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IEEFA Data Bite: Coal Dependency in Kosovo Is More Extreme Than in the World’s Biggest Coal-Burning Countries

April 18, 2016
Tom Sanzillo and Seth Feaster

Kosovo relied on coal for 97 percent of its electricity generation in 2013, according to the most recent data from the International Energy Agency, and its dependency hasn’t improved much (if at all) since then.

Of the 12 biggest coal-burning countries in the world, none rely on it as intensely as Kosovo does. Only South Africa comes close, and South Africa is plotting a way to reduce its dependency.

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Yet the government of Kosovo, with backing from the U.S. government and the World Bank, wants to build a gigantic new coal plant. If it goes ahead with the project, it will have locked in Kosovo’s heavy coal dependency for the long term and effectively crowded out investment elsewhere in the economy (more here on that in a report we published earlier this year (Albanian version here)). The project would require the single largest capital outlay in Kosovo for the foreseeable future. As such, it would bring deep and detrimental economic and environmental impacts that would linger for decades.

Such a project—aside from being starkly out of step with the times—also would amount to a misguided rejection of a widely accepted, core principal of energy planning: diversification of electricity-generation sources. And Kosovo, at the behest of certain private interests, the World Bank and the U.S. government, would have chosen an economic growth model that even large coal-burning countries no longer accept.

To be sure, Kosovo will continue to depend heavily on coal. It has rich lignite reserves, and even if construction of this new plant is scuttled, the country will still most likely rely on coal for well over 70 percent of its electricity.

But the balance of Kosovo’s electricity needs—that other 30 percent—can be better met by improved energy efficiency, hydropower, wind and solar. A policy geared toward that goal would be better for public health, better for the environment and better for the economy, in no small part because it would drive electricity prices lower (clean-energy resources are now cheaper than coal in most parts of the world.)

Kosovo, if it goes forward with its coal build-out scheme, would remain an outlier, and for no good reason.

Tom Sanzillo is IEEFA’s director of finance. Seth Feaster is an IEEFA energy-data analyst.

Related posts:

The World Bank’s Bad Energy-Policy Call in Kosovo

IEEFA Review: Proposed ‘New Kosovo’ Coal-Fired Plant Would Drive Electricity Costs Higher

Red Flags on a Coal-Fired Power Plant in Kosovo

Tom Sanzillo

Tom Sanzillo is Director of Financial Analysis for IEEFA. He has produced influential studies on the oil, gas, petrochemical and coal sectors in the U.S. and internationally, including company and credit analyses, facility development, oil and gas reserves, stock and commodity market analysis, and public and private financial structures. He also examines such areas as community and shareholder activism, institutional investment, public subsidies and Puerto Rico’s energy economics.

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Seth Feaster

Seth Feaster is an energy data analyst whose work focuses on the coal industry and the U.S. power sector.

Before joining IEEFA, he created visual presentations at the New York Times for 25 years with a focus on complex financial and energy data; he also worked at The Federal Reserve Bank of New York. 

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