Albania's government picked a group led by India Power Corporation Ltd. to build the Adriatic country's first solar power station worth 70 million euros ($79.34 million) with a capacity of 100 MW, the Energy Ministry said on Saturday.
The offer by India Power, Mining Resources FZE based in the United Arab Emirates and the Hong Kong-based Midami Ltd. was the one out of three with the best combination of "technical and financial credibility, price and additional capacity", it added.
"This project will be an important step in diversifying energy resources in Albania and lead the way in turning Albania into a centre of solar power in the Balkans," said the ministry.
The Socialist government of Prime Minister Edi Rama wants to install 120 megawatts of solar and 70 MW of wind power capacity by 2020, since more than 90 percent of Albania's power is produced from rivers and a newly built power plant, beset by a cooling problem, does not work.
Once the solar plant has been built in 18 months, it will sell power to the local distributor at 59.9 Euro per MW for 15 years out of its 50 first MW. Energy from the other 50 MW will be sold at market prices.
The ministry hailed the auction as a success because it secures "one of the lowest energy prices in the region". The price "is lower than the 63 Euro/MW in Greece and Turkey and also below the average import price", it said.
Albania believes the record of India Power, "a 100-year-old company with a 1,500 MW capacity of thermal, wind and solar power owned by the Kanoria Foundation Group" provided enough assurance for the project.
Now Albania and the group led by India Power will negotiate the contract. If finalised, this would be the first major investment by an Asian company to Albania since two Chinese companies bought its crude extraction firm and an airport concession from their respective Canadian and German owners around two years ago.
The ministry said the outcome of solar plant contract will encourage them to hold similar auctions in other parts of the sun-kissed country on the shores of the Adriatic Sea.