Nartë Lagoon Vlorë Bay A

Report No. 40213-AL 1 Public Disclosure Authorized

The Inspection Panel

~ Public Disclosure Authorized

Report and Recommendation

ALBANIA: Power Sector Generation and Public Disclosure Authorized Restructuring Project (IDA Credit No. 3872-ALB)

July 2,2007 Public Disclosure Authorized

The Inspection Panel

Report and Recommendation on Request for Inspection

ALBANIA: Power Sector Generation and Restructuring Project (IDA Credit No. 3872 ALB)

1. On April 30, 2007, the Inspection Panel (the “Panel”) received a Request for Inspection (the “Request”) dated April 30, 2007, related to the Albania Power Sector Generation and Restructuring Project (the “Project”) financed by the International Development Association (IDA)’ (Credit No. 3 872 ALB). The Request was submitted by Mr. Lavdosh Fermni, on behalf of the Civic Alliance for the Protection of the Bay of Vlora (CAPBV). On May 2, 2007, the Panel received a second document containing evidence of Mr. Ferruni’s authority to represent eight persons who live in the city of Vlora2 and who claim to be affected by the Pr~ject.~

2. On May 2, 2007, the Panel registered the Request and notified the Executive Directors and the President of the International Development Association (IDA) that it had registered the Request4 The Panel received Bank Management’s Response to the Request for Inspection on June 1, 2007 (the “Management Response”).

3. As provided in paragraph 19 of the 1993 Resolution establishing the Inspection Panel (the 6‘Reso1ution’7)5,the purpose of this report is to determine the eligibility of the Request and make a recommendation to the Executive Directors as to whether the matters alleged in the Request should be investigated.

A. The Project

4. The development objective of the Project is “to achieve signfzcant improvement in power system performance through: (a) priority investments to increase

’ For the purposes ofthis Report, the IDA is also referred to as the “Bank”. The city is referred to as Vlora or Vlore in different documents. This report uses “Vlora.” These eight persons, Civic Alliance for the Protection of the Bay ofVlora (CAPBV) and Mr. Lavdosh Femni, collectively hereinafter referred to as the “Requesters.” 4 The Inspection Panel, Operating Procedures (August 1994) (hereinafter “the Operating Procedures”), at 7 17. International Development Association (IDA) Resolution 93-6, dated September 22, 1993,

1 domestic thermal generation; and (b) measures to implement sector reforms and institutional strengthening.”6 The objective is to be achieved through two Project components: a combined-cycle power station, and technical assistance and training.

5. The first component includes the “construction of a combined-cycle power station wore Thermal Power Plant) at a six-hectare Greenfield site about 6 km north of Vlora adjacent to an oil tanker terminal” and the “rehabilitation of the adjacent oil tanker terminal, and connection to the transmission network. ” The second component includes the “provision of technical assistance to the Albanian Power Corporation (KESH) for the implementation of the Project, improvement of operation of KESH and sector reforms and provision of training to KESH in procurement and environmental management.’77

6. According to the Project Appraisal Document (PAD), Vlora Thermal Power Plant would be designed to allow conversion to natural gas if and when imported gas is brought to Albania. The plant size would be 85 MW - 135 MW depending on the evaluation ofbids.

7. Management of the implementation of the Project would be carried out by the Albanian Power Corporation (KESH). The Vlora Thermal Power Plant would be owned and operated by a separately incorporated enterprise, with all of its shares held by KESH. There would be a power purchase agreement between the company and KESH, probably with a guaranteed take-or-pay arrangement for a limited period and a provision for automatic adjustments to reflect variations in the price of imported distillate oil’.

B. Financing

8. The total Project cost is estimated to be US$112.66 million. The estimated cost of the Project includes US$3 million for the refurbishment of the existing oil tanker terminal and US$4.4 million for connection to the Albanian transmission system at the planned Babica 220/1 lOkV substation located seven km away. The total Project cost also includes US$4.85 million for technical assistance and training. The Project is being financed through an IDA Credit equivalent to US$25 million (SDR 16.9 million)’, an European Bank for Reconstruction and Development (EBRD) loan in an amount of US$37.5 million, and an European Investment Bank (EIB) loan in an amount of US$37.5 million. KESH is contributing

Project Appraisal Document on a Proposed Credit in an amount of SDR 16.9 million (US$25 million equivalent) to Albania for the Power Sector Generation and Restructuring Project, dated February 17, 2004, hereinafter “PAD”, pg.2. ’ Development Credit Agreement between Albania and InternationalDevelopment Association for Power Sector Generation and Restructuring Project dated April 6, 2004, pg. 14. * According to the PAD, this arrangement will provide for “a track record of thefinancialperformance of the subsidiary company ... ” and “could facilitate its subsequent privatization ’’ (PAD, pgl8). The IDA Credit was relent to KESH for 20 years with a 5 year grace period and an interest rate equal to the six-month US Dollar Libor rate plus 0.75%.

2 US$12.66 million to the Project cost. The IDA Board of Executive Directors approved the Credit on March 16,2004; it became effective on January 25,2005. The Project Closing Date is January 31, 2008. As of May 2, 2007, SDR 450,000, or about 2.7% of the IDA Credit, had been disbursed.

B. The Request

9. According to the Request, “ifbuilt, the Vlora Thermal Power Plant will destroy environment, tourism, safe Jsheries, natural habitat, ecosystem, coral colonies as well as the unique historical and cultural signijicance of the entire Vlora Bay and Narta Lagoon. The Request states that, “the Environmental Impact Assessment, in [sic] which the Bank has based its loan, refers only to one thermal power plant of 100 M, while in the decision of the Government No. 61 0 dated 09/21/2004 - which the Bank is or should have been aware of - it is explicitly written that it is agreed to reach a capacity of 300 MW in next phases.” The Request further indicates that “the Government approved (Law No. 9231 dated 05/13/2004) just one km far from Vlora Thermal Power Plant a concessional agreement of building of [a] large oil storage deposit in the Vlora Bay. ”

10. According to the Request, “the procedures concerning the Vlora Thermal Power Plant were already found in violation of Article 6 of the Aarhus Convention on Access to Information, Public Participation and Access to Justice, as determined by the Aarhus Convention Compliance Committee in its Draft Finding and

Recommendations of March 23, 2007. I’

11. The Requesters have confirmed that they contacted Bank Management on several occasions.” However they are not satisfied with the answers and explanations provided. The Requesters assert that the Bank Management failed to consider the fact that: “(a) the Project is based on the material misrepresentation of the site; (3) the Environmental Impact Assessment upon which the Bank’s loan was based was misleading, illegal and wrong; and (c) the Bank’s procedure leading to the Project is in violation of Albania’s laws on environment, public participation, cultural heritage and Environmental Impact Assessment, as well we the EU’s laws and guidelines. ’J’

12. In their Request to the Inspection Panel, the Requesters asked the Panel to recommend to the Board of Executive Directors of the World Bank that an investigation be conducted on the alleged matters.

10 Request for Inspection, letter dated April 30, 2007, para. 3, p.1 l1Letter to Orsalia Kalantzopoulos and Nadir Mohammed dated June 20,2005; letters to Shigeo Katsu during the year of 2006 by Dr. Anna Kohen, Honorary Citizen of Vlora and Honorary Member of Civic Alliance for the Protection of the Vlora Bay; and meetings in Tirana with Orsalia Kalantzopoulos, Nadir Mohammed and Arlene Fleming. Request for Inspection, letter dated April 30, 2007, para. 5, p.2

3 13. In the Notice of Registration the Panel noted that the above claims may, inter alia, constitute non-compliance by the Bank with various provisions of the following Operational Policies and Procedures:

OMS 2.20 Project Appraisal OP/BP 4.01 Environmental Assessment OP/BP 4.04 Natural Habitats OP/BP 4.12 Involuntary Resettlement OP/BP 10.04 Economic Evaluation of Investment Operations OPN 11.03 Management of Cultural Property in Bank-Financed Projects OP/BP 13.05 Project Supervision

C. Management Response

14. On June 1, 2007, Management submitted its Response to the Request for 1nspecti0n.l~The Response addresses key issues raised by the Requesters. The Response includes 6 annexes.

15. The Response states that Albania has suffered from electricity shortages since the summer of 2000, which is due to growth in electricity demand and impacts from adverse hydrology on Albania’s predominantly (95 percent) hydropower-based system. Management states that since 1997, Albania has had to import significant quantities of electricity. At the end of 2006, and as recently as January 2007, the country has suffered from significant power supply disruption^.'^

16. Management states that the electricity crisis has had multiple adverse impacts on the poor. Management further notes that the use of budgetary resources for electricity imports means that funds are diverted from poverty reduction efforts.

17. The Response states that Albania’s electricity needs are supplied almost solely by hydropower, which is subject to considerable variability since it is dependent on rainfall. Management states that “the average generation in a normal hydrological ear is about 4,000 GWh, compared to current demand of about 6,800 GWh. ” r” Management asserts that domestic thermal generation capacity is needed to reduce dependence on the import of electricity and to diversify domestic generation.

18. Management states that following the request of the Government of Albania to assist in arranging donor financing for a new thermal electric power plant (TEP), the Bank initiated discussions with EIB and EBRD regarding co-financing of a TEP, and informed the Government in January 2002 that the three institutions

l3Bank Management Response to Request For Inspection Panel Review ofthe Albania: Power Sector Generation and Restructuring Project (IDA Credit No. 3872 ALB), June 1,2007. l4Management Response, 7 6. l5Management Response, 7 9.

4 were prepared to assist in financing the Project. Management states that in 2002 an internationally recognized consulting firm prepared a siting and feasibility study of the proposed TEP with financing from the United States Trade and Development Agency (USTDA), and that this consulting firm also prepared the environmental assessment of the Project in 2003. l6

19. Management notes that in January 2003, the European Commission and Albania started negotiations on a Stabilization and Association Agreement. Management states that the Albanian system needed to be interconnected with the Union for the Coordination of Transmission of Electricity (UCTE), which is the association of transmission system operators in continental Europe. Management further states that maintaining UCTE interconnection required Albania to meet a number of conditions and one of these conditions was the commissioning of the Vlora TEP.17

20. Management states that based on a review of available TEP unit sizes from different manufacturers, bids were invited for a capacity between 85 MW and 135 MW, and the contract was awarded for a thermal power plant of 97 MW capacity.18 Management notes that construction of a thermal plant in the southern part of the country will reduce technical losses and significantly improve the security and quality of supply in the country overall and in particular in the south, which is poorly served at present. Management states that the TEP is designed to allow conversion to natural gas if and when it is imported to Albania.

2 1. According to Management, an analysis of alternatives was carried out as part of the Project appraisal process, and four sets of alternatives to the Project were considered. Management further notes that the Project feasibility study considered other sites and it also considered other fuels as alternatives to the use of distillate oil in a combined-cycle generating unit at Vlora (site B). The other sites investigated were: Durres, Elbasan, Fier, Korce, Shengjin, and Vlora (site A).” Management notes that the sites were evaluated on the basis of ten criteria, each assigned a different weight. Management indicates that the Vlora (site B) and Fier sites were found to be best from a transmission perspective. Management further notes that there was a close correspondence between the ordering of the sites on the basis of the ten criteria and the ordering on the basis of “levelized” cost alone.20 Management states that in both cases, the recommended Vlora site was ranked first over the site at Fier, which was ranked second.21

22. Management indicates that the total amount of financing for the contract of the TEP is currently expected to be EUR92 million (approximately US$123.3 million). Management states that based on the awarded Engineering, Procurement

l6Management Response, f 12. l7Management Response, f 14. l8Management Response, f 15. l9Management Response, 126. 20 Management Response, f 3 1. 21 Management Response, f 30-3 1

5 and Construction (EPC) contract, the cost ofthe power station project includes: (i) an offshore oil tanker terminal; (ii)an undersea pipeline; and (iii)fuel storage facilities. It also includes a connection to the Albanian transmission system at the Babica 220/110 kV substation located seven kilometers away. The Project also includes funding for technical assistance and training.22

23. Management indicates that the Project was assigned a “Category A” rating for Environmental Assessment (EA), because it recognized the potential significant impacts on the environment and the need for avoidance, mitigating and monitoring measures. Particular areas of concern include the impacts on air quality from stack emissions, water quality from cooling water discharge, and any ancillary impacts on the Narta lagoon, which according to Management is located about two kilometers from the Project site.

24. Management states that the key safeguard policies that were investigated for relevance under the EA (OP 4.01) process included Natural Habitats (OP 4-04), due to the proximity of the Narta lagoon (since then designated for protection) and Involuntary Resettlement (OP 4.12), due to the possible need for land acquisition for transmission line towers. Management further states that during Project preparation review and after consultations on the protected area around the Narta lagoon with the United Nations Development Programme (UNDP), it was found that the potential impacts on natural habitats would not be significant and hence the Bank’s safeguard policy would not be applicable.

25. The Response notes the Requesters’ concern that one or more additional TEPs would raise generation capacity at the selected Vlora site to as much as 300 MW.23Management states that the Project documentation shows the Vlora site could physically accommodate additional units for a total installed capacity of 300 MW. Management further states that “the Project beingfinanced by the Bank, EBRD and EIB is limited to one facility of 97 MW capacity and the final EA focused on that only.” Management adds that “if the Government decides to proceed with additional generation units (either at the Vlore site or another location), then a new comprehensive EA will be required.”24

26. The Response addresses the Requesters’ concerns regarding: (i)a proposed major industrial or “energy park;” and (ii)a proposed oil storage facility operated on a concession basis and located at a partially-built site south of the Vlora TEP, stating that, to Management’s knowledge, the proposal for the energy park never advanced to the pre-feasibility stage and that a proposed onshore oil terminal concession is not related to the Project, which will have its own independent offshore terminal, pipeline and storage tanks. Management indicates that, in its view, Project due diligence for unassociated investments in the general Project area did not need to be carried out by the Bank.

’*Management Response, 7 18. 23 Management Response, 7 49. 24 Management Response, 7 52.

6 27. In its Response, Management agrees that there was insufficient coverage in the EA on the matter of the review of potential cultural property. Management indicates that when this issue was subsequently raised, it carried out a supervisory visit was carried out in July 2006.25Management notes that as a result of the visit, it concluded “that the site is not of archaeological signijkance due to the &own locations of the ancient city sites in the Vlore Bay region and the lack of any evidence of human habitation during digging for the adjacent jshing harbor in the early 1980s and beyond. Consequently a surface survey of the selected site prior to the start of construction is neither necessary nor justiJable. ~~26

28. With respect to the Requesters’ concern of the Project’s potential impacts on ecosystems (i.e. ‘tfisheries, natural habitat, ecosystem, coral colonies”), Management states that the EA and measures to be taken during implementation are adequate. Management indicates that the Project site is outside the protected area around the Narta lagoon, designated as such in 2004 by the Government, and is not anticipated to have an impact on this area.

29. Management states that the issue of tourism potential is not covered directly by Bank safeguard policies, but only indirectly through related issues such as potential impacts on cultural property and natural habitats. Management notes that while tourism adjoining the immediate site could possibly be reduced, the benefit of more reliable power in the Vlora area (and generally in the southern part of Albania) for tourism “is undeniable.”

30. Management indicates that the Bank Policy on Involuntary Resettlement was “triggered” and a Policy Framework for Land Acquisition was included in the PAD and disclosed. Management notes that this Framework was needed to address the very small amount of land that will need to be acquired for transmission line towers and not for the TEP itself. Management states that the land acquisition will not lead to actual displacement of households or businesses, since acquisition of privately held land is unlikely.

31. Management asserts that the EA was carried out “in full compliance” with relevant EU laws and guidelines. In addition, Management notes that the approach to due diligence followed by EBRD and EIB is heavily influenced by EU Directives. Management states that the Requesters’ claim that the Project violates Albanian laws on environment and public participation is not supported by legal citations and that the Government has stated that all Albanian legal requirements have been complied with in approving the Project and issuing the relevant licenses.

32. Management addresses the draft findings of the Aarhus Convention Compliance Committee and states that the Bank’s safeguard policy framework supports the Convention by, among other items, seeking early and meaningful dialogue.

25 Back-to-Office Report on Cultural Property Issues, July 2006 included as Annex 3 to Management Response. 26 Management Response, 7 56.

7 Management states its belief that the process leading up to the Project respected the requirements ofthe Aarhus C~nvention.~’

D. Eligibility

33. The Panel must determine whether the Request satisfies the eligibility criteria for an Inspection, as set forth in the 1993 Resolution establishing the Panel and the 1999 Clarifications:’ and recommend whether the matter alleged in the Request should be investigated.

34. The Panel has reviewed the Request and Management’s Response. Panel Member Tongroj Onchan, together with the Panel’s Deputy Executive Secretary Dilek Barlas and expert consultant Eduardo Abbott, visited Albania from June 24 to June 30,2007. During their visit, the Panel Team met with a wide array of Project stakeholders, including the Requesters, national, local and Project authorities, members of the Albanian Academy of Sciences, local professionals, including architects, engineers, journalists, archeologists and lawyers, members of the association of tourist and hotel entrepreneurs, student leaders, and numerous members of local NGOs and the community. The Panel also met with the Project Task Team Leader in the Bank Country Office of Tirana. The Panel Team visited the Project site, the city of Vlora, and the Fier site.

35. The Panel wishes to thank all those who facilitated the Panel Team’s visit, especially the Civic Alliance for the Protection of the Bay of Vlora (CAPBV), officials of the Ministry of Finance, Ministry of Economy, Trade and Energy, KESH, the World Bank Country Office in Tirana and the many academics and members of civil society who met with the Panel Team in Manhattan, Tirana, Vlora, and the Project site.

36. Based on the reasons set forth below, the Panel is satisfied that the Request meets all of the eligibility criteria provided in the 1993 Resolution and Paragraph 9 of the 1999 Clarifications.

37. During the visit, the Panel confirmed that the Requesters are legitimate parties under the Resolution to submit a Request for Inspection to the Inspection Panel. The persons who signed the Request have, and/or represent people who have, common interests and concerns related to the Project, and reside in the Borrower’s territory, as required by Paragraph 9(a).

38. The Panel notes that the Request “assert[sJ in substance that a serious violation by the Bank of its operational policies and procedures has or is likely to have a material adverse effect upon the requesters” as required by Paragraph 9(b).

27 Management Response, 7 62. ** Conclusions of the Board’s Second Review of the Inspection Panel (the “1999 Clarifications”), April 1999:

8 39. The Panel has reviewed the claims and the Management Response carefully in relation to this criterion. The Panel also gathered relevant information during its eligibility visit to Albania, particularly through its visit to the Project area, the proposed alternative Project site in Fier, and its meetings with Requesters, other members of civil society and local communities that might be affected by the Project, who reiterated the claims of non-compliance by the Bank with its own operational policies and procedures, and related harm.

40. The Panel wishes to emphasize that it recognizes the immediate importance of developing sources of electricity for Albania, which the Requesters also recognize. However, the Requesters have expressed serious concern about the construction of the TEP in Vlora. They claim that the Project will cause very significant harm to the environment, ecology, tourism of Vlora Bay area and Narta Lagoon, sites of great ecological, historical and cultural importance.

41. The Requesters and Management have advanced conflicting assertions regarding a number of important issues. Some of these issues are highlighted below.

EnvironmentalAssessment

42. Analysis of Alternative Sites. The Requesters have expressed serious concerns about the adequacy of Management’s consideration of other sites than Vlora. In its Response, Management states that seven candidate locations for a thermal power plant were evaluated on the basis of ten weighted criteria, including environmental and social factors. The Panel notes that Management indicates that “there are no internationally standardized approaches to conducting such site rankings, and other evaluators might have chosen different ranking factors or ~eightings.’’~~The Panel notes that the Requesters dispute this notion and during the Panel visit stated that these criteria were chosen to justify the selection of the Vlora site. They claim that based on an appropriate selection criteria the best and most effective option would not be the building of a new plant at Vlora, but the rehabilitation of the existing power plant in Fier, a town 20 miles north-west of Vlora.

43. During its visit, the Panel Team noted that the selection of Vlora as the Project site is a source of significant dispute and controversy for the local community of Vlora. Some of the concerns expressed to the Panel Team relate to the potential harm to be caused by the TEP emissions both in the water and air which, because of prevailing winds and currents, will affect the enclosed Vlora Bay and contaminate the Vlora city air. These effects will have a negative impact not only on local population and fishing but also on the tourism industry which is an important source of employment and income in the area. The Requesters stated that the prospect of economic growth of the area is mostly based precisely on the activities to be harmed by the Project, namely tourism and fishing.

29 Management Response, T[ 47.

9 44. The Requesters have also expressed concern about the adequacy of Management’s assessment of other fuels as alternatives to the use of distillate oil. Management states that the use of natural gas, indigenous coal and heavy fuel oil was considered. Management indicates that the option of a natural gas-fired combined-cycle unit at each of the proposed sites was found to be more costly than the distillate fuel option but that, if and when imported natural gas is brought to Albania, the Vlora plant could be readily converted to gas.

45. Project Site Characterization. The Panel notes the Requesters claim that the EA misrepresents the Project site. The Requesters’ objection to the representation of the site in the EA as “greenjeld site ... relatively barren coastal area with little vegetation or wildlife.” The Requesters note the proximity of the Project site to the Narta Lagoon, which is a protected area composed of beaches, sand dunes, forests and wetlands and is home to a number of endangered species. The Requesters assert that the area is sanctuary to important animals, plants and coral colonies, which might be significantly harmed by the Project. They allege that this was not considered during the preparation of the EA. The Panel notes Management’s statement that the EA provided sufficient in-field review and site characterization and that where field data was missing reasonable surrogates were chosen. It adds, though, that the EA does rely on a certain level of reconnaissance level information on some topics, which will need to be refined as implementation progresses. Management adds that it “sees no appreciable gains from an examination of additional project possibilities or choices selected.

Public Consultation and Disclosure

46. The Requesters assert that no adequate public consultation was carried out during the preparation of the Project. They claim that most of the meetings were not properly advertised, the information provided incomplete and, that in any event most of the meetings took place after the selection of the Project site had been approved by Government authorities. The Requesters claim that the Bank has failed to ensure public participation and consultation in decision-making regarding the Project.

47. In its Response, Management states that a public meeting was held in Vlora in October 31, 2002 to discuss the findings of the final siting study (dated October 21, 2002), and the draft feasibility study (dated August 6, 2002) including a detailed preliminary environmental analysis and a draft outline of an EA. Management indicates that following the standard Bank procedures for Category A projects, public consultations were held at the early EA preparation stage on April 2,2003 and draft EA report stage on September 3,2003.

30 Management Response, 7 55.

10 48. The Requesters note that on April 27, 2005, they submitted a communication to the Aarhus Convention3’ Compliance Committee (“the Committee”) with regard to compliance by Albania with its obligations under the Aarhus Convention concerning public access to information and participation in decision-making on the construction of an industrial park and a thermal power plant.32

49. The draft findings of the Committee dated March 23, 2007, with regard to the decision33 on the approval of the construction site of the thermal power plant in Vlora, were attached to Management Response.34

50. The Panel notes that the draft findings the Committee, with regard to Decision No. 20, which established the site of the thermal power plant at Vlora, state that “the only element of public participation in this phase of the process appears to have been the public meeting that tookplace in Vlora on October 31, 2002.” The Panel also notes the Committee’s draft finding that “the obscure circumstances around the meeting in October 2002, and the failure of the Party concerned to provide anything to substantiate the claim that the October meeting was duly announced and open for public participation, clearly point to the conclusion that the Party concerned failed to comply with the requirements for public participation set out in paragraphs 3, 4 and 8 of article 6 of the C~nvention.”~~ The Committee’s draft findings did not consider the meetings that took place on April 2, 2003 and September 3, 2003 as instances of ublic participation since they occurred after Decision No. 20 had been finalized.39

51 With respect to the above mentioned public consultations of the draft EA that took place on April 2, 2003 and September 3, 2003, the Committee, in its draft findings noted that “no information has been provided by the Party concerned to demonstrate that the meetings in April and September 2003 were publicly announced, so as to make it possible for members of the public opposing the project to actively take part in the decision-making, Nor has the Party concerned been able to give any reasonable explanation as to why the rather strong local opposition to the project, indicated by the 14,000 people callingfor a referendum, was not heard or representedproperly at any of these meetings. It is thus clear to the Committee that the invitation process also at this stage was selective and

insufJicient. 1137

31 Aarhus Economic Commission for Europe Convention on Access to Information, Public Participation in Decision-Making and Access to Justice in Environmental Matters, done at Aarhus, Denmark, 25 June 1998, ECEICEPI43 (hereinafter “Aarhus Convention”). 32 Communication ACCC/C/2005/12 by the Alliance for the Protection ofthe Vlora Gulf (Albania). 33 Decision of the Council of Territorial Adjustment ofthe Republic of Albania Decision No. 20 dated February 19,2003. 34 Management Response, Annex 4. 35 Draft Findings and Recommendations of the Committee dated March 23,2007,T 67. 36 Id. at 7 68. 37 Id. at 7 69.

11 52. The Panel notes the Committee’s draft findings with respect to the decision on the siting of the TEP near Vlora3*, which state that “although some efforts were made to provide for public participation, these largely took place after the crucial decision on siting and were subject to some qualitative de$ciencies, leading the Committee to ind that the Party concernedfailed to comply with the requirements in question. JJ3f 9

53. With respect to the Requesters claim regarding the lack of public participation and disclosure, the Panel notes Management’s contention that: (a) the Committee’s compliance process is still ~ndenvay,~’and (b) the process leading up to the Project respected the requirements of the Aarhus Convention. The Panel notes that in fairness to all parties concerned, the facts related to these allegations and Management compliance, or lack thereof, with applicable policies and procedures can only be determined in the course of an investigation.

