Public policy program to support the reform of the electricity sector in Albania

Electricity Renewable energy Regulator

Beneficiary Country:

  • Albania Albania

Donation passport

Donor/IFI: AFD, KfW
Starting Year: 2021
Ending Year: 2030
Budget: 45 mil. EUR
Type of Donation: Policy based loan and technical assistance
Status: Ongoing

Lead Donor Contact

Agence française de développement, AFD

Short description of the overall project

This project supports the ongoing electricity sector reform process in Albania, through a sector budget loan and the establishment of a technical assistance programme.

The purpose of the operation is to ensure the security of supply and the sustainability of the energy sector in the long term. AFD's intervention will promote the development of intermittent renewable energies, strengthen investment planning and analysis of the impacts of the reform, strengthen the capacity of actors to adapt to the new sectoral context and finally support the implementation of a sustainable reform process from a financial, social and environmental point of view.


Short description of activities financed by  the donation

The general objective of this public policy loan (PrPP) is to improve the sustainability of the Albanian electricity sector by supporting sector reform and diversifying the electricity mix towards renewable energies.

The program is structured around the following specific objectives:

  • Improvement of the financial situation and improvement of the financial sustainability of operators in the sector
  • Establishment of an electricity market and a gradual process of deregulation of tariffs, in order to improve the transparency of exchanges
  • Diversification of the electricity mix and development of renewable energies
  • Strengthening of the legislative and regulatory framework of the sector.

Significant technical assistance is financed by AFD and deployed by Expertise France to support the Albanian government in the development of a new tariff model. Modeling tools and a study on the impact of the reform on vulnerable populations will support decision-makers in implementing the reform.