Albania to Subsidize Electrcity Bills

Finance Minister Ridvan Bode

Tirana– Albania government intends to pay a 10 million euro in electricity bills for public utilities such as water-supply companies, in the next year, Ministry of Finance Ridvan Bode said in a press conference.

This week, the government accepted to pay a 5 million euro bill for 2008.

Public institutions and public owned utility companies are the biggest electricity consumers in the country. They account for a quarter of total consumption. Water-supply companies are among the biggest debtors of the power distribution operator, OSSH.

Czech power giant CEZ has agreed to pay 102 million Euro for Albanian Distribution Operator OSSH, bur negotiations have halted due to the unclear financial and technical situation of OSSH. Created as a company only in June 2009, almost two months before its privatization, OSSH has had serious difficulties in measuring power consumption of its clients, both public and private ones, and in collecting bills.

Experts allege that during the last several years, public institutions were billed artificially higher then their real consumption, due to the fact that it easier to cash bills from public institutions then private consumers. But this scheme has created a covert form of subsidizing OSSH from tax-payer’s money. Officially, the government cannot subsidize power companies directly as a precondition for successful market liberalization and privatization.

Short URL: http://www.albanianeconomy.com/news/?p=1420

Posted by editor on Dec 25 2008. Filed under Business, Economy, Invest-Inform. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry