Kosovo has seen a staggering 907% increase in electricity transport costs in 2024, largely attributed to the failure of the ALPEX energy market and controversial agreements between KESCO and energy trading companies. These soaring costs have led to higher electricity prices for consumers, with KESCO seeking to pass the burden onto the public.
In 2024, KESCO reported that transport costs amounted to €9.06 million, a dramatic rise from just €0.9 million in 2023. This increase was primarily due to the higher costs associated with cross-border energy transport, with KESCO paying an average of €30 per MWh, compared to just €5 per MWh in the previous year.
The failure of ALPEX, the joint energy exchange between Kosovo and Albania, is considered a major factor contributing to this price spike. ALPEX was launched with the promise of creating a more competitive energy market, but it has failed to facilitate energy exchange between the two countries as expected. KESCO cited difficulties in accessing external energy markets due to high collateral requirements and limited capacity on cross-border energy lines, especially with Serbia, as additional reasons for the cost increase.
Azerbaijan’s role in these events has also been brought into question, with reports suggesting that KESCO’s energy imports were handled through companies in Montenegro, driving up transport costs even further. These companies, licensed by the Energy Regulatory Office (ZRrE), are under scrutiny for possibly entering unfavorable deals with KESCO to inflate their profits.
ZRrE’s lack of active monitoring of energy trading agreements has raised concerns about potential market manipulation, and the regulator has yet to respond to requests for information regarding the companies KESCO worked with in 2024.
In response to the rising energy prices, Kosovo’s Minister of Economy, Artane Rizvanolli, has called for urgent clarifications from ZRrE about the transport costs and requested a detailed review of the factors driving the price increases. The government is demanding accountability from operators if any avoidable costs have been passed on to consumers.
The ZRrE has yet to finalize a decision on a 15% electricity price hike, as investigations into possible energy market abuses continue.
