2 nd National Energy Efficiency Action Plan (NEEAP) of Kosovo

Transcription

1 Republika e Kosovës Republika KosovaRepublic of Kosovo Qeveria VladaGovernment Ministria e Zhvillimit Ekonomik Ministarstvo Ekonomskog RazvojaMinistry of Economic Development 2 nd National Energy Efficiency Action Plan (NEEAP) of Kosovo June

2 TABLE OF CONTENTS Abbreviations Overall context of the second NEEAP Highlights of the Second NEEAP National context of energy savings Primary energy SAVINGS Overview of primary saving and targets List of Strategies Energy saving assumptions/targets Primary energy saving measures Measures in the lignite sector Measures in the electricity generation sector Measures in the transmission sector Measures in electricity distribution sector Measures in the heating sector Energy savings achieved in the energy enduse sectors Calculation of energy savings achieved Description of energy savings achieved Description of energy savings measures implementation Summary on energy savings planned and achieved Energy efficiency measures of the second NEEAP in the energy enduse sectors Measures in the residential sector Measures in transport sector Measures in the tertiary sector Measures in the Industry and SME sectors Measures in the building sector Horizontal measures

3 4.7 Summary of overall final energy savings Exemplary role of public sector Ensuring availability of advice and information Obligations of energy companies to promote energy savings in enduse consumption Market for energy services Strategy for the increase of nearlyzero energy buildings Alternative measures for heating and air conditioning systems Measures to support EPBD implementation Establishment of Competent Bodies and Assigned Organisations

4 ABBREVIATIONS: KEEA MED MEM KEPA MESP MF TPP DH KEK J.S.C. HPP KOSTT EnCS ORFEE/GIZ CCEAM AI LPG SME EU EC EBRD MTI KBRA EPBD Kosovo Energy Efficiency Agency Ministry of Economic Development Ministry of Energy and Mining Kosovo Environment Protection Agency Ministry of Environment and Special Planning Ministry of Finance Thermo Power Plant District Heating Kosovo Energy Corporation, Joint Stock Company Hydro Power Plant Kosovo Transmission System and Market Operator Energy Community Secretariat Open Regional FundEnergy Efficiency / Geselschaft für Intenationale Zusammenarbeit Commission for Certification of Energy Auditors and Managers Administrative Instruction Liquid Petroleum Gas Small and Medium Enterprise European Union European Commission European Bank for Reconstruction and Development Ministry of Trade and Industry Kosovo Business Registration Agency Energy Performance of Buildings Directive 4

5 1 OVERALL CONTEXT OF THE SECOND NEEAP The Kosovo National Energy Efficiency Action Plan (NEEAP) is a basic document for the implementation of Kosovo s policies on energy efficiency. Kosovo s NEEAP ( ) was approved by the Ministry of Economic Development on September 30 th, It foresees the indicative target of 9% of ktoe to be achieved at the end of the period ( ). Therefore, the amount of energy that Kosovo aims to save by the end of 2018 is ktoe. The first Kosovo Energy Efficiency Action Plan ( ) (hereinafter 1 st NEEAP) was also approved by the Ministry of Economic Development on September 30 th, The intermediate indicative target of 3% for energy savings has been adopted. The target quantity of 3% of the overall amount for the period ( ) is ktoe. Kosovo s second National Energy Efficiency Action Plan (hereinafter 2 nd NEEAP) has been prepared on the basis of Article 10 of the Law on Energy Efficiency. The Guide and template for the preparation of the second national energy efficiency action plan developed by the European Commission s Joint Research Centre has been taken into account preparing the 2 nd NEEAP, and adapted by the Energy Community Energy Efficiency Task Force in October The Kosovo Energy Efficiency Agency (hereinafter KEEA) was established in April According to the Article 6 of the Law on Energy Efficiency among other tasks KEEA is responsible for the following actions to be taken in relation to the National Energy Effiency Plan: to propose the National Energy Efficiency Plan, to prepare the Progress Report on the Implementation of the National Energy Efficiency Plan, to develop the system for monitoring the implementation of the National Energy Efficiency Plan and achievement of the indicative targets for energy saving. The KEEA, as the main institution responsible for development and implementation supervision of the NEEAP, lead the process of its development. In order to support KEEA, an interinstitutional working group was established by the Ministry of Economic Development (Decision Nr. 283, on February 14, 2013), consisting of representatives from the following institutions: 1. Ministry of Economic Development, 2. Prime Minister s Office, 3. Ministry of Environmental and Spatial Planning, 4. Ministry of Finance, 5. Ministry of Infrastructure, 6. Ministry of Trade and Industry, 7. Ministry of Public Administration, 8. Ministry of Local Administration 9. Ministry of Security Forces of Kosovo, 10. University of Prishtina, 11. Association of Local Municipalities, 12. Energy Regulator s Office ERO, 13. Power Corporation of Kosovo KEK, 14. Kosovo Operator for Transmission and Trade KOSTT, 15. District Heating of Prishtina TERMOKOS, 16. Kosovo Statistics Agency, 17. Kosovo Customs, 18. Institute for Development Policy INDEP, 19. Kosovo Renewable Energy Association KREA. It is foreseen that this interinstitutional cooperation platform will continue its operations after the approval of the 2 nd NEEAP and will evaluate implementation progress of the 2 nd NEEAP ( ) and the longterm NEEAP ( ) on regular basis, as well as taking measures for adjustments if needed. 5

6 1.1 Highlights of the Second NEEAP The 1 st NEEAP ( ) mainly consisted of promotional and regulatory framework establishment measures, and only some concrete investment projectbased measures. The review process of the 1 st NEEAP implementation experience showed that the 1 st NEEAP had too many measures almost 40 and that most of them were soft ones, like awareness raising campaigns, administrative instructions, etc. So many measures do not create a targeted and resultoriented policy. Nevertheless, measures implemented during the 1 st NEEAP implementation period like adoption of the Law on Energy Efficiency, establishment of the KEEA, development of energy auditing systems, etc. created a very good starting point for further activities. Therefore, in the development process of the 2 nd NEEAP, it was decided to put implementation of energy efficiency measures with measurable energy savings at its centre. Softmeasures, like awareness raising campaigns, energy audits will continue to have a facilitating role. The Kosovo Energy Efficiency Agency was established in April, According to Article 6 of the Energy Efficiency Law, the KEEA s responsibilities are to: propose to the Minister policies to promote energy efficiency, develop and maintain the database on energy efficiency, develop the system of monitoring implementation of the National Energy Efficiency Action Plan and achievement of the indicative targets for energy saving, propose to the Minister the National Energy Efficiency Action Plan, prepare the Progress Report on the Implementation of the National Energy Efficiency Action Plan, guide and support municipalities in the preparation of the municipal energy efficiency plans and their progress reports, promote energy efficiency through public awareness campaigns, provide recommendations on necessary improvements to national and municipal energy efficiency plans, prepare its Annual Work Report for the Minister, cooperate with the Ministry and other relevant institutions in implementing energy efficiency plans, support the participation of interested parties in undertaking energy efficiency initiatives, propose to the Ministry improvements in and completion of legal and regulatory frameworks on energy efficiency, with a view to approximation with relevant European standards on energy efficiency, support municipal energy offices on matters related to energy efficiency planning and promotion, and implementation of various energy efficiency programs at municipal level, promote information and educational activities in the field of energy efficiency, in cooperation with ministries responsible for energy, construction and education. During the process of the 1 st NEEAP implementation review, a lack of statistical data on energy efficiency (especially in the transport sector and the industry sector) was identified as one of the main barriers to the proper assessment and reporting of energy savings achieved. Therefore actions were taken to establish a system for collection of data by the KEEA on energy efficiency measures taken. The KEEA will become the core institution that will develop solid monitoring and evaluation systems for the assessment of results achieved and planning of the next steps to be taken. The 2 nd NEEAP will become the core document for planning of energy efficiency policy and its implementation in Kosovo, which will attract IFI's financing and will mobilize national funding for implementation of the energy efficiency measures planned. 6

7 1st NEEAP 2nd NEEAP 3rd NEEAP TOTAL mill. Euro ktoe % mill. Euro ktoe % mill. Euro ktoe % mill. Euro ktoe % Residential EBRD/EC R ProCredit R Multiapartment R MED campaign R Measures 1st NEEAP¹ Services ktoe/build buildings ktoe/build buildings ktoe/build buildings EC S WB/EC 3 S KfW/EC S Municipalities S4 KEEA energy audits S5 550 EAs 550 EAs Measures 1st NEEAP² Industry EBRD/EC I ProCredit I Transport Campaign T1 Inspection T2 Pristina buses T3 5.5 Horizontal kwh/m 2 m 2 /y kwh/m 2 m 2 /y EE Law H1 Green procurement H2 Building code H Footnotes: ¹ Reported for R1, R10, R12 NB: Not all of the subtotals add up, because some estimates have been included, as follows: ² Reported for S7,S13,S15,S16,S17) Figures in red are estimates that have been included in the totals and subtotals 3 3 year program to include buildings, est. cost US$22.5m. Figures in brown are estimates that have not been included in the totals and subtotals Target 4 Cumulative totals 5 Excluding horizontal measures 6 Including horizontal measures

8 1.2 National context of energy savings Kosovo has approved the indicative target of 9% of ktoe to be achieved by the end of the period ( ). Therefore, the calculated national indicative energy savings target for 2018 is ktoe. The planned energy savings targets for 2018 are not being changed and will remain valid until 2016, when the 3 rd National Energy Efficiency Action Plan will be developed. Table2. Overview of the share of all sectors in final consumption (ktoe) Economic sector * Industrial sector Household sector Services sector Agricultural sector Transport sector Total Source: Energy Balance of Kosovo 2010, 2011, 2012 (forecast)*, Ministry of Economic Development Table 2 shows that energy consumption for 2012 reached ktoe, which marks a decrease of ktoe (1.77 %) in comparison with 2011 ( ktoe) and an increase of 94,25 ktoe (8.07 %) in comparison with 2010 ( ktoe). The sectors, in order of their energy consumption in 2012, were as follows: the household sector, which consumed ktoe ( % of overall consumption), followed by the transport sector, ktoe (26.67 %), the industry sector, ktoe (23.04%), the service sector, ktoe (9.13 %) and the agriculture sector, ktoe (1.63 %). Fig1. Overview of the share of all sectors in final consumption (ktoe) 8

9 Fig 2. Energy enduse by sector for 2012 Taking into account that the household and transport sectors are the largest for energy enduse consumption i.e. accounting for % and % respectively of total energy enduse consumption these sectors have been designated as priority sectors for the 2 nd NEEAP. The 2 nd NEEAP has been prepared taking into account the following policy planning documents: Kosovo Economic Development Plan ( ); Action Plan of the Economic Vision of Kosovo ( ); Energy Strategy of the Republic of Kosovo ( ); Heating Strategy for Kosovo ( ); Kosovo Energy Efficiency Action Plan ( ); as well as other sectorial and intersectorial development documents, policies and strategies. The Kosovo Economic Development Plan ( ) describes the economic development planning framework and proactive commitment of the Government to the economic growth and development of the country. With the implementation of this plan, the objective is to achieve a growth rate of 78% per annum in the medium term and a reduction in the level of the registered unemployed by approximately 810% per annum. Table3. GDP annual growth data realized for the period Source: Ministry of Finance GDP 6.3% 6.9% 2.9% 3.9% 5.0% 9

10 The forecast of macroeconomic indicators shows that the Kosovo economy is expected to reach an average growth of 6.8% during The positive growth rate is expected to be driven by an expansionary fiscal policy, while private investments and exports are expected to continue at a relatively stable growth rate throughout the forecasting period. More precisely, higher economic growth is projected to be reached in 2013, resulting from increased exports, investments and consumption, mainly as a result of raising public sector wages, and its multiplicative effect on the economy of Kosovo. Table4. Main macroeconomic indicators, (millions of euro) Description Consumption 4,345 4,280 4,760 5,074 5,336 5,545 5,819 Investment 1,094 1,166 1,213 1,433 1,620 1,704 1,756 Net export 1,587 1,534 1,684 1,867 1,979 2,035 2,075 Export of goods and services ,049 1,049 Import of goods and services 2,156 2,146 2,504 2,742 2,912 3,030 3,124 GDP 3,905 3,912 4,289 4,639 4,978 5,214 5,501 Real GDP Growth, in % GDP per capita in euro 1,847 1,848 1,996 2,127 2,249 2,321 2,412 Inflation, in % Source: Microeconomic Department, MoF Issues related to energy sector development are regulated in the following legislative acts, administrative instructions and regulations: 10

11 Laws: Law on Energy, Law on Energy Efficiency, Law on the Energy Regulator, Law on Electricity, Law on Natural Gas, Law on Mines and Minerals, Law on Spatial Planning, Law on Construction, Law on Public Procurement, Law on Environment Protection, Law on Trade of Petroleum and Petroleum Products, Law on Scientific Research Activities, Regulation on Longterm Allocations of Real Estate in SociallyOwned Property, managed by Kosovo municipalities, Law on Foreign Investments, Government Decision on restructuring of KEK j.s.c., Government Decision on unbundling of KEK j.s.c., Government Decision on the Establishment of an Electricity Distribution and Supply Company and its privatization through a public tender, Law on PubliclyOwned Enterprises, Government Decision on Central POE property policy, Government Decision on the installation of efficient light bulbs in public buildings, Law on Competition, Law on Expropriation, Law on Central Heating, and Law on PublicPrivate Partnerships and Concessions. Administrative Instructions: Administrative Instruction for Promotion of energy efficiency for the final consumers and energy services, Administrative Instruction for Labeling of energy using equipment, Administrative Instruction for Energy Audit, Administrative Instruction Rules on energy balance, Administrative Instruction for Security of supply in natural gas sector, and Administrative Instruction for opening of market for electric energy for all nonhouseholds costumers. Regulations: Regulation Nr. 01/2012 for Establishing and functioning of a commission for certifying energy auditors and managers, Regulation Nr. 08/2011 for Internal organization of the Agency for Energy Efficiency, and Technical regulation Nr. 03/2009 on thermal energy saving and thermal protection in buildings. Energy intensity in Kosovo still remains at a relatively high level. Energy intensity (toe/1000 ) Table5. Energy Intensity Source: Energy Balance of the Republic of Kosovo for 2009, 2010 and

12 The energy consumption forecast includes the development of the new Power Plant Kosova e Re, economic sector demands and energy efficiency measures. In calculating energy consumption forecasts, three basic factors are taken into account: Economic growth, Number of households, Energy consumption in the three last years. Because of the influence of these measures on the demand of all sectors, as well of measures to rehabilitate the electroenergy system, the final energy consumption demand in 2020 is expected to be ktoe. Also, the energy sector is expected to have the same impact in terms of energy efficiency. Table6. Overview of forecast final energy consumption (ktoe) Industrial sector Household sector Service sector Agriculture sector Transport sector Total Source: Long Term Energy Balance of the Republic of Kosovo The sector with the most intensive growth in energy demand will be the industry sector. In Kosovo, with all forecasts indicating more energy intensive development trends in industry, the industry sector share of total energy consumption, even in 2022, will be below the developing countries consumption rate of 29% of energy consumed. Kosovo is not actively participating in the implementation of the EU Framework Convention on Climate Change. However, taking into account the fact that in future Kosovo will have to meet the international obligations related to the implementation of this Convention, strategic directions and priorities in this field are set in the national legislative documents. Despite the fact that Kosovo is not a member state of UNO, actions are being taken to establish a legal framework and to build capacities in order to be able to participate in international efforts to combat climate change. From this perspective, Kosovo s actions are in accordance with the United Nations Convention on Climate Change (UNFCCC) and the Kyoto Protocol. 12

13 Table7. Sources of greenhouse gases according to sector for 2008 and 2009 GHG Sources Unit ton/year CO2 CH4 N2O CO2 CH4 N2O Energy 6,221, , ,040, , Industry 11, , Transport 1, , TOTAL 6,234, , ,053, , Source: State of Air Report, year 2012, KEPA/MESP EU Directive 2001/80/EC of 21 October 2001, determines the ceilings for power plant pollution. The Directive requires a reduction of pollutant emissions for existing plant (Kosovo A and B) and also determines ceilings for emissions from new plants (Kosova e Re). Figure3. Forecast of dust, NOx and SO2 emissions from Kosovo power plants for the period Figure4. Forecast of CO2 emissions from Kosovo power plants for the period

14 Industrial sector Household sector Service sector Agriculture sector Transport sector Total Table8. Overview of forecast energy consumption in all sectors* (ktoe) Source: Long Term Energy Balance of the Republic of Kosovo * including nonenergy consumption 14

15 2 PRIMARY ENERGY SAVINGS In general, the 2 nd NEEAP has been drafted to assess energy savings in meeting targets outlined in Directive 2006/32/EC, for endcustomers and energy services, while the EC format and instructions recommend an assessment of energy savings also in transformation and transmission (energy efficiency measures on primary energy savings in the energy sector in generation, transmission and distribution). Realized consumption of primary energy in Kosovo in 2010 and 2011 was ktoe and ktoe respectively. Calculations for 2012 have yet to be completed taking into account available data. Final energy consumption is considerably lower, due to the proportionately high use of lignite as primary energy. For instance in 2011 lignite accounted for 64.81% and oil byproducts and biomass for 23.61% and 9.66% respectively. The energy balance for Kosovo in 2011 indicates that nonenergy needs reached ktoe, while the final energy consumption totalled ktoe and additionally, the transformation sector with energy losses and internal energy consumption of the sector). Table9. Primary and final energy consumption and relevant differences Year Primary consumption in ktoe Target of final energy consumption in ktoe Final consumption in ktoe Difference For the reporting period there were no forecasts for the primary energy production therefore no targets are reported. Figure5. Graphical presentation of primary and final energy consumption in 2010 and 2011 In the transformation sector, energy efficiency is low as power plants use lignite as fuel and because of the low coefficient of use of TPP Kosovo A (around 26.86%) and TPP Kosovo B (around 34.48%), and the use of oil byproducts as primary energy for meeting the needs of Kosovo. This coefficient of use is expected to increase 15