54. Cumulative Impact. The Panel notes that the Requesters claim that, “the Environmental Impact Assessment, in which the Bank has based its loan, refers only to one thermal power plant of 100 Mw, while in the decision of the Government No. 610 dated 09/21/2004 - which the Bank is or should have been aware of - it is explicitly written that it is agreed to reach a capacity of 300 MW in next phases. ” The Requesters further indicate that “the Government approved (Law No. 9231 dated 05/13/2004) just one kin far from Vlora Thermal Power Plant a concessional agreement of building of [a] large oil storage deposit in

Vlora Bay. JJ41 The Requesters assert that the Bank failed to take into account the future cumulative environment impact of one or more additional thermal power plants that would raise generation capacity at the selected Vlora site to as much as 300 MW and the other investments already approved by the Government in the vicinity of the Project site.

55. As noted above, Management states that the proposal for the energy park never advanced to the pre-feasibility stage and that a proposed onshore oil terminal concession is not related to the Project. Management indicates that, in its view, Project due diligence for unassociated investments in the general Project area did not need to be carried out by the Bank.

Natural Habitats

56. The Requesters assert that the Project site is located only 746 meters from the Narta Lagoon, which is a protected area, rather than the two kilometers as indicated in the Project documents. According to the Requesters, the Project will

38 Decision of the Council of Territorial Adjustment ofthe Republic of Albania Decision No. 20 dated February 19,2003. 39 Draft Findings and Recommendations ofthe Committee dated March 23,2007,177. 40 Management Response includes in Annex 5 the “World Bank Response to Draft Findings of the Aarhus Convention Compliance Committee.” 41 Request for Inspection, letter dated April 30, 2007,y 4.

12 have significant impacts on the protected area and the Bank’s policy on natural habitats applies.

57. Management states that the Project site is outside the protected area around Narta Lagoon, designated as such in 2004 by the Government, and is not anticipated to have an impact on this area. Management notes that the Bank’s policy on Natural Habitats does not apply.

58. The Panel observes that with respect to the Narta Lagoon the PAD states that “Parliament is expected to designate the Narta Lagoon as a ‘Protected Area’ under a new law which provides for the establishment of protected areas to ensure the conservation of natural resources, protect biodiversity, and restore and maintain habitats and species. The Government has conjrmed that the proposed Vlore power plant site will be outside of the boundaries of the Narta

Lagoon protected area. ’J42 The Panel notes that the character of the natural habitat of the Narta Lagoon is not under dispute but the probable effects of the Project is subject of contention.

Cultural Property

59. The Panel notes the conflicting assertions between the Requesters and Management regarding the archeological and historical significance of the Project site. The Panel notes that the Requesters assert that the Project site has important archeological and historical significance. The Requesters state that the Project site is in close proximity to an ancient Mediterranean port city, Treport Cape/Aulona, that has archeological significance. The Panel also notes that the Requesters state that the Project site has historical significance to Sephardic Jews escaping from Spain in 1492 who landed and settled in Vlora. The Requesters expressed strong concern that, if the thermal power plant is built, it will destroy the unique historical and cultural significance of the area. Local archeological experts reiterated and provided further information about these claims to the Panel Team during its visit to the Project area.

60. In its Response, Management acknowledges that there was insufficient coverage of the potential cultural property issues in the Environmental Assessment. Management states that a supervisory visit which was carried out in July 2006 concluded that the Project site “is not of archeological signzjicance” and that “consequently a surface survey of the selected site prior to the start of the construction is neither necessary nor justifable. Management also states that “monitoring of excavations during construction of the plant and related civil works to identifi and protect ‘chance jnds’ was deemed the only action that needed to be taken, consistent with established Bank practice, and this is provided in the EPC contract. 1’44

42 PAD, p. 34. 43 Management Response, 7 56. 44 Management Response, 7 44.

13 6 1. The Panel confirmed that the Requesters contacted Bank Management on several occasions.45 However the Requesters indicate that they are not satisfied with the answers and explanations provided by Management.

62. The Panel is therefore satisfied that the Request “does assert that the subject matter has been brought to Management’s attention and that, in the Requesters’ view, Management has failed to respond adequately demonstrating that it has followed or is taking steps to follow the Bank’s policies and procedures. ” Hence, the Request meets the requirement of Paragraph 9(c) of the 1999 Clarifications.

63. The Panel notes that the subject matter of the Request “is not related to procurement”, as required by Paragraph 9(d) ofthe 1999 Clarifications.

64. The Credit financing the Project was approved by IDA Board of Executive Directors on March 16,2004. The expected Closing Date of the Project is January 31, 2008. When the Request was filed on April 30, 2007, about 2.7% of the IDA Credit, had been disbursed. The Request therefore satisfies the requirement in Paragraph 9(e) that the related Credit has not been closed or substantially disbursed.46

65. Furthermore, the Panel has not previously made a recommendation on the subject matter of the Request. Therefore, the Request satisfies Paragraph 9(f) of the 1999 Clarifications.

F. Conclusions

66. The Requesters and the Request meet the eligibility criteria set forth in the Resolution that established the Inspection Panel and the 1999 Clarifications. The Request and Management Response contain conflicting assertions and interpretations about the issues, the facts, and compliance with Bank policies and procedures.

67. In light of the foregoing, the Panel recommends an investigation of the matters raised by the Request for Inspection.

45 Letter to Orsalia Kalantzopoulos and Nadir Mohammed dated June 20,2005; letters to Shigeo Katsu during the year of 2006 by Dr. Anna Kohen, Honorary Citizen of Vlora and Honorary Member of Civic Alliance for the Protection of the Vlora Bay; and meetings in Tirana with Orsalia Kalantzopoulos, Nadir Mohammed and Arlene Fleming. 46 According to the Resolution that established the Panel, ‘this will be deemed to be the case when at least ninety-Jive percent of the loan proceeds have been disbursed. ” Footnote to Paragraph 14(c).

14 ANNEX I REQUEST FOR INSPECTION t OY/ w- Civic Alliance for the Protection of the Bay of Vlora (CAPBV) Aleanca Qytetare per Mbrojtjen dhe Lhvillimin e Gjirit te Vlor4s Zyra Wore, Lagjja Hajro Cakern, perballt shtepisd sd Beut Zyra Tirane; Rr Sami Frasheri P20/10 Tel/fax 250575 E: mail; [email protected]; info@vloranerrezlk. org; www.VlcraNeRrezik.org

To: Executive Secretary, The Inspection Panel 1818 H Street, NW, Washington, DC 20433, USA Fax NO.202-522-0916;

1. I,Lavdosh Fermi, on behalf of the Civic Alliance for the-Protection of the Bay of Vlora (CAPBV) that rsresents a sizable number of local residents living in Vlora and the .~*-".,-.*4*~~*- area known as Treport Beach present the following complaint before the Inspectional Panel CAPBV's and my address are attached below. . i-

2. We have suffered, or are likely to suffer, harm as a result of the World Bank's failures - or omissions in the Vlora Thermal Energy Power Plant project [TEPP] [Project ID PO 775261 to be located in Treport, Vlora, Albania.

3. Describe the damage or harm YOU are sufferin9 or are likely to suffer from the project or program: Ifbuilt, the Vlora TEPP will irreplirably destroy environment, tourism, safe fisheries, natural habitat, ecosystem, coral colonies as well as the unique historical and cultural significance ofthe entire Vlora Bay and Narta Lagoon. In short, it will destroy , our past, present and future.

4. [List (ifknown) the World Bank's operational polices YOU believe have not been observedl. We believe the Bank has violated policies concerning environment, public participation, cultural heritage, the requirement for full compliance with Albania's domestic laws. There is violation of the World Bank's own guideline for new thermal power plants. (This guideline says: "When there is reasonable likelihoodthat in the medium term the power plant will be expanded or other pollution sources will increase significantly, the analysis should take account ofthe impact ofthe proposed plant design both immediately and after probable expansion in capacity or in other sources of pollution"). The EIA, in which the Bank based its loan, refers only to one thermal power plant of 100 MW, while in the decision of government No. 610 dt. 21.9.2004 - which the Bank is or should have been aware of - it is explicitly written that it is agreed to reach a capacity of300 MW in next phases. Also the government approved (Law No. 923 1 dt. 13.5.04) just one km far from TEP Vlora a concessional agreement of building of large oil storage deposits in the Vlora Bay.

5.We have complained to World Bank staff on the following occasions: Letter to Orsalia Kalantzopoulos and Nadir Mohammed, on date 20 June 2005'; various letters to Mr. Shigeo Katsu during the entire year of 2006 by Dr. Anna Kohen, Honorary Citizen of VIora and Honorary Member of Civic Alliance for the Protection of the Vlora Bay2, meetings in Tirana with Ms. Orsalia Kalantzopoulos, Mr. Nadir Mohammad, Ms. Arlene

6. We note that the procedures concerning the Vlora TEPP were already found in violation of Article 6 ofthe Aarhus Convention on Access to Information, Public Participation and Access to Justice, as determined by the Aarhus Coiivention Compliance Committee in its Draft Finding and Recommendations of March 23,2007. We request the Inspection Panel to recommend to the World Bank's Executive Directors that an investigation of these matters be carried out as soon as possible and, pending ofthe outcome ofsuch investigation, we would like the Board to order the suspension of any loan disbursement of the above referenced Project. We note that the Office ofthe Executive Director Giovanni Majnoni (EDS2 1) may have a conflict of interest in properly, thoroughly and impartially investigating this matter. Among other countries, EDS21 is comprised of Albania, Italy and Greece. Italian and Greek companies may have strong economic and financial interests in benefiting from World Bank's Vlora TEPP loan agreement. Moreover, Greek citizens who are employees of the World Bank are directly responsible for the TEPP violations in both planning and implementation stage. For exampIe, Ms. Orsalia Kalantzopoulos wash Country Director for Albania whereas Mr. Demetrios Papathanasiou is Bank Team LeaderIProject Director. Finally, the contract for the construction ofthe Vlora TEPP, signed on February 9,2007, is between the Albanian utility KESH and a major Italian company, Maire Engineering, partially or wholly owned by the Fiat group. We can simply hope that EDS2 1 cames out its duties in the most professional, ethical and responsible fashion and opens the way to the Inspection Panel for a thorough, impartial and objective investigation ofsuch matter,

Signatures:

Contact: Lavdosh Ferruni * Rr. Sami Frasheri, p20/10 Tirana, TeVfax: +355 4 250575, mobile: +355692099047

Partial list of attachments: Includes reference to key documents. Full documents will be sent via email or regular inail - and not via facsimile - in order to contain cost. We do authorize you to disclose our identities

With Kalantzopoulos and Mohammad on 24 April 2006 and with Arlene Fleming on July 14,2006 CIVIL ALLIANCE FOR THE PROTECTION OF THE BAY OF VLORA 1

ALEANCA QYTETARE PER MBROJTJEN E GJTRIT TE VLORES Address: Lagjja 29 Nentori Rr.Sadik Zotaj P.455 Wore ALBANIA TeVfax: +355 33 25313, mob: 0692260212 rn :* * :,liJicc-al.crs II ;LAruui@icc-&i.org I

Tirana: 20 June 2005

To: World Bank South East Europe -Albania

Coordinator; Orsalia Kalantropoulos 1818 H Street, NW Washington, DC 20433 USA Fax: (1-202) 477 1034

Country Maneger; Nadir Mohammed Address: The World Bank Deshmoret e 4 Shkurtit, No. 34 Tirana, Albania Fax: (355-42) 405 90

CC:Country Officer: Timothy Gilbo Fax: (1-202) 477 1034

CC: Project team leader - Power sector generation and restructuring project lftikhar Khail n

Subject: Case against the Thermo-electric Power Plant at Vlora, Albania

Dear madam and sirs, In our capacity as qualified, scientific specialistssto the expanded Civil Alliance for the Protection of the Bay of Vlora - environmental scientists and engineers, members of the Albanian Academy of Sciences and university professors - and on behalf ofthose many citizens of Vlora who have protested repeatedly against the construction of a TEP in the vicinity of near their city - and whose construction is envisaged by means of a credit from your very institution, wish to put to you, openly and sincerely, a number of arguments which can but cast doubt on any decision to designate the Bay ofVlora as an appropriate site for the construction of a TEP,

ANNEX I1 MANAGEMENT RESPONSE BANK MANAGEMENT RESPONSE TO THE REQUEST FOR INSPECTION PANEL REVIEW OF THE ALBANIA: POWER SECTOR GENERATION AND RESTRUCTURING PROJECT (IDA Credit No. 3872-ALB)

Management has reviewed the Request for Inspection of the Albania: Power Sector Gen- eration and Restructuring Project (IDA Credit No. 3872-ALB, received by the Inspection Panel on April 30,2007 and registered on May 2, 2007 (RQ07/03). Management has prepared the following response.

CONTENTS Abbreviations and Acronyms ...... iv I. INTRODUCTION...... 1 11. THE REQUEST ...... 1 111. PROJECT BACKGROUND ...... -2 Country Context ...... 2 The Project...... 3 Project Economic Evaluation and Analysis of Alternatives...... 7 Project Status ...... ;...... -10 IV. SAFEGUARD-RELATED ISSUES ...... 10 Alleged Deficiencies Relating to World Bank Safeguard Policy Compliance .... -13 Site Selection and Linkages to Other Investments ...... 14 Adequacy of Safeguards Compliance for the Project ...... 15 V. MANAGEMENT’S RESPONSE,...... 18

Map 1. Power Sector Generation and Restructuring Project: Vlore Project Area (IBRD No. 35504)

Annexes

Annex 1. Claims and Responses Annex 2. Selected Key Dates Related to Safeguards Annex 3. Back-to-Office Report on Cultural Property Issues, July 2006 Annex 4. Draft Findings of the Aarhus Convention Compliance Committee Annex 5. World Bank Response to Draft Findings of the Aarhus Convention Compliance Committee Annex 6. Government ofAlbania Response to Draft Findings of the Aarhus Convention Compliance Committee

.., 111 ABBREVIATIONS AND ACRONYMS

BP Bank Procedures KESH Korporata Electroenergjikite CAPBV Civil Alliance for the Protection of Shqiptare (Albanian Power the Bay ofVlora Corporation) CAS Country Assistance Strategy KfW Kreditanstalt flir Wiederaufbau - CCGT Combined-Cycle Gas Turbine German Development Bank CTARA Council of Territorial Adjustment of kWh Kilowatt hour the Republic of Albania MVAr Mega Volt Ampere reactive EA Environmental Assessment MW Megawatt EBRD European Bank for Reconstruction NO, Nitrogen oxides and Development NPV Net Present Value ECA Europe and Central Asia Region NSSED National Strategy for Socio- ECSIE ECA Inffastructure and Energy Economic Development Sector Unit OMS Operational Manual Statement EIB European Investment Bank OP Operational Policy EMP Environmental Management Plan OPN Operational Policy Note EPC Engineering, Procurement and PAD Project Appraisal Document Construction PCD Project Concept Document ERR Economic Rate of Return PID Project Information Document EU European Union QACU Quality Assurance and Compliance GOA Government ofAlbania Unit GPRS Growth and Poverty Reduction SOX Sulfir oxides Strategy TEP Thermal electric power plan GWh Gigawatt hour TT Task Team HFO Heavy Fuel Oil TTL Task Team Leader IDA International Development TWh Terawatt hour Association UCTE Union for the Coordination of IF1 International Financial Institutions Transmission of Electricity IMF International Monetary Fund UNEP UnitedNations Environment IPN Inspection Panel Programme IPP Independent Power Project USTDA United States Trade and Development ISDS Integrated Safeguards Data Sheet Agency

Currency Unit (as of May 23,2007)

1 ALL.= USD 0.0102 / USD 1 = 97.27 ALL 1 EUR = USD 1.35 / USD 1 = 0.74

Measurements

1 kWh = 1000 Watt-hours 1 MWh = 1000 kWh 1 GWh = 1,000,000 kWh 1 TWh = 1,000,000,000 kWh

iv I. INTRODUCTION

1. On May 2, 2007, the Inspection Panel registered a Request for Inspection, IPN Request RQ07/03 (hereafter referred to as “the Request”), concerning the Albania: Power Sector Generation and Restructuring Project (Credit No. 3872-ALB) financed by the In- ternational Development Association (IDA),

2. The document contains the following sections: Section I1 presents the Request; Section I11 describes the project and country context; Section IV discusses issues related to safeguards, and Section V contains Management’s response. Annex 1 presents the Re- questers’ claims, together with Management’s detailed responses, in table format. Annex 2 contains a chronology of key dates related to safeguard aspects of the project. Annex 3 is a report of the visit of a senior level consultant with expertise in cultural property to the project site in July 2006. Annex 4 contains the Draft Findings of the Aarhus Convention Compliance Committee (see paragraph 62). Annexes 5 and 6 are the responses of the World Bank and the Government of Albania to the Draft Findings of the Aarhus Conven- tion Compliance Committee. A map of the project area is included (IBRD No. 35504).

11. THE REQUEST

3. The Request for Inspection was submitted by Mr. Lavdosh Ferruni, on behalf of the Civil Alliance for the Protection of the Bay of Vlora (CAPBV) and eight persons who live in the city of Vlore (hereafter referred to as the “Requesters”).

4. Attached to the Request is the first page of a June 2005 letter from the CAPBV to the World Bank. Although the Request makes reference to other attachments to be sent subsequently by mail or e-mail, no further materials were received by Management in support of the Request.

5. The Request contains claims that the Panel has indicated may constitute violations by the Bank of various provisions of its policies and procedures, including the following:

OMS 2.20, Project Appraisal, January 1984;

0 OPBP 4.01, Environmental Assessment, January 1999 (revised August 2004);

0 OP/BP 4.04, Natural Habitats, June 2001;

0 OPBP 4.12, Involuntary Resettlement, December 2001 ;

0 OPBP 10.04, Economic Evaluation of Investment Operations, September 1994;

0 OPN 11.03, Management of Cultural Property in Bank-Financed Projects, Sep- tember 1986; and Albania

0 OPBP 13.05, Project Supervision, July 2001.

111. PROJECT BACKGROUND

COUNTRYCONTEXT

6. Albania has suffered from electricity shortages since the summer of 2000. This is due to growth in electricity demand and impacts from adverse hydrology on Albania’s predominantly (95 percent) hydropower-based system. A net exporter of electricity until 1997, Albania has since had to import significant quantities of electricity (from 300 GWh in 1998 to 2,200 GWh in 2002). Improved hydrological conditions during 2003-2005 resulted in reduced electricity imports and power disruptions but, in the absence of new thermal generation capacity, the vulnerability of Albania’s economy to adverse hydrology has continued to increase. At the end of 2006 and as recently as January 2007 the country has suffered from significant power supply disruptions.

7. The electricity crisis has had multiple adverse impacts on the poor. There is the direct impact in that frequent and prolonged load shedding deprives them of light, space heating and cooking fuel, thereby adversely affecting their quality of life and their health, as well as restricting their access to education. Secondly, the use of budgetary resources for electricity imports means that fimds are diverted from poverty reduction efforts. Thirdly, it adversely affects economic growth, which is recognized to be the main instrument to reduce poverty in Albania.

8. The crisis has affected economic performance in a number of ways. A fall in hydropower production is the direct cause of a fall in national output. Electricity imports contribute to a widening of Albania’s trade deficit. Load shedding leads to cuts in industrial production, and requires industrial and commercial enterprises to install costly back- up diesel-fueled power generators. An Energy Sector Study’ completed in January 2003 estimated that these generators produce electricity equal to about 15 percent of what they receive from the grid. Electricity shortages are also listed among the factors which representatives of business mention as reasons for slow expansion in production of tradable goods.

9. Albania’s electricity needs are supplied almost solely by hydropower, which is subject to considerable variability since it is dependent on rainfall. The total potential hy-

DECON, EDF, LDK Consultants, Lahmeyer Int and GEL ENERGY, “Albania Energy Sector Study” January 2003. The study provides: (i)electricity demand projections to 2015; (ii)a least-cost power generation investment program covering the same period; (iii)a power transmission master plan; (iv) a plan for reduction in technical and non-technical power losses; (v) a power dispatch plan; (vi) a power distribution master plan; (vii) an investigation of the heating sector; (viii) an evaluation ofthe technical and economic feasibility of imported natural gas; (ix) a petroleum strategy; (x) an overall investment plan and financing options; (xi) electricity tariff reform taking into account long run marginal cost estimates and financial performance; and (xii) recommendations for energy sector restructuring.

2 Power Sector Generation and Restructuring Project dropower capacity ofthe country is estimated at about 3,000 MW, with an annual generation potential of about 10 TWh. However, the current installed capacity is 1,450 MW, and the average generation in a normal hydrological year is about 4,000 GWh, compared to current demand of about 6,800 GWh. The Drin River cascade, with a total installed capacity of 1,350 MW (Fierze - 500 MW, Komani - 600 MW, and Vau i Dejes - 250 MW), provides about 90 percent of the country’s electricity generation. The remaining 100 MW of hydropower capacity comes fiom small plants on other rivers. The problems stemming from excessive dependence on hydropower from a single river are further ex- acerbated by the fact that the power generation facilities are concentrated in the north of the country, whereas the major load centers are in the center and the south.

10. Future availability of large quantities of electricity imports at competitive prices is uncertain. Domestic thermal generation capacity is needed to reduce dependence on imports and to diversify domestic generation. A Bank-financed review of electricity supply and demand in South-East Europe (2002-2012)2 concluded that an early shortage of generating capacity could appear in the region in the absence of new generating capacity. Thus, prices of electricity imports to deficit countries in the region were expected to soon rise to the level of the full cost of power from new plants, if not higher. Additional domestic generation capacity for Albania would reduce excessive dependence on imports and thereby lessen vulnerability to supply disruptions and price increases. Shortages have already begun to appear in the region and the price of electricity imports has increased significantly (the average import price rose from 4.4 Lek/kWh in 2004 to 9.1 Lek/kWh in 2007). Albania is already facing considerable difficulties in obtaining sufficient imported electricity.

THE PROJECT

1 1. Recognizing the magnitude of the power sector crisis and its serious implications, the Government developed in late 2000 an Action Plan to tackle the critical issues. The Plan included measures to reduce electricity losses, improve collections, lower demand and increase tariffs, as well as other wide-ranging measures to urgently improve the performance of the sector. The Government also adopted a Power Sector Policy Statement in April 2002, setting out the sector reforms to be implemented, and a National Energy Strategy in June 2003, identifying priority investments, financing needs and required reforms for the energy sector. In line with the strategy contained in these documents, the Government made efforts to find financing for new power plants to address the increasing electricity shortage. Various studies commissioned by the Government clearly identified that addition of domestic thermal generation capacity was needed to reduce the excessive dependence on imports and to diversify domestic generation so as to reduce vulnerability to hydrological variations. The addition ofthermal capacity would improve the security of electricity supply and thereby facilitate Albania’s reconnection with the network of Western Europe.

“Review of Electricity Supply and Demand in South East Europe,” World Bank, ECSIE, 2003.

3 Albania

12. The Government asked the Bank to assist in arranging donor financing for a new thermal electric power plant (TEP). As the World Bank had a limited financing envelope for Albania under its IDA allocation, the Bank initiated discussions with the European Investment Bank (EIB) and the European Bank for Reconstruction and Development (EBRD) regarding co-financing of a TEP, and informed the Government in January 2002 that the three International Financial Institutions (IFIs) were prepared to assist it in adding critically-needed thermal generation capacity (about 100 MW nominal capacity). An internationally recognized consulting firm prepared a siting and feasibility study of the proposed TEP with financing from the United States Trade and Development Agency (USTDA) in 2002. It also prepared the environmental assessment ofthe project in 2003: Project appraisal commenced in November 2003, with careful attention to the project's economic, technical, institutional, financial, and commercial aspects, as well as its social impa~t.~

13. The project has an important place in Albania's development strategy. A Growth and Poverty Reduction Strategy (GPRS , subsequently revised as the National Strategy for Socio-Economic Development - NSSED), an IDA-IMF Joint Staff Assessment of the GPRS, and the Country Assistance Strategy (CAS), in which the project was included as a priority investment, were presented to the Board in June 2002. Both the GPRS and the CAS emphasized the macroeconomic impact of the crisis in the power sector, its major impact on the poor, and the critical importance of addressing the underlying causes ofthe crisis and meeting priority investment needs. The NSSED stressed the alleviation of the energy crisis as a key factor for economic growth. Among the measures proposed for the power sector in the medium term were implementation of the Vlore combined-cycle power plant project, further reduction of network losses, an increase in bill collections, restructuring of the Albanian Power Corporation (KESH) and creation of conditions for private sector involvement in energy production and distribution.

14. In January 2003, the European Commission and Albania started negotiations on a Stabilization and Association Agreement. This process gave Albania a significant incen- tive to reform its institutions, including those in the power sector, in line with requirements in the European Union (EU). Another important consideration, both from a regional and national perspective, was the need for the Albanian system to be interconnected with the Union for the Coordination of Transmission of Electricity (UCTE), the association of transmission system operators in continental Europe. Main- taining UCTE interconnection required Albania to meet a number of conditions. A draft agreement has been negotiated under UCTE supervision with the electric power utilities of FYR Macedonia, Greece, Montenegro and Serbia. One of these conditions was the commissioning ofthe Vlore TEP. This agreement was signed in 2004.

