Energji Ashta Shpk (Ashta)
On February 1, 2012, MIGA issued guarantees totaling €121.4 million ($159.4 million) to EVN AG of Austria for its investments in Energji Ashta Shpk (Ashta) in Albania. MIGA’s coverage is for a period of up to 20 years for its equity investment.[i]and up to 10 years for its loan guarantee. Coverage insures against the risks of transfer restriction, expropriation, war and civil disturbance, and breach of contract.
The project involves the construction of a 52.9 megawatt (installed capacity) run-of-river hydropower plant on a build, own, operate, and transfer basis under a 35-year concession agreement originally entered into between VERBUND AG and the Ministry of Economy of Albania. In 2010, the two project sponsors, EVN AG and VERBUND AG negotiated a shareholder agreement to jointly develop and operate the project.
The project is the fourth plant on the Drin River but the first to be built in 30 years. It is located in the district of Shkoder in northwestern Albania. The developers have also entered into power off-take and cascade agreements with the Albanian public wholesale electricity supplier, Korporate Elecktroenergjetike Shqiptare Sh.A (KESH).
The project is expected to have high developmental impact by providing clean, renewable energy while helping to alleviate the power shortage in the country in the mid and long term. The project will also reduce the country’s load shedding and electricity imports.
The project also aligns well with the current World Bank Country Partnership Strategy for Albania. One of the three strategic objectives of the strategy is to accelerate Albania’s economic recovery through improved and more financially sustainable infrastructure services such as roads, energy, and irrigation. In the energy sector, the strategy focuses on consolidating current reforms and completing ongoing investments while promoting new and private financing mechanisms.
[i] The guarantee for Equity investment was cancelled on February 01, 2018.