Albania nationals: Technical analysis of the economic impact of hydroelectricity at local level

Organization for Security and Co-operation in Europe (OSCE)

, , AL

The OSCE Presence in Albania is providing support to local governments to identify the impacts of the extractive industries at the local level, with a particular attention to the revenues stemming from it. To support municipalities in this effort to acquire and better manage the mineral royalty share, the Presence developed a Policy Paper in 2019 and established the Local Governance Knowledge Sharing Platform composed of 13 member municipalities with a focus on Extractive Royalties. The member municipalities have requested the inclusion of the hydropower sector in the extractive royalty platform as an important sector of high social impact but small contribution to local economy.

The aim of the analysis is to determine the socio – economic justification of the concession fee and other incentives system (Feed in Tariff) for financing the production of electricity from small Hydro Power Plants in Albania. The analysis should be done in a way that the comparison of social benefits and social costs will justify the justification of existing incentive systems without taking into account the quantification of damages and costs incurred directly to the environment, biodiversity and potential damage caused by other activities by the construction and operation of HPPs. The study should have in focus a clear divison of, the concession system, the incentive system, the fiscal system and the benefit of certain authorities.

In this context, the department seeks to engage a national expert to deliver a technical report analysing the social – economic impact of hydropower and the benefits for local authorities.

The Governance in Economic and Environmental Issues Department would like to engage the services of one national expert to prepare a technical analysis of the social-economic impact of HPPs in Albania with a focus on the concession’s fees at local level.

Methodology of the analysis

The preparation of the analysis would take 3 months from the moment of the contract signature. The analysis will deal with the following structure:

– Importance and role of HPPs in the production of electricity in Albania;

– System of concessions, concession policies and concession fees for HPPs;

– System for incentives for HPPs, national taxes and local taxes incurred;

– Analysis of the socio – economic justification of the existing HPPs;

– A cost benefit analysis of having such a concession system in Albania;

– Based on the results of the analysis, conclusions and recommendations (legal, institutional, financial) would be given;

– Inventary (in excel file) of all HPPs which are in operation, under construction and planned, filtered by each of 61 municipalities and the respective concession fee they pay respectivly.

The analysis would be based on the available data for  the fiscal year 2019. The results of the analysis would be presented in the form of a written report in Ms. Word format in Albanian and delivered by e-mail in electronic form, firstly as a draft report and then in the final text.

Tasks and Responsibilities

Task 1. Desk research and data collection. Conduct in-depth review of the findings and recommendations of the Policy Paper prepared by OSCE in 2019, and the sectorial legislation (Law on Local Finances, Law on Mining, Law on National Taxes, Law on Energy, Law on Environmental Protection);

Task 2. Develop a technical questionnaire. The questionnaire will be framed for two target groups: the municipalities and the hydroelectricity companies aiming to collect accurate data on the amount of taxes paid by companies and received by municipalities. The questionnaire will first be shared with OSCE Project Manager and after approval will be distributed to all parties. The OSCE will provide support in facilitating its distribution through our partners.

Task 3. Conduct online consultation and interviews with relevant state and other competent authorities, NGO sector and HPPs associations. The meetings shall be organized by the OSCE Presence in Albania during May – June 2020. The key interlocutors, but not only are: Association for Local Autonomy; Agency for Support of Local Self-Governance; Association for Albanian Municipalities; Albanian Extractive Industries Transparency Initiative Secretariat, general directorate of taxes, national agency for natural resources, and key municipalities (Kukes, Mat, Mirdita, Librazhd, Bulqiza, Perrenjas, Gramsh, etj)

Task 4. Drafting of the report. Develop and deliver a draft socio-economic analysis based on the data collected through the desk research, and the online questionnaire and consultation meetings under Task 1,2,3 providing adequate information as per the methodology explained. The draft report should be delivered by 25 July the latest.

Task 5. Final technical socio-economic analysis. The expert will reflect all the comments and suggestions that will be provided by the OSCE PM and other government stakeholders within 5th of August into a final draft report, not later than 15 August 2020.

Expected Output/Deliverable:

Deliverables Timeline 

D.1. Deliver the draft technical analysis between 30-45 pages, in Albanian Language. 1 August 2020 

D.2. Deliver the final analysis reflecting comments and suggestions by the OSCE PM and other key Presence’s stakeholders. 15 August 2020 

Necessary Qualifications (please differentiate between what is mandatory and what is desirable)

• Master Degree in biology/environmental studies, legal studies or, economic studies; (mandatory)

• An minimum of five years of work experience as consultant/expert/project in the field of hydro development in Albania; (Mandatory)

• Extensive knowledge on Albanian legislation, in the framework on National Tax Law, Mining Law; Local Tax Law; and/or on Local Self-Government Finances Law; (Desirable)

• Knowledge and/or previous experience working in the framework of hydro development issues in the South Eastern Europe will be an added advantage;(Desirable)

• Excellent communication, drafting and presentation skills in Albanian and in English; (Mandatory)

• Computer literate