3 The Bank discussed internally whether the environmental assessment should be carried out by the same fm that prepared the siting and feasibility study. In support of the fm being able to carry out this work it was noted that, consistent with Bank EA policy, the fm was not conducting any "engineering studies." (In addition, the fm would not be engaged in any downstream construction.) However, to fortify the objective nature of the EA review, it was decided that an additional independent review would be commissioned for the EA. This independent review of the EA took place during September and October 2003. Per the requirements of OMS 2.20, Project Appraisal.

4 Power Sector Generation and Restructuring Project

15. The project will be the first new generation plant in Albania since the Komani hydropower station entered service in 1987. Based on a review of available unit sizes from different manufacturers, bids were invited for a capacity between 85 MW and 135 MW, and the contract was awarded for a thermal power plant of 97 MW capacity. The plant is expected to provide about 680 GWh per year (at an availability of about 80 percent). When commissioned, it is estimated to cover about 20 percent of the supply deficit in an average hydrological year and a significantly lower proportion in a dry year. Construction of a thermal plant in the southern part of the country will reduce technical losses and significantly improve the security and quality of supply in the country overall and in particular in the south, which is poorly served at present.

16. The project consists of:

(i) a combined-cycle power station fueled by very low sulfur content distillate oil at a six-hectare site about six lun north ofVlore adjacent to an offshore oil tanker terminal; (ii) technical assistance for: - bid evaluation, contract administration and supervision of project implementation; - formation of a subsidiary company of KESH to own and operate the plant, preparation of a power purchase agreement, and assistance in procuring the services of an operator for an initial period; - follow-up studies required by the Environmental Management Plan (EMP); - examination of the option of soliciting bids to supply gas to the plant; power sector reforms; - consumer satisfaction surveys; - improvements in inventory control; and - training in procurement and environmental management.

17. The project will use a Combined-Cycle Gas Turbine (CCGT) for power generation. This technology dominates investments for most modern power plants because it achieves significantly higher efficiency than other options for thermal power generation combined with very low air emissions. CCGT technology is used primarily with natural gas as a fuel but, in the absence of natural gas in Albania in the short to medium term, the plant will be fueled by distillate fuel oil. The fuel specifications for the plant provide for low sulfur content of distillate fuel in order to reduce emissions, even though this will add to the operational cost. “Fuel sulfur content will be monitored to ensure that it is less than or equal to 0.1 percent by weight. Sampling and analysis should be performed on

5 Albania each delivery received. The TEP is designed to allow conversion to natural gas if and when it is imported to Albania.

18. The total amount of financing for the contract of the TEP is currently expected to be EUR92 million (approximately USD123.3 million). Based on the awarded Engineer- ing, Procurement and Construction (EPC) contract the cost of the power station project includes about EURlO million for: (i)an offshore oil tanker terminal; (ii)an undersea pipeline; and (iii)fuel storage facilities. It also includes USD4.4 million for a connection to the Albanian transmission system at the Babica 220/110 kV substation located seven kilometers away. The total project cost also incorporates USD4.85 million for technical assistance and training.

19. Financing for the project is being provided through an IDA Credit of USD25 million equivalent and loans of EUR40 million each (approximately USD54 million) from EIB and EBRD. The three IFIs are providing joint financing, rather than parallel financing, since there is a single supply and install contract (EPC) for the TEP.

20. The power station will be owned and operated by a separate corporatized enterprise, with all of its shares held by KESH. There will be a power purchase agreement between the company and KESH, with a guaranteed take-or-pay arrangement for a limited period. Such an agreement between KESH and the plant company provides two benefits: first, it constitutes a useful precedent for subsequent investments in generation by the private sector or through a public-private partnership; second, a track record of financial performance of the subsidiary company with such an agreement could facilitate its subsequent privatization. In addition, having a reliable power supply by a dedicated producer would benefit the population.

2 1. The project benefits will consist of: (i)increased electricity supply from the new power station that will contribute to an improved balance between hydropower and thermal power; (ii)avoided costs of transmission lines and capacitors to improve electricity service in southern Albania; (iii)lower transmission losses since the plant will be located near demand centers in southern Albania where there is currently a supply shortage; (iv) potential for fulfillment of the condition to connection with the UCTE system; (v) less load shedding resulting from reductions in non-technical power losses and improved collections, since both lead to lower demand and improve the ability of KESH to pay for imported electricity; (vi) improved power sector financial performance resulting from reductions in transmission and distribution losses, increased collections, and higher electricity tariffs; and (vii) implementation by the Government of a clearly defined power sector reform strategy. In addition, increased electricity availability should help to support the growth oftourism in the Vlore area as well as further south.

From the EMP, which forms the Annex to Contract document (h), Annex 5. Refer to table 8.4, page 21. Use of this low sulfur fuel would be in line with EC directive 1999/32/EC which will require distillate fuels to reduce sulfur content to 0.1% sulfur from January 1,2008.

6 Power Sector Generation and Restructuring Project

22. KESH is managing project implementation, with the Project Management Unit that was responsible for implementation of the previous Power Sector Rehabilitation and Restructuring Project continuing for the present project.

PROJECT ANALYSIS OF ALTERNATIVESAND ECONOMICEVALUATION

23. As required under the Bank’s policy on Economic Evaluation, an analysis of alternatives was carried out as part of the project appraisal process.6 Four sets of alternatives to the project were considered: (i)no project; (ii)another transmission and distribution project; (iii)alternative fuels and sites; and (iv) an independent power project (IPP) financed by a private investor.

24. No Project. One alternative to the proposed TEP would have been to import an additional amount of electricity equal to what would have been produced by the plant. Albania was already heavily dependent on imported electricity, and this dependence would continue to increase. Without additional domestic capacity, domestic generation would meet only 44 percent of demand in 2015 in an average hydrological year and 33 percent in a dry year (3,000 GWh domestic generation). Further, a supply deficit was already emerging in the region. Imports were thus likely to become progressively more difficult to obtain and more expensive. Albania was buying imported electricity on the basis of contracts for one year or less, and was unable to arrange for longer contracts. Lack of sufficient imports would have had a major negative macroeconomic impact. Provision of additional domestic generation capacity would reduce Albania’s vulnerability to such a situation.

25. International Interconnection, Transmission and Distribution Project. The option of a new IDA-supported project to strengthen transmission links with neighboring countries was determined to be unnecessary since financing for a new 400 kV interconnection to the north is already committed by KfW of Germany and Italy. The internal Economic Rate of Return (ERR) of this interconnection was lower than that of the proposed Vlore TEP. The option of another project to rehabilitate and strengthen the distribution systems in selected regions of Albania together with associated transmission investments was also considered. This option was evaluated using a detailed cost-benefit analysis of the power distribution and associated transmission investments given the highest priority in the Energy Sector Study, and designated for implementation prior to 2006. The internal ERR for this option, while favorable, was lower than that of the Vlore TEP, and the net present value (NPV) was significantly less.

26. Alternative Fuels and Sites.’ The project feasibility study considered other sites and other fuels as alternatives to the use of distillate oil in a combined-cycle generating unit at Vlore (site B). The other sites investigated were: Durres, Elbasan, Fier, Korce, Shengjin, and Vlore (site A).

6 For more details see also: Project Appraisal Document, February 17,2004, Report No: 27049-ALB. ’ See consultant’s studies, “Final Feasibility Study” and “Siting Study,” October, 2002.

7 Albania

27. The option of a natural gas-fired combined-cycle unit at each site was found to be more costly than the distillate fuel option, since, in the absence of any other significant potential consumer ofgas in Albania at the time the new plant will enter service, the total cost of building the infrastructure to import gas would have to be assumed by the proposed TEP. However, if and when imported natural gas is brought to Albania, the Vlore plant could be readily converted to gas. The oil-fired combustors on the combustion turbines would be capable of firing natural gas, with no additional cost to the project although there would be additional costs with respect to new natural gas lines, gas com- pression, gas treating ‘and heating equipment.

28. The use of indigenous coal in a conventional coal power station was ruled out because of the high cost of reintroducing coal mining, addressing pollution mitigation due to high sulfur content, the lack of an adequate transportation system, and the low heat content. The imported coal option was found to be more costly than the distillate fuel option at all ofthe sites.

29. Use of heavy fuel oil (HFO) in a combined-cycle plant would be cheaper than distillate oil, but firing low sulfur HFO (less than 1 percent) would not result in any cost sav- ings, due to decreased unit performance. The use of high sulfur HFO (more than 1 percent) would have reduced the levelized cost by about 6 percent, but would have also resulted in higher particulate emissions and approximately twice the amount of NO, and SO, emissions. In view ofthis, HFO was not considered for the project.

30. The sites themselves were evaluated on the basis of ten criteria, each assigned a different weight. The criteria and their weights were: (i)environmental remediation - 12 percent; (ii)air quality concerns - 8 percent; (iii)levelized cost - 12 percent; (iv) socio- economic concerns - 8 percent; (v) reduction in transmission system losses and voltage profile improvement - 12 percent; (vi) transmission availability and proximity - 10 percent; (vii) fuel availability - 14 percent; (viii) water and sewage needs - 10 percent; (ix) transportation - 8 percent; and (x) property availability - 6 percent. The Vlore and Fier sites were found to be best from a transmission perspective since they would significantly improve the voltage profile throughout the Albanian power system, greatly reduce the number of substations with low voltage, significantly reduce system losses, and have reasonable interconnection costs.

31. Other advantages of the Vlore sites were the possibility of using sea water for once-through cooling for steam cycle heat rejection, and the possibility of using the nearby Vlore port to receive the imported equipment for the TEP. The Durres and Elbasan sites also would have provided benefits from a voltage and losses perspective, but not as much as the Fier and Vlore sites. The Korce and Shengjin sites would have provided marginal voltage improvements and loss reductions, but they suffered from other limita- tions such as expensive access to fuel and difficulties of transporting material. Site Vlore A, which is located four kilometers west of the city center, encompasses part of an abandoned chemical plant that is a source of extensive mercury contamination as well as other chemical waste. The cost of the measures needed to remedy the environmental problems

8 Power Sector Generation and Restructuring Project would have been prohibitive.8 The disadvantage of the Fier site in comparison with the Vlore B site was the extra cost that would be required to transport the imported distillate oil overland from Vlore to Fier, and associated environmental concerns. There was a close correspondence between the ordering ofthe sites on the basis of the ten criteria and the ordering on the basis of levelized cost alone. In both cases, the recommended Vlore site was ranked first over the site at Fier.

32. IPP. The option of an IPP was rejected in light of the low likelihood that private investors would be interested in investing in a new power station to serve the Albanian market because of a combination of factors. These included the worldwide reduction in investor interest in the power sector, the financial difficulties experienced by some potential utility investors and the substantial perceived country risks.

33. The project feasibility study estimated economic NPV and internal ERR for different sizes and types of combined-cycle plants at the Vlore B site. The estimates used for the Project Appraisal Document (PAD) are for a plant consisting of two combustion turbines and one steam turbine, with an installed capacity of 13 1 MW, annual production of 921 GWh, and an assumed life of 20 years.

34. For the economic analysis during project appraisal, the costs consisted of the investment cost, estimated to be USD 102 million (including physical contingencies of 5 percent but no price contingencies), annual fuel costs and annual operations and mainte- nance costs. The quantified benefits consisted of: (i)retail sales valued at willingness to pay less transmission and distribution costs and losses; (ii)reduction in transmission losses on the Albanian system attributed to the project of46 GWh per year valued at willingness to pay; (iii)avoided investments totaling USD27.9 million in a 220 kV transmission line from Tirana 2 to Durres to Fier and a 220 kV transmission line from Elbasan 1 to Fier; and (iv) avoided investments totaling USD1.7 million in 100 MVAr of capacitors. Willingness to pay of USD0.109 per kWh was estimated on the basis of the consumption weighted average cost of alternative diesel generation located at consumers’ premises for large industrial and small industrial and commercial consumers, with the weights being the consumption increases by these two respective sets of customers. Pro- jected additional demand over the period 2003-2008 for these consumer groups slightly exceeded the output of the Vlore TEP. The Cost Benefit analysis of the project calculated a NPV ofUSDll8 million and an ERR of 37 percent.

8 The United Nations Environment Programme (UNEP) conducted site investigations and risk analyses in 2000, and designated the area a “hot spot” posing risks to public health and the environment. According to UNEP, the former chemical plant used excessive quantities of mercury in its chlorine-alkali electrolysis operations and considerable amounts ofmercury were lost in spills during the production period, causing soil and groundwater contamination. The report made a series ofrecommendations to reduce public health risks and Mher characterize site conditions. See United Nations Environment Programme and National Environmental Agency of Albania, 2000. Post-Conflict Environmental Assessment and State of the Envi- ronment Report. ISBN 82-7701-014-1, available in CD.

9 Albania

PROJECTSTATUS

35. The project was approved by the World Bank’s Board on March 16, 2004. The legal documents were signed on April 6, 2004 and the project became effective on Janu- ary 25,2005. After a bidding process that was protracted by the need to carefully review complexities that arose during evaluation of the bids, the EPC contract for the TEP was signed on February 9,2007 and became effective on May 5,2007. It is expected that civil works will commence in June 2007.

36. Regular supervision missions were carried out by the project team’ after the approval of the project by the World Bank’s Board. The Bank received correspondence from civil society, starting in June 2005, which raised issues about the project. The project team reviewed the concerns and responded in writing. The Country Manager and the Country Director held a meeting with representatives of civil society to discuss their concerns in April 2006 while a separate mission took place in 2006 to conduct further investigations on cultural issues (see also Annexes 1 and 2 for more details).

IV. SAFEGUARD-RELATED ISSUES

ENSUFUNGCOMPLIANCE WITH WORLD BANKAND IF1 SAFEGUARD POLICIES

37. The World Bank, EBRD and EIB all required compliance by the Borrower with various “safeguard” policies to ensure environmental and social standards would be met.” Given the likely design of the proposed TEP, the overarching policy in all three institutions was deemed to be that of Environmental Assessment (EA, covered by OP 4.01 under the World Bank system). While Albania did have laws on EA in place at the time, the country’s experience with (and ability to finance) EA work for such large investments was extremely limited. The USTDA provided support to hire consultants for the preparation of EA and related due diligence assessments. These assessments were prepared in accordance with the requirements of each of the three participating IFIs and relevant Albanian laws. The USTDA facilitated a contractual relationship between the consultant and the Government of Albania (signed April 10, 2002) to carry out EA work in addition to the siting and feasibility support.

38. The comparative analysis of twenty-one sites at seven localities for a new TEP (the “Siting Study”) looked at environmental and social factors, in particular: (i)the extent of environmental remediation required to prepare the site; (ii)air quality concerns; (iii)water and sewer needs; and (iv) socio-economic concerns including proximity to protected or sensitive areas. These and other quantitative rankings led to the recommendation to proceed with further analysis of the Vlore B site; first in a preliminary fashion in

9 See Implementation Status Reports from 9/29/2004. loThe World Bank’s policies can be found at the Bank’s external web site: http://web.worldbank.or~SITE/EXTERNAL/PROJECTS/EXTPOLICIES/EXTSAFEPOL/O,,menuPK: 58444 l-pagePK:64 168427-piPK:64 168435-theSitePK:5 8443 5,OO.html

10 Power Sector Generation and Restructuring Project the draft siting study (June 6, 2002) and then the final siting study of October 21, 2002. The Draft Feasibility Study (August 6, 2002) included a detailed Preliminary Environ- mental Analysis section as well as a draft outline of an Environmental Assessment (EA). These findings were discussed in a public meeting in Vlore on October 3 1, 2002. l1Fol- lowing the identification of the Vlore B site as a leading candidate for the site of the proposed power plant, safeguards work was initiated, with the siting study providing information that was then incorporated into the required “alternatives” section of the EA report.

39. The World Bank’s formal process for safeguards compliance began in early Oc- tober 2002 with the first internal meetings to set safeguards requirements at the concept- stage. The project was assigned a “Category A” rating for EA, recognizing the potential significant impact on the environment and need for avoidance, mitigating and monitoring measures. This was consistent with the rating systems of EBRD and EIB (both based on the EA Directive of the European Commission). The Category A rating was driven by the highest risk component, that of the TEP itself, which required a full EA under World Bank policies and procedures and those of EBRD12 and EIB.13 Particular areas of attention included the impacts on air quality from stack emissions, water quality from cooling water discharge, and any ancillary impacts on the Narta lagoon, located about two kilometers from the project site. It was also recognized that the nature of the EPC contract meant that very localized risks, impacts and mitigating measures would need to be further clarified once the specific project design was set and further data obtained on baseline ambient air quality. Other components of the project that posed potential impacts which would be mitigated during implementation include upgrading of fuel handling, the location of offshore intake for cooling water supply, upgrading of local access roads to handle construction, and construction site waste management.

40. Additional internal discussions on the approach to due diligence took place from October 2002 through early January 2003. Formal public notification of the Bank’s intention to prepare the project took place on January 2, 2003 with the posting of the Project Information Document (PID) in the InfoShop. An outline of the initial approach to safeguards (as required under Bank policy) was posted on February 19, 2003 at the Bank’s InfoShop as a part of the Integrated Safeguards Data Sheet (ISDS). Key safeguard policies that were investigated for relevance under the EA (OP 4.01) process included Natu- ral Habitats (OP 4.04), due to the proximity of the Narta lagoon (then designated for protection) and Involuntary Resettlement (OP 4.12) due to the possible need for land acquisition for transmission line towers. During project preparation review and after consultations on the protected area around Narta lagoon with the United Nations Develop- ment Programme (UNDP), it was found that the potential impacts on Natural Habitats (OP 4.04) would not be significant and hence the safeguard was not triggered.

l1Note some project records have this meeting on October 28’. l2EBRD’s policies can be found at http://www.ebrd.org/enviro/policy/index.htm, l3An overview of EIB’s approach on the environment is provided at: http://www.eib.org/environment/index. htm.

11 Albania

41. The project followed standard World Bank procedures for a Category A project including: (i)public consultations by the Government at the early EA preparation stage on April 2,2003 and draft EA report stage on September 3,2003; (ii)advanced notification of these meetings by Government to stakeholders; (iii)a thorough internal World Bank and IF1 review process for drafts and final documents; (iv) resolution of comments through the completion of final reports and an Addendum; (v) posting of draft EA reports in Albania (in Albanian) and in the InfoShop (in English) in a timely fashion. consistent with the Bank’s Policy on Disclosure of Information (Volume 1 on October 6,2003 and a Volume 2 Addendum on January 15, 2004); and (vi) inclusion of the Policy Framework for Land Acquisition in the EA document^.'^ In addition, an external expert peer review of the EA was conducted by an internationally recognized consulting firm financed by the Canadian Government as an additional measure to ensure the quality of the EA.

42. The EA reports included (as per Bank policy) integrated EMP sections outlining requirements for mitigating and monitoring the project during construction and operation. These provisions were then incorporated into project specifications for bidders. The Gov- ernment committed to adhere to these requirements during project implementation. and an internationally recognized consulting firm (independent from the firm that prepared the previous study) has been engaged to support the implementation of the EMP in four areas: (i)updating of ambient air quality impact assessment using site-specific ambient air quality and meteorological monitoring data; (ii)training of KESH’s Environmental Management Unit to enable their oversight of EMP implementation; (iii)reviewing the oil spill prevention and response plan for the specific designs chosen by the EPC contractor; and (iv) preparing a Supplemental EA for all studies included in the EPC contractor scope. Additional monitoring of air quality and local meteorology has also been in place since February 2002 to allow reconfirmation of the results of the emission studies. Fur- ther details are provided in the selected chronology included as Annex 2.

43. World Bank safeguards requirements were addressed during project preparation and there were no policy exceptions included in the PAD or presented to the Board. Re- garding other IF1 requirements, EBRD and EIB relied on the same EA documentation as the World Bank. EBRD, for example, disclosed the EA to meet its requirements on Feb- ruary 6, 2004, and held a 120-day comment period from February 9 through June 7, 2004.15 The project was approved by the EBRD Board on June 8, 2004. In addition, the Government of Albania has also confirmed that all domestic legal requirements of Alba- nian law were followed for this project (see government’s response to Aarhus Conven- tion). Management notes that the key Environmental Consent and License were in place as of March 2007.

44. The CAPBV wrote to the Bank in June 2005 raising technical, legal and economic arguments against the project. From January 2006, the Bank received letters regarding the completeness of the review of cultural heritage issues in the original EA work. Internal

14 The Policy Framework was prepared and posted in English only due to the initial determination that ac- uisition of privately held land was unlikely. ’Their succinct summary can be found at: http://www.ebrd.org/projects/eias/33833.pdf

12 Power Sector Generation and Restructuring Project

Bank review suggested that this specific matter be looked into through a specialized supervision review which was carried out in July 2006. The review (Annex 3) included a field visit and discussions with noted experts, and confirmed that the project complied with relevant Bank policies (OPN 11.03 at the time) and relevant Albanian laws and regulations on historical and cultural resources. Monitoring of excavations during construction of the plant and related civil works to identify and protect “chance finds” was deemed the only action that needed to be taken, consistent with established Bank practice, and this is provided for in the EPC contract.

ALLEGEDDEFICIENCIES RELATING TO WORLD BANKSAFEGUARD POLICY COMPLIANCE

45. The Requesters have raised several concerns on the project that Management views as being linked to the compliance of the project with World Bank safeguard policies. The first topic is both broad in coverage yet focused on a few environmental and social topics: “lf built, the Vlore TEPP will irreparably destroy environment, tourism, safe fisheries, natural habitat, ecosystem, coral colonies as well as the unique historical and cultural signijkance of the entire Vlore Bay and Narta lagoon. In short, it will destroy our past, present and future. ” Management notes that the application of Bank safeguard policies is the means by which the potential impacts of its investment projects in such areas are systematically examined as part of the project preparation and decision process. The project in question was rated as Category A for EA since it was the view of Management (as well as the co-financing IFIs) that the project could pose potentially significant environmental and social impacts. Through the EA process, however, it is Man- agement’s view that significant environmental and social risks ofthe project can be suc- cessfully avoided, mitigated, monitored and controlled.

46. As noted earlier, the priority need for additional power generation capacity meant that Albania and its IF1 partners sought an approach to project preparation that would provide technically sound options in a timely manner while meeting Bank (as well as EBRD and EIB) standards for quality and due diligence. Indeed, the anticipated growth of tourism along the coast of Albania would considerably increase electricity demand, further supporting the need for investment in power generation. Fortunately, the USTDA was able to mobilize an internationally recognized consulting firm to prepare pre- feasibility and feasibility studies as well as, on a parallel track, the necessary environmental and social due diligence documentation. The timeline for this process was chal- lenging, and consisted of two stages: first, the prioritization of sites from April through November 2002 and, second, preparation and completion of all EA and related work on the highest ranked site (Vlore B) between January 2003 and January 2004. Management notes that the Requesters directly and implicitly raise several questions on the overall site selection, both in the early stages and with respect to any associated or “linked” investments. The next paragraphs examine this question in more detail.

13 Albania

SITE SELECTION AND LINKAGES TO OTHER INVESTMENTS

47. As noted earlier, seven candidate locations for a TEP were evaluated on a number of environmental and social factors. Management notes that there are no internationally standardized approaches to conducting such site rankings, and that other evaluators might have chosen different ranking factors or weightings. Management considers, however, that the approach used under the project reflects appropriate and acceptable professional practice, and that the presentation of the review at the October 2002 public consultation meeting was notable in Albania as one ofthe first such engagements by Government with civil society at an early stage of a major investment project.

48. As a Category A project, the project included public consultations at the design stage of EA in April 2003 as well as at the draft EA report stage in September 2003. No- tification of these consultation meetings was carried out by Government, and the minutes of these meetings were included in the final EA report (October 2003). Each of these meetings and the EA report itself reference the alternatives examined under earlier pre- feasibility and feasibility studies in the latter half of 2002, a process that led to the recommendation of the current site in Vlore. The analysis of alternatives did include a solid range of analytical criteria, including suitability with regard to the environment. It is important to note that no major objections were raised with the Bank regarding the selection ofthe Vlore site during the EA process from April 2003 through Board approval.

49. The Requesters have expressed concern about the extent to which the Bank’s project is physically linked to other investments that had been proposed or might be sited in the area, and how this may have an impact on due diligence. References have been made to three possible investments in this regard: (i)a proposed major industrial or “energy park;” (ii)a proposed oil storage facility operated on a concession basis and located at a partially-built site south of the Vlore TEP; and (iii)one or more additional TEPs that would raise generation capacity at the selected Vlore site to as much as 300 MW.

50. Management notes that the first proposal of an energyhndustrial park was introduced during project preparation by local officials (this proposal was subsequently dropped, as has been stated repeatedly by the Government).16 Appraisal of the project, however, showed that the TEP is fully justifiable based on national energy needs regardless of the possible co-location of a large additional user. Had such an energy and industrial park been sited near to either Vlore B or A, then full due diligence would have been required ofthat facility to meet Albanian law. To Management’s knowledge, the proposal for the energy park never advanced to the pre-feasibility stage, whereby candidate investments and technologies are proposed. Without such basic information, it would have been technically infeasible during project preparation to speculate as to whether ambient air or water surrounding the TEP would have deviated from assumed conditions.