16 considerably with the implementation of TPP Kosova e RE (projected for a later period) and cogeneration in TPP Kosovo B, in 2013 (see details in the chapters on efficient measures in generation and heating with DH Termokos). 2.1 Overview of primary saving and targets Coal for energy purposes Coal for nonenergy purposes Petroleum products for energy purposes Table10. Forecast primary energy consumption (ktoe) Petroleum products for nonenergy purposes Biomass Electricity Biofuels Geothermal energy Derived heat Solar energy Total Source: Long Term Energy Balance of the Republic of Kosovo In analysing longterm demand forecasts for energy, the Kosovo Energy Efficiency Plan ( ) has been taken as the baseline, with the general target for 2018 based on the assumption that every year there will be 1% of energy savings at the endconsumption level. According to the development of long term trends, electricity consumption will increase almost as quickly as petroleum consumption. In addition to any individual and private initiatives for installing such equipment, several energy efficiency and renewable energy projects have been planned. According to the Decision of the Ministerial Council of Energy Community Secretariat (derived from the meeting held on 18 th October 2012 in Budva, Montenegro), Kosovo is bound to generate 25% of gross final energy consumption from renewable energy sources, including solar energy, both for heating and electricity. Table 11 below summarizes forecast consumption of all energy products used for energy purposes only, for the years 2013, 2015 and

17 Table 11. Overview of consumption forecast for all energy products (ktoe and %) ktoe % ktoe % ktoe % Coal Petroleum products Biomass Electricity Biofuels Geothermal energy Derived heat Solar energy Total Source: Long Term Energy Balance of the Republic of Kosovo List of Strategies Following documents are the list of strategies that addressing the objectives for the reduction of primary energy consumption in the Republic of Kosovo: Energy Strategy of Kosovo Heating Strategy Longterm Energy Balance of the Republic of Kosovo Transmission Development Plan Distribution Development Plan District Heating Development Plan Termokos Action Plan of Economic Vision of Kosovo

18 Table12. Overview of the strategic objectives for primary energy savings Title of the strategy Objectives Targeted sector Legal status and other Technical indicators & other respective documents Energy strategy of Kosovo Rehabilitation of lignite sector repairing of lignite excavators TPP New Kosovo, 2x 300 MW. Lignite production Electricity generation, Existing energy strategy under review according to the Energy Law New electricity generation capacities New Kosovo based on BAT (best Available Technology) Extension of transmition substation Kosovo Operator for Transmission and trade(kostt) Transmission Development Plan Heating Strategy Longterm Energy Balance of the Republic of Kosovo Action Plan of Economic Vision of Kosovo Privatisation of Kosovo Electricity Distribution Sector (KEDS) Connection of City Heating in Prishtina (existing network) with TC "Kosovo B" (cogeneration system) Extending operational life of Kosovo B power plant Energy forecast of Kosovo General description of main objectives for economic sustainable development of Kosovo Transaction process for TC New Kosovo Asset Transfer to the Private Investor Distribution Development Plan District heating of Prishtina city capital of Kosovo Energy sector Economy in general and energy sector in particular Distribution Development Plan District Heating Development Plan Termokos Kosovo Statistic Agency Other line ministerial documents of Kosovo Supplementing legislation to enable implementation of the New Kosovo project Already privatised sector More efficient energy system and favorable tariffs for district heating customers in Prishtina. Guarantee continuity of heating for Prishtina citizens. Construction of the 400kV Increase in transmission

19 transmission line in the territory of Kosovo Construction of capacities for RES Promotion of capacities for power generation small hydro plants Review Analysis for the profitability of the initiation of hydropower project in Zhur Review of the possibility to build energy sources solar plants Review of the potential for construction of energy wind power plants Review of the possibility to build plants from biomass Time frame Decommissioning of "Kosova A ", respectively its closure capacity for exchange of energy and increasing the security of the electrical energy supply Increasing security of electrical energy supply and approaching towards 20% target (of the consumed energy to be from renewable sources) Clarifying the profitability of the project and opening of the way for a concrete action plan. Increasing security of electrical energy supply and approaching towards 20% target (of the consumed energy to be from renewable sources) Increasing security of electrical energy supply and approaching towards 20% target (of the consumed energy to be from renewable sources) Increasing security of electrical energy supply and approaching towards 20% target (of the consumed energy to be from renewable sources) EC Supported the study. Donations are expected from international institutions

20 The Energy Strategy of Republic of Kosovo identifies the most important challenges faced by the energy sector, guides the development of the most suitable policies for transforming it, as soon as possible, into a vital, sustainable and financially viable sector in Kosovo, which provides quality energy services that are economically favourable for consumers in Kosovo. Also, it identifies the key policies and measures to be undertaken for advancing sector reforms, thus attracting private investments, providing for environmental protection and a complete and prompt integration of Kosovo s energy systems into regional and European ones. This Strategy pays special attention to compliance with European Union Acquis, since its provisions are compulsory for Kosovo, which is a responsibility undertaken through its membership in the Energy Community. The Strategy aims to stimulate rational use of energy and increased energy efficiency as well as utilization of renewable energy resources and introduction of new technologies for implementing the environmental standards as set forth by law. The strategic objectives, policies and measures identified in this Strategy for each energy subsector constitute the basis for developing the Kosovo Energy Strategy Implementation Program This Plan will have to be improved according to the new reviewed energy strategy in the process of development. The Strategy covers a 10year period. Its goals and anticipated measures represent a clear vision for certain key aspects of great interest for the development of the energy sector during the decade. The Strategy is divided in two parts. The strategy contains the energy demand forecast and its coverage for the period, both aggregated and divided by economic sectors; Strategy s mission and vision; strategic objectives; policies and priority measures for realization of the strategic objectives; European integration and international cooperation perspective; the need and measures to increase local institutional capacities; and measures foreseen to implement Strategy. A special focus in this Strategy is given to achievement of the security of qualitative electricity supply as soon as possible. Towards this, particular attention is given to development of new electricity generation capacities and rehabilitation of TPP Kosova B, both to be funded through private sector investments. The same is foreseen also for the future sufficient and sustained supply of lignite for these generation capacities. Improvement of billing and collection levels for electricity consumed represents a significant challenge for KEK j.s.c and the government institutions. Accomplishment of the set objectives will constitute a good basis for enhancing confidence among investors in the energy sector thereby decreasing perceived risks. Fulfilment of obligations deriving from the Energy Community Treaty and European integration process represents another important dimension of this Strategy. In this aspect, a number of measures need envisaged to be undertaken in the future for the completion of energy sector restructuring and reform in line with the EC directives and other applicable legislation, in order that this sector becomes not only financially selfsustainable but also able to attract private investments and contribute significantly to faster and sustainable economic and social development of the country. Application of the EU approach regarding energy, environment and competition represents the focus of this Strategy. This will facilitate integration of Kosovo s energy system with European systems. Special attention is paid to protecting the environment from pollution caused by emissions from energy facilities. Both improvement of energy efficiency and utilization of renewable energy resources are considered important elements of this Strategy. This document provides clear policies and measures for both of these important sectors. 20

21 This Strategy aims also to promote the preparation of a comprehensive legal and regulatory framework which would attract private investments into the Kosovo energy sector. The objective is for Kosovo s energy sector regulatory framework to be clear and complete in order to enhance confidence among foreign investors. Finally, it is important to emphasize that the vision of this Strategy is that through private investments Kosovo will not only eliminate the burden that the energy sector places on the Budget of Kosovo, but also significantly enhance the security and quality of energy supply. The Revised Energy Strategy (RES) is supported by comprehensive analysis and reflection on the current situation in the energy sector. RES identifies the most important challenges faced by the energy sector, and establishes the guidelines for the development of more suitable sector policies that will support the transformation of this vital sector for Kosovo into a sustainable and selffinanced sector that provides qualitative energy services under favourable conditions for consumers in Kosovo. It also identifies the main policies and measures that need to be undertaken for the advancement of sector specific reforms that will enable attraction of private investment and the earliest and most complete integration of Kosovo s energy systems into the regional and European ones. The Energy Strategy of Kosovo aims at achieving effective management of existing energy resources and protection of the environment. It focuses on enhancing the security of energy supply according to European standards, as well as on the diversification of energy resources. This strategy aims also at stimulating rational utilisation of energy, promoting energy efficiency, promoting development of renewable energy resources and introduction of new technologies that do not cause irreparable damage to the environment, thus respecting the application of internationally accepted environmental standards Energy saving assumptions/targets Total long term energy savings targets until 2017/18 (TPP A/TPP B) for each sector measures Total energy saving targets for lignite production: (TPP A) (TPPB) = 2.31 GWh/year = ktoe/year Total energy saving targets for electricity generation: = GWh/year = ktoe/year Total targets for increase of electricity generation capacity: = 70 MW EE saving targets for electricity transmition system: Reduction of losses by 0.06 % of total demand as a result of implementation of projects until 2016: ktoe x 0.06% = ktoe respectively GWh. EE saving targets for electricity distribution sector: New reviewed middle and long term targets for distribution sector are not yet known because it is now a new privatised company (KEDS). Particular energy efficiency measures and target projections are included in the tables below for each energy sector during the period , and explanations until

22 The 2 nd NEEAP does not provide full details about energy efficiency measures in the energy transformation and transmission sector, because Kosovo is only now, for the first time, confronting energy efficiency planning and implementation issues for this sector in the proper manner. It is expected that realistic, comprehensive and concrete EE measures will be enforced and developed only in the 3 rd NEEAP. 2.2 Primary energy saving measures Measures in the lignite sector Electricity generation in Kosovo is secured from two lignitefired thermal power plants, Kosovo A and Kosovo B, with a total effective capacity of up to 950 MW (installed capacity 1478 MW), while lignite generation is secured from SouthWest Siboc (SWS) and Sitnica lignite mines. Lignite is the most vital energy resource of Kosovo, supplying around 97% of the total electricity generation. Maximum coal generation in South West Siboc is 9.0 ml.t./year. To reach this level of generation, the main mining equipment must be overhauled in line with the supplementary mining plan, which envisages the purchase of two coal excavators. According to the exploitation forecasts for SWS it is safe to assume that the condition of the existing coal excavators cannot guarantee sustainable generation for the period Table13. Measures in lignite production Nr. Measure Target of the use of primary energy/sector Timeline Achieved energy savings in 2015/other indicators Estimated primary energy savings in TPP A2016 and TPP B 2018 and other indicators 1. Repair of lignite excavator E 8B Increase of capacity usage and duration 2013 Reduction of own electricity consumption from 5.97 kwh/m 3 to 5.1 kwh/m 3 and reduction in excavator downtime Increase of effective capacity from 500m³ /h to 650m³/h Consumption before implementation of measure: GWh/year Consumption after implementation of measure: GWh/year Saving: GWh/year 2 Repair of excavator E 9B Increase of capacity usage and duration 2014 Reduction of own electricity consumption from 5.97 kwh/m 3 to 5.1 kwh/m 3 and reduction in excavator downtime Increase of effective capacity from 500m³/h up to 650m³/h Consumption before implementation of measure: GWh/year Consumption after implementation of measure: GWh/year Saving: GWh/year 22

23 2.2.2 Measures in the electricity generation sector Lignite mining, generation and electricity distribution assets are operated by KEK j.s.c., a publicly owned enterprise. Electricity supply is mainly from generation from power plants Kosova A and Kosova B and on a smaller scale from hydropower plants (Ujmani, Lumbardhi, Radaci, Dikanci and Burimi). Gross electricity generation in existing TPPs in 2011 was 5697 GWh 1 and electricity generated from hydropower plants in 2011 was 105 GWh 2. Despite a continuous increase in the operational capacities of generation units in the recent years, their performance remains below installed parameters. Technical data based on rehabilitation measures of the electricity generation sector (TPPs and HPPs in Kosovo). No. Generation units Table14. Existing thermal generation capacities in Kosovo Year of commissioning Installed capacity Threshold Generator net Current power Thresholdnet Generator MW MW MW MW 1 TPPA Not in operationend of lifetime 2 TPPA Not in operationend of lifetime 3 TPPA TPPA TPPA TPPB TPPB HPP Radavci G1 1934/ / HPP Radavci G2 1934/ / HPPIstogu G1 1948/ / HPPIstogu G2 1948/ / HPP Lumbardhi G1 1957/ HPP Lumbardhi G2 1957/ HPP Dikanci 1967/ / HPP Dikanci 1967/ / HPPDikanci March/ HPP Ujmani G HPP Ujmani G The most significant plant outside KEK j.s.c. is the hydropower plant Ujmani/Gazivoda (2 X 17.5 MW = 35 MW), administered by the Publicly Owned Company Hidrosistemi Ibër Lepenc. 1 Source: Annual energy balance (realized) of the Republic of Kosovo, Source: Annual energy balance (realized) of the Republic of Kosovo,

24 Table15. Measures in electricity generation Nr. Measure Target of the use of primary energy/sector Timeline Achieved energy savings in 2015/other indicators Estimated primary energy savings in TPP A2016 and TPP B 2018 and other indicators Repair and modernization of mills in TPP B 2. Improvement of coal quality from the mines for TPP A & B 3. Maintaining heating surfaces clear of ash layers in boiler pipes of TPP A & B Reduction of specific coal consumption in: TPP A from 1.9 to 1.75 ton/ MWh and TPP B from 1.5 to 1.4 ton/mwh TPP A&B TPP A = 0.15 ton/ MWh TPP B = 0.1 ton/mwh Lignite savings forecast: TPP A ton/year TPP B ton/year EE savings forecast: TPP A 146 GWh/year TPP B 264 GWh/year 2. Reduction of oil costs due to reduction of planned downtimes to the minimum, increasing the technical availability of TPP A to the highest level Reduction of specific oil consumption in TPP A from 2.8 to 2.2 lit/mwh ,6 lit/mwh lit/year = 876 ton/year Specific oil consumption 0.32 lit/kwh = ton/mwh 867/0.272x1000 Savings =3.2 GWh/year 3. Reduction of heavy fuel oil costs due to reduction of planned downtimes to the minimum, increasing the technical availability of TPP B to the highest level Reduction of specific crude oil consumption in TPP B from 2.5 to 2.0 kg/mwh kg/mwh kg/year =1850 ton/year Specific heavy fuel oil consumption ton/mwh 1850/ x 1000 Savings = 6.96 GWh/year 4. Rehabilitation of equipment (mills, coal feeders, air heaters, grill and kratzer, soot ventilators, supply pumps, ventilation fittings, drainage, supply, boiler interlocking, etc.) to a technically acceptable level, reinforcing prevention and planned repairs in TPP A Reduction of TPP A own electricity consumption from 12 to 10.5 % % Savings: 25.6 GWh/year 24

25 5. Rehabilitation of equipment (mills, coal feeders, air heaters, grill and kratzer, soot ventilators, supply pumps, ventilation fittings, drainage, supply, boiler interlocking, etc.) to a technically acceptable level, reinforcing prevention and planned repairs in TPP B 6. Reduction of unplanned outages in the unit to the minimum by increasing the technical availability as high as possible in TPP A&B Reduction of TPP B own electricity consumption from 9.5 to 8.5 % Reduction of unplanned downtime of units in TPP A&B by 30 % % Savings: 37 GWh/year Planned annual downtime per unit: TPP A 15 outages/year TPP B 20 outages/year Reduction by 30%: TPP A 10 outages/year TPP B 14 outages/year Savings: TPP A 104 GWh/year TPP B 155 GWh/year 7. Capital overhaul of A4 Unit 2013 Capital overhaul of Turbine and Generator, SM Implement ation 2013 Prior to overhaul: Unit power 130 MW After overhaul: Unit power 155 MW Repair of boiler Increase in capacity of 25 MW 8. Capital overhaul of A5 Unit2014 Capital overhaul of turbine and generator, SM Partial repair of the boiler Implement ation 2014 Prior to overhaul: Unit power 130 MW After overhaul: Unit power 155 MW Increase in capacity of 25 MW 9. Revitalization of units TPP B1 & B Longer lifetime of unit 2. Higher unit usage rate 3. Higher availability of unit 4. Lower specific costs of coal, water Demi and Deka, chemicals and own consumption 5. Elimination of bottlenecks Revitalizati on TPP B TPP B Prerevitalization: 1. Lifetime of units: TPP B1 until 2023, TPP B2 until Unit capacity 310 MW 3. Specific use of steam 3.05 ton/mwh 4. Coal specific consumption 1.40 ton/kg 5. Own electricity consumption 9.5% After revitalization: 1. Lifetime after revitalization: TPP B1 until 2031, TPP B2 until Unit capacity: MW 3. Steam 2.8 ton/mwh 4. Coal 1.35 ton/mwh 5. Own electricity consumption 8 % 25

26 2.2.3 Measures in the transmission sector The electricity system in Kosovo (ESK) is interconnected through its crossborder lines with neighbouring countries (Serbia, Macedonia, Montenegro and Albania) through high voltage 400kV, 220kV transmission lines and three 110kV lines. Kosovo s energy system is characterized by a strong 400 kv interconnection network, which is strongly interconnected in the regional network. A key ongoing activity is the construction of the 400 kv line with Albania which, in the midterm and longterm, will facilitate electricity exchanges and will allow an optimization of two complementary systems thermal in Kosovo and hydro in Albania. The 400 kv line also has great importance for electricity exchanges in the region. KOSTT Kosovo Transmission System and Market Operator, operates at five voltage levels 400 kv, 220 kv, 110 kv, 35kV and 10(20)kV, with a total length of transmission system lines (400 kv, 220 kv and 110 kv) of 1,211 km. Table16. Measures to enhance the electricity transmission system Nr. Measure Timeline Estimated savings of primary energy and other indicators 1. Second transformer 40MVA in SS Skenderaj Q22014 Enhancement of security and reliability of supply in Skenderaj. Optimization of substation maintenance process. Creation of transformation reserves. 2. AT2300 MVA in SS PEJA3 and SS FERIZAJ 2 3. New 110 kv line SS Peja 3 SS Peja 1 and revitalization of SS Peja 1 Q42015 Increase of transformation Reduction of losses by 0.06 % capacities and fulfilment of N1 of total demand as a result of security criterion implementation of projects until 2016: Q ktoe x 0.06% = ktoe respectively GWh Construction of the line allows the fulfilment of N1 criterion. In addition, revitalization of SS Peja 1 has an effect in enhancing security and reliability of system operation. 4. Revitalization of 110 kv line: L126/2 SS Peja 2 SS Deçan Q Increase of transmission capacity of the line from 83 MVA to 114 MVA with the aim of reducing power losses, improving the N1 security criterion for the substation ring 110 kv Peja3 Peja1Peja2Deçan Gjakova Measures in electricity distribution sector Further upgrading and new investment are needed in the distribution network to reduce losses, while demandside investments in energy efficiency should be undertaken to help curve demand. Targeted investments will improve reliability of the distribution system and help reduce technical losses. Rehabilitation of several substations is necessary to decrease technical losses and improve service standards and reliability. 26

27 The most urgent investments in the distribution network concern metering assets at the substation level and secure metering at the enduser level. The Government recognizes that successful privatization on this scale needs to be well prepared in order to maximize the benefits for Kosovo. It is well aware of the fact that the speed of the process depends critically on its own decisionmaking regarding strategic sector options, on its institutional capacity and on prevailing market conditions. After privatization of KEK Distribution, the private investor should increase the number of supply points, as well as reinforce 110/35 kv and 35/10 kv substations along with interconnection lines. In addition, the investor should enhance the network configuration, distribution lines and transformation stations. Anticipated measures and actions related to the distribution network during the period are: Realization of necessary rehabilitations, strengthening and modernization of the network so as to eliminate congestion, reduce technical losses and improve security of electricity supply for enduse consumers; Construction of required substations at all levels; Definition of new substations required in the future and for shifting to different voltage levels; and Creation of conditions for connection of renewable power generation capacity to the distribution system. In general, both lines and transformer stations are overloaded during the winter, resulting in high technical losses which in 2006 were 17.93%, in %, in 2008 around 17%, in 2009 around 18%, in 2010 around 17%, in 2011 around 17% and in 2012 around 16%. The distribution network operates km of the 35 kv network. The 10 (20) kv network has a length of km, the 10 kv system a length of around km, the 6 kv network km and the 0.4 kv network has a length of 11, km. This Division owns transformer stations of 220 kv (from transformer) to 10(20)/ 0.4 kv. Remark: As of 1 st of May 2013 Distribution Division of KEK has been passed to the Private owner as a result of privatization Measures in the heating sector District heating systems exist only in Prishtina, Gjakova and Mitrovica. These systems meet only 3% of heating demand. Existing heating technologies are based on residual fuel oil and diesel. This sector also is challenged by old technology, negative environmental impacts and a low level of billing and collection for the energy supplied. The need to develop the heating market was recognised in the results of the Heating Market Study (ELC, World Bank Study, 2007). Development of such a market will be incentivized by the Government. The Law on Public Enterprises has placed these enterprises under municipal administration. Also the district heating sector, especially the existing system in Prishtina (named Termokos), faces financial difficulties and, to date, it has not proven to be selfsustainable without support from the Kosovo Budget. Commercial losses are high, while the existing tariffs, although not very low, do not completely cover the costs of supply. A further challenge lies in the introduction of thermal energy consumption meters for individual households in apartment buildings. The World Bank study on the heating market (2007) recommended the expansion of the DH market. The government is supporting the development of DH systems. 27

28 Existing DH plants tend to supply those city areas which have a high population density and which include public facilities, such as hospitals, schools and administrative buildings. Table17. District Heating in Kosovo Enterprise (town) Installed capacity (MW) Operation Capacity (MW) Length of distribution network (km) No. of substations DH Termokos J.S.C MW DH Gjakova, J.S.C MW DH Termomit Mitrovica MW Plans for the implementation of the thermal energy cogeneration project at TPP Kosovo B to supply the district heating system in Prishtina are a promising development in terms of improving the efficiency of supply of thermal energy for space heating. MEASURES IN THE HEATING SECTOR DH TERMOKOS J.S.C. Prishtina Thermal energy (hot water) generation is delivered by two boilers, VKLM 58 MW, which use heavy fuel oil, producing 11.3 MWh/Ton with a sulphur content of less than 1%. As an alternative source for providing heating for hospitals in Prishtina, two boilers, each with a capacity of 7.5 MW and which run on light fuel oil, are often used. Table18. Measures in DH TERMOKOS Nr. Measure Target of the use of primary energy/sector Timeline Energy savings in / other indicators Estimated primary energy savings in 2018 and other indicators Cogeneration with TPP B Prishtina DH Company Termokos Thermal heating system for the city of Prishtina Implement ation: Electricity (MWhe) which is reduced for the benefit of Thermal energy (MWhth): Reduction in electricity consumption by Prishtina city heating from 80 MWhe to MWhe 1 TPPB = 140 MWhth Max poss. TPP (B1+B2) = MWhth = 280 MWhth Possibility of connecting cogeneration to New Kosovo TPPs after Reconstruction of 50 thermal substations in the Termokos distribution Improvement of heating quality; System balancing; 2014 Savings as a result of reducing hot water Reconstruction of substations also includes the introduction of SCADA monitoring and 28

29 3 network Replacement of 11.6 km of pipes in the primary network Reduction in energy losses from 18% to 15 %. 15% reduction in water losses compared to current average losses. Reduction in energy losses from 18% to 15% due to improved pipeline insulation production: 1.94 GWh Savings in water 8447m³ control systems for the 50 substations at the central office in Termokos 4 Partial rehabilitation of Termokos : Installation of energy delivered meters Accurate information on energy delivered from the district heating system. Real assessment of energy losses in the distribution network, compared with energy received at substations GWh These measures enhance efficiency of boilers, fuel savings, and environmental protection and minimize downtimes. Installation of new equipment to measure % O2 during the combustion process; Quality control of burning heavy fuel oil and environmental protection when boilers are operating. MEASURES IN THE DISTRICT HEATING DH GJAKOVA J.S.C. Having found itself in financial difficulties as a result of high heavy fuel oil prices, high consumption of electricity and high operating costs, DH Gjakova is seeking alternative ways of generating electrical and thermal energy. The cogeneration system planned through this plant, in a ratio of electrical energy/thermal energy of 4.5 MWhe/25 MWhth, is currently in its initial phase, undergoing a feasibility study supported by WBIF (EU s Western Balkans Investment Framework). There is an interest in supporting this project with grants and loans provided by KfW, with the participation of the Kosovo Government. Currently, there are two boilers in the District Heating Company, with a nominal capacity of 18 MW and 20 MWh. The first was installed in 1980 and the second in Both boilers are in urgent need of repair to their ignition, screens and water heaters. In 2010, all pipes included in the water heater package were replaced in the 20 MW boiler in order to use it as an operational boiler, while the second boiler is kept in reserve. The efficiency level of the two boilers is around 65 70%. Annual consumption of primary energy for heating in Gjakova in 2012 was 11 GWh, while final energy consumption of heating was 9 GWh. 29

30 3 ENERGY SAVINGS ACHIEVED IN THE ENERGY ENDUSE SECTORS Kosovo has adopted a cautious approach to establishing an intermediate indicative energy savings target for its first National Energy Efficiency Action Plan ( ), which amounts to 3% of the overall amount for the period ( ktoe) i.e. 31 ktoe. The national indicative target was allocated between the sectors of final energy demand, so that the effectiveness of the proposed measures could be monitored at a more disaggregated level. The sectorial allocation of the national target was based on the following: the proportion of final energy consumption accounted for by the individual sectors, the potential for efficiency improvements, the economic efficiency concept of different energy efficiency measures for different sectors (so it is much better to promote the most effective measures) and the necessary level of policy and legal interventions in the sectors. A summary of target levels within each sector is provided in the table below. Table 19: Intermediate energy saving targets, by sector Indicative Energy Saving Target: ktoe Period ( ) Sector % ktoe GWh Residential Services Industry * Transport Total Source: Kosovo NEEAP ( ) * The Agriculture sector has been included within the Industry Sector The approved intermediate indicative target of 31 ktoe was allocated between the sectors of final energy demand, so that the effectiveness of the proposed measures could be monitored. In the first NEEAP , a total of 38 energy efficiency measures was foreseen, that included: 15 measures in the household sector, 18 measures in the services sector (public and private services), 2 measures in the industrial sector, 2 measures in the transport sector, 1 measure in the agriculture sector. 3.1 Calculation of energy savings achieved The bottomup (BU) method was used to calculate energy savings achieved in the 1 st NEEAP implementation period. The methodology, which was recommended by the EnCS, is based on an analysis of changes to key energy efficiency indicators selected for the enduse sectors during the period from the selected reference year to the reporting year. The calculation methodology and MS Excelbased tables and calculations of all relevant Indicators were developed through the project Capacity building for monitoring, verification and 30

31 evaluation (M&V&E System) of the energy efficiency policies in SEE countries, in terms of the EU accession process (PN ) supported by ORFEE/GIZ. The calculation Methodology developed with ORF EE/GIZ support is formalized in Kosovo s Legislation through AI no.14/2012. Article 4 of this AI refers to the calculation methodology which is added in annex IV as integral part of AI. Hence, for the purpose of the current report, the calculations of energy savings achieved by implementing of the First NEEAP are carried out based on AI no. 14/2012. Due to a lack of adequate statistical data and surveys, KEEA was not able to apply the topdown (TD) methodology for calculation of EE indicators. KEEA is working with relevant Institutions to ensure that adequate statistical data shall be collected for reporting the achievements made by the Second (2 nd ) NEEAP. At the end of 2012, the KEEA carried out a survey of municipalities and central government ministries to collect information on projects implemented in the public sector: In municipalities (projects related to insulation refurbishment measures applied in building components for existing public buildings, changes in the quantity and type of light bulbs used, street lighting projects implemented). In central government buildings (insulation refurbishment measures applied in building components for existing central government buildings, changes in the quantity and type of light bulbs used). To assess the energy savings achieved by implementing the administrative instruction on labelling of household electrical appliances, data from the Customs Office of Kosovo on imported household appliances was used. Using the above mentioned data for a proper assessment of the energy savings achieved, bottom up calculations were used for 8 energy efficiency measures that were implemented, out of a total of 38 that were included in the 1 st NEEAP. Table 20: Overview of EE measures and indicators used for calculation of energy savings achieved Sector Id Measure Indicator used Residential R1 AI on labeling electrical household appliances Replacement of new household appliances (washing machines, refrigerators, dishwashers) in residential buildings R 10 Promotion of EE in households Insulation refurbishment measures applied in building components in existing residential buildings R 12 Public campaign on energy savings and improved EE Replacement or new installation of lamps in residential buildings Services S 7 EE promotion at municipal level Insulation refurbishment measures applied in building components in existing tertiary buildings S 13 Public campaign on energy savings and improved EE through efficient lighting Replacement or new installation of lamps in public buildings S 15 Stimulation of use of solar systems and panels for sanitary water heating and public lighting Solar water heating in tertiary buildings S 16 Improved EE through efficient lighting in public buildings Replacement or new installation of lighting systems in tertiary buildings S 17 Efficient public street lighting Replacement or new installation of street lighting systems. 31

32 3.2 Description of energy savings achieved Residential sector The following bottomup indicators were used as the basis for calculating energy savings: Replacement or installation of new household appliances (washing machines, refrigerators, dishwashers) in residential buildings; Insulation refurbishment measures applied in building components in existing residential buildings; Replacement or new installation of lamps in residential buildings. AI on labelling household electric appliances (R1) Energy savings for the replacement of new household appliances (washing machines, refrigerators, dishwashers) in residential buildings have been calculated using the following formula: UFES AEC ref _ year _ stockav AEC ref _ market promoted [ kwh/ unit year ] Total savings: 53,47 GWh, or 4.60 ktoe Remarks: Calculations are based on the reference values provided in the approved BU methodology and information concerning the number of imported appliances obtained from Kosovo Customs. It has been assumed that the residential sector accounts for 80% of washing machines and dishwashers, while the service sector accounts for the remaining 20%. For refrigerators, the equivalent figures are 70% (residential sector) and 30% (service sector) Promotion of EE in households (R10) Energy savings from insulation refurbishment measures applied in building components in existing residential buildings have been calculated using the following formula: UFES U ini _ comp U new _ comp 1 HDD24a c b 1000 m comp 2 (Uini_comp=1.4 W/m 2 K and Unew_comp=0.35 W/m 2 K, HDD=2915 Kd/y) kwh of ins.comp year Total savings: GWh, or ktoe Remarks: After 1999 a large number of private houses and buildings in Kosovo were in a destroyed or damaged condition. As a result of public awareness raising campaigns on the energy savings that can be achieved by applying EE measures, a considerable number of households improved the insulation of their houses during the reporting period. ProCredit Bank and Raiffeisen Bank have provided substantial loans under the Ecoprogram launched in KEEA has carried out a survey with manufacturers of insulation materials (Stiropor N4) and large building material markets in Kosovo who provided KEEA with data on the amounts of insulation materials produced respectively sold in the Kosovo market during the reporting period. KEEA has assumed 30% of total insulation material sold was used for rehabilitation and upgrading of existing houses, while the remaining 70% was used for insulating newly constructed houses and buildings. 32

33 Based on expert estimations, KEEA came to the conclusion that up to 30 % of total investments for insulation of existing houses may be attributed to the impact of the current measure. Hence only 30 % of the total EE savings as results of insulation of existing houses is reported. Data provided by the Kosovo Agency of Statistics shows that the average living space per family in Kosovo is m 2. It is considered that the majority of refurbished houses belongs to the construction periods and defined in the BUMethodology U reference values were calculated from BUMethodology as weighted average for the construction periods and Public campaign on energy savings and improved EE (R12) Energy savings resulting from the replacement of existing lamps or the installation of new lamps in buildings were calculated using the following formula: P UFES STOCK _ AVERAGE P BEST _ MARKET _ PROMOTED 1000 F rep n h [ kwh/ unit / year ] For reporting purposes, 80% of the savings achieved by implementing this measure have been attributed to the residential sector. Total savings: GWh, or 8.60 ktoe Remarks: Calculations are based on the approved BU methodology and information on the number of imported EE bulbs obtained from Kosovo Customs. It was assumed that 75 % of total imported bulbs were used to replace bulbs in existing houses and buildings while 25 % were used in newly constructed buildings. It was further assumed that 80% of the imported bulbs were used to replace existing bulbs in the residential sector and 20% in the service sector. Service sector The bottomup formulas for calculation of energy savings that result from implementation of the following energy efficiency measures were used: Insulation refurbishment measures applied in building components in existing tertiary buildings, Replacement or new installation of lamps in residential buildings, Solar water heating in tertiary buildings, Replacement or new installation of lighting systems in tertiary buildings, Replacement of or new installation of street lighting systems. EE promotion at municipal level (S7) Energy savings from insulation refurbishment measures applied in building components in existing public buildings were calculated using the following formulas: Doors and Windows Refurbishment of doors and windows in the municipal buildings of 15 municipalities, using Uvalues stipulated in Table 12 of the BU methodology (U ini. = 5.1 W/m 2 K, U new = 2.8 W/m 2 K and HDD=2915 Kd/y): 33

34 UFES U ini _ comp U new _ comp 1 HDD24a c b 1000 m comp 2 kwh of ins.comp year Insulation of walls Refurbishment of walls in the municipal buildings of 15 municipalities, using Uvalues stipulated in Table 12 of the BU methodology (U ini. =1.03 W/m 2 K, U new =0.36 W/m 2 K and HDD=2915 Kd/y): 1 U ini _ comp Unew _ comp HDD24a c kwh UFES b comp m of ins.comp year Total savings: 9.39 GWh, or 0.81 ktoe Remarks: Assumptions are based on the data received from 15 Municipalities throughout Kosovo which have implemented EE measures from their own budgets. It is considered that the majority of refurbished public buildings belongs to the construction period , defined in the BUMethodology Ureference values were calculated from the BUMethodology as weighted averages for public buildings and schools constructed in the period Public campaign on energy savings and energy efficiency improvement (S13) Energy savings from the replacement of existing or installation of new lamps in the Service Sector were calculated using the following formula: P UFES STOCK _ AVERAGE P BEST _ MARKET _ PROMOTED 1000 F rep n h [ kwh/ unit / year ] For reporting purposes, 20% of the savings achieved by implementing these measures have been attributed to the services sector. Total savings: 25 GWh/year, or 2.15 ktoe Remarks: Calculations are based on the approved BU methodology and information on the number of imported EE bulbs obtained from Kosovo Customs. It was assumed that 75 % of total imported bulbs were used to replace bulbs in existing houses and buildings while 25 % were used in newly constructed buildings. It was further assumed that that 80% of the imported bulbs were used in the residential sector and 20% were used in the service sector. Stimulation of use of solar systems and panels for sanitary water heating and public lighting (S15) Energy savings resulting from the installation of solar water heating in tertiary buildings were calculated using the following formula: UFES USAVE stock _ average _ heating _ systems 34

