Prishtina, 3 May 2024 – A significant step in Kosovo’s energy landscape has been marked with the signing of key agreements between the Government and MCA-Kosovo. The Ministry of Economy signed the Implementing Entity Agreement (IEA) with MCA-Kosovo for the Multifunctional Energy Storage Activity (MFES), while the Ministry of Environment, Spatial Planning, and Infrastructure signed a Memorandum of Understanding with the Millennium Challenge Account – Kosovo (MCA-Kosovo) for Energy and Climate Policy Support Activity under the Compact Program.

These agreements are crucial for the successful implementation of Compact activities, which are integral components of Kosovo’s strategy to enhance energy security and transition to cleaner energy sources.

“Nearly 2 million people will benefit from the Compact Program, making it the largest energy investment in the last 50 years. By completion, Kosovo is expected to have the highest residential battery storage per capita globally”, said Florina Duli – Sefaj, Chief Executive Officer of MCA-Kosovo.

Specifically, the MFES activity aims to support Kosovo’s energy security and transition to a future with cleaner energy by using energy storage systems for reserves, ensuring the availability of storage systems, and reducing costs to provide adequate energy for Kosovo.

“The program has been designed and negotiated to place state ownership at its core, a crucial value of MCC that we greatly appreciate. We are committed to implementing the program successfully and on time, showcasing Kosovo as a success story in MCC programs”, emphasized Minister of Economy Artane Rizvanolli.

In March 2024, the Government of Kosovo took a significant step by establishing the ownership structure of the Publicly Owned Enterprise “Energy Storage Corporation” (ESC). ESC was established to own and operate around 125 MW for two hours (equivalent to 250 MWh) of one or more battery energy storage systems and other potential electricity storage systems.

Minister Liburn Aliu emphasized that together with the Ministry of Economy and MCC, we are starting collaboration for a systematic approach to calculate greenhouse gases and thus assist the Kosovo Environmental Protection Agency and their new sector for the Greenhouse Gas Inventory.

“Additionally, there will be assistance for the Environmental Protection Department to train and enhance staff capacities to better understand battery storage technologies and the approach to assessing the environmental impact of these projects”, Aliu stated.

Both Ministries are serving as government partners in implementing technical assistance financed by the Compact.

The Implementing Entity Agreement and the Memorandum of Understanding are part of the Millennium Challenge Corporation’s (MCC) Compact Program. The MCC Compact Program of $202 million, together with a $34.6 million contribution from the Government of Kosovo, amounts to $236.6 million.

This initiative addresses the challenge of unreliable electricity supply in Kosovo, aligns with national development and energy priorities, and aims to reduce poverty and promote sustainable economic growth in Kosovo.