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EU urges Kosovo to move ahead with power project

Newly independent Kosovo must move ahead swiftly with a project to build a new power plant or risk running out of electricity by 2010, a senior European Union official said on Friday.

The €3.5 billion ($5.50 billion) ‘Kosovo C’ project to build a coal-fired plant and develop a new mine “needs to be moved on urgently”, said Paul Acda, head of the EU wing of the United Nations mission in Kosovo. “If it isn’t, the potentiality is that Kosovo will run out of coal, run out of energy between 2010 and 2012,” he told a news conference.

Kosovo, which declared independence from Serbia with Western backing on Feb 17, faces significant electricity shortages as its decrepit Socialist-era monopoly struggles to meet demand. The previous government had promised to choose between four international bidders by the end of 2007. Kosovo C project manager Lorik Haxhiu said the change of government late last year and Kosovo’s bid for independence had delayed the project. “If we manage to choose the company by the end of this year, that will be good,” he told Reuters.

The project involves the construction of a €2.47 billion coal-fired power plant with a capacity of up to 2,100 MW, the overhaul of the existing electricity plant and development of a new lignite mine nearby.

The previous government narrowed the race down to four bids:
- a joint bid by Czech power firm CEZ, the largest central European power company, with AES Corp of the United States
- a joint bid by Italian energy group ENEL and Sencap, a consortium of Greece’s Public Power Corp and US energy company ContourGlobal.
- a bid by Germany’s RWE, one of Europe’s biggest electricity generators
- a bid by a consortium of German utility EnBW, part-owned by France’s EDF, and US-based WGI.

Lignite, one of the cheapest forms of fuel used to produce power, is Kosovo’s largest resource, with around 10 billion tons. “Kosovo C has the potential to improve the energy situation and make Kosovo an energy exporter,” Acda said.

The UN mission took over running of the Albanian-majority territory in 1999, after NATO bombs drove out Serb forces to halt the ethnic cleansing of Albanian civilians. Acda said the EU pillar within the UN mission would cease operating at end-June, as part of the mission’s downsizing and handover to EU-led supervisory and police missions. (Reuters)