16 See Annex 6, Government ofAlbania Response to Draft Findings of the Aarhus Convention Compliance Committee, ‘Comments on Paragraph 25. According to the Secretariat of the Council of Territorial Ad- justment ofthe Republic of Albania (CTARA), the Ministry of Economy, Trade and Industry has proposed the abrogation of the Decision Nr. 8 Date 19/02/2003 “On Approval of the Industrial and Energy Park- Vlore”. It is expected the CTARA will abrogate the decision during its next meeting.’

14 Power Sector Generation and Restructuring Project

5 1. The second proposed investment in the vicinity of the TEP, a proposed onshore oil terminal concession, is not related to the project, which will have its own independent offshore terminal, pipeline and storage tanks. In Management’s view, project due diligence for the unassociated investment of an onshore terminal in the general area did not need to be carried out by the Bank.

52. Regarding the third issue, that of the possible expansion of generating capacity at Vlore to 300 MW, Management believes clarification of the record is helpful. The need for additional thermal generation capacity in Albania is recognized and a feasibility study had been carried out regarding addition of possible subsequent thermal power plants. Pro- ject documentation shows the Vlore site could physically accommodate additional units for a total installed capacity of 300 MW. The draft EA of July 2003, used for public consultation, did analyze air quality and cooling water thermal dispersion for both 100 and 300 MW capacities and concluded that, for both the 100 and 300 MW case, air quality and receiving water temperature rise are within limits acceptable to the World Bank and EU.” However, the project being financed by the World Bank, EBRD and EIB is limited to one facility of 97 MW capacity and the final EA focused on that only. If the Govern- ment decides to proceed with additional generation units (either at the Vlore site or another location), then a new comprehensive EA will be required.

ADEQUACY OF SAFEGUARDS COMPLIANCE FOR THE PROJECT

53. Moving from the matter of site selection and potentially associated investments, the Requesters have raised issues with the quality of the project EA in terms of the accuracy of site characterization and findings that the projected impacts in a number of areas would meet Bank and Albanian norms. Management’s perspectives on these two themes, as well as reflections on compliance with internal procedural requirements are outlined below.

54. It is Management’s view that the EA18was carried out with an appropriate mix of field reconnaissance, literature review, contacts with Albanian experts, review of available baseline data, and simulation of impacts using analytical models. The World Bank requires the Borrower to carry out the EA, and Albania had limited experience with di- recting EA work of an international standard when the project began. Thus, the EA bene- fited significantly from support by the USTDA through a consulting arrangement with a highly respected international consulting firm. The subsequent EA documentation pro-

17 For example, on the impacts of air emissions, see p. 63 of the Draft Environmental Impact Assessment, July 17, 2003: “The combustion emission unit consists of two distillate fuel oil-Bred combustion turbines, each equipped with a HRSG. There is no supplementalBring in the HRSGs. The exhaust discharge points include two stacks; onefiom each HRSG. Completefacility build-out may include two additional generating units with identical emission sources. For the purposes of this analysis, one unit will be modeled, and impacts fiom completefacility build-out are estimated by scaling the results. ” EA means the two-volume Environmental Impact Assessment report (main text plus later Addendum) disclosed as per Bank requirements, and referenced by the Executive Summary prepared for SECBO. The “Summary ofEnvironmental Impacts associated with the Wore Thermal Power Station” published by EBRD on its web site is based on the same source materials.

15 Albania duced from this collaboration met World Bank requirements (as well as EBRD and EIB requirements) for a Category A project from a content and organizational perspective, and through an iterative internal and external review process (outlined above and elaborated in Annex 2), the EA was deemed to be of professional quality. Consultations and disclosure of EA documentation was consistent with both OP 4.01 and the Bank’s Policy on Disclosure of Information. The thoroughness of these consultations has been raised as an issue directly by the Requesters before the Compliance Committee for the Aarhus Convention (as discussed in paragraph 62) and Management’s view on this matter is presented in that section and in Annex 5.

55. The Requesters’ view that the EA was “based on material misrepresentation of the site.. ...[and] was misleading, illegal and wrong” is, in Management’s view, not supported by any evidence. Management recognizes that the EA does rely on a certain amount of reconnaissance-level information on some topics which will need to be refined as implementation progresses. Additional field review will be carried out as appropriate which represents good professional practice. To cite one example, reliable ambient air quality in the area was not available at the time of the EA and baseline information for modeling was approximated based on a comparable geographic setting and an estimated average ambient air quality. New field data are now being acquired which will allow site- specific data to be used for the analysis; the results of the EA analyses provide a significant margin between the expected results and acceptable limits but, if necessary, fine tuning of technology choices and operation can be undertaken in order to ensure that acceptable ambient quality is achieved after the plant is in operation. Similarly, the specific alignment for the oil pipeline and water intake/discharge will be selected, based on design choices and additional field studies. On the basis of the foregoing, Management sees no appreciable gains from an examination of additional project possibilities or choices selected.

56. One area where Management agrees that there was insufficient coverage in the EA was on the matter of the review of potential cultural property, even though the consulting team’s initial research on cultural property issues suggested there were no assets likely to be found in the project area and thus a field survey was not warranted. When this issue was subsequently raised, Management believed that further consultations and a field visit would be beneficial to address this issue. A supervisory visit was carried out in July 2006, the Back-to-Office Report for which is included as Annex 3, The review concluded “that the site is not of archaeological significance due to the known locations of the ancient city sites in the Vlore Bay region and the lack of any evidence of human habitation during digging for the adjacent fishing harbor in the early 1980s and beyond. Conse- quently a surface survey of the selected site prior to the start of construction is neither necessary nor justifiable. ”

57. The Requesters’ concern for potential impacts on ecosystems (Le., .... ‘tfisheries, natural habitat, ecosystem, coral colonies... ”) was also reviewed and Management considers that the EA and measures to be taken during implementation are adequate in these areas. The project site is outside the protected area around the Narta lagoon, designated as such in 2004 by the Government and is not anticipated to have an impact on this area. There is no evidence to suggest that areas immediately offshore from the TEP site sup-

16 Power Sector Generation and Restructuring Project port colonies of coral. Potential project impacts that were examined in the EA and which Management believes provide adequate assurance of acceptable risks include: (i)the location of the cooling water intake, discharge pipe, and oil supply pipeline which will be selected based on careful consideration of sea-bottom; (ii)the dispersion of cooling water offshore designed to meet acceptable temperature limits before the edge of a mixing zone thereby minimizing impacts on fish and submarine ecology; (iii)no projected impact from chemical or particulate fallout from the TEP stack that could cause loss of biodiversity in the Narta wetland; and (iv) careful consideration of potential ecological impacts and mitigation measures in project components beyond the TEP proper such as the rehabilitation of the access road and construction of a transmission line connecting the TEP to the regional grid. Management concludes that the Natural Habitats safeguard (OP 4.04) was appropriately shown as “not triggered” in the final ISDS.

58. Further details on mitigation and monitoring approaches are outlined in detail in the EA and will be the subject of careful review by the independent consultant’s oversight contract. Management recognizes that even with the implementation of the EMP and supervision of the works by an independent contractor, residual risks do remain, but these are within the range of acceptability by the Bank and the cooperating IFIs. The approach to having the operating contractor provide further details on safeguards compliance (rather than having all details laid out in the EA) is commensurate with the nature of the operation, since an EPC contract means that the contractor undertakes the detailed design, procurement and construction of the project. Management considers, furthermore, that the project warrants close and frequent supervision by Bank staff during implementation and will continue to provide the appropriate support in this regard.

59. Regarding impacts on tourism potential, this is not an issue covered directly by Bank safeguard policies, but only indirectly through related issues such as potential impacts on cultural property and natural habitats. Management notes that while tourism adjoining the immediate site could possibly be reduced, the benefit of more reliable power in the Vlore area (and generally in the southern part of Albania) for tourism is undeniable.

60. Regarding the Involuntary Resettlement Safeguard (OP 4.12), Management notes that the policy was appropriately shown as “triggered” in the ISDS and a Policy Frame- work for Land Acquisition was included in the PAD and disclosed. This Framework was needed to address the very small amount of land that will need to be acquired for transmission line towers and not for the TEP itself. The land acquisition will not lead to actual displacement of households or businesses, since acquisition of privately held land is unlikely.

61. The Requesters allege certain additional legal deficiencies. Regarding the general allegation that the Bank’s procedures violated EU laws and guidelines, Management notes that the EA was carried out in full compliance with relevant EU laws and guidelines. In addition, Management notes that the approach to due diligence followed by EBRD and EIB is heavily influenced by EU Directives under the Environment acquis. Allegations by the Requesters that the project is in violation of Albanian laws on environment and public participation are not supported by legal citations and the Government

17 Albania has stated that all Albanian legal requirements have been complied with in approving the project and issuing the relevant licenses. Albania would certainly benefit from further institutional strengthening on environmental management, but Management believes this should not detract fiom the tremendous gains the country has made in the preparation and implementation of the project. Finally, following the award of the EPC contract, Alba- nian requirements with respect to “Environmental Consent” on the TEP was obtained on February 16, 2007. The Environmental License for operating the TEP was obtained on March 3,2007.

62. The Request for Inspection refers to a recent draft report on the project issued by the Aarhus Convention Compliance Committee, provided as Annex 4. l9 Management maintains that the Bank’s safeguard policy framework supports the Convention by, among other items, seeking early and meaningful dialogue. It is the Bank’s understanding that the Committee’s compliance process is still underway. Management believes that the process leading up to the project respected the requirements of the Convention. Annex 5 presents a response to the Committee’s invitation for comments on the Report. In it, the Bank clarifies or confirms a number of points relevant to the report, including: (a) the project is in compliance with Bank policies and procedures, and, as relevant to this case, the Bank’s EA and disclosure and consultation requirements; (b) a satisfactory analysis of alternatives was conducted for the project, and that the result of this analysis was discussed with local stakeholders; and (c) consultation and disclosure of information did take place during project preparation in a manner satisfactory to the Bank and other development partners. The response of the Government to the Aarhus Convention Compli- ance Committee is provided as Annex 6.

V. MANAGEMENT’S RESPONSE

63. The Requesters’ claims, accompanied by Management’s detailed responses, are provided in Annex 1.

64. Management believes that the Bank has made diligent effort to apply its policies and procedures and to pursue concretely its mission statement in the context of the project. In Management’s view, the Bank has followed the guidelines, policies and procedures applicable to the matters raised by the Request. As a result, Management believes that the Requesters’ rights or interests have not been, nor will they be, directly and adversely affected by a failure of the Bank to implement its policies and procedures.

l9Convention on Access to Information, Public Participation in Decision-Making and Access to Justice in Environmental Matters (Aarhus Convention).

18 Power Sector Generation and Restructuring Project

ANNEX 1 -AIMS A

If built, the Vlora TEPP will irreparably 4.01, In the earliest stages of preparation following a siting and rank- destroy environment, tourism, safe fisher- 4.04, ing study, the World Bank screened the Vlore TEP project as a ies, natural habitat, ecosystem, coral colo- 11.02 Category A for EA, recognizing the potentially significant impact nies as well as the unique historical and on the environment. An iterative process of field review, consulta- cultural significance of the entire Vlora Bay tions, data gathering, analysis, and analytical modeling of key and Narta lagoon. In short, it will destroy media-related risks was undertaken. Internal and external peer our past, present and future. reviews by Bank staff, consultants and other IF1 partners took We believe the Bank has violated policies place which found that risks to the environment (including aquatic concerning environment, public participa- and terrestrial ecosystems) could be mitigated by the selection of tion, cultural heritage, the requirement for high quality and low polluting fuel, good control technologies, and full compliance with Albania’s domestic a comprehensive EMP. The Narta lagoon will not be degraded by laws. the project and, while tourism in the immediate site could possibly be reduced, the benefits of more reliable power in the Vlore area for tourism are undeniable. There is also no evidence to suggest that areas immediately offshore from the TEP site support colonies of coral. The project site is not of archaeological significance, but sound procedures for identifying and protecting chance finds will be put in place. The project has complied with safeguard policies of the World Bank, including policies related to consultations and disclosure. Management recognizes that Albania’s compliance under the Aarhus Convention is currently under review by the UN ECE compliance committee. While Albania is not a member of the EU, IF1 partners such as EBRD and EIB have ensured that the project complies with relevant segments of the EU Environmental acquis. The Requesters have provided insufficient information regarding alleged project non-compliance with Albanian laws and the Gov- ernment has stated that all legal requirements have been complied with in approving the project and issuing the relevant Ii- censes. Management notes that the key Environmental Consent and License were in place as of March 2007. The Bank’s project is based on the mate- 2.20 Sufficient in-field review and site characterization has been car- rial misrepresentationof the site. ried out in the preparation of the EA. Where field data were lacking (for example on ambient air quality) reasonable surrogates were chosen and a program of field monitoring was begun to collect data which will allow site-specific data to be used for the analysis: the results of the EA analyses provide a significant margin between the expected results and acceptable limits but, if necessary, fine-tuning of technology choices and operation can be undertaken in order to ensure that acceptable ambient quality is achieved after the plant is in operation. The project EMP, which is a part of the EA, provides for further site characterization as choices are made in project details such as the alignment of oil supply pipelines and the intake and discharge of cooling water. This approach is flexible and professionally appropriate, as well as commensurate with the need for adding generation capacity in a timelv fashion. The EA upon which the Banks loan was 4.01 The EA is consistent with World Bank policies and procedures based is misleading, illegal and wrong. and those of EBRD and EIB for coverage, accuracy and technical quality. Internal and external peer review and disclosure and consultations were also sufficient and necessary pre-conditions for Board approvals in 2004.

19 Albania

Claimllssue OPlBP Response

The whole Bank‘s procedure leading to the 4.01 Please see the last paragraph of Item 1 above. Project is in violation of Albania’s laws on environment, public participation, cultural heritage and EA, as well as the EU’s laws and guidelines. The EA, in which the Bank based its loan, 4.01 The need for additional thermal generation capacity in Albania refers only to one thermal power plant of is recognized and a feasibility study had been carried out regard- 100 MW, while in the decision of governing addition of possible subsequent thermal power plants. Project ment No. 610 dt. 21.9.2004 - which the documentation shows the Vlore site could physically accomrno- Bank is or should have been aware of - it date additional units for a total installed capacity of 300 MW. The is explicitly written that it is agreed to draft EA, used for public consultation, did analyze air quality and reach a capacity of 300 MW in next phas- cooling water thermal dispersion for both 100 and 300 MW ca- es. pacities and concluded that, for both the 100 and 300 MW case, air quality and receiving water temperature rise are within limits acceptable to the World Bank and EU. However, the project being financed by the World Bank, EBRD and EIB is limited to one facility of 97 MW capacity. Should the Government decide to proceed with additional generation units (either at the Vlore site or another location), then a new full-fledged EA will be required. There is violation of the World Banks own Please see response to Item 5 above. guideline for new thermal power plants. (This guideline says: “When there is [a] reasonable likelihood that in the medium [or long] term the power plant will be expanded or other pollution sources will increase significantly, the analysis should take account of the impact of the proposed plant design both immediately and after probable expansion in capacity or in other sources of Dollution.7

~~ ~~~~~~~ Also the government approved (Law No. The second proposed investmentin the vicinity of the TEP, a 9231 dt. 13.5.04) just one km far from TEP proposed onshore oil terminal concession, is not related to the Vlora a concessional agreement of build- project, which will have its own independent offshore terminal, ing of large oil storage deposits in the Vlo- pipeline and storage tanks. In Management’s view, project due ra Bay. diligence for the clearly unassociated investment of an onshore terminal in the general area need not be carried out. We have complained to World Bank staff 4.01 The World Bank received one letter from CAPBV on June 30, on the following occasions: Letter to [the 2005 raising concerns about the decision to site a Thermo-Electric Country Director] and [the Country Man- Power plant at the Bay of Vlore. The then Acting Country Director ager], on date 20 June 2005,’ various let- responded on August 1 noting CAPBV’s concerns, assuring it that ters to [the Europe and Central Asia Re- the Bank team would take them into account, recornmending a gion (ECA) Vice President] during the meeting with the Albanian power company KESH to clarify the entire year of 2006 by Dr. Anna Kohen, project scope and assuring CAPBV that any future investment Honorary Citizen of Vlora and Honorary would only be undertaken after an EA that ensured the environ- Member of Civic Alliance for the Protection mental impact is minimal and could be mitigated. The Country of the Vlora Bay,’ meetings in Tirana with Director and Country Manager met CAPBV in April 2006 and reit- [the Country Director, [the Country Man- erated these points. ager, and the consultant for physical CUI- The World Bank also received six letters from Dr Anna Kohen, tural resource^].^ We have received no President of the Albanian American Women’s Organization and response [or] we have received a re- then President of the Albanian-Jewish Committee of New York,

‘ htto://auida-shuiotare.net/vloranerrezik/GAZETA oercent2OVLORA oercent20NE ~ercent20RREZlK.odf(note that this link is broken but the letter can be found at htt~://www.uuida-shaiotare.net/news/art.~ho?artid=46). To be found on World Bank‘s archives, or otherwise available to your office immediately upon your request. ’With [the Country Director] and [the Country Manager] on April 24, 2006 and with [the Physical Cultural Resources consultant] on July 14, 2006.

20 Power Sector Generation and Restructuring Project

Clairnllssue Response sponse and we are not satisfied that the between January 2006 and January 2007. Either the Vice Presi- explanations and answers solve our prob- dent or the Director of Infrastructure for the Region responded to lems for the following reasons: each letter promptly, in most cases in less than one month. One The response to Sazan Guri et al’s letter response took two months so as to include the findings of a tech- was misleading and ignoring or misrepre- nical mission to Albania fielded to investigate some of the specific senting of the facts. The Bank staff that claims made by Dr Kohen. Several of the letters from the World authored it was simply in denial. Bank to Dr Kohen offered to meet to discuss the issues, at a time The responses to Dr. Anna Kohen’s letters and location convenient to Dr Kohen. This offer has not been tak- have been more diligent, but still they en up. failed to consider the brutal fact[s noted In each instance, the substantive issues raised by Dr Kohen above in items 4, 5 and 61. The various were addressed comprehensively by the World Bank team. In meetings with Bank‘s officials were also doing so, the team held extensive discussions with experts in Al- completely unproductive. bania, including those in Government Departments with responsibility for Archaeology, Cultural Heritage and Power. In July 2006, as noted above, the Bank contracted a specialist in cultural property issues to undertake a technical mission to Al- bania with members of the project team. The team met with government officials and non-governmental experts in archaeology and cultural heritage. The team also met with CAPBV on July 14, 2006. The findings of this technical mission were conveyed to Dr Kohen in a letter dated August 2, 2006. In August 2006, the World Bank‘s INT Department also received a letter from CAPBV raising allegations of fraud and corruption, as well as concerns regarding the environmental assessment, in relation to the Vlore TEP. INT responded in October 2006 requesting more details of the fraud and corruption allegations and advising CAPBV to address concerns regarding the environmental assessment to the Inspection Panel. No further information was submitted. The Executive Director for Albania, Greece, Italy, Portugal, San Marino, Malta and Timor-Leste has subsequently received a letter

from Dr Kohen dated MavI. 19.2007. Other Issues We note that the procedures concerning The Bank’s safeguard policy framework supports the Conven- the Vlora TEPP were already found in tion by seeking early and meaningful dialogue. The project team violation of Article 6 of the Aarhus Conven- notes that the Compliance Committee of the Aarhus convention tion on Access to Information, Public Par- has issued draft findings on the matter and invited the Bank to ticipation and Access to Justice, as deter- comment on those findings before they are finalized. Annex 5 mined by the Aarhus Convention presents a response to the Committee’s invitation for comments Compliance Committee in its Draft Finding on the Report. The Bank is corresponding with the Committee on and Recommendations of March 23,2007. the matter. It believes that the process leading up to the project respected the requirements of the Convention. We note that the Office of the Executive Management takes exception with the points raised in this pa- Director [...I(EDS21) may have a conflict ragraph. No evidence is provided to support these claims, which of interest in properly, thoroughly and im- discriminate against Bank staff solely on the basis of their nation- partially investigating this matter. Among ality. other countries, EDS21 is comprised of Albania, Italy and Greece. Italian and Greek companies may have strong economic and financial interests in benefiting from World Bank‘s Vlora TEPP loan agreement. Moreover, Greek citizens who are employees of the World Bank are directly responsible for the TEPP violations in both planning and implementation stage. For example, [...the] Country Direc- tor for Albania [is Greek], [... as is] the Bank Team Leader/Project Director. Fi-

21 Albania

No Claimllssue OPlBP Response

nally, the contract for the construction of the Vlora TEPP, signed on February 9, 2007, is between the Albanian utility KESH and a major Italian company [. . .}. We can simply hope that EDS21 carries out its duties in the most professional, ethical and responsible fashion and opens the way to the Inspection Panel for a thorough, impartial and objective investigation of such matter, regardless of whether citizens of Italy andlor Greece become its subject. I

22 Power Sector Generation and Restructuring Project

ANNEX2 SELECTED KEYDATES RELATED TO s ,FEGUARDS Activity 2001 Albania Energy Sector Mission; first mention of option Dec 2001 for new TEP; team safeguard specialist identified but ‘ not on mission.

EIB and EBRD interested in financing new TEP along Jan 2002 with IBRD; USTDA interested in financing feasibility TT studies with work possible by March. Letter from WB Country Director to Albanian Prime Min- Jan 22.2002 ister indicating willingness to assist in raising financing Management for a new thermal plant. Draft scope of services sent to TT from USTDA con- USTDA Con- Jan 30,2002 sultants on feasibility work (including on environment).

~ ~~~ Email from EBRD to TTL confirming their view of EBRD Category A rating with full compliance of EU Directive Feb 4,2002 IF1 review required; concerns about speed of processing sched- ule. Emails from EBRD to VLon specifics of scoping and carrying out project EA; EBRD encourages preparation Feb 2002 IF1 review of consultation and disclosure plan; concurs on use of surrogate air quality data. I Contract Amendment between Government of Albania (GOA)and consultant to prepare draft and final feasibil- INegotiated between ity studies (including Siting Study) and an EA “ofthe USTDA con- USTDA, consultants April 10, 2002 identified site ,. . to comply with both European Union sultants; GOA and GOA(including and Wodd Bank standards”; also to include a “public input from IFls) consultation and disclosure plan.” Draft Siting Study submitted which recommends Vlore B as preferred site for TEP following seven site reviews. Consultant; June 6,2002 Meetings with Government and site visits held during GOA week of April 22, 2002. Albanian Ministry of Energy & KESH agree with MWH June 21,2002 recommendations on Vlore B as being preferred and GOA authorizes completion of Siting Study. Draft Feasibility Study includes 40+ page Section 4 on Aug 6,2002 Preliminary EnvironmentalAnalysis of the Vlore B site Consultant as well as draft outline of full EA to be conducted. E-mail from TT Environmental Specialist following consultation with ENV staff; suggesting draft [project] EA Aug 19,2002 TT/ENV can be condition of appraisal and consultations carried out during appraisal. Preparation mission for proposed Power Sector Gen- eration and Restructuring Project; key environmental AUg 13-21, issues raised relative to Vlore siting including clarifica- TT 2002 tion of approval and licensing process; review of im- r pacts on Narta Lagoon, and questions regarding re- finement of ambient air quality data. Meeting of GOATask Force for implementation of En- ergy Document headed by Minister of Energy; endorsed Sept 12,2002 GOA findings [recommending Vlore B site] and to send report to Min of Environment.