35 Total savings: 0.99 GWh/year, or ktoe Improved EE through efficient lighting in public buildings (S16) Energy savings from replacement or new installation of lighting systems in tertiary buildings were calculated using the following formula: P UFES ini n h_ ini P new 1000 n h_ new [ kwh/ unit / year ] Total savings: 0.72 GWh/year, or 0.06 ktoe Remarks: Assumption was based on data received from the Ministry of Public Administration and the Ministry of Foreign Affairs. Efficient public street lighting (S17) Energy savings resulting from the replacement of existing or installation of new street lighting systems were calculated using the following formula: P UFES s, ini n sh _ ini P 1000 s, new n sh _ new [ kwh/ m/ year ] Total savings: 8.82 GWh/year, or 0.76 ktoe 3.3 Description of energy savings measures implementation The 1 st NEEAP included 38 energy efficiency measures in total. Most of these measures were foreseen in the residential and services sectors, the sectors which had the highest energy saving targets to be achieved. Table 21 presents an overview of the measures included in the 1 st NEEAP and an evaluation of their implementation. 35

36 Table 21: Overview of EE measures and evaluation of their implementation Id Name of energy saving measure Energy savings planned to be achieved in 1 st NEEAP (ktoe) Residential sector Energy savings reported (ktoe) Status of implementation Comments R 1 AI on labeling of household electric appliances Implemented AI on labeling adopted on June 27, 2012 Energy savings were calculated from replacement of washing machines, refrigerators, dishwashing machines. R 2 AI on energy auditing Implemented AI on energy auditing adopted on April 14, 2008 and revised on January 30, energy auditors were trained and certified. R 3 AI on EE promotion for final consumers and energy services Implemented AI on Promotion of energy efficiency for final consumers and energy services adopted on 31 st of October, Insulation refurbishment measures applied in building components in existing residential buildings. R 4 Enhancement of municipal capacities for managing projects and energy audits in municipalities Implemented training took place in December officers in municipalities were trained on energy management. 30 officers in municipalities were trained on energy planning and compilation of municipal EE action plans R 5 Initial training courses for energy auditors Implemented training took place in May Energy Auditors were trained 36

37 R6 R 7 R 8 R 9 Enhancement of the collection rate and improved EE (campaign by KEK J.S.C.) Promotion of LPG for heating and kitchen use 1.5 Technical regulation on energy performance of buildings. Law on EE KEK and KOSTT reported that: KEK launched public awareness campaign on a yearly basis to enhance collection rate KEK procured multifunctional and simple digital meters. During the reporting period KEK has replaced digital meters. Commercial losses decreased on yearly basis (24.02% in 2010, 21.37% in 2011 and 18.81% in 2012) At the current price of LPG the planned target is not achievable. Implemented Technical regulation adopted on May 25th, Implemented Law on EE was adopted on July 8th, Implementation of the measure had a positive impact on introducing of EE light bulbs (R12 and S13) and implementation of AI on labeling household electric appliances (R1) R 10 Promotion of EE in households Implemented Raiffeisen Bank has disbursed: ~ euro to microcredits ~ 1 mil euro to SMEs ~ 4 mil euro loan to big industrial client R 11 Development of a system for certification of energy auditors Implemented through adoption of Regulation no.01/2012 on Establishment and Functioning of CCEAM. Adoption date ProCredit Bank has disbursed: ~ 20 mil euro to microcredits ~ 2 mil euro to SMEs During the reporting period, 52 energy auditors were certified and secondary legislation on the establishment of the Commission for Certification of 37

38 Energy Auditors and Managers was adopted. R 12 R 13 Public campaign on energy savings and improved EE AI on heating of new collective buildings Implemented Not implemented in the reporting period the AI was not approved yet Total savings introducing EE bulbs were calculated for residential and services sectors together, for reporting purposes 80% of savings reported on R12 R 14 R15 Reforms of public procurement legislation to benefit of energy efficiency incentives Incentivize usage of solar energy for sanitary water heating Total from measures: ktoe ktoe Services sector Id Name of energy saving measure Energy savings planned to be achieved in 1 st NEEAP (ktoe) Energy savings reported (ktoe) S 1 AI on labeling of office electric appliances Implemented amendments to Procurement Law approved on 31 August, 2011 Installation of solar collectors observed, but due to insufficient information achieved savings are not reported Status of implementation Implemented AI on labeling adopted on Comments Revised AI no.09/2012 on Labeling of Energy related Products, includes all appliances used in Residential and Services Sector. S 2 AI on energy auditing Implemented AI on energy auditing adopted on April 14, 2008 and revised on January 30, energy auditors were trained and certified 38

39 S 3 S 4 AI on EE promotion for final consumers and energy services Development of municipal capacities for project management and energy audits in municipalities Implemented AI on Promotion of energy efficiency for the final consumers and energy services adopted on 31 st of October Implemented training took place in December officers in municipalities were trained on energy management. 30 officers in municipalities were trained on energy planning and compilation of municipal EE action plans S 5 S6 S 7 Training of energy auditors at municipal level Enhancement of the collection rate and improved EE (campaign by KEK J.S.C.) EE promotion at municipal level Implemented training took place in December KEK and KOSTT reported that: KEK launched public awareness campaign on yearly bases to enhance collection rate. KEK procured multifunctional and simple digital meters. During the reporting period KEK has succeeded in replacing digital meters. Commercial losses decreased on yearly basis (24.02% in 2010, 21.37% in 2011 and 18.81% in 2012) Refurbishment of doors and windows in municipal buildings of 15 municipalities totaling m2 Refurbishment of walls in municipal buildings of 17 municipalities totalling m2 30 trained Municipal officers. Implementation of the measure had positive impact on introducing of EE light bulbs (R12 and S13) and implementation of AI on labeling household electric appliances (R1) 39

40 S 8 S 9 S 10 LPG promotion Technical regulation on energy performance of buildings Law on EE S 11 Promotion of EE in SMEs 0.5 With current price of LPG the planned target is not achievable. Implemented Technical regulation adopted on May 25th, 2009 Implemented Law on EE was adopted on July 8th, 2011 EE investments in SMEs observed, but due to insufficient information savings are no reported Raiffeisen Bank has disbursed: ~ euro to microcredits ~ 1 mil euro to SMEs ~ 4 mil euro loan to big industrial client ProCredit Bank has disbursed: ~ 20 mil euro to microcredits ~ 2 mil euro to SMEs S 12 S 13 S 14 Creation of a system for certifying auditors Public campaign on energy savings and energy efficiency improvement Transformation of procurement legislation, with the aim of improving EE Implemented through adoption of Regulation no.01/2012 on Establishment and Functioning of CCEAM. Adoption date Implemented Implemented amendments to Procurement Law approved on 31 August During the reporting period, 52 energy auditors were certified and secondary legislation on the establishment of the Certification Commission for Energy Auditors and Managers was adopted Total savings from introduction of EE light bulbs were calculated for residential and services sectors together, for reporting purposes 20% of savings reported on S13 40

41 S 15 S 16 S 17 Stimulation of use of solar systems and panels for sanitary water heating and public lighting Improved EE through efficient lighting in public buildings Efficient public street lighting MED/MEM has financed exemplary pilot projects installing Solar Panels in 3 hospital clinics, one students dormitory and its Administrative Building, while the University Students Centre has financed one Students Dormitory 13 municipalities and 3 ministries have reported energy savings by replacing lighting systems in public buildings In 2010 through cofunding (GIZ, MEM and Municipalities) pilot projects in 5 municipalities have been implemented on replacement of street lighting systems S 18 Improved EE in heating equipment for the services sector Total from measures 13,24 ktoe Ktoe Industry Sector Id Name of energy saving measure Energy savings planned to be achieved in 1 st NEEAP (ktoe) Energy savings reported (ktoe) In 2011 and more municipalities have replaced street lighting systems from their own budgets Due to lack of data, savings achieved are not evaluated and reported Status of implementation Comments I 1 EE promotion among SMEs Due to lack of data, savings achieved are not evaluated and reported Raiffeisen Bank has disbursed: ~ euro to microcredits ~ 1 mil euro to SMEs ~ 4 mil euro loan to 41

42 big industrial client ProCredit Bank has disbursed: ~ 20 mil euro to microcredits ~ 2 mil euro to SMEs I 2 Encouragement of simple audits in the industry sector and a campaign on awareness raising in this sector 2.2 Due to lack of data, savings achieved are not evaluated and reported Total from measures 2.2 ktoe 0 ktoe Transport sector Id Name of energy saving measure Energy savings planned to be achieved in 1 st NEEAP (ktoe) Energy savings reported (ktoe) T 1 AI on introduction of biofuel in transport T 2 Public awareness raising 1.4 campaign in transport Total from measures 1.4 ktoe 0 ktoe Agriculture sector Id Name of energy saving measure Energy savings planned to be achieved in 1 st NEEAP (ktoe) Energy savings reported (ktoe) Status of implementation In the reporting period the AI was not yet approved Due to lack of data, savings achieved are not evaluated and reported Status of implementation Comments Comments A 2 Awareness campaign on energy efficiency 0,15 Due to lack of data, savings achieved are not evaluated and reported Total from measures 0.15 ktoe 0 ktoe TOTAL 30,26ktoe ktoe Analysis of actual energy savings achieved show that more than 80% of the target has been achieved in residential sector. However, it should be taken into account that due to a lack of data, savings achieved in the services sector have not been fully evaluated and reported. In addition, savings achieved in the industry and transport sectors have not been reported at all. 42

43 Remark: Besides the reported saving measures, First NEEAP has had many soft measures connected with implementation of Laws and AI s which could have provided tangible results but we could not apply the M&V&E methodology, therefore are not reported on this report. In addition, on these soft measures we do not foresee substantial developments in upcoming period of Second NEEAP as a matter of budgetary constraints, therefore are not included in the Second NEEAP. Table 22: Actual energy saving achieved by sector Indicative Energy Saving Target: 31 ktoe Period ( ) Sector (%) (ktoe) (GWh) Residential Services Industry Transport Total Summary on energy savings planned and achieved The saving target set in the 1 st NEEAP of ktoe has been over achieved ktoe. Preliminary estimates show that energy savings reached in the first midterm period are even higher than reported, but due to the lack of statistical data energy savings cannot be properly assessed and reported. Energy savings reached in the transport and industry sectors were not evaluated at all in the 1 st NEEAP. National indicative target in 2018 Intermediate indicative target in 2012 Separation of sector targets Table 23: National indicative target and its accomplishment ktoe ktoe Approximate Sector target Energy savings in 2012 assumption of energy savings in From Total From Total measures (TD) measures (BU) (TD) (BU) Residential (ktoe) ktoe Services (ktoe) ktoe 18,91 Industry (ktoe)** Not evaluated Transport (ktoe) Not evaluated Total (equivalent units): ktoe ktoe ktoe Total (GWh): GWh GWh Percentage (%)(compared to ESD reference consumption) 3 % 9 % 3.1 % 9.00% *Fields shaded in grey include values from the first NEEAP **Agriculture sector has been included in into the Industry Sector Remark: In the First NEEAP we have not forecast a national target for nearly zero energy buildings. 43

44 4 ENERGY EFFICIENCY MEASURES OF THE SECOND NEEAP IN THE ENERGY ENDUSE SECTORS In total, 17 energy efficiency measures have been included the 2nd NEEAP. Most of these energy efficiency measures are planned to be implemented in the services sector 5, and followed by the residential sector. 4.1 Measures in the residential sector The residential sector is the second largest energy enduse sector in Kosovo. In 2012, energy enduse in the residential sector was ktoe or % of total energy enduse consumption. It is estimated that the energy savings potential for the residential sector is around 1040%. It is clear from the above that the household sector would contribute most energy savings, but it is also the most difficult sector in which to achieve progress, due to lack of incentives and penalties for nonimplementation. Reduction of energy consumption will be one of the greatest challenges in the future. It is certainly required, as rising energy prices will put an increasingly heavy burden on households in particular on low income households, who already can hardly afford to pay their energy bills. The draft of new Condominium Law is approved by the Parliamentary Commission. The Law will be presented to the parliament for the second reading in next Months. The Law will regulate the use, management and maintenance of jointly owned buildings. It is important to note that the creation of house owners associations will become obligatory. The implementation of the Law will regulate the rights and duties of apartment owners, the allocation of profit, charges and costs, general meeting and binding decisions for minorities after majority votes, preconditions for unanimous decisions, etc. The policy planning document that addresses housing development issues in Kosovo is the Strategy of the Ministry of Environment and Spatial Planning ( ). The following two strategic objectives address issues related to the establishment of a legal and institutional framework for the promotion of energy efficiency: increasing access to housing that is affordable and compatible with the economic circumstances of families and with the preservation of the value of the housing stock; regulating construction activities by engineering technical regulations in compliance with EU standards. Issues related to promotion of energy efficiency in multiapartment buildings will be the main priority of the Ministry of Environment and Spatial Planning for the coming years. The following 4 measures for the residential sector have been included in the 2nd NEEAP: Improving EE through implementation of energy efficiency measures in residential buildings, Improving EE through implementation of energy efficiency measures in the residential sector, Improving EE through implementation of energy efficiency measures in multiapartment buildings, Improving EE through continuing information campaigns on energy efficiency. 44

45 No R.1. R.2. R.3. R.4. Table 24 Summary table of energy efficiency improvement measures in the residential sector Title of the energy saving measure Improving EE through implementation of energy efficiency measures in residential buildings Improving EE through implementation of energy efficiency measures in the residential sector Improving EE through implementation of energy efficiency measures in multiapartment buildings Improving EE through continuing information campaigns on energy efficiency Target group Duration Households 2014 to 2015 Households 2013 Owners of apartments in multiapartment buildings to to 2018 Households 2013 to 2015 Achieved energy savings in 2012 summary of sectorial savings based on measures defined in 1st NEEAP Energy savings expected in ,06 ktoe 51,56 ktoe Title of the energy saving measure Index of the measure Improving EE through implementation of energy efficiency measures in residential buildings R1 Description Category Financial instrument Timeframe Start: 2014 Aim/brief description Target enduse End: 2015 Measure aims at increase of energy efficiency in residential buildings Existing buildings Target group Households 45

46 Information on implementation Energy savings Regional application List and description of energy saving actions substantiating the measure Budget and financial source Implementing body Monitoring authority Method for monitoring/measuring the resulting savings Expected savings in 2012 as per 1 st NEEAP Savings achieved in 2012 Expected energy savings in 2015 Expected impact on energy savings in 2018 (if available) Assumptions Overlaps, multiplication effect, synergy Nationwide It is planned that energy saving measures will be implemented in residential buildings. Energy saving measures in residential buildings foresees insulation of walls, replacement of windows, insulation of roofs and basements. Total EBRD contribution (loan/grant) 12mil Euro. (The total budget for measures R1 (3 mil., Euro) and I1 (9 mill. Euro)). MED/KEEA KEEA KEEA has developed a project postimplementation monitoring system which foresees that final beneficiaries will submit information on actual energy consumption after project implementation. Implementation of the measure will start in 2013 Implementation of the measure will start in ,00 ktoe Estimates of expected energy savings are based on an assessment of energy savings achieved with similar investment in the 1 st NEEAP, foreseeing that approx. 1/3 of budget available will be invested in residential sector (the rest in Industry and SMEs sector I1) Title of the energy saving measure Index of the measure Improving EE through implementation of energy efficiency measures residential sector R2 Description Category Financial instrument Timeframe Start: 2013 Aim/brief description Target enduse End: 2018 Measure aims at increase of energy efficiency in residential buildings Existing buildings Target group Households 46

47 Information on implementation Regional application List and description of energy saving actions substantiating the measure Budget and financial source Nationwide It is planned that energy saving measures will be implemented in residential buildings. Energy saving measures in residential buildings foresees insulation of walls, replacement of windows, insulation of roofs and basements. Commercial banks have already issued a large number of loans for implementation measures in the residential and SME sectors it is also expected that in the period of the 2 nd NEEA implementation overall costs will at least remain at the same level i.e. at least 20 mill. euro Energy savings Implementing body Monitoring authority Method for monitoring/measuring the resulting savings Expected savings in 2012 as per 1 st NEEAP Savings achieved in 2012 MED/KEEA KEEA KEEA together with commercial banks is developing a project implementation monitoring system that will allow assessment of the energy savings achieved. 2,86 ktoe 9,76 ktoe Expected energy savings in 2015 Expected impact on energy savings in 2018 (if available) Assumptions Overlaps, multiplication effect, synergy 7 ktoe Estimates of expected energy savings are based on an assessment of the energy savings achieved with similar investments in the 1 st NEEAP Title of the energy saving measure Index of the measure Improving EE through implementation of energy efficiency measures in multiapartment buildings R3 Description Category Timeframe Start: 2013 Aim/brief description Target enduse Regulation / Financial instrument End: 2018 Measure aims to increase energy efficiency in multiapartment buildings. Existing buildings 47

