Kosovo Transmission Development Project

Translated version of this PSD: Albanian

Project Description

The EBRD is considering providing a corporate loan of up to €30 million to the public service company Transmission, System and Market Operator j.s.c. (KOSTT) to finance the rehabilitation of selected substations and transformers and strengthening the grid at the 110kV level.

The project will assist KOSTT in achieving compliance with the N-1 electricity transmission grid security criteria, a key technical requirement of the European Network of Transmission System Operators for Electricity (ENTSO-E).

Transition Impact

The transition impact potential of the project stems primarily from the following:

• Expansion of competitive market interactions in other sectors: The project will assist KOSTT in achieving ENTSO-E’s technical requirements, thereby supporting market integration by enabling KOSTT to manage a liberalised market system.
• Setting standards for corporate governance and business conduct: The EBRD loan will be the first non-sovereign guaranteed loan to a public company in Kosovoand this is expected to have a demonstration effect to both domestic and foreign financiers of new ways to finance projects.

The Client

Kosovo Transmission, System and Market Operator j.s.c. (KOSTT).

EBRD Finance

Up to €30 million.

Project Cost

€36.5 million.

Environmental Impact

Category B.  An Initial Environmental and Social Examination (IESE) confirmed that the Project is a B category in accordance with the Bank’s Environmental and Social Policy, requiring an Environmental and Social Due Diligence (ESDD). The IESE confirmed that none of the projects to be financed by the Bank will be located in sensitive areas, such as Natura 2000 (or equivalent), or be associated with resettlement or public health implications. Some of the projects will require an EIA under National legislation and would fall under Annex II of the EU EIA Directive.

The IESE confirmed that the Company has the capacity to fully implement the Bank’s PRs, and is in the process of implementing ISO 14001 and OHSAS 18001.

The Bank will undertake further ESDD and among others, develop a Stakeholder Engagement Plan (SEP) as well as a Non-Technical Summary (NTS) for each subproject. Based on the ESDD an Environmental and Social Action Plan (ESAP) will be developed and agreed with the Company.

The PSD will be updated once the ESDD is completed.

Technical Cooperation

The EBRD is exploring associated technical cooperation projects to assist KOSTT with Environmental and Social Due Diligence; to assist with the implementation of the project; and capacity building assistance for KOSTT.

Implementation Summary

The Project supported KOSTT in improving the stability and reliability of the power system by reducing inefficiencies and bottlenecks in Kosovo’s transmission network and meeting the ENTSO-E’s technical requirements. The Company became technically ready and compliant, and signed the Connection Agreement with ENTSO-E by end of 2020 allowing the Kosovo TSO to operate under the synchronous area of Continental Europe and manage its border capacity.

The Project was implemented in accordance with the Bank’s environmental and social policy and the Bank’s involvement ensured that transparent and efficient procurement procedures were followed. Through the Environmental and Social Action plan developed, the Project helped the company to strengthen environmental, health and safety management as well as stakeholder engagement attaining international EHS management standards.

As a part of its wider Transition Impact, the Project contributed to successful implementation of country and energy sector strategy and set standards for corporate governance and business conduct.

 

Related material