23 Albania

Date Activity Comments First email exchange between TT and Quality Assur- ance and Compliance Unite (QACU) on project seeking Sept 23-24, advice on due diligence requirements for the project; TT; QACU 2002 QACU noted that it could be controversial given siting near lagoon and, in a follow-up meeting, suggested taking up this specific issue with UNDP. Request from TT to ECA safeguards team requesting First formal contact by Oct 1,2002 initial pre-Project Concept Document (PCD) stage con- TT TT with ECA safe- sultation meeting to set EA requirements. guards Pre-PCD safeguards consultation meeting held on 3rd; First formal step in ECA on environment; extensive advice for preparation of ECA Safe- Oct 3-5,2002 safeguards clearance project documentation and EA. TT’s initiative in calling guards process for early review appreciated. E-mail from UNDP to TTL and others outlining background on Narta lagoon issues and related UNDP-GEF efforts. Their brief review suggests siting of TEP should Oct 11,2002 IF1 review not affect integrity of habitat; emphasizes continued cooperation. lTL met UNDP in Tirana from Oct 17-24 and followed up with e-mail on November 14, 2002. Comments were fac- Environmental reviewer comments on terms of refer- ECA Safe- Oct 17,2002 tored into preparation of ence for consultant; some deficiencies noted. guards the EA Addendum Follow-up internal discussions on biodiversity issues relative to Narta Lagoon given UNDP/GEF interest; also Oct 2002 on remedying issue with same firm doing feasibility TT/Ot hers studies and EA work (w/LEGEN; approved on Oct 9, 2002). Ministry of Environment approval letter to Ministry of Trade and Industry on Vlore B (although initially it felt “Fier option is a little bit preferable from the environ- Oct 8,2002 mental point of view’? yet recognized the higher cost of GOA Fier. Also urged a good EA on Vlore noting “This should be an open process ensuring participation of all interested parties especially of public in the area. ’’ Date of Final Siting Study and Final Feasibility Study USTDA con- Oct 21,2002 release date. sultants Meeting was organized Public meeting in Vlore to discuss the recommenda- Oct 28,2002 GOA by GOA under its own tions from the siting study that Vlore site is preferred. process. Letter from GOA to TTL forwarding minutes of Oct 28‘h meeting, reporting on progress on several issues, and expressing “that all three ministries (Energy, Environ- Nov. 15,2002 ment and Territory) stakeholders in Vlora agreed with GOA us for the importance of Building this power plant in Vlora B site. ” 2003 Jan 2,2003 Date of PID on World Bank external website. TT; InfoShop ECA Man- Jan 10,2003 Project Concept Review date. agement Review of PCD for environment and social. OP 4.12 Jan 10 & 14, suggested as triggered (confirmed on Feb 4‘h) due to ECA Safe- 2003 small amounts of land acquisition for associated trans- guards mission line towers. Feb 2,2003 Government of Albania (Council of Territorial Adjust- GOA Formal siting approval

24 Power Sector Generation and Restructuring Project

Date Activity Comments ment, CTARA) decision nr. 8 “On Approval of the Indus- by GOA on surrounding trial and Energy Park-Vlore. ” Industrial Park (later dropped) PCD-stage ISDS completes staff clearance by ECA safeguards; some issues raised by Acting Regional ECA Safe- Feb 2003 Safeguards Coordinator regarding possible illegal forest guards cutting due to fuel price hikes. ISDS cleared by Acting Regional Safeguards Coordina- ECA Safe- Feb tor on 14th; by Sector Manager on 19‘h; same day regis- 2003 ’ guards & TT tered in Infoshop. Government of Albania-(CTARA) decision nr. 20 for “the Formal siting approval Feb 19, 2003 construction of the new thermal generation facility in GOA Vlora...within the Industrial and Energy Park.” by GOAon TEP Preappraisal mission: lT provides copies of Bank requirements for EA and stresses need to ensure that applicable requirements for consultation and disclosure March 10 to are met and that this is appropriately documented. lT TT 19,2003 was informed that the CTARA had approved the Vlore Site for the construction of the proposed thermal power plant and had confirmed that this site was outside the proposed protected area around Narta Lagoon. Email from consultant to TTL requesting review of March 24, agenda for public consultation meeting (initial stage of Consultant 2003 EA). Invitations to April 2”d public meeting sent out to “more March 25, than 700 people” including government, locals, media, GOA 2003 etc. March 31, Outline for public meeting cleared by lT Environmental TT 2003 Specialist. This meeting corre- Public meeting in Vlore reportedly attended by more sponds to the first (of than 60 persons (Powerpoint and meeting minutes later GOA; presen- two) EA consultations April 2, 2003 included in EA). Reported as “second public consulta- tation by con- required by the World tion,’’ since October 2002 meeting on the siting study is sultant Bank for a Category A considered as the “first.” project EBRD E-mail to TTL supporting independent peer re- April 2, 2003 IF1 review I view by Canadian consultants. April 8-22, E-mails between TT, consultant and EBRD regarding TT, consult- 2003 timing of EA consultations and disclosure period. ant, EBRD TTL informs KESH and Government that the World April 24, 2003 Bank would like an independent review of EA by Cana- TT dian (CIDA) funded group. Country Di- May 2003 Country Director visits Albania, including project site. I rector E-mail transmitting Draft EA and supporting appendices Consultant, July 18, 2003 I from consultant to TTL. TT Invitations to September 3rd public meeting reportedly July 23, 2003 sent out; copies of EA made available later to Ministries GOA and locally in Vlore in English and Albanian. Comments from EBRD on Draft EA sent to TTL; sup- July 29, 2003 portive but requesting details on alternatives, more spe- IF1 review cifics on EMP, capacity building for KESH, etc. July 31, 2003 Comments from EIB on Draft EA. IF1 Review

25 Albania

Activity Who Comments Extensive comments from lT Environmental Specialist 4ug 1,2003 on draft EA. This meeting corre- sponds to second (of Public meeting in Vlore attended by approximately 25 presen- persons (PowerPoint and meeting minutes later in- two) EA consultations Sept 3,2003 tation by concluded in EA). Reported as “third public consultation” required by the World sultant given sequencing noted above. Bank for a Category A project. Draft independent desk peer review of July 17” draft EA Peer review to Sept 10,2003 by Canadian-financed consultants. TT General concurrence on comments by TT Environ- Sept 13,2003 TT mental Specialist. Acknowledgement of receipt of comments from peer reviewers by consultant; most comments OK except Sept 18,2003 Consultant request for new data collection on air and noise which is not covered by terms of reference. Justification from consultant on use of surrogate mete- Oct 1,2003 oroloaical data for air dispersion modeling. USTDA con- Final EA is augmented Transmittal and Date of Final EA (in English). Oct 6,2003 sultants bv an Addendum later Oct 6,2003 Date of EA on World Bank external web site. TT; Infoshop Transmittal of final peer review report from independent Peer review to Oct 10,2003 peer reviewer. TT Comments from ECA safeguards team on Final EA; ECA Safe- Oct 10,2003 issues to be covered in Addendum. guards GOA letter of agreement to implement recommenda- Oct 13,2003 tions of EA and actions specified in EMP (Min of econ- GOA omy; Min of Industry & Energy; Min of Environment). TT and lnfo- Date of EA summary on World Bank external web site. Oct 15,2003 ShoD Safeguards team comments on PAD (Decision pack- Oct 20-21, ECA Safe- age); further comments on environment; Policy Frame- 2003 guards work still pendina on social. _____ Response by consultant on comments raised by ECA Oct 20,2003 safeguards team environmental reviewer. ECA Man- Oct 21,2003 Project Decision Meeting. aaement Transmittal of EA Summary from Sector Manager to ECA Man- Oct 23,2003 SECBO. agement Disclosure of EA report (including environment and Oct 24,2003 social aspects) in Infoshop; Date of PID on World Bank TT; Infoshop external web site. Comments from EBRD on EA report; numerous con- Oct 24,2003 cerns on technical aspects, inclusion of information on IF1 review alternatives from earlier report, etc.

OCt 28-29, Draft EA Addendum and Response to World Bank, Consultant 2003 EBRD and EIB comments from consultant. Detailed resolution of comments on EA by TT Environ- Nov 6,2003 TT mental Specialist. ECA Man- Start of Project Appraisal. Nov 10,2003 agement

26 Power Sector Generation and Restructuring Project

Activlty Who Comments Issues on environment Safeguards team review of EA Addendum; key issues ECA Safe- lec resolved in view of ECA 15,2003 raised in earlier reviews have been resolved guards safeguards team Transmittal of Final EA Addendum “including all com- Consultant to 3ec ments provided by the MinisttyKESH, World Bank, 17,2003 TT EBRD and €16 on Final EA.” Safeguards team clears OP issues; Negotiations 4.12 ECA Safe- Dec package is thereby cleared by Regional Safeguards 17,2003 guards Coordinator. =est from l7LtoGoA regarding EBRD request for “detailed accounting of the public disclosure and con- Dee 18,2003 sultation process.. ..to judge the adequacy of consulta- TTL to GOA tion vs. theirpolicy requirements in terns of its scope, detail and duration.” Agreement by GOAto “implement all the recommendations given in the Addendum to the Environmental As- Dec GOA 19,2003 sessment and the actions specified in the Environ- mental manaaement Plan. ...” Dec 22,2003 Updated ISDS filed in InfoShop. TT; InfoShop Response from GOA to EBRD (cc. to TTL) on April 2 GOA to IF1 Dec 24,2003 and September 3 public consultation meetings for EA; and TT summary and minutes forwarded. 2004 Final Technical Specifications (contains clear linkages Jan 2004 to EA documentation which contained EMP). sultantsUSTDAcon- ~~~ I Note re-disclosed in InfoShop in April 2004 Jan 15,2004 EA Addendum filed in InfoShop. TT though this earlier date applies for policy compliance E-mail enquiry to LEGEN from European Commission (Head of Unit on Environmental Governance with DG- Not acting in an official Jan 22,2004 Environment) expressing concern over choice of TEP IF1 enquiry capacity on this en- site at Vlora given impacts on birds and wetlands; also quiry. concerned about EA. Response from l-r to QACU clarifying that lagoon will Feb TT;QACU 3,2004 not be impacted. I Feb 17,2004 Date of PAD on external World Bank web site. TT; InfoShop I I Mar Bank project approval. 16,2004 WBManage-ment ~ I Emails fromlto InfoShop clarifying that EA documents TT; ECA Sa- also contained Policy Framework for OP 4.12; filing April 2004 feguards; separately and corrected on March st for EA adden- 1 InfoShop dum (Vol 2) and Resettlement Plan (March 24). Signed Legal Agreements between Bank and Albanian GOA;World April 6, 2004 partners. Bank E-mail response from World Bank to January 22ndletter; April 22, 2004 clarifying background and record of project due dili- QACU gence. E-mail from QACU to EBRD and EIB forwarding re- April 27, 2004 QACU sponse April 22 response for information. I I

27 Albania

Activity Comments 2005 ECA Man- Jan 25,2005 Project effective. agement Report is available on Country-based safeguards effectiveness review found ECA Safe- June 2005 ECA safeguards intra- very good compliance with Bank policies. guards net site. Letter from CAPBV to World Bank on “Case against the Civil society Brief reply from World June 30, 2005 Thermo-electric Power Plant at Vlora, Albania” contain- complaint Bank on August I“. ing over 25 allegeddeficiencies. 2006 Receipt by World Bank of January 16thletter from Anna Correspondence and Kohen (Albanian American Women’s Organization) response by Bank con- January 23, Civil society expressing “deep apprehension over a power plant pro- tinued periodically the- 2006 complaint ject ...” Numerous issues were raised; issues on cultural reafter and not noted property addressed by July mission. here. Cultural property sutervision mission carried out; BTOR prepared on July 27 finds that “the project complies with OPN 11.03 and the relevant Albanian laws and July 9-15, regulations governing protection of cultural heritage. 2006 TT Aside from monitoring excavation during construction of the plant and its related structures, no further actions related to cultural heritage are required for the project.” Letter from UN ECE to World Bank regarding communi- July 27, 2006 cation to Aarhus Convention Compliance Committee UN ECE “concerning a RroROSed industrial park in Vlora.”

~~ August 2, ECA Man- Reply from Bank to UN ECE. 2006 agement 2007 “Environmental Consent” for the Construction of the Feb 16,2007 new TEC in Vlora by Ministry of Environment, Forest GOA and Water Management. “Environmental License” for the “Construction and Op- eration of the Thermal Power Plant”; License Commit- Mar 3,2007 GOA tee Decree no.2 by Ministry of Environment, Forest and Water Management. Draft Findings and Recommendations of the Aarhus Compliance Committee regarding Albanian compliance Mar 29,2007 UN ECE with the Convention on activities including the TEP forwarded to World Bank for comment. Notice of registration regarding a Request for Inspection WB- May 2,2007 of the Albania Power Sector Generation and Restructur- Inspection ina Proiect. Panel Comments on Draft Findings and Recommendations ECA Man- May 15,2007 Sent from WB to UN ECE. agement

28 ANNEX3 BACK-TO-OFFICEREPORT ON CULTURAL PROPERTY ISSUES, JULY2006

THE WORLD BANWIFC/MIGA OFFICE MEMORANDUM

DATE: July 27,2006

TO: Charles M. Feinstein, Sector Manager, ECSIE

FROM: Henk Busz, Lead Advisor, ECSIE, ECA (Consultant), Arlene Fleming, Cultural Resource Specialist and Safeguards Advisor (Consultant), Artan Guxho, Project Officer (ECSIE)

EXTENSION 3-2686

SUBJECT: Albania: Power Sector Generation and Restructuring Project Cultural Resources (PO775261 - Back to Office Report for Supervision Mission -July 9 to 15,2006

1. In accordance with our terms of reference, dated July 7, 2006, we carried out a mission to Albania from July 9 to 15, 2006, to determine whether supplementary information and investigation were needed to meet the requirements of the World Bank’s policy OPN 11,03 (Management of Cultural Property in Bank-financed Projects) and the Albanian laws and regulations governing protection of cultural heritage in the context of the Power Sector Generation and Restructuring Project. The mission’s findings and a list of principal persons met follow below. Detailed information is attached in annexes.

Executive Summary

2. The mission held extensive discussions with principal Albanian archaeologists, including those with national responsibility for protecting and managing the country’s physical cultural resources. Mission members also reviewed the archaeological literature related to Vlore Bay, and visited the project site selected for construction of the thermal power plant. Based on this investigation, the mission concluded that the site is not of archaeological significance due to the known locations of the ancient city sites in the Vlore Bay region and the lack of any evidence of human habitation during digging for the adjacent fishing harbor in the early 1980s and beyond. Consequently, a surface survey of the selected site prior to the start of construction is neither necessary nor justifiable.

3. In accordance with Albanian law and World Bank requirements, excavation for the foundations of the plant and related structures should be monitored by a qualified person from the Albanian Institute of Archaeology, in order to salvage and document any chance finds. The Institute should be alerted and arrangements made for this monitoring at the appropriate time.

4. Given the above conclusions, the project complies with OPN 11.03 and the relevant Albanian laws and regulations governing protection of cultural heritage. Aside from monitoring excavation during the construction of the plant and its related structures, no further actions related to cultural heritage are required for this project. -2- July 27, 2006

Mission Findings

4. The power plant site is neither of cultural heritage significance nor of archaeological interest. The six-hectare site is located on the shore of Vlore Bay, adjacent to an offshore oil tanker terminal situated on the Adriatic cost, The site is mostly scrub land adjacent to a small fishing port on the south and to a crescent-shaped expanse of sandy shoreline on the north. This shore ends several hundred meters south of the small, elevated Cape of' Treport on which is located the remains of an ancient settlement. The project site is approximately 2,300 m. south of Treport, and about six km. north ofthe city of Vlore, accessed by a rough road running through a degraded industrial area that includes a large abandoned soda factory on mercury-contaminated ground. A wooded area, with trees planted in rows about 50 years ago, serves as a buffer between the industrial zone and the power plant site. The sandy shore to the north of the site is used for bathing, but is considerably less attractive than the beaches located in the city of Vlore, and along the coastline to the south. The industrial zone is in stark contrast to the spectacular natural beauty of the extensive Vlore Bay region, including the low mountains to the east of the city and the undeveloped highlands of the Karaburuni Peninsula on the western shore. (See Annex 1 for maps and photographs ofthe site and environs.)

5. Three prominent Albanian archaeologists stated emphatically to the mission that the power plant site is not of archaeological interest and that a surface survey prior to the start of construction is not warranted. Two of the three are key officials in the Government of Albania, responsible for the protection of cultural heritage: Prof. Dr. Muzafer Korkuti, Director of the Institute of Archaeology; and Prof. Dr. Apollon Bace, Director of the Institute of Cultural Monuments. The third is Dr. Neritan Ceka, a noted archaeologist and cultural historian, and author of numerous articles and books on the ancient history of Albania, as well as guidebooks to several archaeological sites. Dr. Korkuti has conducted excavations and extensive surface surveys in near-by regions of the country. Dr. Bace has excavated at numerous sites, including Treport, and during the 1980s monitored construction at the fishing port adjacent to the power plant site, where no evidence of human habitation was discovered. He accompanied the mission to Vlore and participated in the inspection of the power plant site. (A letter from Dr. Bace, of June 13, 2006, attesting to the historical and archaeological insignificance of the site is provided in Annex 2, together with references for archaeological research on Treport and Vlore.)

6. The ancient settlement on the Cape of Treport did not extend to the project site area. Treport is a registered national monument of Albania, designated for protection by the government. It is an archaeological site, lying in ruins, and virtually inaccessible by automobile. Sporadic excavations began in the early 20thcentury and were conducted most recently by Vasil Bereti during the late 1980s and early 1990s. According to Bereti, the site was inhabited from the late seventh century B.C. to around the second century B.C. (Ithought it was AD) when it was abandoned. These dates are based on analysis of walls and pottery, some of which is of Corinthian Greek manufacture. A wall, now submerged at the edge of the bay, measured some 600 m. in length, running approximately east-west along the coast. It is assumed to be part of the settlement fortification. The boundaries of the city have been established but the burial ground is undiscovered. In accordance with custom, it would likely have been located in-land on high ground rather than near the coast, at a distance of 500 m. to one km. (Korkuti said 300-500 m., acc. To my notes and recollection) from the settlement, according to Dr. Korkuti, Director ofthe Institute ofArchaeology.

7. Following abandonment of the Treport site, settlement moved to Aulona, now modern Vlore. There are literary references to Aulona in the late antique period; the earliest substantial remains of the town are parts of fortification walls dated to the 4* century A.D. by the presence of coins found near-by. These walls are preserved in situ near the national -3- July 27,2006 independence monument in Vlore. During the medieval period the city continued to grow with the construction ofa castle and port. The port is still in use.

8. The Albanian law for protection and management of cultural heritage contains requirements for preparation and implementation of construction projects. The Institute of Cultural Monuments and the National Centre of the Cultural Properties’ Inventory within the Ministry of Culture, Youth and Sports, and the Institute of Archaeology, have responsibility for physical cultural resources under Albanian law. The applicable legislation IS the Law Number 9058 for the Cultural Heritage, April 7,2003. (See Annex 3 for the text.)

9. Regarding project planning, Article 47 of the Law states that investors in construction projects, such as roads, airports, industrial works, and housing centers, undertaken on state or private property, must consult with experts in the Institute of Archaeology and the Institute of Cultural Monuments during the planning stage. The experts determine whether there are valuable archaeological or ethnographic features on the property, and if this is the case, and modifications of the project are required, expenses for such changes must be covered by the investors.

10. In regard to project implementation, Article 48 states that during construction works, if objects of archaeological or ethnological value are discovered, work must be suspended immediately. Within three days, those responsible for the works must inform the local authorities, the Institute of Archaeology and the Institute of Cultural Monuments, who must investigate and report on the value of the discoveries and make recommendations on whether the work should continue. If the finds are of significant value, the construction project may be modified or interrupted, and expenses for any modifications to the project, as well as for scientific research, restoration and preservation of the material discovered, are to be borne by the investor.

11. Article 49 (j) sets the penalty for violating Articles 47 and 48 at from 1,000,000 to 5,000,000 leks. Section 2 of this Article states that damage caused to unique objects of the cultural heritage constitutes a crime and it is prosecuted according to penal legislation.

12. The project complies with World Bank policy and regulations for safeguarding cultural resources. OPN 1 1.03 (Management of Cultural Property in Bank-financed Projects), was in force during the preparation and approval stages of the project. (See Annex 4.) This policy states that management of cultural resources is the responsibility of the client country government; however, the Bank generally assists in the preservation of cultural properties and seeks to avoid their elimination. Before proceeding with a project involving large-scale excavations, movement ofearth, surficial environmental changes or demolition, Bank staff must determine what is known about the cultural property aspects of the proposed project site. The attention of the government should be drawn specifically to this subject, and appropriate agencies, NGOs or university departments should be consulted. If there is any question ofcultural property in the project area, a brief reconnaissance survey should be undertaken in the field by a specialist.

13. The World Bank’s Standard Bidding Documents cover chance finds encountered during project implementation. Section VI1 General Conditions, Article 4.24 for Procurement ofWorks, states that: “All fossils, coins, articles of value or antiquity, and structures and other remains or items of geological or archaeological interest found on the Site shall be placed under the care and authority of the Employer. The Contractor shall take reasonable precautions to prevent Contractor’s Personnel or other persons from removing or damaging any of these findings.” Contract documents for the project should include these provisions, and procedures required by Albanian law must be followed. -4- July 25,2006

List of Principal Persons Met

Ministry of Economy, Trade and Energy Mr. Gjergji Bojaxhi - Deputy Minister Mr. Bujar Leka - Director, Foreign Relations Department

KESH Mr. Andi Beli - General Director Ms. Denisa Saja - Environmental Expert

Ministry of Tourism, Culture, Youth and Sports Ms. Suzana Turku - Vice Minister Prof. Dr. Apollon Bace - Director, Institute of Cultural Monuments Ms. Nora Malaj - Vice Director, Institute of Cultural Monuments Mr. Ymer Yzeiri - Director, Regional Department of Monuments and Culture in Vlore

Parliament of Albania Prof. Dr. Neritan Ceka - Archaeologist and writer; Parliament Deputy for Vlore; President ofthe Democratic Alliance Party

Municipality of Vlore Ms. Drita Aga -'Deputy Chair, Municipal Council of Wore Mr. Halim Dervishaj - Deputy Mayor of Vlore

Institute of Archaeology, Albanian Academy of Sciences Prof. Dr. Muzafer Korkuti - Director, Institute of Archaeology; Editor in Chief, Iliria Review, published by the Archaeological Institute of the Albanian Academy of Sciences

Civic Alliance for the Protection of Vlora Bay Dr. Ardian Klosi - Executive Director, German-Albanian Cultural Society; Philologist; Editor ofthe Shekulli newspaper

World Bank Office in Albania Mr. Nadir Mohammed - Country Manger Ms. Greta Minxhozi - Senior Country Operations Officer -5 - July 27,2006

Distribution: Mission Members: Messrs./Mmes. Busz, Fleming (Consultants); Guxho (ECSIE).

Region Albania DL, ECSIE Sector Staff, ECACA Sector Staff, ECA Fiduciary

IRIS ANNEX 1

Back to Office Report on a Mission to Assess the Potrritial Impact on Cultural Heritage ofa Thermal Power Plant at Vlore, Albania

July 2006

Contents:

Map 1: Ancient city of Treport and Power Plant site on Vlore Bay

Map 2: Treport, Power Plant site and ancient remains in Wore (formerly Aulona)

Photographs

i', I

I "

Pic. I. View of power plant site fwing Pic. 2:. Power plant site facing fishing port North

Pic. 3. Power plant site facing fishing port Pic. '1. Abandoned factory on access road to power plant site Pic. 5. View of Vlore Bay with Karaburuni Pic 5. Wore Bay - view toward Treport Peninsula in the background

Pic 7. Beach North of power plant site Pic. 3. Wore Bay - view toward Treport ANNEX 2

Back to Office Report on a Mission to Assess the Potential Impact on Cultural Heritage Ofa Thermal Power Plant at Vlore, Albania

July 2006

Contents:

Letter from Prof. Dr. Apollon Bace, Director of the Albanian Institute of Cultural Monuments to Nadir Mohammed, Country Manager, World Bank Office in Albania, regarding ancient remains in Treport and Aulona (modern Vlore), June 13,2006

References on ancient remains in Treport, Vlore/Aulona and the Vlore Bay region

REPUBLIKA E SHQIPbISg

NrJIOProt Tirane, mi2 2006

Prof. Dr. Apollm Baqe, Director of Institute of Cultural Monuments Tirana, Albania Mobile +355682078646 +mail apollonhc&hotmail.com

To: Nadir Mohammed Y Country Manager, WB Albania

Cc: Mr. Paul Wolfowitz, Resident Wl3

Prof. Dr. !Mi Berisha, Premier of Republic of Albania

Mr.LftikharKhali4 Task Team Leader, WB

Mr. Shm Gjika Mayor of Wora

Mrs. Anna Kohen

Resident of AIbaruak* JewishCommittee of New York

Honorable Sir,

In light of our conversation, and sh ' g ftom the concerns and arguments presented by Dr. Anna Kohen, President of Albanian-Jewish Committee of New York, against the construction of the thermal power plant (TEC) in Vlora, I would deem it fit to present you with the archeological and historical background for this area.

"'his summary contains my views m the positiondthe Dirrctor ofthe Institate of Cultural Monuments of Albania, which is legally respomiile for the protection of Cultural Monuments, and with the responsibility of the historian and archeologist who has done the study, sounding and excavations m the centes of Wora Bay, particukly m Aulona- Treport ( ApoJlon Bq,"zR6 centres fortifies du Golf de Wore", "Monumentet", 10,1975, pages 521, "La citadele de Vim" "Mmumenter, 56,1973, pages 43-54, La ville Meede Kanine", "Monumentet", 7-8 1974, pages 25-54 e.)

1. Aulona (Treport) mentioned by ptdemeus (III122) as a town outfitted with a pier and later mentioned by the Itinerary of Anbninus (I.R. 323 10,608 lo), the Naval Itinerary of Antoninus (It Mar. 323) and Tabula Peutingeriana (" 559) as one of the starting points of Via EgMtia (Dynah- ApoloIli- Aulona) is located north of the VI- Bay. The Acropolis of the town is located in a hill near the seacoast (83ox15om) (photo 1,2) while the ceramks, lhe traces of a temple and a road, discovered durhg our excavations (ApoUon Baw, Monumenkt 10) testify that the down town was located in the hill slope and partly in the field of the fortified town. The traces ofthe pier 650 mlong are photographedby the 1- archeologist L. M. Ugolini (Albania Antica, Roaa 1927) (photo I,Z), and which we have fonowed under the surface of water are clearly seen m a satellibe photo of the bay. (Photo3). These traces testify that the town had a rectangle shape reaching a surface of about 30 ha (photo 3). According to our soundings and to those of our colleagues (Vad Bereti, Halil My~to,"ILiria 1W, %,a,93) the life in this town flourishes during the 9 century BC up to the 3rd century AC. It faded and fhished at the end of W century.