48 Information on implementation Target group Regional application List and description of energy saving actions substantiating the measure Budget and financial source Owners of apartments in multiapartment buildings Nationwide Draft Law on Condominiums which is in the second reading stage in Parliament, foresees establishment of housing associations as an obligation. It creates a legal basis for the further implementation of EE measures in multiapartment buildings. The Ministry of Environment and Spatial Planning will draft an administrative regulation concerning technical housing norms for condominiums; an administrative instruction for a certification program for administrators, an administrative instruction about condominium agreements and an administrative instruction for a register of condominiums, in parallel, administrators at local level will start a promotion campaign for the establishment of housing owner associations. It will be an obligatory precondition for receiving further support from the state for preparation of energy audits and the implementation of energy saving measures. There is a Capstone Project being carried out by an officer of the Ministry of Environment and Spatial Planning which aims to be deliver a promotional program for the Law for development of the condominium management mechanisms. It is planned that energy saving measures will be implemented in multiapartment buildings. Energy saving measures foresee insulation of walls, replacement of windows, insulation of roofs and basements. AI budget of the Ministry of Environment and Spatial Planning Promotional measures for establishment of housing associations for 12 multiapartment buildings (Ministry of Environment and Spatial Planning would cover half the cost in the form of conditional grants for establishment of owner associations and the other half should be covered by the building owners) Implementation of first pilot projects for 4 multiapartment buildings (Ministry of Environment and Spatial Planning would invest in renovation measures covering half of the total amount as conditional grants and the rest would be covered by the building owners) Total budget for promotion measures and Implementation of pilot projects

49 euro. Energy savings Implementing body Monitoring authority Method for monitoring/measuring the resulting savings Expected savings in 2012 as per 1 st NEEAP Savings achieved in 2012 Expected energy savings in 2015 Expected impact on energy savings in 2018 (if available) Ministry of Environment and Spatial Planning KEEA KEEA has developed a project postimplementation monitoring system that foresees that final beneficiaries should submit information on actual energy consumption after projects implementation. Implementation of the measure will start in 2013 Implementation of the measure will start in ,5 ktoe 9,00 ktoe Assumptions Overlaps, multiplication effect, synergy Title of the energy saving measure Index of the measure Improving EE through continuing information campaigns on energy efficiency R4 Description Category Information measure Timeframe Start: 2012 Aim/brief description Target enduse End: 2015 Measure aims at increasing awareness of energy efficiency issues and that this will facilitate further implementation of EE measures in residential, industrial and services sectors. Residential Information on implementation Target group Regional application List and description of energy saving actions substantiating the measure Budget and financial source Households Nationwide It is planned that KEEA will carry out continuing awareness raising campaign for energy efficiency measures. MED/ KEEA budget euro during the period , euro for each year. 49

50 Energy savings Implementing body Monitoring authority Method for monitoring/measuring the resulting savings Expected savings in 2012 as per 1 st NEEAP Savings achieved in 2012 Expected energy savings in 2015 Expected impact on energy savings in 2018 (if available) Assumptions Overlaps, multiplication effect, synergy MED/KEEA KEEA TD Implementation of the measure will start in 2013 Implementation of the measure will start in Measures in transport sector The transport sector is the second largest energy enduse sector in Kosovo. In 2012, energy enduse in transport sector was ktoe or % of total energy enduse consumption. Table25. Overview of total energy consumption by transport subsectors Subsectors / Year * Road transport ,35 Railway transport ,24 Air Transport ,88 Total transport sector Source: Energy Balance of Kosovo 2010, 2001, 2012 (forecast)*, Ministry of Economic Development Two energy efficiency measures were included in the 1 st NEEAP, which envisaged energy savings of 1.4 ktoe in the transport sector. Due to the lack of data for calculation of energy efficiency indicators in the transport sector, no achieved energy savings have been reported in the 1st NEEAP. The Ministry of Infrastructure has planned to make improvements in the data collection system especially regarding the collection of data on mileage, creating the possibility to calculate energy savings achieved in the transport sector in the 2 nd NEEAP. Development of the public infrastructure has been included as one of the pillars in the Action Plan of the Economic Vision of Kosovo ( ). Several transport sector infrastructure development projects have been included in the above mentioned policy document. For instance, in road infrastructure development, construction of the highway R7 Morinë Merdare, highway R6 Prishtinë Hani i Elezit, expansion of national roads, etc. It also foresees investment projects in the railroad sector rehabilitation and modernization of the south sector line 10 of the railroad. There are two main policy planning documents in the transport sector: Strategy of Multimodal Transport and Action Plan; 50

51 Strategy of the Ministry of Infrastructure ( ). The goal of the Ministry of Infrastructure is to contribute to economic growth through the establishment of an efficient and integrated multimodal system road, railway, air. The following 3 measures have been included for the transport sector in the 2nd NEEAP: Improving EE through a continuing information campaign on promotion of ecodriving; Systematic inspections of the technical condition of vehicles; Improving the public transport system in Pristina city. Table26. Summary table of energy efficiency improvement measures in the transport sector No T.1. Title of the energy saving measure Improving EE through continuing information campaign on promotion of ecodriving Target group All vehicle owner groups Duration 2012 to 2014 Achieved energy savings in 2012 summary of sectorial savings based on measures defined in 1st NEEAP Energy savings expected in 2018 T.2. Systematic inspections of the technical condition of vehicles All vehicle owner groups 2013 to 2015 Savings not reported due to lack of data 12 ktoe T.3. Improving of public transport system in Pristina city Users of public transport in Pristina city 2013 to 2015 Title of the energy saving measure Index of the measure Improving EE through continuing information campaign on promotion of ecodriving T1 Description Category Information measure Timeframe Start: 2013 Aim/brief description Target enduse End: 2015 To promote ecodriving that will lead to more efficient driving and reduced consumption of energy resources by vehicles. Transport Target group All vehicle owner groups 51

52 Information on implementation Energy savings Regional application List and description of energy saving actions substantiating the measure Budget and financial source Implementing body Monitoring authority Method for monitoring/measuring the resulting savings Expected savings in 2012 as per 1 st NEEAP Savings achieved in 2012 Nationwide In order to promote ecodriving the following actions will take place: continuing awareness raising campaign on ecodriving will be carried out; starting 2013, ecodriving will be introduced as a part of the training course and final examination for obtaining a driving license; drivers at the ministries will be encouraged to pass ecodriving courses Budget of the Ministry of Infrastructure Costs are covered by the cost of the driving licence Budgets of central government ministries Ministry of Infrastructure Ministry of Infrastructure / KEEA TD Expected energy savings in 2015 Expected impact on energy savings in 2018 (if available) Assumptions Overlaps, multiplication effect, synergy Title of the energy saving measure Systematic inspections of the technical condition of vehicles Index of the measure T2 Description Category Timeframe Aim/brief description Target enduse Target group Specific measures in the transport sector Systematically To ensure that vehicles are being operated according to the manufacturer's requirements. Transport All vehicle owner groups 52

53 Information on implementation Energy savings Regional application List and description of energy saving actions substantiating the measure Budget and financial source Implementing body Monitoring authority Method for monitoring/measuring the resulting savings Expected savings in 2012 as per 1 st NEEAP Savings achieved in 2012 Nationwide In order to reduce the consumption of energy resources by vehicles: every vehicle owner shall ensure periodic maintenance of his vehicle according to the manufacturer s requirements; vehicle owners shall ensure that the mandatory technical inspection is carried out in accordance with Law No. 02/L70 On Road Traffic Safety Article 316 on an annual basis for privately owned vehicles and once in 6 months for commercial vehicles. Technical inspection costs are covered by vehicle owners Ministry of Infrastructure Licensed companies that carry out inspections Ministry of Infrastructure / KEEA TD Expected energy savings in 2015 Expected impact on energy savings in 2018 (if available) Assumptions Overlaps, multiplication effect, synergy Title of the energy saving measure Index of the measure Improving of public transport system in Pristina city T3 Description Category Specific measures in the transport sector Timeframe (investment component to be finished by the end of 2014) Aim/brief description To improve the public transport infrastructure the quality of services offered in Pristina city that would lead to increased use of public transport instead of using privately owned 53

54 cars. Information on implementation Energy savings Target enduse Target group Regional application List and description of energy saving actions substantiating the measure Budget and financial source Implementing body Monitoring authority Method for monitoring/measuring the resulting savings Expected savings in 2012 as per 1 st NEEAP Savings achieved in 2012 Expected energy savings in 2015 Expected impact on energy savings in 2018 (if available) Assumptions Overlaps, multiplication effect, synergy Public transport In Pristina city Users of public transport in Pristina city Pristina city Program for improvement of public transport system in Pristina city foresees the following activities to be taken: Public awareness raising campaign supported by special offers to promote the use of public transport Investment component it is planned that 50 new buses will be bought for improvement of public transport services in Pristina city Public awareness raising campaign budget of Pristina city council Investment component 5.5 mill. euro (budget of Pristina city council 2 mill. Euro, Government of Japan 3.5 mill. Euro) Pristina city council Pristina city council / KEEEA BU Implementation of the measure will start in 2013 Implementation of the measure will start in ktoe by the end of the implementation period related energy savings will be reported (old bus new bus) by the end of the implementation period the number of replaced buses and related energy savings will be reported 54

55 4.3 Measures in the tertiary sector Energy efficiency measures in the tertiary sector which includes public administration, healthcare etc. institutions will be central investment projects in the 2 nd NEEAP. The 2 nd NEEAP contains five measures for implementation, for which financing from the national budget of Kosovo, local municipal budgets and IFIs has been mostly committed. More than 200 buildings will be renovated as a result of the implementation of investment projects in the above mentioned activity. The following 5 measures have been included for the tertiary sector in the 2nd NEEAP: Improving EE through renovation of public buildings in municipalities, Improving EE through renovation of central government buildings, Improving EE through renovation of public buildings (municipal buildings), Improving EE through renovation of municipal buildings and street lighting, Promotion of energy efficiency measures by preparing energy audits. Table 27. Summary table of energy efficiency improvement measures in the public sector No S1 Title of the energy saving measure Improving EE through renovation of public buildings in municipalities S2 Improving EE through renovation of governmental buildings S3 Improving EE through renovation of public buildings (municipal buildings) S4 Improving EE through renovation of municipal buildings and street lighting S5 Promotion of energy efficiency measures by preparing energy audits Target group Duration Achieved energy savings in 2012 summary of sectorial savings based on measures defined in 1st NEEAP Public services Central government buildings Public services Public services Public services, central government buildings 2013 to to to to to 2014 Energy savings expected in ,865 ktoe 20,71 ktoe 55

56 Title of the energy saving measure Index of the measure Improving EE through renovation of public buildings in municipalities S1 Description Information on implementation Category Financial instrument Timeframe Start: 2013 Aim/brief description Target enduse Target group Regional application List and description of energy saving actions substantiating the measure Budget and financial source Implementing body End: 2014 Measure aims at increasing energy efficiency in municipal buildings Existing buildings Public services Nationwide It is planned that energy saving measures will be implemented in 65 public buildings (63 schools and 2 hospitals). Energy saving measures foresees insulation of walls, replacement of windows, insulation of roofs and basements, as well as installation of energy efficient lighting. Concrete measures that will be implemented in each building have been identified in the process of preparation of energy audits. EC contribution (grant) 15.6mil. euro post monitoring implementation period will show energy savings results MED/KEEA Energy savings Monitoring authority Method for monitoring/measuring the resulting savings Expected savings in 2012 as per 1 st NEEAP KEEA KEEA has developed a project postimplementation monitoring system which foresees that final beneficiaries should submit information on actual energy consumption after projects implementation. Implementation of the measure will start in 2013 Savings achieved in 2012 Implementation of the measure will start in 2013 Expected energy savings in ,17 ktoe Expected impact on energy savings in 2018 (if available) Assumptions Overlaps, multiplication effect, synergy Estimates of expected energy savings are based on energy audits that were carried out for each building. 56

57 Title of the energy saving measure Index of the measure Description Information on implementation Energy savings Category Improving of EE through renovation of governmental buildings S2 Financial instrument Timeframe Start: 2013 Aim/brief description Target enduse Target group Regional application List and description of energy saving actions substantiating the measure Budget and financial source Implementing body Monitoring authority Method for monitoring/measuring the resulting savings Expected savings in 2012 as per 1 st NEEAP End: year program which aims to increase energy efficiency in central government and municipality buildings Existing buildings Public services Nationwide It is planned that the project will include buildings: energy audits will be prepared for all central government buildings (except: police, military) and some municipality buildings energy saving measures will be implemented in all central/local governmental buildings that will be audited. Energy saving measures foresees insulation of walls, replacement of windows, insulation of roofs and basements. Concrete measures that will be implemented in each building will be identified during the preparation of energy audits. WB (loan) is estimated at US$18m for the central government component and US$4.5m. for the municipality component also 0.7 m EC contribution as grant (energy audits) in total about 17.5 mill. Euro MED/KEEA KEEA KEEA has developed a project postimplementation monitoring system which foresees that final beneficiaries should submit information on actual energy consumption after projects implementation. Implementation of the measure will start in 2013 Savings achieved in 2012 Implementation of the measure will start in 2013 Expected energy savings in 2015 Expected impact on energy savings in 2018 (if available) Assumptions 2.,34 ktoe 7.34 ktoe (cumulative total) Estimates of expected energy savings are based on average energy savings evaluated in energy audits that have already been prepared for central and 57

58 local government buildings. Overlaps, multiplication effect, synergy Title of the energy saving measure Index of the measure Description Category Improving of EE through renovation of public buildings (municipal buildings) S3 Financial instrument Timeframe Start: 2013 Aim/brief description Target enduse End: 2016 Measure aims at increase of energy efficiency in public (municipal) buildings Existing buildings Information on implementation Target group Regional application List and description of energy saving actions substantiating the measure Budget and financial source Public services Nationwide It is planned that energy saving measures will be implemented in 30 public buildings. Energy saving measures foresees insulation of walls, replacement of windows, insulation of roofs and basements. Concrete measures that will be implemented in each building will be identified during the preparation of energy audits. KfW/EC contribution grant 5.0 mill. Euro, in total 5.0 mill. Euro. Energy savings Implementing body Monitoring authority Method for monitoring/measuring the resulting savings Expected savings in 2012 as per 1 st NEEAP MED/KEEA KEEA KEEA has developed a project postimplementation monitoring system that foresees that final beneficiaries should submit information on actual energy consumption after projects implementation. Implementation of the measure will start in 2013 Savings achieved in 2012 Implementation of the measure will start in 2014 Expected energy savings in ,0 ktoe Expected impact on energy savings in 2018 (if available) Assumptions Estimates of expected energy savings are based on average energy savings evaluated in energy audits that have already been prepared for public buildings. 58

59 Overlaps, multiplication effect, synergy 59

60 Title of the energy saving measure Index of the measure Description Information on implementation Energy savings Category Improving EE through renovation of municipal buildings and street lighting S4 Financial instrument Timeframe Start: 2013 Aim/brief description Target enduse Target group Regional application List and description of energy saving actions substantiating the measure Budget and financial source Implementing body Monitoring authority Method for monitoring/measuring the resulting savings Expected savings in 2012 as per 1 st NEEAP End: 2018 Measure aims at increase of energy efficiency in municipal buildings Existing buildings Public services Nationwide Municipal energy efficiency plans are expected to be developed for approx. 15 municipalities in Kosovo. It is foreseen that this initiative will have a positive impact on municipalities willingness to invest in energy efficiency projects. It is expected that it will lead to implementation of approx. 100 investment projects in municipalities overall in Kosovo. Energy saving measures foresees insulation of walls, replacement of windows, insulation of roofs and basements, as well as installation of efficient lighting. National budget (Ministry of Local Governments Administration) and budgets of municipalities depending on the investment to be made by these two institutions. Ministry of Local Governments and Administration Municipalities/Municipalities KEEA KEEA has developed a project postimplementation monitoring system that foresees that final beneficiaries should submit information on actual energy consumption after projects implementation. Implementation of the measure will start in 2013 Savings achieved in 2012 Implementation of the measure will start in 2013 Expected energy savings in 2015 Expected impact on energy savings in 2018 (if available) Assumptions Overlaps, multiplication effect, synergy Estimates of expected energy savings are based on average energy savings evaluated in energy audits that have already been prepared for public buildings. 60

61 Title of the energy saving measure Index of the measure Promotion of energy efficiency measures by preparing energy audits S5 Description Category Energy audits Timeframe Start: 2013 End: 2015 Aim/brief description The measure aims at promoting the implementation of energy efficiency measures by carrying out energy audits. Target enduse Existing buildings Information on implementation Energy savings Target group Regional application List and description of energy saving actions substantiating the measure Budget and financial source Implementing body Monitoring authority Method for monitoring/measuring the resulting savings Expected savings in 2012 as per 1 st NEEAP Savings achieved in 2012 Expected energy savings in 2015 Expected impact on energy savings in 2018 (if available) Assumptions Public services, central government buildings Nationwide It is expected that by using resources of the Kosovo national budget and also resources provided by IFIs energy audits will be prepared for public buildings municipal and central government buildings. This process will facilitate the further implementation of energy efficiency investment projects. MED/KEEA budget euro committed (2013 for 116 energy audits to be carried out) The WB/EC project (measure S2) foresees approx. 250 energy audits to be carried out in central government buildings. MED/KEEA KEEA TD Implementation of the measure will start in 2013 Implementation of the measure will start in 2013 Overlaps, multiplication effect, synergy 61

62 4.4 Measures in the Industry and SME sectors According to Kosova Business Registration Agency (KBRA) at the MoTI, on December 31st 2010, there were more than 100,000 registered SMEs, with 216,799 employees, representing % of total employees in the private sector and 62.24% of the total number of employees in Kosovo. From a total of 103,755 enterprises, 102,070 (or 98.37%) are micro enterprises, 1,406 (1.35%) are small, 221 (0.22%) are medium and only 58 (0.06%) are classified as large. The overwhelming predominance of microenterprises has implications for the SME Strategy. In terms of sector breakdown, SMEs are mostly concentrated in: retail (around 50%); transport, storage and distribution (14%); food products, beverages and tobacco (9%); and, hotels and restaurants (9%). According to the SME Policy Index 2009, the sectorial distribution has remained stable over time. Industry is the third largest energy enduse sector in Kosovo. In 2012, energy enduse in the industry sector was ktoe or 23.04% of total energy enduses consumption. Table28. Overview of total energy consumption by industrial subsectors in ktoe Subsectors / Year * Iron and steel 59,36 69,03 77,82 Nonferrous metal industry 61,75 64,47 41,06 Chemical industry 1,83 1,89 1,74 Glass, ceramics & construction material industry 28,4 60,69 59,83 Excavating industry 2,56 2,7 2,14 Food, drinks & tobacco industry 78,88 83,8 73,21 Textile, leather and clothing 0,16 0,17 0,13 Paper and printing 0,24 0,26 0,26 Engineering & other metallic industries 0,01 0,01 0,01 Other industry 21,72 32,62 34,47 Total Industry sector 254,89 315,64 290,68 * Forecast consumption Source: Energy Balance of Kosova for 2010, 2011,

