Power losses in February 2013 dropped to 48.71 percent, down from 51.12 percent in January, while the bill collection rate rose to 63.1 percent in February 2013, up from 59 percent last January
TIRANA, May 1 – Three months after taking over as state administrator of CEZ Shperndarje distribution operator, Sahit Dollapi says the electricity supply situation in Albania has considerably improved. Reporting to the Energy Regulatory Entity (ERE) on the performance of the electricity system in Albania, Dollapi said the increase in the bill collection rate has enabled the payment of a series of debts to state-owned power corporation KESH and transmission operator OST. He also announced the establishment of a task force in several areas which do not pay electricity bills. Dollapi said another measure under the company’s state administration involved the reducing of salaries for employees and their evaluation on a merit basis. The state administrator said CEZ was not importing electricity but was currently buying it from KESH and that the distribution operator was making a series of investments in the power grid to reduce losses. Power losses in February 2013 dropped to 48.71 percent, down from 51.12 percent in January, while the bill collection rate rose to 63.1 percent in February 2013, up from 59 percent last January.
ERE says that the cancellation of the contract with CEZ Albania which served as a sub-contractor for CEZ Shperndarje’s financial, IT, counseling, procurement services and its integration within CEZ’s internal structure has considerably cut the company’s expenditure.
Czech Republic-based CEZ Group, whose Albanian power supply subsidiary CEZ Shperndarje, was stripped of its licence last January, says it has officially initiated international arbitration procedures to claim compensation for the damage incurred in Albania. CEZ says it will claim Euro 200 million in international arbitration while the Albanian government claims that CEZ’s failure to fulfill its contract obligations over imports, investments and reducing grid losses caused the state USD 1 billion in damage. However, new Economy Minister Flojron Mima has urged for reconciliation steps.
The CEZ Group entered the Albanian market in May 2009 by acquiring a 76 percent equity stake in the Albanian power distribution company for Euro 102 million. CEZ blames the situation in Albania on tariff disputes with the Energy Regulatory Entity and heavy fines imposed by local authorities. Under a unanimous decision taken on January 21, the Energy Regulatory Entity (ERE) Board of Commissioners decided to revoke CEZ’s licence in Albania, arguing that the company had failed to make compulsory electricity imports, reduce grid losses, make investments, provide all consumers with power meters, pay debts to state-owned operators KESH and OST, and stop collective power cuts.
ERE’s Board also appointed Sahit Dollapi, the director of the Tirana Water Supply and Sewerage company and former director of the state run distribution operator OSSH until the Czechs took over in 2009 as the temporary State Administrator of the company until issues with CEZ are settled and the licence is awarded to another operator.
Debt collection company
claims Euro 108 mln
In its report on the performance of the CEZ Shperndarje distribution operator after the appointment of state administrator Dollapi, the Energy Reghulatory Entity (ERE) also notes that CEZ has been sued in the Vienna International Arbitral Centre by a debt collection company over its unilateral cancellation of the contract. ERE says Debt International Advisory (DIA) is seeking euro 108 million in damages for its unilateral cancellation of the contract due to expire on January 31, 2013. The company had been contracted by the Czechs to collect electricity debts from consumers who had not paid bills for more than 90 days. ERE says it is concerned over the selection of the Wolftheiss legal studio, which also served as a consultant for CEZ a.s when it acquired the Albanian distribution operator, and that it should not represent CEZ Shperndarje under state administration in the international arbitration trial.