2. The place were the thermal power plant ('IEC) is expected to be constrwtd (its nearest edge with the antic town) is 2300 m far from Aulona - Treport The possibility of town expansion in this me, in a surface400300 ha, absolutely unfamiliar for the period, is impossible, given the fact that the towns of that period were not built in flat defenseless t&ains. During the excavation for the building of the pier m the point where TIFX: is going to be build, we have not found any ceramics or other traces of any time.

3. According to the Albaruan legislation (The law "For Cultural Heritage" Nr. 9048, date: 07.04.2003) "in archaeological centers .,.are prohiited the new constructions that damage the existing objects" (article 29), that is excluded in the case, and "for cultural monuments is detennm. ed a surface around them as their pmtected zone that fits their axhikctonic values ''(article 32). In the practice of the Institute of Cultural Monuments, in an analogue case in the Antic- Middle age town of Dun& is the expanding oftheprotecbed zone at about 50 m far from the surrounding wall. Considering this fad, the building of the TEC in a distance of 2300 m far away from the traces of Adona is not in violation of the law for the protection of monuments.

4. However, taking into consideration the above mentioned concern and the verbal request of the representatives of the World Bank, the Institute of Cultural Monuments undertakes the responsibility of following the excavations for the opening of the TEC foundations through the Regional Directory of Cultural Monuments m Vlora and the Department of Rescue Archaeology of the Institute who will be present during all the excavations' period. Also, the excavations will be supenrised by the direcbor of the Institute, Prof. Dr. Apollon Bap, who has an archamlogical expaienoe more than 35 years and is also a member of the German Archaeological Institute.

5. Dr. Anna Kohen, President of Albanian -Jewish Committee of New York, raises the concern that "Treport/ Adom has tremendous importante for the history of the Jewish people in the Mediterranean... in 1492 hundreds of Sephardic Jews escaping Spanish In- landed m Trepart/ Adma. As a result Vlora became the third largest Jewish community m the Mediterranean" With all due respect for the erudition of my colleague of archaeology Dr. Kohen and her impressive professionalimn, I'd like to emphasize that due to not being diredy aware of the terrain, Dr. Kohen searches middle age Aulana m theTreport, whileafter the fading of lifem the Antic Aulona of the W century, during the 4th century the life of the town has moved to the . existing town of Vlora (5,8 km far from TEC) where are discovered the walls of the fartification and other material traces.

6. The existence of Vlora during the middle ages in this place is testified by the fragment of the German knight Von Harf. According to him, "Vlara is a big village with ZtXM hearths and higher than them is a mountainous casde named Kano (Kanina) (Monumentet 56). This castle, directly above the quarter of Harbor of Vlora (14 km far from TEC), can't be seen from the Went town of Trqwrt/ Aulona. Meanwhile, during the 15 century, in this berritny of Vlora Port was located the Castle of Wora outfitted with a pi'er for ship landing (Apollon Bace, ";La citadele de Vlora" Monumentet5,6) (Monumentet 10). The traces of this castle have come into light recently. Considering the fact that Sephardic Jews arrived in mora from Spain only with big ships and landing normally, not clandestinely, they couldn't land in a shallow sea or unpopulated area, but obligatory m a port Therefore the place where they landed, certainly of a great spiritual value for the Jewish community, particularly for the Albaruan' - Jewish me, should be searched in the current town of Vlora and not in the place where the Theznal Power Plant is going to be built As a result, spiritual values for this community gains the town of Vlora, 14 km far from TEC and not the beach near the ancient city ofTreport/ Aulcma.

7. Based on the above mentioned, as the authorized person by the Ahmian Government for the protection of Mormments, Irespmsii dechthat the building of TEC in Vlora, in the determined place, is not in opposition wit5 the archeologicaland historical data or the Albanian legislatia

Sincerely yours

Director of the lnstitute of Cultural Monuments

Prof. Dr.fi&on BACE References on ancient remains in Treport, Vlore/Aulona and the More Bay region

Treport

Bace, Apollon, Letter to Nadir Mohammed, Country Manager, World Bank Office in Albania, June 13,2006 Bereti, Vasil, Archaeological reports in Zliria; I984:2, pp. 263-64; 19852, pp. 318e 1992: 1 and 2, pp. 143% 1993: 1 and 2, pp. 148ff. Korkuti, Muzafer and Karl M. Petruso, “Archaeology in Albania,” American Journal of Archaeology, Vol. 79, No. 4 ,October 1993, p. 729.

Vlore/Aulona

Bace, Apollon, Letter to Nadir Mohammed, June 13,2006 “Vlora Fortress,” Monurnentet, 1973, pp. 43-54 “The Fortified City of Kanina,” Monumentet, 1074, pp25-54 “Fortified Centers in Vlora’s Bay during Antiquity,” Monumentet, 1975, pp. 5-2 1 Komata, Damian, Archaeological reports in Iliria: 1986:2, pp. 269-70; 1987:2, pp. 258-60; 1988;2, pp.270-271; 1989:2, pp. 297-98; 199012, pp. 272-74 Korkuti, Muzafer and Karl M. Petruso, “Archaeology in Albania,” American Journal of Archaeology, Vol. 79, No. 4, October 1993, p. 740 \\TVW. bashkiaviore.org “The History ofVlora,” 2005

Vlora Bay region

Bace, Apollon, Letter to Nadir Mohammed, June 13, 2006 “Fortified Centers in Vlora’s Bay during Antiquity,” Monumentet, 1975, pp. 5-2 1 Ceka, Neritan, The Illyrians to the Albanians, Migieni, Triana, 2005 Republic of Albania, List and map of registered monuments in the Vlora Bay region, in Albania Integrated Coastal Management and Clean-up Program, Heritage Assets Mapping, Final Report, 18 March 2005

ANNEX 3

Back to Office Report on a Mission to Assess the Potential Impact on Cultural Heritage of a Thermal Power Plant at Vlore, Albania

July 2006

Contents:

Albanian Law Number 9058 for the Cultural Heritage, April 7,2003

ANNEX 4

Back to Office Report on a Mission to Assess the Potential Impact on Cultural Heritage of a Thermal Power Plant at Vlore?Albania

July 2006

Contents:

World Bank Operational Policy Note (OPN) 1 1.03 - Management of Cultural Property in Bank-financed Projects (This was the applicable policy from 1986 until April 15, 2006 when it was replaced by OPBP 4.1 1 - Physical Cultural Resources)

Physical Cultural Resources Country Profile for Albania (draft) - Word version ; see website display at: http://esd.worldbank.org,/pcr

ANNEX4 DRAFTFINDINGS OF THE AARHUSCONVENTION COMPLIANCE COMMITTEE

ACCC/C/2005/12 version 23 March 2007

DRAFT FINDINGS AND RECOMMENDATIONS

with regard to compliance by Albania with its obligations under the Aarhus Convention in a case concerning public access to information and participation in decision-making on the construction of an industrial park and a thermal power plant (Communication ACCC/C/2005/12 by the Alliance for the Protection ofthe Vlora Gulf (Albania))

I.INTRODUCTION

1. On 27 April 2005, the Albanian non-governmental organization (NGO) Alliance for the Protection of the Vlora Gulf (also translated as Civil Alliance for the Protection of the Vlora Bay) submitted a communication to the Committee alleging violation by Albania of its obligations under article 3, paragraph 2; article 6, paragraph 2; and article 7 ofthe Aarhus Convention.

2. The communication alleged that the Party concerned had failed to notify the public properly and in a timely manner or to consult the public concerned in the decision-making on planning of an industrial park comprising of, inter alia, oil and gas pipelines, installations for the storage of petroleum, three thermal power plants and a refinery near the lagoon ofNarta, on a site of 560 ha inside the Protected National Park. The communicant also alleged that the Party failed to make appropriate provision for public participation in accordance with article 7 of the Convention. The full text of the communication is available at littp://www.uncce.or~/env/pp/pubconi.htm.

3. The communication was forwarded to the Party concerned on 29 June 2005, following a preliminary determination by the Committee that it was admissible. At the same time, the Committee requested the communicant to present some clarifications and additional information, in particular on any use made of domestic remedies.

4. The Party concerned responded on 25 November 2005, disputing the claim of non- compliance. It stated, inter alia, that: (a) The government had not made a decision on the development of the proposed industrial park as a whole; (b) A decision-making process for the establishment of a thermal electric power station (TEP) was under way, but no decision on an environmental permit had been taken; (c) The public had been provided with timely and adequate access to information about construction ofthe thermal electric power station; (d) The government had never received any request for information on the projects from the communicant; (e) The public had had the possibility to participate in the decision-making process for the TEP, as three public meetings had been organized at different stages ofthe process (feasibility study, scoping and environmental impact assessment), with participation of local citizens and NGOs; (0 Since the government had not made any final decisions yet on the projects, there was nothing to be challenged through the courts or other appeal bodies in Albania by the communicant.

1 ACCC/C/2005/12 version 23 March 2007

5. The Committee discussed the communication at its tenth meeting (5-7 December 2005), with the participation of a representative ofthe communicant (Mr. Ardian Klosi) who provided additional information. The Party concerned had also been invited to send a representative but had declined to do so. The communicant was asked to provide additional information and to answer several questions in written form within four weeks. The Committee also asked the secretariat to seek certain additional information from the government, which was done by letter of 16 December 2005.

6. The communicant answered the questions by letter of 7 January 2006, providing additional information and several documents in Albanian with summaries in English. In its letter, the communicant alleged that there had been no public participation in decisions concerning the proposed industrial energy park. It maintained that there had been only pro forma public participation in the TEP project, because most ofthose who had participated were governmental employees and functionaries from one political party. The communicant also alleged that the state-owned Albanian Electrical Energy Corporation (Korporata Elektroenergjetike Shqiptare or KESH) had only announced the public discussion on the construction of the TEP and the documents had only been made available in February 2004, after the Environmental Impact Assessment (EIA) process had already been finished. The communicant further alleged that there had been no public information or public participation with respect to the decision-making processes concerning the proposed Albanian-Macedonia-Bulgaria Oil (AMBO) pipeline (see para. 44 below).

7. The communicant sent a further letter to the Committee on 1 February 2006 containing additional information about alleged plans ofthe Albanian government to issue a final license to the Italian-Romanian company LaPetrofilera which would allow it to start operating a large coastal terminal for the storage of oil and oil by-products in the Bay ofVlora without any public participation having taken place.

8. Having received no response from the Party concerned to its request of 16 December 2005 for additional information by the time of its eleventh meeting (29-3 1 March 2006), the Committee sent a second request on 12 April 2006, asking for additional information and some clarifications.

9. On 12 June 2006, the Party concerned provided the Committee with the text ofthree decisions of the Council of Territorial Adjustment ofthe Republic of Albania, all dated 19 February 2003. Decision No. 8 approved the use ofthe territory for the development of an industrial and energy park; Decision No. 9 approved the construction site for a coastal terminal for the storage of oil and oil by-products and associated port infrastructure in Vlora; and Decision No. 20 approved the construction site of the TEP in Vlora. The Party concerned also sent the Committee a chronology ofthe participation ofthe public in the decision-making process for the TEP, stating that the procedures had been in accordance with national and international law.

10. As the Party concerned had not fully answered the Committee’s questions, on 5 September 2006, the secretariat wrote on behalf ofthe Chairperson requesting it to provide additional information before the thirteenth meeting ofthe Committee (4-6 October 2006). In its response,

2 ACCC/C/2005/12 version 23 March 2007 sent to the secretariat on 21 October 2006, the Party concerned answered some ofthe outstanding questions. However, it failed to answer a number of other questions, including questions on public notification and participation procedures in the decision-making process for the industrial energy park; nor did it discuss the time frame for appeal to the court or provide a copy of the decision of the Albanian Parliament on funding of the TEP.

11. On 20 November 2006, the secretariat sent a further letter to the Party concerned on behalf of the Chairperson reiterating the request for the missing information and posing a few additional questions. It was also agreed to return to the discussion phase at the fourteenth meeting ofthe Committee, and consequently both the Party concerned and the communicant were notified accordingly and invited to participate.

12. On 1 December 2006, the Party concerned answered in some detail a question about the possibilities for access to administrative and judicial review, providing new information about Albania’s Ombudsman and the role ofthe courts in the Constitution and laws of Albania. However, it did not answer a question on whether there was a possibility of appeal before a final decision had been taken. It also failed to answer a crucial question about notification of the public and public participation in decision making on the industrial park. Finally, it did not send four documents requested by the Committee.

13. Meanwhile, at its eleventh meeting, the Committee had decided to seek information from the World Bank and the European Bank for Reconstruction and Development (EBRD), as two of the main financing institutions for the TEP. It noted that the project was subject to their procedures, including procedures related to information and participation issues. The secretariat sent letters to both institutions on 27 July 2006 inviting them to provide any relevant information, including whether the World Bank’s Inspection Panel was or had been addressing the issue.

14. The World Bank office in Tirana responded in a letter dated 2 August 2006 that it was not and had never been involved in the development ofthe industrial park project, but that it had consistently advised the Government ofAlbania that the development of any facility planned to be included in such a park should be subject to an appropriate environmental assessment. Regarding the thermal power plant in Vlora, the World Bank, EBRD and the European Investment Bank had agreed to finance the project and consultants funded by the United States Trade and Development Agency had selected the location based on a detailed siting study, taking into consideration environmental issues. According to the above letter, the siting study had been followed by preparation of a fill Environmental Assessment, during which several scoping sessions and public consultations had been organized, and public input had been taken into account. The Bank stated that the meetings had been well attended by representatives of governmental agencies, universities, NGOs and the general public and had been publicized by Albanian television. According to the Bank, “The entire process was carried out in accordance with Albanian laws and in compliance with applicable EU and World Bank guidelines.” Finally, the World Bank letter stated that no complaint had been registered with the World Bank Inspection Panel regarding the Vlora project.

15. The communicant sent a letter to the Committee on 30 September 2006 commenting on the World Bank response. It stated that even if the World Bank was not directly involved in the

3 ACCC/C/2005/12 version 23 March 2007 industrial park, the Bank was aware ofthe other components that were envisaged for the industrial park as well as the intention to expand the TEP itself from a capacity of 100 MW up to a capacity of 300 MW. Despite this, public presentations ofthe project had only addressed the impact and emissions from a 100 MW power plant, thus failing to take into account the future cumulative environmental impact ofthese projects. Thus, the information presented by the project’s proponents during the public consultation process was, in the view ofthe communicant, ‘oriented to disinformation’ .

16. The communicant furthermore stated that there was no evidence that intellectuals and NGOs ofVlora had participated in the meeting on 3 1 October 2002. Besides, this meeting had taken place after the approval ofthe Siting Study and Feasibility Study. The communicant argued that at that stage there had been a lack ofpublication of information. It cited the director of the National Agency for Energy, Mr. Besim Islami, who, in answer to a question from a member of the public at the public meeting on 3 September 2003, admitted that “There were not any views taken on this phase from the local government, as this was not requested from the company for the reason of confidence and prudence. In these days and in the last month we have been passing into these explanatory and indispensable procedural meetings.”

17. The EBRD in its response of 25 October 2006 to the letter from the secretariat confirmed that it was providing financing for the construction ofthe TEP and stated that it was not involved in the industrial park. The EBRD Board of Directors had approved the financing for the TEP following its review of the project documentation, including reports on compliance with the Bank’s policies and procedures on public consultation. The project was subject to EIA and public consultations that had been carried out in accordance with Albanian EIA legislation and the World Bank’s environmental guidelines, which were comparable to the EBRD EIA requirements.

18. The Compliance Committee at its fourteenth meeting (13-1 5 December 2006) discussed the case with the participation ofrepresentatives of both the Party concerned and the communicant, both ofwhom answered questions, clarified some issues and presented some new information. The Party concerned provided information about current status of the TEP, namely that no applications for environmental, construction or operating permits had been lodged. As far as the industrial energy park was concerned, the only decision made was about its location. Although some questions remained unanswered, the Committee decided to move to the preparation of draft findings and recommendations.

19. The Committee at its eighth meeting (May 2005) had determined on a preliminary basis that the communication was admissible, subject to review following any comments received from both parties. At its fourteenth meeting (December 2006), the Committee confirmed that the communication was admissible.

20. At its eighth meeting, the Committee also discussed the extent to which use had been made of domestic remedies and requested fbrther information from the communicant on this point. After receiving additional information and answers from the communicant, the Committee at its tenth meeting in December 2005 again discussed the question of domestic remedies in the presence ofthe communicant. The communicant asserted that its attempt to conduct a

4 ACCC/C/2005/12 version 23 March 2007 referendum against the industrial park was the use of a domestic remedy. The communicant had collected 14,000 signatures (10% ofthe electorate in Vlora), which was the amount necessary for a referendum according to the Albanian Constitution. However, on 25 November 2005, the Election Committee had refused the request for a referendum. The communicant had then appealed this decision to the court in Tirana despite having doubts about the prospects of a successful outcome. The Supreme Court rejected the appeal in December 2006.

2 1. In explaining why it had not pursued more traditional channels of administrative or judicial review, the communicant stated in its letter of 7 January 2006 that the “judiciary system in Albania is very slow and sluggish, in many aspects corrupt” and that “there was not a single case up to this day that would have been decided in favour of an environmental complaint or charge”.

22. The Party concerned in its initial response of 25 November 2005 took the position that there were no domestic remedies currently available in the present case: “Since there is no decision taken on the projects, there is nothing to be challenged by courts or other appeal bodies”. However, in its letter of 21 October 2006, the Party concerned stated that “the Albanian legislation does provide for possibilities to appeal for cases when there is noticed failure to provide information or inadequate notification. According to Albanian law, the case can be sent to court for violation of procedures., . ”. The Party did not indicate at what stage this possibility existed - before or after the decision is made.

23. In its response of 1 December 2006, the Party concerned, in addition to providing a detailed explanation of the possibilities for access to administrative review and to the courts in accordance with the Constitution and legislation ofAlbania, presented information about access to the Ombudsman. At the fourteenth meeting ofthe Committee, the representative ofthe Party concerned stated that access to justice was possible both before and after a decision is made. The communicant in response explained that it had not tried to use the Ombudsman or seek administrative review because it considered that to challenge the decision ofthe Cabinet of Ministers signed by the Chairman ofthe Council, who also happened to be the then Prime Minister, was “out of the question”.

11. SUMMARY OF THE FACTS, EVIDENCE AND ISSUES]

24. The communication concerns a proposal to establish an industrial and energy park north of the port of Vlora on the Adriatic coast. The facts relating to proposed energy park itself and some of its envisaged components, notably the TEP, the oil storage facility and the proposed oil and gas pipeline, are summarized in the following paragraphs, taking into account that different components relate to different provisions ofthe Convention.

Industrial and energy park

25. On 19 February 2003, the Council ofTerritorial Adjustment ofthe Republic ofAlbania approved through Decision No. 8 the site of an industrial and energy park immediately to the

This section summarizes only the main facts, evidence and issues considered to be relevant to the question of compliance, as presented to and considered by the Committee.

5 ACCC/C/2005/12 version 23 March 2007 north ofthe city ofVlora. Through this Decision, signed and stamped by Mr. Fatos Nano, Chairman of the Council, who was the Prime Minister at the time, the Council “Decided: The approval ofthe territory for the development of ‘The Industrial and Energy Park - Vlore.”’ Decision No. 8 fbrthermore deemed that the Ministry ofIndustry and Energy “should coordinate work” with various Ministries and other bodies “to include within this perimeter [of the industrial and energy park] the projects ofthe above mentioned institutions, according to the designation ‘Industrial and Energy Park.”’ It stated also that various Ministries “must carry out this decision” and “This decision comes to force immediately.”

26. The Party concerned informed the Committee that the decision had been subject to an EIA procedure; however, the EIA was not detailed, because it was considered that the separate components of the proposed park would each carry their own more demanding EIA requirements.

27. The Committee has not been provided with any evidence ofpublic participation, including notification or public announcement, in the process leading up to Decision No. 8.

28. In October 2005, following a change of government the Prime Minister established an ad hoc commission to consider the economic and environmental aspects ofVlora industrial and energy park project. Three meetings were held with stakeholders, two in Tirana (22 and 29 October 2005) and one in Vlora (1 1 November 2005). The communicant has not contested that these meetings took place and that they enabled the concerned stakeholders to participate, and it has confirmed that its representatives did indeed participate in them. Its objections relate rather to the perception that there was a lack of willingness to from the proponents ofthe project, including the Government, to “listen and to take into consideration the opinion and the will of the people”, thereby reducing the decision-making process to “a mere rubber stamp”.

29. The communicant states that it submitted several requests for information regarding the plans for the industrial park to the Ministry of Energy and to the Ministry ofthe Environment, but that it has never received any answer from them. However, the communicant did not present any evidence to substantiate that statement (e.g. copies of letters, proof of receipt). The Party concerned maintains that no such requests from the communicant have been ‘registered’ by the Ministry of the Environment. The communicant did present a copy of a letter from Ekolevizja (the most well known network of environmental organizations in Albania) to the Ministry of Environment dated 3 March 2005 asking for information about the proposed TEP and oil storage facility in Vlora, to which it had received no response. The communicant did not present proof of receipt of the request.

Thermal electric power plant (TEP)

30. On 19 February 2003, the Council ofTerritorial Adjustment approved through Decision No, 20 on the construction site ofthe TEP in Vlora. Through this Decision, signed and stamped by Mr. Fatos Nano, Chairman of the Council, who was the Prime Minister at the time, the Council “Decided: to approve the construction site with a surface of 14 hectares for the facility of the new Prot of Vlora, within the industrial Energy Park.. . according to the attached layout”. It stated also that the Council of the District ofVlora and the Ministry ofEnergy and industry should carry out this decision” and “This decision comes to force immediately.”

6 ACCC/C/2005/12 version 23 March 2007

3 1. The Committee has not been provided with any evidence of public participation including notification or public announcement in the process leading up to Decision No. 20.

32. The Party concerned informed the Committee that in order to address the problem with electricity supply in Albania, the Ministry for Industry and Energy and KESH began to study the technical and financial viability ofinstalling new base load thermal generation facilities in Albania. KESH asked for funding from EBRD, the World Bank and EIB.

33. The United States Trade and Development Agency (USTDA) awarded a grant to the Government ofAlbania to assist in the development ofthe new thermal generation facility. The Albanian Ministry of Industry and Energy hired international consultants Montgomery Watson Harza (MWH) to select the best site and technology, to conduct a feasibility study, and to conduct an environmental impact assessment (EIA) of the proposed facility.

34. Site selection was undertaken during the period April-September 2002. A draft Siting Report was completed on 6 June 2002 recommending Vlora as the best site and distillate oil-fired, base load, combined cycle generation allowing for conversion to natural gas as the best generation technology. On 21 June 2002, the Ministry of Energy and KESH approved the recommendation. MWH then conducted a detailed feasibility study to evaluate the technical requirements and the financial, environmental, and social viability ofthe proposed generation facility with an installed capacity range of 90 to 130 MW at the selected site. On 21 October 2002, the feasibility study was completed and ‘introduced in Vlora’.

35. On 3 1 October 2002, the Ministry of Energy and Industry convened a public meeting in Vlora to introduce the project and begin the public consultation process. On 21 December 2002, the Council of Territorial Adjustment (Vlora District) approved the choice ofthe site for the TEP. On 19 February 2003, the Council of Territorial Adjustment of the Republic of Albania confirmed the site ofthe TEP through Decision No. 20.

36. On 2 April 2003, a public meeting was held in Vlora to discuss the terms ofreference for the EIA study (scoping). On 23 July 2003, copies ofthe draft EIA study were delivered in Vlora for public consultation purposes. On 3 September 2003, a further public meeting was held to discuss the draft EIA study.

37. As regards the participation ofthe public in the three public meetings referred to in the previous paragraphs, varying degrees of information are available to the Committee:

(a) The introductory meeting on 3 1 October 2002 was attended by various representatives of national and local authorities as well as, according to the Party concerned, intellectuals and NGOs ofVlora. The communicant disputes the claim that intellectuals and NGOs of Vlora participated. The Committee has repeatedly requested2 the Party concerned to provide specific information concerning the process of notification for the meeting (for residents, NGOs and other stakeholders) and a list ofparticipants, but no such information has been forthcoming.

Initially by letter of 16 December 2005.

7 ACCC/C/2005/12 version 23 March 2007

(b) The meeting on 2 April 2003 to review the scope of the EIA was attended by more than 100 people, 40 ofwhom signed an attendance sheet a copy of which was made available to the Committee. The communicant commented that “there was not a single NGO represented or any important environmental activist in this meeting” and that public opinion was not taken into account in the decision. It stated that those considered to represent the public presence at this meeting and at the third meeting were mostly members of the local government and the Socialist Party who were promoting the construction of the industrial and energy park. Without directly disputing this, the Party concerned maintained that among those actors it had identified as potential participants in the meeting were environmental and public information NGOs. However, it did not provide the Committee with any details ofwhich ofthese were invited to participate, or more generally ofthe steps taken to notify the public concerned.

(c) The meeting on 3 September 2003 to review the draft EIA was attended by some 35 people, a list of whom was included in the EIA study (Appendix E). Of these, five appear to have been technical experts, 15 represented various public authorities, five represented various local enterprises, the affiliation of six was not indicated and four appear to have been associations, including two environmental organizations. Again, information requested from the Party concerned regarding the process ofnotification ofthe public concerned which might help to shed light on this apparent imbalance in participation has not been forthcoming.