63 The 2010 energy consumption results by industrial subsector show that food, drink and tobacco was the largest subsector, consuming ktoe or % of the total industry sector consumption. It was followed by the nonferric metal subsector with ktoe or % and then by the steel and iron subsector with ktoe or % of the total energy consumption. The 2011 energy consumption results by industrial subsector show that the food, drink and tobacco subsector had the highest consumption with ktoe or 26.5% of the total industry sector consumption, followed by the steel and iron subsector with ktoe or 21.9%, the nonferric metal subsector with ktoe or 20.4%, glass, ceramic and construction material industry with ktoe or 19.2%, and other industrial subsectors with ktoe or 10.3%. Until now, the forecast (not realized) energy consumption for 2012 in the iron and steel subsector shows a perceptible increase of 11.30% in consumption, from ktoe (2011) to ktoe (2012) or 26.77% of the total industry sector, a decrease in the share of the food, drinks & tobacco industry, from 83,8 to 73,21 ktoe, and a decrease in the consumption of the nonferrous metal industry from 64,47 to 41,06 ktoe. Two energy efficiency measures were included in the 1st NEEAP, which envisaged energy savings of 2.2 ktoe in the industry sector. Due to the lack of data for calculation of energy efficiency indicators in the industry sector, no achieved energy savings have been reported in the 1st NEEAP. The following 2 measures have been included in the 2nd NEEAP: Improving EE through implementation of energy efficiency measures in SMEs, Improving EE through implementation of energy efficiency measures in industrial enterprises. Table29. Summary table of energy efficiency improvement measures in the industry sector No I1 Title of the energy saving measure Improving EE through implementation of energy efficiency measures in SMEs Target group Duration SMEs 2014 to 2015 Achieved energy savings in 2012 summary of sectorial savings based on measures defined in 1st NEEAP Savings not reported due to lack of data Energy savings expected in ktoe I2 Improving EE through implementation of energy efficiency measures in industrial enterprises SMEs 2013 to

64 Title of the energy saving measure Index of the measure Improving EE through implementation of energy efficiency measures in SMEs I1 Description Category Financial instrument Timeframe Start: 2014 Aim/brief description Target enduse End: 2015 Measure aims at increase of energy efficiency in SMEs by implementing energy savings measures. Industry and SMEs Target group Regional application Industry and SMEs Nationwide Information on implementation List and description of energy saving actions substantiating the measure It is planned that energy saving measures will be implemented in SMEs. Energy saving measures in SMEs foresee replacement of old inefficient production units as well as implementation of efficient lighting solutions. Budget and financial source Total EBRD/EC contribution (loan/grant) 12 mill euro Implementing body (Total budget for measures I1 (9) and for R1 (3)) MED/KEEA Energy savings Monitoring authority Method for monitoring/measuring the resulting savings Expected savings in 2012 as per 1 st NEEAP Savings achieved in 2012 Expected energy savings in 2015 Expected impact on 2018 energy savings (if available) KEEA KEEA has developed a project postimplementation monitoring system that foresees that final beneficiaries should submit information on actual energy consumption after projects implementation. Implementation of the measure will start in 2014 Implementation of the measure will start in ,50 ktoe Assumptions Overlaps, multiplication Estimates of expected energy savings are based on an assessment of energy savings achieved with similar investment in the 1 st NEEAP, foreseeing that approx. 2/ 3 of budget available will be invested in the SME sector 64

65 effect, synergy Title of the energy saving measure Index of the measure Improving EE through implementation of energy efficiency measures in industrial enterprises I2 Description Category Financial instrument Timeframe Start: 2013 Aim/brief description Target enduse End: 2015 Measure aims at increase of energy efficiency as a result of the industry sector and SMEs implementing energy savings measures. Industry and SMEs Information on implementation Target group Regional application List and description of energy saving actions substantiating the measure Budget and financial source Industry and SMEs Nationwide It is planned that energy saving measures will be implemented in SMEs and industrial enterprises. Energy saving measures in SMEs foresee replacement of old inefficient production units as well as implementation of efficient lighting solutions. Commercial banks have already issued a large number of loans for implementation measures in the residential and SME sectors it is expected that in the period of the 2 nd NEEAP implementation the costs will remain at least at the same level i.e. at least 10 mill. euro Energy savings Implementing body Monitoring authority Method for monitoring/measuring the resulting savings Expected savings in 2012 as per 1 st NEEAP Savings achieved in 2012 Expected energy savings in 2015 Expected impact on energy savings in 2018 (if available) MED/KEEA KEEA KEEA, together with the commercial banks, is developing a project implementation monitoring system that will allow assessment of the energy savings achieved. Implementation of the measure will start in 2013 Implementation of the measure will start in ,00 ktoe 65

66 Assumptions Overlaps, multiplication effect, synergy Estimates of expected energy savings are based on an assessment of energy savings achieved with similar investment in the 1 st NEEAP 4.5 Measures in the building sector The construction characteristics of building units in Kosovo, in terms of insulating materials and quality of windows and doors, have tended to improve in recent times. In general, buildings constructed since 1999 achieve mandatory construction standards, while buildings constructed before 1999, particularly those in the public sector, are characterized by poor overall thermal insulation quality, especially in respect of attics, external walls and windows. According to the NEEAP and CENSUS 2011, there were approximately 310,000 residential buildings in Kosovo in 2011, over 55,000 commercial buildings and around 2,000 public buildings. The public building stock of Kosovo (schools, universities, hospitals, health centres, government buildings, etc.) includes some 1,800 buildings. Most parts of public buildings are fully heated, with fuel oil, district heating and electricity being the most common space heating fuels. Since most of these buildings date back to the pre 1999 period, their construction characteristics are relatively poor. The Private/Commercial Service Building Sector is a developing sector in Kosovo. In many instances, the private sector has experienced modernization and qualitative improvements. This group of businesses includes activities such as hotels, restaurants, banks, tourist agencies, consultancies and insurance offices, etc., as well as many private services that operate in parallel with the public sector, such as education, culture, health, etc. Many of these businesses are aiming to introduce modern energy efficiency technology, but improvements are still needed to ensure the efficient utilization of such technology. However, it should be noted that the Private Service Sector also includes some traditional repairservice workshops and small shops and restaurants that have neither the demand for, nor the opportunity to install, space heating and air conditioning. 66

67 Table30. Summary table of energy efficiency improvement measures in the building sector o Title of the energy saving measure Target group R.1. Improving EE through implementation of energy efficiency measures in residential buildings R.2. Improving EE through implementation of energy efficiency measures in residential sector R.3. Improving EE through implementation of energy efficiency measures in multiapartment buildings R.4. S1 S2 S3 S4 S5 Improving EE through continuing information campaign on energy efficiency Improving EE through renovation of public buildings in municipalities Improving EE through renovation of central government buildings Improving EE through renovation of public buildings (municipal buildings) Improving EE through renovation of municipal buildings and street lighting Promotion of energy efficiency measures by preparing energy audits Households Households Owners of apartments in multiapartment buildings Households Public services Central government buildings Public services Public services Public services, central government buildings 4.6 Horizontal measures Energy efficiency horizontal measures are those that apply to more than one energy enduse sector and in the longterm these measures can show real energy savings. Three measures that have the greatest potential for promotion of energy efficiency are included in the 2 nd NEEAP: Amendments to the Energy Efficiency Law, Green public procurement policies, Improving minimum energy efficiency requirements in new buildings and existing buildings that are to be reconstructed. 67

68 Table31. Summary table of horizontal energy efficiency improvement measures No H.1. Title of the energy saving measure Amendments to the Energy Efficiency Law Target group All endusers Duration 2013 to 2015 Achieved energy savings in 2012 summary of sectorial savings based on measures defined in 1st NEEAP Energy savings expected in 2018 H.2. Green public procurement State authorities Local authorities 2013 to 2015 Implementation of the measure will start in ,00 ktoe H.3. Improving minimum energy efficiency requirements in new buildings and in existing buildings that are to be reconstructed Owners of buildings 2013 to 2018 Title of the energy saving measure Index of the measure Amendments to the Energy Efficiency Law H1 Description Category Regulation Timeframe Start: 2013 Aim/brief description Target enduse End of October 2013 Measure aims at the further development of the legal framework and laying the basis for secondary legislation that will introduce penalties/incentives for promotion of implementation of energy measures All endusers Information on implementation Target group Regional application List and description of energy saving actions substantiating the measure All endusers Nationwide Amendments to the Energy Efficiency Law will include the following main initiatives: To be determined according to recommendations of the Parliamentary Commission. 68

69 Energy savings Budget and financial source Implementing body Monitoring authority Method for monitoring/measuring the resulting savings Expected savings in 2012 as per 1 st NEEAP KEEA budget Not yet estimated MED/KEEA KEEA TD Implementation of the measure will start in 2013 Savings achieved in 2012 Implementation of the measure will start in 2013 Expected energy savings in 2015 Expected impact on energy savings in 2018 (if available) Assumptions Overlaps, multiplication effect, synergy Title of the energy saving measure Index of the measure Green public procurement H2 Description Category Timeframe Start: 2013 Aim/brief description Target enduse Cooperative instruments End: 2015 Measure aims at facilitation of the penetration of energy efficient technologies through public procurement procedures, leading to a reduced impact on the environment as well as to budget savings. Public sector Information on implementation Target group Regional application List and description of energy saving actions substantiating the measure State authorities Local authorities Nationwide In its procurement policy the contracting entity will set out environmental requirements for suppliers' abilities and include them in the technical specifications for the subject of the procurement, by making use of the relevant standards and ecolabelling, and also by including environmental and energy efficiency factors in the selection criteria for the most economically advantageous tender. 69

70 Energy savings Budget and financial source Implementing body Monitoring authority Method for monitoring/measuring the resulting savings Expected savings in 2012 as per 1 st NEEAP Savings achieved in 2012 Expected energy savings in 2015 Expected impact on energy savings in 2018 (if available) Assumptions State or local authority budgets, according to the authorities' procurement plans State and local authorities KEEA TD Implementation of the measure will start in 2013 Implementation of the measure will start in 2013 Overlaps, multiplication effect, synergy Title of the energy saving measure Improving minimum energy efficiency requirements in new buildings and in buildings that are to be reconstructed Index of the measure Description Category H3 Legislation Timeframe Start: 2013 End: 2018 It is planned that by the end of 2013 the government will finalize and amend the Building Code. Part of this code will be a Chapter which defines standards for energy savings and thermal protection of buildings. Aim/brief description Measure aims at facilitating the implementation of energy saving measures and at introducing higher standards for new and reconstructed buildings. Target enduse The aim is to set standards and facilitate measures for implementation of energy savings in new and existing buildings. Buildings Target group Owners of buildings In new and renovated dwellings and administrative buildings. 70

71 Information on implementation Energy savings Regional application List and description of energy saving actions substantiating the measure Budget and financial source Implementing body Monitoring authority Method for monitoring/measuring the resulting savings Expected savings in 2012 as per 1 st NEEAP Savings achieved in 2012 Expected energy savings in 2015 Expected impact on energy savings in 2018 (if available) Assumptions Overlaps, multiplication effect, synergy Nationwide The Building Code will set minimum energy efficiency requirements for new buildings and for reconstructed buildings. Budget of the Ministry of Environment and Spatial Planning No Budget planned Ministry of Environment and Spatial Planning, Municipalities, MED, MTI Ministry of Environment and Spatial Planning TD Implementation of this regulation requires professional and human capacities Implementation of the measure will start in 2013 Implementation of the measure will start in ,00 ktoe Planned energy savings of 30 kwh/m 2 in new and in reconstructed buildings. The average area of new or reconstructed buildings is m 2 per year ) and m 2 per year ( ) 71

72 4.7 Summary of overall final energy savings The planned and achieved energy enduse savings have been collated in Table 32 below. Table32. Summary of final energy savings Sector Calculation methodology Achieved energy savings in 2012 (in ktoe) summary of sectorial savings based on measures defined in 1st NEEAP Residential sector Transport sector Services Sector Industry & SMEs Horizontal measures Energy savings expected in 2018 (in ktoe) TD/BU 28,06 51,56 TD/BU 12,00 TD/BU 3,865 20,71 TD/BU 15,50 TD 9,00 TOTAL 31, ,77 Remark: The calculation of the energy saving targets and estimation of the energy saving measures has been carried out in accordance with Directive 2006/32/EC (ESD), Annex II. 4.8 Exemplary role of public sector Various market assessments in recent years have identified a significant level of potential energy savings that could be achieved in Kosovo by implementing energy efficiency measures in the country s building stock. By far the largest contribution to the energy saving potential comes from the residential sector, followed by the private and commercial sector. Although the energy saving potential of municipal and central public buildings is low less than 10% of the total in comparison with the other two sectors, public buildings at present provide the best opportunities for achieving real energy savings because in many cases they already meet the minimum energy performance levels set in the current Technical Regulation on Thermal Energy Savings and Thermal Protection in Buildings, No.03/2009. This fact suggests that any energy efficiency program should begin with the implementation of measures in public buildings. Therefore implementation of the national energy efficiency policy of Kosovo is focused on the public sector, not only because of ESD requirements, but also because of the fact that it is most practical to begin with activities in this sector. Furthermore, this represents a pragmatic approach to EE due to the immature energy efficiency market in Kosovo. Through its activities and decisions, the public sector can influence citizens and organisations from other sectors and encourage them to undertake similar activities to reduce energy consumption. Despite their relatively low savings potential, launching the EE implementation program in the central and municipality public building sectors would give a strong message that the government is prepared to lead by example and it would provide a showcase for encouraging other EE initiatives in Kosovo. This in turn would help to foster a market for EE goods and services and create better access to public and donor funds. On the supply side (that is, in the provision of goods and services that improve EE, such as the installation of efficient heating and cooling systems, solar hot water systems, efficient light bulbs, etc.), a successful implementation 72

73 program will create real opportunities for construction, heating and air conditioning companies and they will be incentivized to improve their skills and knowledge in order to win future business. After completing a number of EE implementation projects successfully, the experience of other countries suggests that some of these companies will evolve and transform into ESCOs. Secondary legislation to support the ESCO contracting framework would need to be prepared, as required by the Law on Energy Efficiency, to provide an enabling environment for the uptake of ESCO business. Carrying out a programme of EE investments will generate many benefits for the Kosovo economy, including increased energy savings, reduced energy imports and a lower trade deficit, increased life of retrofitted buildings, growth in the number of businesses and in employment and a reduction in GHG and acid rain emissions. The available evidence shows that the building sector of Kosovo provides significant opportunities for realizing energy savings. Since space heating accounts for the major share of energy consumption in buildings, most energy saving potential is associated with thermal insulation, heat loss reduction and the introduction of efficient boilers. More than half of the Kosovo building stock was constructed in the period 1970 to 1985, which is reflected in the relatively high specific heat consumption of these buildings. The current level of heat consumption in Kosovo is estimated to be about 219 kwh/m 2 year, compared to kwh/m 2 year in Western Europe, which indicates that there is a significant opportunity for EE improvements. In order to exploit the existing energy saving potential, any supporting legislation and programs must take advantage of existing EE market drivers. One such driver that has become increasingly important in recent years is energy security. Despite increased use of local energy resources, such as lignite and biomass, Kosovo depends totally on imports of oil byproducts and to a lesser degree on imports of electricity, which overall accounted for about 25% of its energy needs in The introduction of EE measures can enhance energy security by (a) reducing imports of oil byproducts and thereby reducing the trade deficit; (b) cutting down on the consumption of fire wood and thereby preventing deforestation; and (c) minimizing the volume of electricity imports, thereby reducing the need for government subsidies. Improvement of the fiscal balance is a high priority for the GoK, especially given the current economic situation. EE measures represent an opportunity for the government and the public sector to reduce their energy budget expenditures. This would be a costeffective measure because investments made in order to improve EE in government facilities will pay for themselves through savings at the national level. In addition, if the government wishes to consider the introduction of financial incentives to support the development of an EE market, these incentives can be partially offset by reducing subsidies on domestic energy sales. EE investments have a positive economic impact since they contribute to the development of a modern industry that offers jobs and a range of business development opportunities. They also generate revenues from increased taxation on the construction work required for EE implementation, which creates a positive situation, whereby the GoK s need to optimize tax revenues is supported by the development of an EE market with its various associated social and environmental benefits. The need to achieve mandatory comfort levels (i.e. minimum energy performance levels) in buildings in line with EU Directives on the energy performance of buildings means that renovation of the existing building stock carries a high priority in Kosovo. Old buildings require immediate investment in thermal insulation, the introduction of efficient double/triple glazed windows and the introduction of efficient space heating and hot water systems. Important energy savings have been identified for other energy services, such as cooking, lighting and in the use of other electrical appliances. This presents an opportunity for the GoK to ensure that such renovations are realized in an energyefficient way that contributes to the Kosovo s sustainable economic development. In addition, renovating old and damaged buildings will contribute to the achievement of the NEEAP s energy savings target for the period up to

