A couple of years back, I wrote an article about Kosovo’s coal industry. Short version: Kosovo has lots of coal, and most of it is middle-quality lignite. But the mines suffer from a horrible lack of investment; many of them are still using thirty to forty year old equipment. So both output and quality are far below where they should be.
So I wasn’t exactly surprised to see this recent article:
Importing Lignite into Coal-Rich Kosovo
[One of] Kosovoâ€™s biggest firms is being forced to import lignite from Malaysia and Indonesia, despite estimates that the newly independent country sits on the worldâ€™s fifth largest reserve of the fuel.
Metal firm Ferronikeli, one of Kosovoâ€™s biggest companies, is importing lignite from the other side of the world because it cannot access the countryâ€™s rich reserves of brown coal… the ferronickel exporter has been forced to sign deals with Malaysia and Indonesia to import lignite to its plant in Drenas.
Ferronikeli, which was bought in 2007 by IMR/Alferon as part of Kosovoâ€™s privatisation programme, complains that the lignite which is available cannot be used.
Arten Bajrushi, spokesman for Ferronikeli, told Balkan Insight: â€œEven early on, and still today, we have imported lignite from other countries of the world. We have agreements with Indonesia and Malaysia to import lignite.â€
He added that only a very small amount of lignite is taken from KEK, Kosovoâ€™s national energy provider, because the publicly owned firm cannot provide enough lignite, and that the coal it can provide is â€˜too wetâ€™ for Ferronikeli to use.
Bajrushi said: â€œLignite that KEK uses for electricity is 38 per cent wet, while for our technological processes lignite needs to be only 18 per cent wet.
â€œThis issue was supposed to be solved by a drying facility that KEK does have, but it does not work most of the time,â€ said Bajrushi.
He added that KEKâ€™s organisational problems mean that it is cheaper for his firm to import coal from thousands of kilometres away rather than buy it in Kosovo.
The coal is brought in via Greece rather than Albania, because Greece’s ports have more capacity. I assume the coal is brought along the rail line north through Macedonia; if any Kosovar readers know more details, I’d be interested to hear.
Ferronikelli was created back in Yugoslav times with this idea; it would take the nickel and other ores from Kosovo’s mines, and use Kosovo’s abundant coal to smelt them. Like most Communist-era industrial concentrations, it was not very efficient, and the environmental side effects were horrendous. But the basic idea was sound.
In a related story, Kosovo’s Energy Minister just announced that they won’t be building the 2,000 MW thermoelectric plant that they bid out earlier this year. Instead, they’ll be re-bidding the project next year — as a 1,000 MW plant, half as big.
As a data point, Kosovo’s current electricity needs are around 2,000 MW, but half of their generating capacity expected to go offline by 2016 (aging equipment, environmental problems). Over the same period, the country’s population is expected to grow by almost 10%, and its electricity demand by nearly 20%. So in very round numbers, Kosovo needs to find about 1400 MW of new production by the second part of the next decade. The original plan would have covered this, plus some excess capacity for export. The current version doesn’t even cover the next five years of expansion plus lost capacity. The official explanation is that the reduction is “because of the current economic crisis”. This seems unlikely on its face. More likely explanations might include “Kosovo’s transmission and distribution systems couldn’t handle the larger load”, “Kosovo’s coal mines can’t guarantee the necessary fuel”, and/or “KEK can’t show how it will collect enough money to pay for the larger plant”.
Kosovo should have energy, literally, to burn. It’s a small country sitting on top of billions of tons of coal. It should be able to export electricity to its neighbors while supporting a variety of energy-intensive industries at home. Instead, Kosovo’s cities are still plagued by blackouts, while its largest industry has to import coal from abroad. That’s just nuts.
Long-time readers of this blog know that I’m a firm supporter of Kosovar independence. And not all of this is Kosovo’s fault; as noted in the earlier post, they endured a decade of actively malevolent mismanagement under Milosevic, followed by seven years of simply incompetent mismanagement under UNMIK.
But they’ve been running things themselves for a while now. And this is just ridiculous.