator, a heavy reliance on clean electricity gives little room for Albania to improve the current carbon intensity of its power sector—a shortcoming any country would be proud to claim. While it may be hard to fathom a decline from these top levels of performance, given established infrastructure, recent policy changes in Albania signal that the country may decline in performance on this indicator in the future. 

Because water availability for Albania’s energy sector historically has been unstable, Albania’s power sector suffers from frequent outages and shortfalls. The World Bank projects that climate change will only exacerbate existing problems of water availability. However, Albania is keen to maintain the general trend of growth it has experienced since it opened its markets following the fall of communism. To do so requires expanding its power sector. Among the proposed approaches to overcoming Albania’s energy shortages is connecting Albania to Kosovo’s coal-based electricity grid. A deal was signed in December 2013 to build a 400-kV transmission line linking the two countries.

Another deal has been struck between Albania and an Italian firm to build a large “energy complex” in the area of Porto Romano, the centerpiece of which will be an 800-megawatt coal-fired power plant. With its own coal infrastructure on the horizon, it seems likely that the days of Albania’s exceptional record of low-carbon energy are numbered.

EPI methods do not account for future projections of indicator metrics, which is why Albania is still a top performer in Climate and Energy despite impending policies. Taking into consideration current actions that may impact Albania’s future climate performance, including the shortfalls of the country’s current hydropower system as well as an imminent increase of coal consumption, suggests the country should look to diversify its renewable energy portfolio beyond hydropower if it seeks to continue low-carbon economic growth.