CEZ resumes electricity imports for its grid losses

TIRANA, July 17 – CEZ Shperndarje has resumed electricity imports to cover its huge grid losses, a legal obligation which the distribution operator had not respected in the past three months because of its critical financial situation. The resumption of electricity imports came after the country’s Energy Regulatory Entity (ERE) and the KESH power corporation had warned the CEZ distribution operator, currently under state management, would not tolerate lack of electricity imports for grid losses. CEZ said on Wednesday it has started importing 4 million kWh to cover its grid losses.
CEZ’s resumption of imports came after the KESH corporation warned CEZ’s failure to import electricity would cause a collapse in the energy system. KESH, which provided electricity to CEZ from April to June for its grid losses because of the favourable electricity generation, warned it could not tolerate the situation anymore because of the need to preserve the hydro-electricity reserve during the drought period.
“If CEZ does not import for its grid losses for one month, the water level in the Fierza lake will drop by 6 metres. Under current circumstances, CEZ owes the Corporation USD 450 million in electricity bills,” said KESH’s director general Halit Velaj, adding that because of unpaid debts the Corporation is facing difficulty in paying off obligations to the tax administration, pay social security contributions to its employees and loans guaranteed by the government.
“Small electricity producers are a grave burden for KESH which owes them USD 20 million and is not able to pay bills. Under these circumstances, all KESH’s bank accounts have been frozen by bailiffs,” said Velaj last week, asking for support by the new government.
CEZ said it has paid part of bills to KESH and will continue paying off the rest of the bills.
Grid losses in the Albanian dilapidated distribution grid stand at around 50 percent, most of which in unpaid electricity bills and thefts from illegal connections.
Since late 2012, when CEZ Shperndarje under Czech management declared its financial inability to make electricity imports for its grid losses, electricity imports have been carried out by state-owned KESH power corporation.
In late 2012, the country’s Energy Regulator fined CEZ Shperndarje 430 million lek (around Euro 3 million) because of its failure to import electricity.
CEZ’s state administrator Sahit Dollapi, said the distribution operator had not made electricity imports in order to pay off debts to other companies.
CEZ Shperndarje had paid off USD 181 million out of USD 208 million in debts CEZ Albania subsidiary owed to third parties.
“The company has up to now paid USD 181 million of which USD 60 million to KESH Power Corporation, USD 20 million to OST transmission operator and USD 30 million in outstanding and new bills for electricity imports,” said Dollapi.