(d) The Party concerned states that notifications of these meetings “were made available one month prior (according to the information given by the consulting ~ompany).”~No further information on the manner or content ofthe notifications has been forthcoming.

(e) The final EIA document, published on 6 October 2003, five weeks after the third public meeting, states that all three meetings ‘were covered by Albanian television stations and broadcast through a segment on the nightly news’.

(f) A document entitled ‘Summary of Environmental Impacts Associated with the Vlore Thermal Power Station’, prepared [by ...Ifor the purposes of meeting the requirements of EBRD’s public disclosure and consultation procedure, states that “The public was well engaged in a dialogue concerning the project early on in the EIA process. Public announcements were thorough, transparent and well distributed.” It maintains that “direct invitations to attend public meetings were sent to institutions and individuals” and that the process was coordinated closely with (among others) “citizens of Vlore, Vlore University students and faculty, local and national television stations, more than 20 non-governmental organizations (NGOs) and others associated with social and environmental issues.” However, the document does not go into detail as to who was notified or invited to which meeting, and while it does provide some more information concerning the meetings (to some extent reflected in subparagraphs (a) to (c) above) information concerning the first meeting is particularly sparse.

38. The EIA study was finalized on 6 October 2003. On 18 October 2003, KESH issued a press release launching a public discussion on the evaluation ofthe ETA. It invited all interested parties to participate in an open consultation process and provided information on where the relevant documents could be obtained.

Letter of 25 November 2005.

8 ACCC/C/2005/12 version 23 March 2007

39. On 10 February 2004 KESH issued a further press release along similar lines though providing more specific details on where and by what date comments should be submitted and indicating that the suggestions from the public would be included in an annex to the EIA. Specifically, the EIA materials would be available for a 120-day period from 9 February 2004 to 7 June 2004 for public review and comment, in a number ofpublic locations, including in Vlora, in accordance with EBRD’s public consultation and disclosure procedure. Announcements containing this information were also placed in various newspapers.

40. The public meetings held in late 2005 referred to in paragraph 28 above, while established to consider the economic and environmental aspects ofthe industrial and energy park project, appear to have focused on the TEP and should therefore be taken into consideration in reviewing the overall decision-making process for the TEP.

4 1, No application for an environmental permit, construction permit or operating permit for the TEP has yet been lodged. The only decision that has been taken concerns the location ofthe TEP .

Oil storage terminal and port infrastructure

42. On 19 February 2003, the Council of Territorial Adjustment ofthe Republic of Albania approved the construction site for a coastal terminal for storage of oil and by-products and associated port infrastructure through Decision No. 9. On 8 May 2003, the Council of Ministers adopted a decision approving a concession procedure to the benefit of the Italian-Romanian company La Petrolifera. On 13 May 2004, the concession was approved by Parliament. On 11 February 2005, the Council of Ministers adopted a decision registering the land in the name of Petrolifera. Any such facility having a capacity of 200,000 tons or more would fall within the scope of annex Iof the Convention. The communicant provided information orally at the fourteenth session, which was not contested by the Party concerned, to the effect that the envisaged capacity was of the order of 500,000 tons.

43. No evidence of public participation in or prior to this sequence of decisions has been presented to the Committee.

Oil and gas pipelines

44. On 5 December 2003, the Council of Territorial Adjustment ofthe Republic of Albania approved the route of the proposed AMBO pipeline. On 26 April 2004, the Council of Territorial Adjustment (Vlora District) approved the route of the pipeline. No evidence of public participation prior to either of these decisions has been pre~ented.~

The Committee is aware of another proposal for a gas pipeline passing through Vlora, namely the Trans-Adriatic Pipeline proposal from the Swiss company Elektrizitatz Gesellschafi Laufenburg AG for a pipeline which would bring gas fkom the Caspian, Russia and the Middle East through Greece and Albania to fuel Italian power stations, but has not received any information concerning the decision-making processes involved.

9 ACCC/C/2005/12 version 23 March 2007

National legislative framework

45. The EIA legislation of Albania has provisions on public debate over projects and the associated EIA reports, with participation of various agencies and stakeholders including “interested people [and] environmental not-for-profit organizations”. The debate should be organized and directed by the responsible local authority, which should within five days of receipt ofa consultation request from the Minister ofEnvironment: a) notify the public and environmental not-for-profit organizations and put at their disposal the environmental impact assessment report for a period of one month and b)within one month, organize an open debate with all those interested, notifying participants ten days in advance (art. 20).

46. A separate article, article 26, is dedicated to public participation. Whereas article 20 appears to apply to the stage when the EIA report has been prepared, article 26 provides that the interested public and environmental not-for-profit organizations may participate in all phases of the environmental impact assessment decision-making process. The Minister of Environment is required to determine with a separate normative act the duties of environmental organs in order to guarantee the participation ofthe public and of environmental not-for-profit organizations in this process.

47. The legislation does not have a provision on appeal to a court or another independent judicial body. Instead, in case of irregularities in the EIA process, the public may request the Minister of the Environment to carry out a partial or full review of the process of environmental impact assessment and the Minister is required to reply within twenty days from receipt of request. This is distinct from the appeal possibilities referred to by the Party concerned in its letter of 1 December 2006 (see para. 23 above), according to which the Code of Administrative Procedures gives the right to initiate or participate in administrative processes and procedures for administrative review as well as for appeals whereby any person may make a motion to nullify, cancel or change of administrative decisions.

48. According to the EIA legislation, strategic environmental assessment is required inter alia for strategies and action plans on energy, industry, transport, territory adjustment, national and regional plans, industrial areas, coastal areas, tourism areas, protected areas (art.5). Procedures, deadlines and parties’ obligations in all phases of strategic environmental assessment process shall be the same as for projects requiring the more in-depth process of environmental impact assessment.

111. CONSIDERATION AND EVALUATION BY THE COMMITTEE

49. Albania deposited its instrument of ratification of the Convention on 27 June 2001. The Convention entered into force for Albania on 25 September 2001.

50. The Convention, as a treaty ratified by Albania, is part ofthe Albanian legal system and is directly applicable, including by the courts. The Party concerned has stated that some aspects of the Convention have been transposed into national law, but has not been specific about this.

10 ACCC/C/2005/12 version 23 March 2007

A. Admissibility and use of domestic remedies

5 1. As mentioned under paragraph 20 above, the Committee found the communication to be admissible. Nonetheless, the Committee does have some concerns about the limited extent to which the communicant made use of domestic remedies. The communicant did not try to apply to a court or another independent or impartial body established by law, either about the alleged refusal ofthe information requests (as entitled under article 9, paragraph l),or about the alleged failure ofthe public authorities to notify the public concerned about the proposed activities in an adequate, timely and effective manner and to take into account its concerns (under the article 9, paragraph 2).

52. The communicant attempted to justify this at one point by asserting that Albanian legislation did not provide domestic judicial or similar remedies ofthe kind envisaged under article 9; at another stage, by reference to its lack of confidence in the ability ofthe Albanian courts to safeguard its interests in an effective way, referring to the judicial system as ‘slow and sluggish, in many aspects corrupted’ and asserting that ‘there was not a single case up to this day that would have been decided in favour of an environmental complaint or charge’. Furthermore, it considered its efforts to raise signatures and thereby recipitate a referendum to be a form of domestic remedy, albeit not in a conventional sense. sp

53. Decision I/7 ofthe First Meeting ofthe Parties ofthe Aarhus Convention says that the Committee should “take into account any available domestic remedy” (emphasis added). As previously noted by the Committee (MP.PP/C. 1/2003/2, para. 37), this is not a strict requirement to exhaust domestic remedies. The Party concerned said in November 2005 that there was no domestic judicial remedy that could be used before the decision was taken, as there was nothing that a court could consider. A year later, the Party concerned presented general information to the effect that according to the Constitution and laws ofAlbania, there was access to administrative review, Ombudsman and courts. The first statement of the Party concerned could be seen to imply that the three decisions the text ofwhich it submitted to the Committee in June 2006 (see para. 9 above) were not subject to appeal, which was also the position of the communicant (see para. 23); by contrast, its second statement indicated that they could have been appealed. In any event, there appears to be a certain lack of clarity with regard to possibilities to appeal certain decisions.

54. The Committee regrets the failure ofboth the Party concerned and the communicant to provide, in a timely manner, more detailed and comprehensive information on the possibilities for seeking domestic remedies. Furthermore, it does not accept the communicant’s assertion that it has tried all possible domestic remedies. Nonetheless, in the face of somewhat incomplete and contradictory information concerning the availability of remedies, also from the side ofthe Party concerned, the Committee cannot reject the allegations ofthe communicant that domestic remedies do not provide an effective and sufficient means ofredress.

’ The reasons why the Election Committee, and subsequently the Supreme Court, rejected this initiative despite the requisite number of signatures having supposedly been obtained remain unclear to the Committee.

11 ACCC/C/2005/12 version 23 March 2007

B. Legal basis

55. As is clear from section I,the case concerns a number of different issues and proposed activities: the energy and industrial park, the TEP, the oil storage facility, the oil and gas pipelines, among others. Each of these issues and proposed activities has its own decision- making processes, and to a certain extent they relate to different provisions of the Convention.

56. During the discussion on the case which took place at the Committee’s fourteenth meeting (1 3- 15 December 2006), the communicant indicated that the various decisions of the Albanian authorities referred to in the communication were parts of an overall construction and development plan, about the existence of which the public had not been informed. No evidence or further information to substantiate this allegation has been made available to the Committee. Consequently, the Committee has not addressed this issue in its findings and conclusions. The Committee, however, notes that where such overall plans exist, they might be subject to provisions of the Convention and that, in any event, meaningful public participation, generally speaking, implies that the public should be informed that the decisions subject to public participation form parts of an underlying overall plan where this is the case.

57. The Committee decides to primarily concentrate on the issue of public participation with regard to the making ofthree decisions by the Council of Territorial Adjustment ofthe Republic of Albania, all made on 19 February 2003, namely Decision No. 8 (approving the site ofthe proposed industrial and energy park), Decision No. 9 (approving the construction site for the proposed coastal terminal for storage of oil and by-products and associated port infrastructure) and Decision No. 20 (approving the construction site of the proposed TEP). This approach is in line with the Committee’s understanding, set out in its first report to the Meeting of the Parties (ECE/MP,PP/2005/13, para. 13), that Decision I/7 does not require the Committee to address all facts and/or allegations raised in a communication. This procedural decision by the Committee to focus on these issues does not prevent it from addressing other aspects ofthe case.

58. The three decisions have in common that they are crucial for the entire decision-making in relation to these sites, constructions and activities. The Committee will first have to consider whether the relevant decisions amount to decisions on specific activities under article 6 ofthe Convention, or decisions on plans under article 7. The Committee, in one ofits earlier decisions pointed out that “When determining how to categorize a decision under the Convention, its label in the domestic law of a Party is not decisive. Rather, [. . .it] is determined by the legal functions and effects of a decision.. .” (ECE/MP.PP/C.l/2006/4/Add.2, para. 29). Also as previously observed by the Committee (ECE/MP.PP/C. 1/2006/2/Add. 1, para. 28), the Convention does not establish a precise boundary between article 6-type decisions and article 7-type decisions.

59. Decision Nos. 9 and 20 concern activities oftypes that are explicitly listed in annex Iof the Convention. Paragraph 1 of annex Irefers to ‘Thermal power stations and other combustion installations with a heat input of 50 megawatts (MW) or more’. Paragraph 18 refers to ‘Installations for the storage of petroleum, petrochemical, or chemical products with a capacity of 200,000 tons or more’. Other paragraphs of the annex may also be relevant to Decision No. 9. As regards Decision No. 8, industrial and energy parks are not listed in annex Ias such, even though many of the activities that might typically take place within such parks are listed. If an

12 ACCC/C/2005/12 version 23 March 2007

EIA involving public participation for such a park were required under national legislation, it would be covered by paragraph 20 of annex I.

60. Decisions Nos. 9 and 20 are decisions that simply designate the site where the specific activity will take place and a number of further decisions to issue permits of various kinds (e.g. construction, environmental and operating permits) would be needed before the activities could proceed. Nevertheless, on balance, they are more characteristic of decisions under article 6 than article 7, in that they concern the carrying out of a specific annex Iactivity in a particular place by or on behalf of a specific applicant.

61. Decision No. 8 on the industrial and energy park, on the other hand, has more the character of a zoning activity, i.e. a decision which determines that within a certain designated territory, certain broad types of activity may be carried out (and other types may not).6 This would link it more closely with article 7.

62. The proposed industrial and energy park includes several separate construction projects, each of which would require various kinds of permits. From the information received from the Party concerned and the communicant is not clear is the extent to which the industrial park itself, as distinct from its components, would require fbrther permitting processes, which would in turn allow opportunities for public participation. This too might be a factor distinguishing Decision No. 8 from Decision Nos. 9 and 20, because it is clear that the latter decisions will be followed by further permitting decisions for the respective projects.

63. Taking into account the fact that different interpretations are possible with respect to these issues, the Committee chooses to focus on those aspects ofthe case where the obligations ofthe Party concerned are most clear-cut. In this respect, it notes that the public participation requirements for decision-making on an activity covered by article 7 are a subset ofthe public participation requirements for decision-making on an activity covered by article 6. Regardless of whether the decisions are considered to fall under article 6 or article 7, the requirements of paragraphs 3,4 and 8 of article 6 apply. Since each of the decisions is required to meet the public participation requirements that are common to article 6 and article 7, the Committee has decided to examine the way in which those requirements have or have not been met.

64. The Committee is aware that at least two of the three decisions that it has chosen to focus on would need to be followed by further decisions on whether to grant environmental, construction and operating permits (and possibly other types of permit) before the activities in question could legitimately commence. However, public participation must take place at an early stage ofthe environmental decision-making process under the Aarhus Convention. Therefore it is important to consider whether public participation has been provided for at a sufficiently early stage ofthe environmental decision-making processes in these cases.

In reaching this conclusion, the Committee notes the definition of“plans” in the EC Guide for Implementation of Directive 2001/42 on the Assessment ofthe Effects of Certain Plans and Programmes on the Environment: “Plan is one which sets out how it is proposed to carry out or implement a scheme or a policy. This could include, for example, land use plans setting out how land is to be developed, or laying down rules or guidance as to the kind of development which might be appropriate or permissible in particular areas.” Definition of‘‘program’’ is “the plan covering a set of projects in a given area.. . comprising a number ofseparate construction projects.. , .” Iittp://~~~.ti~iece.ore/env~seaec auicle/sect3.htm#Refi7

13 ACCC/C/2 00 5/ 12 version 23 March 2007

C. Substantive issues

Industrial and energy park

65. The Party concerned has informed the Committee that there was “no complex decision taken on the development of industrial park as a whole”. It has emphasized that Decision No. 8 ofthe Council of Territorial Adjustment ofthe Republic ofAlbania “On the Approval ofthe Industrial and Energy Park - Vlore”, which approved the development of ‘The Industrial and Energy Park - Vlore’, was just a location (siting) decision. However, this does not detract from its importance, both in paving the way for more specific decisions on future projects and in preventing other potentially conflicting uses of the land. Several Ministries were instructed to carry out this decision. The decision came into force immediately. It is clear to the Committee that this was a decision by a public authority that a particular piece of land should be used for particular purpose, even if further decisions would be needed before any ofthe planned activities could go ahead.

66. No evidence of any notification ofthe public concerned, or indeed of any opportunities for public participation being provided during the process leading up to this decision, has been presented to the Committee by the Party concerned, despite repeated requests. The documents provided by the Party concerned do not demonstrate that the competent authorities have identified the public that may participate, as requested under article 7 of the Convention, and that they have undertaken necessary measures to involve the members ofthe public into the decision- making. To the contrary, the evidence provided suggests that the opponents were not properly notified.about the possibilities to participate. The Committee is therefore convinced that the decision was made without effective notification ofthe public concerned, which ruled out any possibility for the public to prepare and participate effectively during the decision-making process. Given the nature ofthe decision as outlined in the previous paragraph, even if public participation opportunities were to be provided subsequently with respect to decisions on specific activities within the industrial and energy park, the requirement that the public be given the opportunity to participate at an early stage when all options are open was not met in this case. Because of the lack of adequate opportunities for public participation, there was no real possibility for the outcome of public participation to be taken into account in the decision. Thus the Party concerned failed to implement the requirements set out in paragraphs 3,4 and 8 of article 6, and consequently was in breach of article 7.

Thermal electric power plant

67. Contrary to the decision-making process leading up to the designation ofthe site ofthe industrial and energy park, the decision-making process relating to the proposed TEP involved some elements ofpublic participation, e.g. public notifications, public meetings, availability of EIA documentation and so on. However, as regards Decision No. 20, dated 19 February 2003, which establishes the site ofthe TEP, the only element of public participation in this phase of the process appears to have been the public meeting that took place in Vlora on 3 1 October 2002. The issues of who was notified of the meeting and invited to participate in it, the content ofthe notification, and who actually participated, are therefore important. As mentioned above (para.

14 ACCC/C/2005/12 version 23 March 2007

37(a)), the Party concerned asserted that among those who participated in the meeting were “intellectuals and NGOs ofVlora” This assertion has been strongly disputed by the communicant. Unfortunately, despite repeated requests by the Committee, the Party concerned has failed to provide specific information on these points. The obscure circumstances around the meeting in October 2002, and the failure ofthe Party concerned to provide anything to substantiate the claim that the October meeting was duly announced and open for public participation, clearly point to the conclusion that the Party concerned failed to comply with the requirements for public participation set out in paragraphs 3,4 and 8 of article 6 ofthe Convention.

68. The two meetings that took place on 2 April 2003 and 3 September 2003, respectively, obviously occurred after the adoption of Decision No. 20, and therefore cannot be considered as events contributing to the involvement ofthe public in that decision. Thus, they do not mitigate the failure ofthe Party concerned to comply with the Convention in the process leading to Decision No. 20 of 19 February 2003.

69. Even so, the Committee wishes to make a short comment on these meetings as well, since they also give rise to concern. No information has been provided by the Party concerned to demonstrate that the meetings in April and September 2003 were publicly announced, so as to make it possible also for members ofthe public opposing the project to actively take part in the decision-making. Nor has the Party concerned been able to give any reasonable explanation as to why the rather strong local opposition to the project, indicated by the 14,000 people calling for a referendum, was not heard or represented properly at any ofthese meetings. It is thus clear to the Committee that the invitation process also at this stage was selective and insufficient. The only public notification, in the form ofnewspaper advertisements, that was presented to the Committee related to meetings that took place later in 2004. Thus the Committee notes that, despite some subsequent efforts to improve the means for public participation, there were several shortcomings also in the decision-making process after February 2003.

Oil storage terminal and port infrastructure

70. Decision No. 9 approving the construction site for a proposed coastal terminal for storage of oil and by-products and associated port infrastructure appears to have been adopted without any prior public participation. Assuming that the proposed oil storage terminal would have a capacity ofmore than 200,000 tons (see para. 42), it is an activity falling within the scope of annex Iof the Convention. Considered under either article, the lack of public participation possibilities leading up to the decision represents a failure to implement the requirements set out in paragraphs 3,4 and 8 of article 6.

Oil and gas pipelines

71. The Committee notes that pipelines for the transport of gas, oil or chemicals with a diameter of more than 800 mm and a length ofmore than 40 km are listed in paragraph 14 of annex Iof the Convention and therefore subject to the full set ofpublic participation requirements under article 6. The AMBO pipeline and other pipeline proposals have not been a particular focus of the Committee’s attention, and the Committee has not received sufficient information from the

15 ACCC/C/2005/ 12 version 23 March 2007

Party concerned or the communicant to be in a position to conclude whether or not there was a failure of compliance with the Convention.

Requests for Information, Article 4

72. With regard to the allegations of the communicant that several requests for information were refused or ignored (para. 29 above), the Committee is concerned that at least some information requests to the government may not be registered or dealt with properly. However, in the absence of more concrete evidence, including proof that the requests were received by the public authorities in question, the Committee is not in a position to find that there was a failure to comply with article 4 ofthe Convention.

Clarity of the framework, Article 3, paragraph 1

73, The Committee is concerned about the lack of a clear, transparent and consistent framework to implement the provisions of this Convention in Albanian legislation. In particular, there is no clear procedure of early notification ofthe public (by public announcement or individual invitations, before a decision is made), identification ofthe public concerned, quality of participation, or taking the outcome of public meetings into account. Besides the fact that the Committee had difficulties to obtain information from both parties who did not answer all its questions in a timely and comprehensive manner and that it still has some questions unanswered, the Committee considers that the Party concerned should take the necessary legislative, regulatory and other measures to achieve compatibility between the provisions implementing the information, public participation and access-to-justice provisions ofthe Convention.

Process of developing findings and recommendations

74. As a general remark on the processing ofthe communication, the Committee is concerned by the fact that it has taken more than two years to prepare findings and recommendations in this case. This is at least partly attributable to the initial lack of engagement ofthe Party concerned in the process (as evidenced not least by the fact that it did not accept the invitation to participate the discussion at the eleventh meeting ofthe Committee), and to the difficulties in obtaining timely, accurate and comprehensive answers from both the Party concerned and the communicant.

IV. CONCLUSIONS

75. Having considered the above, the Committee adopts the findings and recommendations set out in the following paragraphs.

A. Main findings with regard to non-compliance

76. With respect to the proposed industrial and energy park (paras. 65-66), the Committee finds that the decision by the Council ofTerritorial Adjustment ofthe Republic ofAlbania to allocate territory for the Industrial and Energy Park of Vlora (Decision No. 8 of 19 February 2003) falls

16 ACCC/C/2005/12 version 23 March 2007 within the scope of article 7 and is therefore subject to the requirements of article 6, paragraphs 3,4 and 8. The Party concerned has failed to implement those requirements in the relevant decision-making process and thus was not in compliance with article 7.

77. With respect to the proposed thermal electric power plant (paras. 67-69), the Committee finds that the decision by the Council of Territorial Adjustment ofthe Republic of Albania on the siting of the TEP near Vlora (Decision No. 20 of 19 February 2003) is subject to the requirements of article 6, paragraphs 3,4 and 8. Although some efforts were made to provide for public participation, these largely took place after the crucial decision on siting and were subject to some qualitative deficiencies, leading the Committee to find that the Party concerned failed to comply with the requirements in question.

78. With respect to the proposed coastal terminal for storage of oil and by-products and associated port infrastructure (para. 70), the Committee finds that the decision by the Council of Territorial Adjustment ofthe Republic ofAlbania on the siting ofthis facility near Vlora (Decision No. 9 of 19 February 2003) is subject to the requirements ofarticle 6, paragraphs 3,4 and 8. The failure of the Party concerned to provide for public participation possibilities leading up to that decision represents a failure to implement those requirements.

79. By failing to establish a clear, transparent and consistent framework to implement the provisions of the Convention in Albanian legislation the Party concerned was not in compliance with article 3, paragraph 1, of the Convention (para. 73).

B. Recommendations

80. moting that the Party concerned has agreed that the Committee take the measure referred to in paragraph 37 (b) of the annex to decision I/7,] the Committee, pursuant to paragraph 36 (b) of the annex to decision I/7, [has adopted] the recommendations set out in the following paragraphs.

8 1. The Committee recommends that the Party concerned take the necessary legislative, regulatory, administrative and other measures to ensure that:

(a) A clear, transparent and consistent framework to implement the provisions of the Convention in Albanian legislation is established;

(b) In order to comply with article 7 ofthe Aarhus Convention, “practical and/or other provisions for the public to participate during the preparation ofplans and programmes relating to the environment” are in place not only during preparation of individual projects, including through development of detailed procedures and practical measures to implement article 25 ofthe EIA Law ofAlbania;

(d) Notification ofthe public is made at an early stage for projects and plans, when options are open, not when decisions are already made;

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(e) Notification of the entire public which may participate, including non-governmental organizations opposed to the project, is provided, and notifications are announced by appropriate means and in an effective manner so as to ensure that the various categories ofthe public which may participate are reached, and records kept ofsuch notifications;

(f)The locations where the draft EIA can be inspected by the public before public meetings are publicized at a sufficiently early stage, giving members ofthe public time and opportunities to present their comments.

(g) Public opinions are heard and taken into account by the public authority making the relevant decisions in order to ensure meaningful public participation;

82. Having regard to paragraph 37 (d), in conjunction with paragraph 36 (b), ofthe annex to decision I/7, the Committee recommends the Party concerned to take particular care to ensure early and adequate opportunities for public participation in any subsequent phases in the permitting process for the industrial and energy park and the associated projects.

83. The Committee also recommends that the measures proposed in paragraphs 80 to 82 be taken or elaborated, as appropriate, in consultation with relevant NGOs.

84. The Committee invites the Party concerned to draw up an action plan for implementing the above recommendations and to submit this to the Committee by 15 September 2007.

85. The Committee invites the Party concerned to provide information to the Committee by 15 January 2008 on the measures taken and the results achieved in implementation ofthe above recommendations.

86. The Committee requests the secretariat, and invites relevant international and regional organizations and financial institutions, to provide advice and assistance to the Party concerned as necessary in the implementation of the measures referred to in paragraphs 80 to 88.

87. The Committee resolves to review the matter no later than three months before the third meeting of the Parties and to decide what recommendations, if any, to make to the Meeting of the Parties, taking into account all relevant information received in the meantime.

18 ANNEX5 WORLD BANKRESPONSE TO DRAFTFINDINGS OF THE AARHUSCONVENTION COMPLIANCE COMMITTEE

The World Bank Washington, D.C. 20433 U.S.A.

