EXECUTIVE SUMMARY

The European Bank for Reconstruction and Development (EBRD) is supporting Albania's Ministry of Infrastructure and Energy (MIE) in preparing a new 300 MW solar photovoltaic (PV) auction with co-located battery energy storage systems (BESS). The assignment, disclosed on 5 November 2026 under the Renewable Energy Market Accelerator (REMA) programme, covers auction design, regulatory development and implementation support.

Albania relies heavily on hydropower generation, exposing its electricity supply to hydrological variability. The EBRD has been working with Albanian authorities to diversify electricity generation through solar PV, onshore wind and battery storage. With the Bank's assistance, MIE has completed four competitive renewable energy auction rounds, procuring more than 800 MW of capacity at competitive regional prices.

In October 2025, MIE and EBRD signed a Memorandum of Understanding under REMA to cooperate on further renewable energy auctions and regulatory development. The initiative aligns with Albania's Reform Agenda 2024–2027, which requires at least 600 MW of renewable capacity to be auctioned. The EBRD-supported 2024 solar auction contributes towards this requirement, while the upcoming round will cover 300 MW of solar PV alongside BESS.

The assignment has three objectives. First, EBRD will support an assessment of Albania's solar project pipeline and available grid capacity to establish auction eligibility requirements. The work will also examine state aid provisions, market readiness for Contracts for Difference (CfDs), and battery storage revenue and support requirements. These findings will inform the recommended auction structure and design parameters.

Second, the assignment will address legal and regulatory requirements for electricity storage. This includes reviewing Albania's Power Sector Law No. 59/2026, approved by Parliament in June 2026, identifying regulatory gaps and supporting the preparation of secondary legislation needed to implement the auction.

Third, EBRD will assist with auction documentation and provide legal, commercial and technical support throughout the process, from launch and project selection to award and financial close.

The Bank previously supported Albania's Energy Regulatory Authority (ERE) in developing a Market Readiness Assessment methodology. An assessment completed in early 2026 found that market conditions were not sufficiently mature to replace Power Purchase Agreements with CfD-based support. The new assignment will support ERE in conducting another assessment.

EBRD has also supported Albania's transmission system operator, OST, in assessing grid flexibility requirements associated with BESS. The upcoming auction will combine solar procurement with storage considerations, while the assignment will address the supporting market and regulatory framework.