74 Implementation of EE measures represents an economically rational response to energy scarcity and increasing energy prices as well as to environmental concerns. Yet in all sectors the uptake of loans to pay for EE investments is not as enthusiastic as might be expected. Therefore, it is necessary to identify the nature of the barriers that are constraining the implementation of EE measures in Kosovo and to consider how these constraints might be overcome. The constraints operating in Kosovo can best be understood by classifying them according to the building sector they apply to residential/commercial, public or crosssector and according to their origin economic, institutional, legal and regulatory, financial. The severity of barriers differs between the various building subsectors, so that for example, the lowincome segment of the residential market experiences more problems in securing finance and will be less able to invest in the repair and renovation of buildings. In a relatively lowincome economy, many householders and small businesses need access to capital at zero or very low cost. According to the Statistics Agency of Kosovo (November 2012) the average monthly wage in the budget (public) sector of Kosovo in 2011 was 368, so inevitably many householders are not in a position to take up loans for improvement of buildings on commercial terms and have higher priority needs to attend to, such as provision of food, clothing and transport. A typical EE loan in Kosovo currently averages between 5,000 and 6,000 at a special (discounted) interest rate of around 10%. Some constraints, therefore, could be addressed by the introduction of financial mechanisms, such as grants, soft interest rates, guarantee schemes, dedicated funds, credit lines, more efficient procedures in financial institutions and so on. In some circumstances, successful financing programs can serve as a mechanism to remove some constraints from the market, although the removal of other barriers may also require legislative or organizational change in the institutional framework. The cost benefit analyses of the buildings that have been subjected to energy audits indicate that in the majority of cases, the Economic IRR (based on economically efficient shadow prices ) is higher than the Financial IRR (based on actual prices), which demonstrates the importance of increasing energy prices (especially electricity, lignite and fire wood) to the level of their longrun marginal costs of supply without interruption. The barriers constraining the implementation of energy efficiency measures in Kosovo are significant. A summary of the main issues is presented below: 1. Residential and Commercial Sector Issues (i) Economic Constraints Market distortions in local energy markets mean that the prices of some fuels do not reflect their true production costs (e.g. firewood, lignite) and therefore energy savings are undervalued. (ii) Institutional Constraints Many households adhere to traditional methods of cooking and space and water heating, either because of preference, lack of awareness or, in areas where power cuts are common, for security of supply reasons. (Over 50% of customers fall into the C category of the KEK power rationing scheme.) (iii) Legal and Regulatory Constraints Since 2000, a large number of illegal buildings have been constructed in Kosovo without the required building permits. As a result, building energy performance standards are not enforced or monitored, often resulting in excessive energy consumption. 74

75 There is no secondary legislation to promote the establishment of owners communions (or Housing Associations) and current structures to deal with refurbishment of the fabric of joint dwellings and common areas in apartment blocks are ineffective. Inefficient energy pricing: (a) electricity and heat tariffs are not yet fully costreflective, (b) tariffs are subsidized and (c) some inefficient tariff structures persist. (iv) Financial Constraints Lack of affordable EE financing schemes for lower income households unable to access the loan market. High level of commercial losses and nonpayment of energy bills. 2. Public Sector Issues (i) Economic Constraints EE is not a top priority for municipality mayors water supply, waste disposal, sewage treatment are considered more important issues. (ii) Institutional Constraints Insufficient EE expertise and resources at municipal level. There are 38 municipalities in Kosovo, 28 of which had a budget of below 10m in The demands of the decentralization process are placing an increasing burden on municipalities, while their resources are frozen or being reduced. (iii) Legal and Regulatory Constraints Budgetary rules do not allow municipalities to benefit from any energy savings they achieve in the longer term each year s budget allocation is based on the previous year s outturn. Technical Regulation Nr. 03/2009, which states that energy sustainability, requires the achievement of planned comfort levels in public buildings, as well as energy efficiency. The Law on Public Procurement should ensure that the process for evaluating government tenders takes account of any EE related benefits that a particular proposal will deliver. (iv) Financial Constraints The Law on Public Debt imposes various restrictions on municipalities ability to borrow money. (Although for those municipalities that meet the required standards, the legal and regulatory environment appears to be favourable to municipality lending.) Central government budgetary constraints prevent direct finance of EE projects and the creation of an energy efficiency fund is at present not allowed. 3. Cross Sector Issues (i) Economic Constraints Underdeveloped local EE/RES business infrastructure. Absence of ESCOs and ESCO based schemes from the local market (ii) Institutional Constraints Inadequate data and institutional capacity to monitor evaluate and verify the impact of EE programs. 75

76 Lack of impartial and detailed technical information on EE markets and the goods and services they provide. Lack of surveys on the quality of EE services and products means that potential customers are not well positioned to make informed decisions. Lack of a comprehensive and reliable EE data base for Kosovo. Poor quality of data leads to poor decision making which in turn results in ineffective investments. (iii) Legal and Regulatory Constraints The Kosovo Energy Efficiency Agency is under resourced relative to its responsibilities and obligations The Law on Energy Efficiency laid down procedures for setting up an EE fund to promote EE and RES projects. However such a fund is not permissible under existing legislation. (iv) Financial Constraints High level of transaction costs for (in terms of both money and time) for EE investments Lack of funds for energy auditors and energy audits Specific initiatives to address and alleviate and/or remove these constraints are planned. Other activities in the public sector A number of Energy Efficiency Projects in Kosovo have been completed in Kosovo in the recent past, including the following: 1. The GIZ project Modernization of Municipal Services (MMS) ran from 2006 to 2012 and implemented 56 EE projects. The main focus of the project was a program of small municipal investments in the field of energy efficiency, jointly financed by the 20 participating municipalities and through a fund established by GIZ and Association of Kosovo Municipalities. The project did not involve any detailed energy audits but consisted of a series of individual investments in EE projects in public buildings: schools, clinics and municipal buildings. Projects included refurbishment of public buildings (doors, windows, thermoinsulation and installation or upgrading of central heating systems) and modernization of street lighting. The total joint investment was in the order of 2.5 million and resulted in energy savings of around 0.4 ktoe. The project also included Improvement of Energy Efficiency in Kosovo, to improve awareness on utilization of energy saving technologies as well as a program to improve local waste management. 2. Assistance to the Ministry of Energy and Mining was a twoyear EUfunded project which ran from 2009 to Included amongst its objectives were: (a) to strengthen the capacity of MEM staff to revise and update policies and programs on energy efficiency and renewable energy sources and (b) to incorporate the requirements of the Energy Community Treaty in the area of energy efficiency. The Project assisted MEM with the preparation of the first National Action Plan on Energy Efficiency as well as training key staff in MEM s Energy Efficiency and Renewable Energy Sources Division. In the course of carrying out these tasks, the Project developed, in accordance with EU regulations, an Energy Labelling Scheme and identified the changes to primary and secondary legislation that would be needed to allow for the enforcement of domestic appliance labelling. A Manual of Energy Efficiency for Small and Medium Enterprises (SMEs) and Light Industry was produced to promote energy savings by setting out a list of practical steps explaining how businesses can reduce energy bills. The Manual was made available to small businesses throughout Kosovo. The project also produced a booklet entitled EU Assisting Energy Sector reforms in Kosovo which summarized the progress that was being made in the areas of energy efficiency, renewable energy sources and the environment and a Project Factsheet, describing the work and the specific achievements of the project. 76

77 3. Installation of efficient public lightning in public facilities, financed by MEM/MED and GIZ ( 572k) which was completed in In June 2011 the MED and GIZ signed a memorandum of understanding which set out the arrangements for cofunding a project on efficient lighting in public facilities at municipal level. The purpose of the project was to contribute to the modernization of lighting in public facilities and street lighting by replacing inefficient light bulbs with efficient ones. The project, which was cofunded by MED, GIZ and the municipalities, was implemented over a twoyear time frame and involved five municipalities Pristina, Mitrovica, Ferizaj, Podujevo and Gjilan. Another beneficiary was one of the dormitories at the University of Prishtina. This project has contributed to the achievement of the targets set in the 1 st National Energy Efficiency Plan. 4. Study and Implementation of EE measures in Municipalities (63 schools and 2 hospitals), financed by EU ( 15.6 m). The beneficiaries are the selected municipalities and the Ministry of Health. The project, which started in March 2011, involves implementing EE measures in some 33 municipalities in buildings preselected by the Ministry of Local Government Administration and the EC Liaison Office and handed over to the contractors for audit. The project is grant funded. Implementation was due to commence in September 2012 and three foreign companies were contracted to carry out the works. However, due to time and budget constraints, the quality of the energy audit data was limited. Only the overall geometry of buildings and total investment requirements were evaluated and there was no baseline scenario analysis to facilitate monitoring and no detailed energy audit reports were prepared. The implementation project has now been put on hold, while the data collected in the audits is reassessed. 5. Feasibility Study and Implementation of EE measures in public buildings at municipality level, supported by KfW/EU/WBIF ( 7.5 m). The Implementation of Energy Efficiency Measures in Public Buildings project ran from April 2011 to January Subject to a successful application to the WBIF/KfW/EU for further funding, the implementation phase of the project could begin this year and continue over the following 48 months. The results of the energy audits which were performed by the project auditors show that when the EE measures are in place and all 30 selected buildings are operating at their planned comfort levels, total annual energy savings could amount to over 650,000. Moreover, the auditors calculated that because of introducing EE measures in these 30 public buildings, it would be possible to reduce the total volume of GHG emissions by more than 3,600 tons of CO2 equivalent/year. 6. In 2012 the MED commissioned a program of 48 energy audits of municipal buildings. The program was completed in December Special measures for public procurement To meet the requirements of Directive 2006/32/EC in the context of its exemplary role, the public sector must apply at least two of the six eligible energy efficient public procurement measures which are set out in Annex VI of the Directive: (a) use of financial instruments for energy savings, including energy performance contracting; (b) purchase of equipment and vehicles based on lists of energyefficient product specifications; (c) purchase of equipment that has efficient energy consumption in all modes, including in standby mode; (d) replace or retrofit existing equipment and vehicles with the equipment listed in points (b) and (c); (e) use energy audits and implement the resulting costeffective recommendations; (f) purchase or rent energyefficient buildings and replace or retrofit such buildings in order to render them more energyefficient. Transposition of the EPB Directive will mean that the minister responsible for construction (MESP) will in future regulate in detail the issues concerning the performance of energy audits of buildings, energy performance certification of buildings and the performance of independent controls of reports on energy audits and issued energy certificates. 77

78 In the area of energy efficiency, however, the Law on Public Procurement Act does implicitly allow for energy efficiency to be taken into account when evaluating public tenders (Article 52 states that criteria for awarding a contract can be either the lowest price only or the economically most advantageous tender) but at present there is no accompanying secondary legislation (Administrative Instruction) in place to explain how the Law is to be implemented. Through transposition of the provisions of Directive 2010/30/EU (and succeeding Directives) on labelling of energy and other energyrelated products, Kosovo will in time strengthen the obligation to procure energy efficient products. Recommendations for future periods The Kosovo Energy Efficiency Agency is now the focal point for all EE related projects and initiatives. The Agency is now overseeing and coordinating the following projects: 1. Initial meetings have been held with the Municipality of Prishtina concerning participation in the EU initiative Covenant of Mayors (CoM). This initiative will be pursued further as it can significantly contribute to achieving the targets of the ESD and this NEEAP. 2. Promotion of EE measures in households through Eko loans financed by KfW ( 20 m.) and implemented by ProCredit Bank and Raiffeisen Bank on going to Kosovo is among the partner countries involved with the German State Development Bank KfW, which provided the ProCredit and Raiffeisen Banks with a credit loan to finance energy efficiency schemes for the wider population of Kosovo. To promote the scheme, the banks issued a range of publicity materials, including some general information relating to EE on their websites. 3. Promoting EE and RES in Kosovo, technical assistance for capacity building, funded by EU ( 1.5 m) ongoing to The purpose of this project is to support the relevant Kosovo institutions at central and local level in enhancing the legal framework and developing policies and action plans to increase energy efficiency and the use of renewable energy sources. The anticipated results of this project include the updating, monitoring and evaluation of the National Energy Efficiency Action Plan, the preparation of municipal energy plans, completion of the Kosovo RES Plan, improved energy planning capacity at the beneficiary institutions, better cooperation between central and local level in the EE and RES planning processes and the transposition of EU Directives on the energy performance of buildings and on renewables into the national legal framework/secondary legislation as required by the Energy Community Treaty. 4. National Building Energy Efficiency Study for Kosovo was carried out in 2012 with the support of the World Bank and is to be followed by implementation a program of EE measures in 200 to 250 central and local government buildings, funded by supported by WB/EC as follows: EE investments in central government buildings, US$18m.; Pilot EE investment program for municipalities, US$4.5m. (in total, approximately 16.8 mill. Euro). 5. EBRD is providing 20m for the establishment of a Regional Energy Efficiency Programme for the Western Balkans. The programme is structured as follows: Window 1: Institutional capacity building/regulatory support and new product development for public sector energy efficiency: Theme 1: 5m. for ESCO projects (legal and technical), with the objective of supporting individual local entities (e.g. cities, regions) in implementation of ESCO/EnPC programmes and individual projects. 78

79 Theme 2: 1m. for general efficiency policy dialogue (tariff, metering, EPBD, procurement), with the objective of address in market barriers and establishing an enabling legal framework for effectively translating the NEEAPs and Municipal Energy Plans, into investment plans and actions on the ground. Theme 2 has three focus areas: a) support tariff reforms, smart metering and billing regulations; b) support the transposition of the Energy Performance f Buildings Directive (EPBD); and c) improve, and where necessary develop, public procurement rules relating to energy efficient equipment. Window 2: Credit lines for financing of smaller scale sub projects in public and private sector (including ESCOs), channelled through local participating banks Window 3: Direct financing for mediumsized renewable energy and energy efficiency measures, including ESCOs Below is a summary of proposed activities for successful and effective promotion of energy efficiency, awareness raising and activation of transformation and sustainable development of energy efficiency market Activity Activity 1 Development of Marketing and Communication Strategy The strategy has to be developed in order to define the necessary activities for successful awareness raising and activation of EE market transformation and sustainable development. As part of the strategy development national media profile has to be analysed and defined, as well as research of the EE market. Activity 2 Creation, development and activation of EE website The site has to be informative, educational, interactive and userfriendly. Its content has to be organized properly in order to enable visitors with different level of technical understanding to find relevant information for themselves. Activity 3 Telephone infoline for EE advices to the citizens Activation of Freeofcharge telephone line; EE advisors have to be organized, educated and trained for interactive communication with citizens; Advices must be competent and guarantee precise information to each citizen for their concrete case. Activity 4 EE infocorners and centres Attractive and easy reachable location for establishment of EE infocorners and centres will be identified and the centres established; The EE infocorners will be the place where citizens could come to see available EE technology and ask EE advisors for optimal solution for their concrete case. Also would serve as the point where educated demand meets with qualified supply. Activity 5 Educational course for EE advisors The course should be organized for the EE advisors who will give advices for citizens through the telephone infoline, but also as advisors and guides at the EE infocorner and EE infocentre. Activity 6 EE awareness survey EE awareness survey among citizens will be conducted to determine actual awareness and knowledge about EE. It has to be repeated periodically (on annual basis at least, or even more frequently). 79

80 Activity 7 National educational EE campaign in media National educational EE campaign will be developed, produced and broadcasted (advertised) in media; the campaign should include: television, radio, newspapers and magazines, outdoor advertising and Internet. Activity 8 Informativeeducational publications Informativeeducational publications, such as brochures which could be used by citizens as EE guides, should be developed, designed, printed and disseminated to the citizens. (As we will work closely with our colleagues from UNDP Croatia, the idea is to use 5 of their successful publications: One ton CO2 Challenge, 200 EE Tips, Green Office handbook, Green Office workbook and Handbook for EE advisors.) Activity 9 EE pool of producers and/or distributors of EE technology, products and providers of services Identify and gather producers and/or distributors of available EE technology and products, as well as providers of services, in informal EE Pool is important to activate them in education process by enabling them to present their technology, but also to motivate them to offer more adequate products at the market and cooperate with construction sector. Activity 10 Comprehensive PR activities Public Relation (PR) activities should promote results from the pilot projects of implemented EE measures, but those activities should also deliver public promotion of different stakeholders involved in the process politicians, decision makers, opinion makers, experts, construction professionals, producers and distributors, but also propose interesting content for journalist covering EE and related subjects (i.e. public signings of National Charter for EE and RES, public openings of various infopoints established at local municipalities etc.) Activity 11 Cooperation with media and journalists The cooperation with media and journalists has to be established in order to enable them to cover energy efficiency more as subject and not only as news, by providing them with necessary information or even enabling them with education through workshops, presentations, visits to pilot projects locations and advanced technology fairs and events. The assistance to the journalists and other media professionals could also be realized by proposing them some attractive media formats for successful communication of EE as subject. Activity 12 Education of children in primary schools and kindergartens Special tool and format for education of children in primary schools and kindergartens have been developed as a part of the EE Project in Croatia. The format is called Think of tomorrow School Hour, and it consist of a 10 minutes educational animated film projection that serves as a base for interactive discussion with children about EE and RES within one school hour. The idea is to use this already developed, and proven successful format, translated and adapted to the local situation). Activity 13 Handbook for EE KEEA is planning to issue a handbook of practical EE measures that can be implemented in the residential and SME sectors. During implementation phase of the 2 nd NEEAP, for all the reasons outlined in this section, strong emphasis will be placed on the exemplary role of public sector and on ensuring a close linkage between the public sector and the measures described in Chapter 4.3 which deal with the tertiary sector. 80

