Albania wins arbitration against Italy's Hydro S.R.L. over Kalivac HPP

Hydropower plant HPP Photo Vjosa Albania

TIRANA (Albania), January 25 (SeeNews) – The Paris-based International Court of Arbitration has ruled in favour of Albania against Italy's Hydro S.R.L in a breach of contract case in the construction of Kalivac hydro power plant, Albania’s ministry of infrastructure and energy said on Thursday.

The Albanian government will receive around 172 million euro ($212 million) in damages under the arbitration decision, the ministry said in a press release.

Albania was sued by Hydro S.R.L in October 2014, with the company requesting the breach of contract and the payment of 137 millon euro compensation from the government for not respecting the agreement. Albania then filed a countercharge with the ICC against Hydro S.R.L, demanding 158 million euro in compensation and 12.9 million euro of unpaid interest for the company's failure to build the HPP, according to the press release.

In its decision, the arbitration tribunal said Hydro S.R.L must pay the compensation, the interest and a further 1.25 million euro in court expenses.    

The Kalivac HPP will now be built and operated by Turkish-Albanian consortium Ayen Enerji & Fusha which signed a 35-year concession contract with the Albanian government in October 2017.

Construction works on Kalivac HPP are projected to cost 125.3 million euro and the HPP will be operational in 2020, according to information provided by infrastructure and energy ministry.

Annual electricity production at the future hydro power plant located on Vjosa river near Kalivac village, in southern Albania, is projected at 366.6 million kWh.

($ = 0.80939 euro)

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