Bilateral agreement heralds big plans -- Italians sign up for 1000 MW in Albania

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Albania ended 2008 just as it began -- with no wind capacity yet installed but the number of projects planned for the country by Italian firms continuing to grow. Italian wind projects in the pipeline for Albania now top 1000 MW, although no turbines are expected to be turning in the country for several years.

Marseglia Group is the latest Italian firm to get an official nod of approval from the Albanian government for an ambitious wind project. The company's Ital Green Energy has permission to develop a 234 MW wind farm in Albania's Lezha region, with Albanian Prime Minister Sali Berisha turning up to witness the signing of the contract in January. Just a month earlier, Italian Prime Minister Silvio Berlusconi joined Berisha for a contract signing ceremony held by Italy's Moncada Energy Group for its 500 MW wind farm, approved by the Albanian government early last year for development on the Karaburun peninsula. Two further projects, with a combined capacity of 328 MW, are planned for Albania by Italian firm Italgest and Swiss firm EnergyMixx.

The growing interest in Albania wind power being shown by Italian firms results from a bilateral treaty that allows electricity imported from wind and other renewable energy plant in Albania to benefit from Italy's attractive renewable energy incentive mechanism, which pays some of the highest rates for wind generated electricity in Europe (previous story). Although Albania is in dire need of more generation, the grid is weak, supply is prone to frequent blackouts, and electricity prices are low, making the bilateral agreement vital for wind project viability, says Antonio Pecchia of Ital Green Energy.

Under the agreement, the bulk of electricity eventually generated by Italian built wind farms will be exported to Italy, Pecchia says. But some of it will be left for use in Albania. "Our sensation is that the substation that we will build for the project will also create greater stability in the dispatching of electricity [in Albania]," he says.

It will be some time, though, before the electricity starts to flow. Pecchia admits he has no idea when the 234 MW wind farm will come online. While the Albanian government has granted all necessary permits for the EUR 1 billion plan, what is still missing is the Italian government's go-ahead for a 1000 MW undersea electricity transmission cable linking the two countries.

Moncada is also arranging to ship most of the electricity from its 500 MW Albania development back to Italy, via a 400 kV, 500 MW undersea cable spanning 154 kilometres from Babica in Albania to Brindisi in southern Italy. Moncada already has approval for its cable and expects to open its construction site this year. It estimates that it will take about four years to complete the wind farm. The cable link is expected to take three years to build once a general contractor is chosen for that portion of project, says the company.

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