81 4.9 Ensuring availability of advice and information One of the tasks being undertaken by a current EUfunded project 3 is to support the establishment of local and regional energy agencies for promoting EE and RES in the five development regions in Kosovo. Activities under this task aim at promoting the establishment of regional/local energy agencies in the form of NGOs, funds or organisations of public or private or mixed status that will operate independently of the municipalities. The establishment of these agencies will be supported by the creation of a communication platform to facilitate internet networking both amongst themselves and with other similar agencies across the EU. The project is also implementing a Communication and Visibility Plan to promote the joint work of the project and the MED/KEEA (project objectives, outputs, activities and events) and to publicise the EU's role and intentions. Secondly, it aims to promote project activities which provide support to central and local level Kosovo institutions on enhancing the legal framework and on developing policies and action plans to increase energy efficiency and the use of renewable energy sources in line with the relevant EU and EnCT policies. The immediate target group consists of the Ministry of Economic Development (MED) and the 38 Kosovo municipalities. The project also interacts with the Ministry of Local Government (MLGA), the Ministry of Environment and Spatial Planning (MESP) and the Ministry of European Integration (MEI). The secondary target group includes organizations and institutions which may benefit from the project indirectly. In addition, where possible, the project seeks to inform and educate the wider public, through communication materials. The main communication and visibility activities include the creation and management of the project website and communication platform and publishing project quarterly newsletters. Newsletters are an important tool for ensuring visibility of the project and raising awareness about the implementation of national plans on EE and RES and are distributed by and also posted on the project web site (in Albanian, Serbian and English). The project website is being developed in order to communicate effectively with the target groups and facilitate online sharing of the project activities 4. It provides a platform for communicating the latest updates of the activities of the project, supporting awareness raising activities, disseminating information, allowing access to key references, procedural documents, lists of project stakeholders, news of current and forthcoming events, various materials (background documents, activity reports, articles, reports, training course materials etc.) and links to other related governmental bodies, NGOs, etc. KEEA is planning to develop its own webside supported by UNDP (see earlier section Recommendations for future period, Activity 2). Feedback that has been received from energy consumers indicates that while there is a good level of awareness concerning the general benefits of EE and RES, there is: A lack of impartial and detailed technical information on EE markets and the goods and services they provide. A lack of surveys on the quality of EE services and products, which means that potential customers are not well positioned to make informed decisions. 3 Promoting EE and RES in Kosovo, a two year project scheduled to end in June English: Albanian: Serbian: 81

82 In order for the EE market to work well, participants must be fully informed about current and future prices including future energy prices technological options and developments and all other factors that might influence the economics of a particular investment. Clearly, these conditions can never be fully met in the energy services market and a number of significant information failures can be identified as inhibiting investments in energy efficiency: (1) the lack of information, (2) the cost of information, (3) the accuracy of information, and (4) the ability to use or act upon information. The solutions could include local market surveys relating to building materials and services, and information on building materials explaining legal requirements could be published as a catalogue and on the web, with FQAs and most common solutions. Such catalogues have been developed in Denmark for selected solutions, such as windows, heat pumps etc. Responsibility for such a scheme could rest with KEEA in cooperation with DOC. Information should also be made available for the municipal energy offices. In Denmark, for example, an information office has been established at the Technological Institute for training professionals in how to carry out installation work. It consists of a section with 34 officials and the work is tendered out by the Energy Agency. A website is operational with information and examples on how to implement energy efficient measures. The EE data available on public sector buildings is very limited and there is no data at all relating to the residential and private building stock. There is no dependable data base of energy consumption for the residential/public/private building sectors for each energy service (space heating, space cooling, lighting, cooking, and water heating and electrical appliances) that would be sufficient to support the production of a reliable energy balance to be used for the evaluation of EE potential. Poor quality of data leads to poor decision making which in turn results in ineffective investments. The KEEA is starting work on the establishment of an energy efficiency database to define and then to implement an ongoing program of data collection, with support from other participants in the market, such as the commercial banks who provide loans for the implementation of EE measures Obligations of energy companies to promote energy savings in enduse consumption In cases where consumers do not pay for their energy consumption, the incentive to undertake energy efficiency measures is absent, except as a byproduct of measures to enhance comfort in buildings. Commercial losses in Kosovo have been reduced as a result of various actions taken by KEK, but are still high. According to KEK (June 2012), 14% of Total Energy is unaccounted for (commercial losses) and 9% of energy bills remain unpaid. KEK, ERO and the newly privatized KEDS are working to improve the situation and there is an initiative in place to acquire and install 100,000 electronic meters in 2012 in order to replace existing mechanical meters, which are relatively easy to tamper with. The price of electricity is based upon an estimate of the unit price of the tariff typically applied to public buildings. Based on the Energy Strategy ( ) and KEK and KOSTT action plans, there is a five year plan ( ) to achieve fully costreflective electricity tariffs for all categories of consumer Market for energy services The principal challenge facing the energy efficiency sector in Kosovo today is to develop market driven financing mechanisms that will incentivize energy users from across the entire building stock of Kosovo to invest in energy efficiency measures. Reliance on government supported schemes and therefore pressure on 82

83 public funds will thereby be reduced and the government s role can then be focused on developing legal and regulatory frameworks that facilitate these market mechanisms. An important prerequisite for a successful EE implementation program is the development of an environment that facilitates the growth of a local EE market and this objective has to be supported through the delivery of a broad range of awareness raising and capacity building activities. SMEs in Kosovo tend to operate individually and there are not many trade or representative organizations. They focus on taking advantage of immediate opportunities and do not to work within the framework developed by the municipality, NGOs and international donors, except on an ad hoc basis when there is a perceived need. The fragmented nature of the private sector prevents the development of strong privatepublic partnerships. Although credit lines and funds are available from IFIs via the banks, SMEs show little interest in the opportunities available as business development is their primary concern. Awareness of EE is not sufficient to make it a high priority and the commercial sector has only taken up less than 20% of the loans available for EE projects. This situation results in the lack of a transparent and competitive EE market, with good quality (and preferably local) suppliers of EE related goods and services (equipment, materials, installation, repair, maintenance, energy auditing, commercial forestry, fuel efficient ovens, recycling, etc.). In Kosovo the EE industry is only slowly developing and does not yet display the characteristics associated with a vibrant and dynamic market. The enhancement of commercial and professional expertise to implement EE measures should be encouraged by the KEEA and the Chambers of Commerce to support local businesses in identifying and developing EE market capabilities. An Energy Users forum at which SMEs can discuss EE and other related issues should be established. The forum could offer training in energy management and disseminate examples of best practice. Targeted campaigns could be launched, underlining the economic benefits of EE measures for small businesses and a website with good practice examples developed. Another significant issue is the absence of ESCOs and ESCO based schemes from the local market, although this is being addressed by the EBRD s Regional Energy Efficiency Programme For The Western Balkans, specifically Theme 1: ESCO development. The main benefit of ESCOs is that they finance EE investments, thus obviating the need for their clients to borrow upfront capital, as the ESCO recovers its costs by retaining a proportion of the client s energy savings that result from the EE investment undertaken. In the absence of ESCOs, energy consumers wishing to invest in EE have to borrow the necessary funds, which not all consumers are willing or able to do. ESCO companies often develop out of other types of businesses that operate in the EE sector, as they become more comfortable with EE market. Hence it is necessary for the Government to create confidence in the future of this market. This requires the Government to take various proactive measures to demonstrate its commitment to EE, such as creating demand by funding investment programs, facilitating the development of affordable finance packages, removing legal barriers in areas such as public procurement (where least cost bidders have to be preferred) and allowing credit for bids which deliver environmental benefits, allowing municipalities to retain at least some of the energy savings they make, supporting the development of Monitoring and Verification programs and so on Strategy for the increase of nearlyzero energy buildings The formulation of a strategy that will deliver an increase in the number of nearlyzero energy buildings is an important requirement of the Directive on the Energy Performance of Buildings (2010/31/EU). Kosovo is 83

84 already promoting the renovation of buildings (especially public buildings, with a view to developing the lead role of the public sector) in order to meet the energy standard of "nearly zero energy buildings". To further fulfil the requirements of the EPBD (Article 9), specific targets for increasing the number of nearly zero energy buildings will be set as part of the national plan for increasing the number of such buildings. These activities will be initiated by (or in cooperation with) the Ministry of Environment and Spatial Planning, which is the ministry responsible for EPBD implementation. In parallel, development of the legal framework is envisaged, including the development of new standards for new buildings, as is required by the EPBD. The KEEA has prepared an outline proposal for a nearlyzero energy buildings. 6.pdf The Green School in Pristina was opened in May 2011, as the result of a cooperation between USAID s Small Infrastructure for Education and Support for School" project which seeks to improve the quality of education in schools throughout Kosovo the municipality Department of Education. The Green School is a pilot project using green technology and highquality energy saving materials. Unique aspects of this school include: a geothermal and solar heating system, a cooling system, a thermal façade, windows and doors, and a Green Roof which will provide insulation. It is the largest project implemented under the USAID education infrastructure programs. The school will serve as a model of sustainability and a learning tool for both the students that will attend it in the coming months as well as the Kosovo s graduate students who will be monitoring its efficiency Alternative measures for heating and air conditioning systems The most important law in force regarding energy efficiency is the Law on Energy Efficiency, which attempts to define the role and powers of institutions and is essential for the creation of the institutional basis for energy efficiency. However, the Law on Energy Efficiency concentrates on tasks required for the elaboration of Energy Efficiency Plans at national and local levels, implementation, reporting and monitoring. Delegations for transposition of the other requirements that are needed for implementation of energy efficiency are very general. For instance Article 12 On Energy Auditing says The Government shall approve the necessary secondary legislation on energy auditing and another deficiency is that the Law does not foresee auditing of heating and air conditioning systems, which is a direct requirement of Directive 2010/31/EU (EPBD) and may be link with implementation of the audit scheme required by Directive 2006/32/EC and new Energy Efficiency Directive 2012/27/EU. It is planned that the Law on Energy Efficiency will be revised in 2013 to bring it into line with the requirements of Directive 2006/32/EC on energy enduse efficiency and energy services and, when appropriate, the new Energy Efficiency Directive (2012/27/EU) which was formally adopted in October 2012 and which amends and repeals the Cogeneration Directive (2004/8/EC) and the Energy Services Directive (2006/32/EC). The World Bank s plan for the new Kosovo Power Project envisages rehabilitation of Kosovo B power plant to make it compliant with EU standards and converting Kosovo B into a combined heat and power plant (CHP) which provide heat for the Termokos district heating system in Prishtina. Amongst the overall objectives of the project are to reduce fuel consumption at Termokos, to reduce overall harmful emissions and improve the air quality for the citizens of Prishtina, to improve heating energy security and to reduce the need for electricity imports. 84

85 4.14 Measures to support EPBD implementation Directive 2010/31/EU sets minimum requirements for the energy performance of buildings and building elements. Newly constructed buildings and buildings which have undergone major renovation must have energy certificates, as must buildings which are being rented or sold. Therefore the energy certification process must be integrated with the process of obtaining consents for the rental or sale of property. Transposition of this Directive must be achieved by adopting a Law on Energy Performance of Buildings (EPB). By revising the existing Law on Construction, the Government of Kosovo accepted the obligation to formalize the construction process but in doing so it did not set any clear requirements for the transposition of the Directive on the Energy Performance of Buildings within the new system and the division of responsibilities between Ministries in the field of energy efficiency is not sufficiently clear. The proposed amendment of the Law on Construction (Law No.04/L110) provides a legal framework for the construction process and anticipates that most of its measures, obligations and objectives are to be regulated by secondary legislation rather than being specified within the primary legislation. As the secondary legislation has not yet come into force, the legal framework is incomplete. In progress All seven subnormative acts required by the Law on Construction (6 AIs listed below plus the construction code) are in various stages of completion, and will be completed by July Below is additional information on the status of the Administrative Instructions under the Law on Construction. Administrative Instruction Status Construction Permit Fees Adopted by 19 November 2012 Construction Permitting Procedures Adopted by MESP on 04 June Categories of Construction Works Adopted by MESP on 22 May Construction Works for which no Construction Permit is Required Contents of the Construction Diary Construction Inspection Procedures Adopted by MESP on 22 May Under development Under development Improvements in the energy performance of buildings may require other legislative and/or organizational change in the institutional. Specifically the Legislative Program 2013, approved in December 2012 and updated in February and March 2013, requires the submission of Draft Amendments to the Law on Energy Efficiency so that it fully transposes the Energy Services Directive 2006/32/EC. Similarly, the Draft Law on Treating Illegal Construction is with the Parliamentary Commission and is expected to be adopted by Parliament by the end of this year. Electricity and heat tariffs in Kosovo are not yet fully costreflective, some tariffs are subsidized and some inefficient tariff structures still exist. ERO has stated that all tariffs will be fully costreflective by 2017, thereby making investment in EE measures more attractive. The current high levels of commercial losses and nonpayment of bills will reduce over the next few years with the implementation of KEDS metering replacement program, which also strengthen the incentives for households and businesses to invest in EE measures. Finally, Kosovo s longterm NEEAP sets targets and identifies measures for energy savings up to

86 Recommendations for transposition Kosovo has, in effect, already started the process of transposing Directive 2010/31/EU by making references to it in the Law of the Republic of Kosovo on Construction, which was adopted on 31 May The Law foresees that implementation of energy efficiency measures is one of the objectives of the Unified Construction Code of the Republic of Kosovo. Building development based on efficiency standards is now required by the Law on Construction, where each user of the building under development is obliged to obtain a utilization certificate, which sets out the required energy efficiency measures. However, as Kosovo has not yet implemented a system for building energy certification in practice, there only two related regulations that exist at the moment: (1) the Technical Regulation on thermal energy saving and thermal protection in buildings and (2) the Regulation on Establishment and functioning of the Commission for Certification of Energy Auditors and Managers. The option to transpose Directive 2010/31/EU by secondary legislation might not be considered the best option and all activities would clearly have to be very carefully coordinated. At the moment, the proposed content of the draft Unified Construction Code covers only two out of the six issues that need to be regulated. The alternative option of transposing the Directive by drafting a Law could be more efficient, since a Law would establish a framework for concentrated action, mobilize the government to achieve the various new tasks that must be fulfilled and give a clear signal to the construction sector and to the general public about the new requirements and the new opportunities that exist. The adoption of a Law would also give a positive signal to the EU that Kosovo is not just transposing the minimum requirements, but is fully aware of the further implementation of directive. A third option might be to amend the existing laws, but in Kosovo`s case amending the relevant laws that are currently in force would be more timeconsuming than drafting a new Law. Creating inventories, data bases and research and analysis on data availability, as well as development of data models and calculation methodologies are not permanent duties of MESP Department of Construction. This requires highly qualified experienced experts. The task required by Article 5, Annex 3 of the Directive, to establish an Inventory of building stock, definition of reference buildings, defining energy performance measures, cost effectiveness estimation for different measures and different types of buildings, drafting a method for calculation of buildings energy performance (including software) and methodology for calculation of costoptimal levels of energy performance requirements for buildings and building elements can only be undertaken if appropriate technical assistance is provided to the MESP, as the Department of Construction is not equipped with all the necessary competences and expertise needed to carry out this tasks. The most effective option for implementation of the energy certification of buildings in Kosovo is to deliver technical assistance projects for all the above mentioned tasks, as they are all closely interconnected and need to be effectively coordinated. Accordingly, a request for funding Transposition of Directive 2010/31/EU for the Energy Performance of Buildings under the EBRD Theme Two energy efficiency policy dialogue was prepared and submitted jointly by MED and MESP in May In order to satisfy requirements of reporting under Article 10 of EPBD (by 30 June 2013 to ECS) as required by Article 10(2) of Directive 2010/31/EU, following measures mentioned in NEEAP are listed also here: Government Decision on the installation of efficient light bulbs in public buildings, Measures for residential sector R.1. Improving EE through implementation of energy efficiency measures in residential buildings R.2. Improving EE through implementation of energy efficiency measures in the residential sector 86

87 R.3. Improving EE through implementation of energy efficiency measures in multiapartment buildings R.4. Improving EE through continuing information campaigns on energy efficiency Measures for tertiary sector S1 Improving EE through renovation of public buildings in municipalities S2 Improving EE through renovation of governmental buildings S3 Improving EE through renovation of public buildings (municipal buildings) S4 Improving EE through renovation of municipal buildings and street lighting S5 Promotion of energy efficiency measures by preparing energy audits The GIZ project Modernization of Municipal Services Installation of efficient public lightning in public facilities, financed by MEM/MED and GIZ Study and Implementation of EE measures in Municipalities Feasibility Study and Implementation of EE measures in public buildings at municipality level Program of 48 energy audits of municipal buildings Promotion of EE measures in households through Eko loans National Building Energy Efficiency Study for Kosovo Activities to ensure availability of advice and information 5. Establishment of Competent Bodies and Assigned Organizations The Ministry of Economic Development is the lead ministry in the field of energy sector development, energy efficiency policy planning and implementation supervision. It has also a leading role in development and implementation of economic sector structural development policy, industrial policy development and other policies in those areas specified in the relevant legislation. 87

88 The KEEA will be responsible for monitoring of the 2nd NEEAP implementation progress. It has already established an energy efficiency data base for collection and analysis of information on project based energy savings achieved. Development of energy efficiency statistics has been identified as the highest priority activity that will be carried out by all the parties involved. Several other line ministries have been actively involved in the 2nd NEEAP preparation process and will have an important role in ensuring the success of its implementation. The Ministry of Infrastructure will be responsible for implementation of policies related to transport sector development and promotion of energy efficiency in the transport sector. The Ministry of Environment and Spatial Planning will be responsible for activities related to transposition of the EPBD and its implementation. The KEEA is responsible for reporting on implementation of the EPBD. 88