In the process of implementation of Directive 2001/77/EC several steps are already made, as provisions related to promotion of renewable energy sources are to be found in 2003 Power Sector Law with the subsequent amendments, 2006 Concession Law, and two Governmental decrees from 2007 and 2008. The 2002 Law on investments facilitation in the new electricity generation capacities provide custom tax exemption for equipment used for renewable power plants with installed capacity less than 5 MW.

National indicative targets are not set yet, however the potential of renewable energy sources in Albania has been assess. In relation to the support schemes to be adopted, the 2006 Concession Law and two subsequent Government Decrees from 2007 and 2008 stipulates that uniform feed-in tariffs will be approved by ERE if the lessee requests it. Existing support schemes include support tariffs within the concession agreements concluded for small hydro power plants not exceeding 15 MW in installed capacity. For 2008, ERE approved tariffs of 6.5 leke/kWh (0,05 ¢€/kWh) for existing privatised SHHP and 9.4 leke/kWh (0,08 ¢€/kWh) for new HHP recently given in concession. Feed-in tariffs for electricity produced from other type of renewable sources than hydro are still to be developed by ERE.

The Regulatory Authority, ERE has been assign the issuing body for guarantees of origin and the regulation for issuing guarantees of origin has been adopted in 2007.

Authorisations for new capacities, including renewables power plants that are not subject on Concession Law, are issued by the Government. An authorisation procedure which is not based on Concession Law is in process of approval. Based on the Power Sector Law, ERE grant the status of a privilege producer that enjoys priority treatment by the TSO when dispatching the electricity to:
- electricity producers from renewables with an installed capacity up to 25 MW and hydro power plants up to 10 MW;
- electricity produced in cogeneration power plants up to 100 MW installed capacity;
- auto-producers for their electricity surplus provided that they use renewables and the installed capacity is up to 10 MW.
According to the Power Sector Law, the investor has to cover the cost of connection to transmission and distribution networks. Guaranteed access to the distribution networks has to be considered and where appropriate to require TSO and DSO to bear in full or in part the cost of connection to the grid.

Hydropower generation accounts for 95% of electricity produced in Albania, while 5% produced in small thermal power plants. However, according to Albanian TSO, in 2007 one of the most drought years in decades, the share of the electricity produced in hydro power plants decreased to about 50% of total energy consumption and Albanian power system had to rely on imports and, moreover, on power cuts to keep the system balance.
The technical hydro potential is considered to be currently exploited at only 35%, additional 2000 MW can be further developed to produce about 6.5 TWh/y however, it is largely dependent on the hydrology. Large projects under development includes Skavica (up to 350MW), Devolli (400MW), Vjosa (up to 400 MW), Kalivaci and Ashta (48 MW) hydropower plants.

In October 2008, the 35-year BOT concession agreement for Ashta hydropower plant (48MW) has been signed with a consortium of Verbund and EVN. The development of three hydropower plants on Devolli River with a combined 400 MW capacity has been concluded with EVN. Small hydro power plants could count for 700 GWh/y in identified 41 locations. Already 16 small hydropower plants projects has been awarded based on concession agreements that would add about 43 MW in installed capacity to the electricity system.

Biomass and solar energy sources have the greatest potential after hydro generation. Wind potential has not been assess in detail due to poor reliable data while the guaranteed access to the grid could be proved difficult for the instable Albanian electricity system.

The Law for Production, Transport and Trade of biofuels and other Renewable fuels in Transport was adopted in February 2008; the required targets were set as follows: the total annual amount of biofuels and other renewable fuels supplied in the market, by 2010 shall not be less than 3%, and in 2015 this amount shall not be less than 10%.

The purpose of this law is to promote production and use of biofuels and other renewable fuels for transport, hence – among others - to contribute to the accomplishment of Albania commitments initiated in the frame of the Kyoto Protocol. The provisions related to the functional and organizational aspects for production, transportation and trade of biofuels are provided in the law as well as the incentives to support the competitiveness of biofuels and renewable fuels competitive on the market, like special tax advantages for machineries, equipments and materials necessary for the construction and commissioning of biofuels plants.