ORSALIA KAIANTZOPOULOS Country Diredor and Regional Coordinator for Southeast Europ Europe and Central Asia Region

May 15,2007

Mr. Jeremy Wates Secretary Convention on Access to Information, Public Participation in Decision-making and Access to Justice in Environmental Matters (Aarhus Convention) United Nations Economic Commission for Europe Environment, Housing and Land Management Division CH- 12 1 1 Geneva 10, Switzerland

Dear Mr. Wates:

Your Refi: Draft Findings and Recommendations of the Aarhus Convention Compliance Committee with regard to communication (ACCC/C/2005/12; Ora@ Findings version 23 March 2007)

Referring to your letter dated 29 March 2007, the World Bank has received the invitation from the Aarhus Convention Secretariat to respond to the Draft Recommendations and Findings set forth by the Aarhus Convention Compliance Committee as per the above references.

The World Bank wishes to note its appreciation for the diligent and transparent manner in which the Committee has carried out its work, and the opportunity to comment on the Draft. The World Bank is fblly supportive of the Aarhus Convention and will continue to support its implementation as requested by its member governments, as well as through the relevant World Bank safeguard policies and practices.

The World Bank also recognizes that the Aarhus Convention is binding upon its member states, and that the requested response regarding issues of compliance with the Convention is directed to Albania.

Nevertheless, the World Bank takes note of certain draft findings and recommendations by the Committee, principally, the following paragraphs that relate to the World Bank financed project: 15-16,3 1,37,64,67-69,77 and 81-86. In regard to these paragraphs, the World Bank respectfully submits its comments as follows:

Project Scope

15. The communicant sent a letter to the Committee on 30 September 2006 commenting on the World Bank response. It stated that even ifthe World Bank was not directly involved in the industrial park, the Bank was aware of the other components that were envisaged for the industrial park as well as the Mr. Jeremy Wates -2- May 15,2007

intention to expand the TEP itsevfrom a capacity of 100 MW up to a capacity of 300 MW Despite this, public presentations of the project had only addressed the impact and emissionsfrom a 100 MWpower plant, thus failing to take into account the future cumulative environmental impact of these projects. Thus, the information presented by the project’s proponents during the public consultation process was, in the view of the communicant, ‘oriented to disinformation I.

Comment. The TEP project was prepared and appraised independently from the other projects mentioned (Industrial and Energy Park; Oil storage terminal and port infrastructure; Oil and gas pipelines).

The TEP funded by the World Bank, the European Investment Bank (EIB) and the European Bank for Reconstruction and Development (EBRD) is designed as a stand-alone project and would be implemented as such. The project contemplates the constructionhehabilitation of: (i) an undersea pipeline; (ii) an off-shore fuel oil tanker terminal and (iii)distillate fuel handling and storage facilities, to provide fuel dedicated to the TEP. These project components carry an additional cost of about €lOmillion out of a total estimated projected cost of €90million. Ifthe TEP were associated with the oil storage terminal and port infrastructure mentioned in the Request, then the €10 million component related to supplying fuel for the TEP would not have been required, since it would have duplicated investments for items (i)-(iii)above. The least cost solution would have been to supply fuel to the TEP using much cheaper on-shore pipelines connecting it to the oil storage terminal and port infrastructure or the Industrial and Energy Park.

The EIA and public consultations for the TEP focused on the impact and emissions of a 1OOMW plant. However, the potential and requirements for future expansion to 300 MW were mentioned and studied. For example, the Final Environmental Impact Assessment - Vlore Combined Cycle Generation Facility (MWH Consulting, October 6,2003), contains the following information:

Page 89: “Reduction in transmission system losses and voltage profile improvement - Albania’s power system has a low voltage profile. The development of a new plant in the system, whether its capacity is 100 or 300 MW, will affect the voltage profile of the power system. Any voltage improvement to the power system provides direct financial benefit to the owner ofthe system through lower fuel costs, less electricity imports, etc. Transmission is a critical factor in determining the viability of a new generation facility. As a result, it was given a high level weighting.

“Transmission availability and proximity - MWH also evaluated the transmission capacity of the site (1 00 and 300 MW) as well as its proximity to the nearest interconnection point. Since the development of new transmission lines and towers to the nearest interconnection point can be extremely costly, MWH gave this criteria a high level weighting.”

Page 231: Includes a slide from the presentation used in the second consultation meeting of April 2,2003, where under the title “Project Highlights” It is stated “Capacity Size 80- 1 10 MW, with Possible Expansion to 300 MW” Mr. Jeremy Wates -3 - May 15,2007

Volume 2 Final EL4 Addendum, Page 1: “The installed capacity of the Project will depend upon equipment offers during the EPC bidding process, but will be in the 90 to 130 MW range. However, all analyses performed for the Final EIA were based on the largest potential capacity size.”

Page 6, note b on Table A. 1: “b Directive 2001/80/EC of the European Parliament and ofthe Council of 23 October 200 1, On the limitation of emissions of certain pollutants into the air fiom large combustion plants. If the total plant capacity exceeds 300 MW, then the SO2 limit is more restrictive, depending on the size of the plant.”

See also the references in three different newspaper articles of November 1, 2002 (Annex 1-3), where higher capacities are mentioned.

Public Consultation

16. The communicantfurthermorestated that there was no evidence that intellectuals and NGOs of Vlora hadparticipated in the meeting on 31 October 2002, Besides, this meeting had taken place afler the approval of the Siting Study and Feasibility Study. The communicant argued that at that stage there had been a lack of publication of information. It cited the director of the National Agency for Energy, Mr. Besim Islami, who, in answer to a question from a member of the public at the public meeting on 3 September 2003, admitted that “There were not any views taken on this phase from the local government, as this was not requestedfiom the company for the reason of conjidence andprudence. In these days and in the last month we have been passing into these explanatory and indispensableprocedural meetings. ”

31. The Committee has not been provided with any evidence of public participation including notijkation or public announcement in the process leading up to Decision No. 20.

3 7. As regards the participation of the public in the three public meetings referred to in the previous paragraphs, varying degrees of information are available to the Committee:

(a) The introductoty meeting on 31 October 2002 was attended by various representatives of national and local authorities as well as, according to the Party concerned, intellectuals and NGOs of Vlora. The communicant disputes the claim that intellectuals and NGOs of Vlora participated. The Committee has repeatedly requested’ the Party concerned to provide specific information concerning the process of notiJicationfor the meeting for residents, NGOs and other stakeholders) and a list ofparticipants, but no such information has been forthcoming.

Comment. The World Bank would appreciate the opportunity to gain further understanding regarding certain timing elements under the Aarhus Convention. To the best of our knowledge, the middle pillar of Aarhus regarding public participation in decision-making has most often

’ Initially by letter of 16 December 2005. Mr. Jeremy Wates -4- May 15,2007 been interpreted as within the EIA process. In some cases, there may be varied timing regarding siting, zoning, or other early potential actions by authorities prior to environmental studies being undertaken. For the World Bank, the primary vehicle for input from the public on new projects takes place surrounding the development and elaboration ofthe environmental impact assessment and we seek to ensure full and fair early participation principally as it relates to the environmental assessment instruments. (Please see footnote 2 on page 6 ofthis letter).

Nevertheless, in this particular case, we wish to point out that public consultation did indeed take place in October 2002, where the project was presented - including a discussion of alternative sites. This first meeting in October 2002 was to introduce the project to the public and to begin the EIA public consultation process. The minutes of the 2002 meeting, as provided from the records of the Ministry of Economy, note a question (No. 11) from the discussion session in which the public consultation nature of the meeting is emphasized and the Aarhus convention is mentioned. Question No. 16 in the same minutes presents the consideration of alternative sites and the reasons why the Vlore region was selected, The meeting was attended by representatives ofthe public and NGOs, which were invited directly by the local authorities of Vlore. In addition, the meeting was covered by the media. The following points are of note:

Letter from the then Minister of Economy Victor Doda to Mr. Iftikhar Khalil (Task Manager.for the World Bank), dated November 15,2002, with Prot. No. 6689/9 referring to the October 2002 meeting “in front of all stakeholders and Non Governmental Organization (based in Vlora) to inform them about this very important project”; Report (“The minutes of the presentative meeting on Vlora TEC”) in English; Proces Verbal --as above in Albanian; and Newspaper articles in three National Albanian Newspapers ofNovember 1,2002 referring to the public consultation meeting.

Mr. Besim Islami, who headed the process on behalf of the National Energy Agency, stated that invitations for the meetings were sent directly to relevant NGOs identified in Vlore, Vlore University students and faculty, the local and national media, as well as individual citizens. Unfortunately records ofthe invitation process are no longer available. It was assumed that the record of participants (and their affiliations) as noted in the minutes of the meeting (annex 4), as well as the coverage by local and national media would be sufficient to ensure that consultation of important stakeholders did indeed take place. Mr. Islami maintains that many ofthose who attended the second consultation meeting on April 2,2003 (an account of which is presented as an annex to the EIA) were also present at the first meeting.

67. Contrary to the decision-makingprocess leading up to the designation of the site of the industrial and energy park, the decision-making process relating to the proposed TEP involved some elements ofpublic participation, e.g. public notijlcations, public meetings, availability of EL4 documentation and so on. However, as regards Decision No. 20, dated 19 February 2003, which establishes the site of the TEP, the only element of public participation in this phase of the process appears to have been the public meeting that took pLace in Vlora on 31 October 2002. The issues of who was notifed of the meeting and Mr. Jeremy Wates -5- May 15,2007

invited to participate in it, the content of the notification, and who actually participated, are therefore important. As mentioned above (para. 3 7(a)), the Party concerned asserted that among those who participated in the meeting were “intellectuals and NGOs of Vlora ” This assertion has been strongly disputed by the communicant. Unfortunately, despite repeated requests by the Committee, the Party concerned has failed to provide specific information on these points. The obscure circumstances around the meeting in October 2002, and the failure of the Party concerned to provide anything to substantiate the claim that the October meeting was duly announced and open for public participation, clearly point to the conclusion that the Party concernedfailed to comply with the requirementsfor public participation set out in paragraphs 3, 4 and 8 of article 6 of the Convention.

Comment. Please see above discussion on paragraphs 16,37 (a) and 3 1.

64, The Committee is aware that at least two of the three decisions that it has chosen tofocus on would need to be followed by further decisions on whether to grant environmental, construction and operating permits (and possibly other types of permit) before the activities in question could legitimately commence. However, public participation must take place at an early stage of the environmental decision-makingprocess under the Aarhus Convention. Therefore it is important to consider whether public participation has been provided for at a suflciently early stage of the environmental decision-making processes in these cases.

68. The two meetings that took place on 2 April 2003 and 3 September 2003, respectively, obviously occurred after the adoption of Decision No. 20, and therefore cannot be considered as events contributing to the involvement of the public in that decision. Thus, they do not mitigate the failure of the Party concerned to comply with the Convention in the process leading to Decision No. 20 of 19 February 2003.

69. Even so, the Committee wishes to make a short comment on these meetings as well, since they also give rise to concern. No information has been provided by the Party concerned to demonstrate that the meetings in April and September 2003 were publicly announced, so as to make it possible also for members of the public opposing the project to actively take part in the decision-making. Nor has the Party concerned been able to give any reasonable explanation as to why the rather strong local opposition to the project, indicated by the 14,000people callingfor a referendum, was not heard or representedproperly at any of these meetings. It is thus clear to the Committee that the invitation process also at this stage was selective and insuflcient. The only public notijkation, in the form of newspaper advertisements, that was presented to the Committee related to meetings that tookplace later in 2004. Thus the Committee notes that, despite some subsequent eforts to improve the means for public participation, there were several shortcomings also in the decision-makingprocess aftr February 2003. Mr. Jeremy Wates -6- May 15,2007

77. With respect to the proposed thermal electric power plant (paras. 67-69), the CommitteeJinds that the decision by the Council of Territorial Adjustment of the Republic of Albania on the siting of the TEP near Vlora (Decision No. 20 of 19 February 2003) is subject to the requirements of article 6, paragraphs 3, 4 and 8. Although some eflorts were made to provide for public participation, these largely tookplace ajer the crucial decision on siting and were subject to some qualitative deficiencies, leading the Committee tofind that the Party concerned failed to comply with the requirements in question.

Comment. Meaningful consultation and disclosure are required under World Bank safeguard policies2. As the project was classified as Category A, thereby requiring a full environmental assessment, it included public consultations at the design stage of the site-specific environmental assessment (EA) in April 2003 as well as at the draft EA report stage in September 2003, Notification of these consultation meetings was carried out by Government (as per Bank policy), and the minutes of these meetings were included in the final EA report (October 2003). Each of these meetings and the EA report itself reference the alternatives examined under earlier pre-feasibility and feasibility studies in the latter half of 2002; a process which led to the recommendation of the current site in Vlore. The alternatives analysis included a range of analytical criteria, including suitability for the environment. No substantial objections were raised as to the selection of the Wore site during the EA process from October 2003 through World Bank Board approval on March 16,2004. Had significant objections been raised during this period on either substantive or procedural grounds, then the World Bank would have considered delaying project preparation until they were adequately addressed. The World Bank considers that the Government’s approach met World Bank Operational Policy requirements with respect to the project in question.

International Financial Institutions need to determine how wide a range of associated investments should be considered in their review of projects on a case by case basis. For example, the suggestion raised at one point during preparation that an industrial park could be located near the TEP was an important local issue. It was clear from the Bank’s feasibility studies and sector work, however, that Albania’s energy needs required a TEP to augment regional supplies in any case and that an industrial park need not be “linked” to it, be it from a technical, financial or due diligence perspective.

We would like to note that in 2002 and 2003, Albania was suffering from power shortages and the government was making every effort to show that it was responding to the situation by developing new projects. The publication of relevant articles in the press shows clearly that the matter was of national interest and the prospects ofnew power generation in the southern part of the country could only be welcome to alleviate the shortages. During 2003 the project and its EIA were presented and discussed publicly in at least two occasions, the draft final EIA was published and made available for more than 30 days in the Wore public library before the September 2003 Consultation meeting, and an invitation for comments was issued. In addition, the World Bank has a policy of publishing the EIA for 120 days in its own lnfoshop before

* Please note that the World Bank’s OP4.01 states at paragraph 14: “For all Category A and Bprojects proposed for IBRD or IDA financing, during the EA process, the borrower consults project-affected groups and local nongovernmental organizations (NGOs) about the project’s environmental aspects and takes their views into account. The borrower initiates such consultations as early as possible. For Category A projects, the borrower consults these groups at least twice: (a) shortly afier environmental screening and before the

terms of reference for the EA arefinalized; and (b) once a draft EA report is prepared. I’ Mr. Jeremy Wates -7- May 15,2007 presenting the project to the Board. No significant issues or objections were raised about the project in 2003 up to the World Bank approval of the project in February 19,2004. The TEP project only became an issue when it was presented, wrongly, as associated with the other projects mentioned in the complaint and again during the 2005 elections.

Respectfully, we submit our view that Bank safeguard policies support the Convention by seeking early and meaningful dialogue. The Bank would welcome an opportunity to ascertain with UN ECE and the Committee those areas where clarity would be helpfbl in balancing broad programmatic objectives with the practicalities of project-specific due diligence.

Recommendations

81. The Committee recommends that the Party concerned take the necessary legislative, regulatory, administrative and other measures to ensure that:

(a) A clear, transparent and consistentpamework to implement the provisions of the Convention in Albanian legislation is established;

(b) In order to comply with article 7 of the Aarhus Convention, "practical andor other provisions for the public to participate during the preparation of plans and programmes relating to the environment" are in place not on& during preparation of individual projects, including through development of detailed procedures and practical measures to implement article 25 of the EL4 Law of Albania;

(d) Notvcation of the public is made at an early stage for projects and plans, when options are open, not when decisions are already made;

(e) Notijkation of the entire public which may participate, including non- governmental organizations opposed to the project, is provided, and notvcations are announced by appropriate means and in an effective manner so as to ensure that the various categories of the public which may participate are reached, and records kept of such notipcations;

03 The locations where the draft EL4 can be inspected by the public before public meetings are publicized at a suflciently early stage, giving members of the public time and opportunities to present their comments.

(& Public opinions are heard and taken into account by the public authority making the relevant decisions in order to ensure meanin@l public participation; 82. Having regard to paragraph 3 7 (d), in conjunction with paragraph 36 e), of the annex to decision I/7, the Committee recommends the Party concerned to take particular care to ensure early and adequate opportunities for public participation in any subsequent phases in the permitting process for the industrial and enerapark and the associatedprojects, Mr. Jeremy Wates -8- May IS, 2007

83#The Committee also recommends that the measures proposed in paragraphs 80 to 82 be taken or elaborated, as appropriate, in consultation with relevant NGOs.

84. The Committee invites the Party concerned to draw up an action plan for implementing the above recommendations and to submit this to the Committee by 15 September 2007.

85. The Committee invites the Party concerned to provide information to the Committee by 15 January 2008 on the measures taken and the results achieved in implementation of the above recommendations.

86. The Committee requests the secretariat, and invites relevant international and regional organizations andfinancial institutions, to provide advice and assistance to the Party concerned as necessary in the implementation of the measures referred to in paragraphs 80 to 88.

Comment: Regarding the recommendations in section B. (paragraphs 8 1-86), please note that the World Bank welcomes the suggestion by the Committee regarding assistance to Albania in reviewing and enhancing its legal and institutional framework pertaining to the Aarhus Convention, and takes this opportunity to convey to the Convention Secretariat and the Committee that we will soon communicate our interest in providing this assistance. We hope that this will give us an opportunity to collaborate with the Convention in addressing this important matter.

*I***

In closing, the World Bank wishes to advise the Committee that the Inspection Panel has received a Request for Inspection on the subject project. According to the internal process for such Requests, Bank management has until June 1,2007 to respond to the Panel regarding the claims made in the Request. If during our review of the case we determine the availability of relevant factual information which can be disclosed according to the Bank’s disclosure policy, this will be shared with the Aarhus Secretariat through a supplemental letter.

If you have any questions, please do not hesitate to contact me. Both Iand our Bank team will be pleased to assist you in your very important endeavors.

Sincerely,

&Orsalia Kalantzopoulos Country Director and Regional Coordinator for Southeast Europe Europe and Central Asia Region

Attachment REPUBLIKA E SHQIPERISE MINISTFUA E INDUSTRISE DHE ENERGJITIKES Kabineti Blvd. Deshmoret e Kombit Nr.2 Tel. 355 4 22 76 17 E-mail:[email protected] Fax: 355 4 23 40 52 Internet: http://www.mepp.gov.al

November 15,2002

Subject: Follbvhgwork for New Thermal Power Plant

To: Mr. Iftikhar KHALIL

Dear Mr. Khalil, Since October 2002 we have contacts with Ministry of Environment, Ministry of Territory and Truism, Municipality of Vlora, District of Vlora and Prefecture of Vlora related with approval of Vlora B site for the new Thermal Power Plant. During these meeting we have explain to the participants all advantages and disadvantages of Vlora B site compare with other site based on MWH study.

Also together with Ministry of Environment, Ministry of Territory and Truism, Municipality of Vlora, District of Vlora and Prefecture of Vlora, on 28 October 2002 we have one day long meeting to present in front of all stakeholders and Non Governmental Organization (based in Vlora) to inform them about this very important project. The minutes of this meeting are attached this letter.

Also during this period of time we have work very hard to prepare the following tasks: J We have prepared the topographic details presentation for this site including the schematic layout of power plant, the cadastral allocation and power plant units presented in blocks. We need those designs to present in Territory Committee of District of Vlora and Albanian Republic to get the site approved. J Also we have done with OUT institution all detail measurements and analyses about groundwater issues in Vlora B site. These measurements and the report we are sending to you attached this letter. Also we have done with our institution all detail measurements about air pollution, These measurements and the report we are sending to you attached this letter. In mean time we are continuing our efforts for fulfilling all documents needed according the official documentations &om Territory Committee of District of Vlora and Albanian Republic to get the site approved.

As a conclusion, as you will see in the attached documents, we are please to inform you that all three Ministries (Energy, Environment and Territory) stakeholders in Vlora agreed with us for the importance ofbuilding this power plant in Vlora B site.

Best regards,

MINISTER Viktor DODA

REPORT

THE MINUTES OF THE PRESENTATIVE MEETING ON VLORA TEC (HELD IN VLORA ON OCTOBER 28,2002

Today on October 28.2002, in presence of:

Mr. Pjeter DEMA Vice-Minister ofIndustry and Energy Mr. Petrit AHMETI Advicer of Minister for Energy Mr. Besirn ISLAMI Chairman ofNational Agency of Energy Mr. Arben DEMETI Vice-Minister ofRregulation of Territory and Turismus Mrs, TatjanaHEMA Vice-Minis t er ofEnvironment Mr. Shpetim GJIKA Prefect of Vlora Mr. Bashkim HABILAJ Chairman of Councel ofDistrict of Vlora Mr. Niko VEIZAJ Chairman ofMunicipality of Vlora

And with participation ofthe interested persons (see Annex 1 (Participation List), here included)

Was held the presentation meeting of the final Study on New TPP of Vlora, executed by MWH Company.

The Meeting was opened by Mr, Gjika Shpetim, Prefect of Vlora, who presented in front of auditorium the participants in meeting and thanked the working body for the chosing made on appointing Vlora as the city of the TPP to be built (4 Minutes).

The second one who presented the project was Mr. Islami Besimi, Chairman of the national Agency of Energy. He presented the project on all phases extended till now, beginning from idea draft on the building of a new TEC with a high productivity, the chosen of the place, the feasibility study, the technical and environmental aspects of the project. He also made a description of the other steps expected to be undertaken till the full realization of the project. During its presentation were made some short questions, especially on technical issues as for example on the fuel sorts to be used, on the technology to be used, etc. After finishing his presentation Mr. Islami invited the participants to ask questions (20 Minutes),

Here unten is given a summary of the questions made and the answers given on the resulted issues.

1. How much is going to influence on the sea water the hot water temperature, turned back from the cooling of the TPP condensation?

Mr. lslami Besim : The cold water temperature entering into the condendenser as average during all year is 15OC. After cooling in the condenser this temperature is increased on the level of 19- 20°C. Moving the pulled out tube into the depth, in a distance 3-5 km from the seaside, is made posible that the sea water temperature to be increassed no more than 1.S°C towards its value. This

-1- makes possible the phenomenon avoidance of thermic heating and is within the permitted norms making possible the preservation ofthe marine flora and fauna (about 3 Minutes).

2, Has been taken in consideration the fact that into lagoona are not poured other water sources except the water sea and that the marine sole is clayey.

Mr. Islami Besim : The cold water is going to be obtained fkom the sea. The taking and unloading of the cooling water has no conection with lagoona. The full environmental study will make possible to be observed the impact which is going to have on the clayey sole the taking of the sea water. But the preliminary analyses show no negativ influence will result (1 Minute).

3. What is the future ofthe Albanian Energy sector?

Mr. Islami Besim : The Ministry of Industry and Energy, the World Bank and KESH are doing a study on the development of the Albanian Electro energetic Sector. This study will finish on Jannuary 2003, Also since July 2002 has begun the work for preparing of National Strategy of Energy from the side of National Agency of Energy in collaboration with Albanian energetic institutions. Both these documents together with Electro energetic Politics will form the hture basis for Albanian energetic sector development, in such a way that no crises to be more repeated (2 Minutes).

4. What kind of pollutants are emitted into the atmosphere?

Mr. Islami Besim : To reduce the emissions into the atmosphere has been showed caution since the election of the fuel which is going to be used onto TPP. As a result is going to be used diesel with a sulfur percent not higher than 0.5%. Both this with a very sophisticated technology offered by the combined cycle, especially gas turbines will make possible that the emissions into the atmosphere from this TPP to be within the permitted norms from WB, EIB and EBRD (3 Minutes).

5. Having in consideration that the TPP is near the city, have been analyzed the winds which may push the smokes towards the city?

Mr. Pirro Mitrushi : As here mentioned, the Vlora-City-Gulf, influenced from the Northwest- Southeast and Southwest-Northeast winds. On these conditions, based on the study ofthe rose of the wind of ex Soda PVC plant, the conditions for the TPP on the zone Vlora B are improved, because the displacement towards Northwest into 2-3 km improves (deviates) the wind movement. It is to underline that the new TPP emissions will be less problematic as those ofex- Soda-PVC Plant. The underlined values are the maximum ones on the case of using a non qualitative distillates with a Sulfur content less than 1% (2 Minutes).

6. Is the water to be taken fiom TPP to be unsalted?

Mr. Mitrushi Pirro : TPP needs for water are to be resolved : The potable water is to be taken from the water furnishing enterprise of city Vlora; industrial water 200 m3/hour if possible

-2- from the same enterprise, but if this enterprise will not be able to satisfy the needs of TPP, in Project has been foreseen an Unsalted Osmotic Plant of the see water; the marine cooling water will be taken from the see and then taken back into the see. For the needs of boiler, turbines, etc. the project has foreseen as necessary an unsalted milder plant (2 Minutes).

7. Is polluted the zone chosen from the erecting of TPP?

Mr. Islami Besim : The chosen zone is 1.8 km way from PVC, zone which results polluted from mercury in very hygh levels. According the studies done this zone (Vlora B) may be not much polluted. But this zone may not be a turistic zone too, because is very near to the new port. (1 Minute)

8. Has been thought for the pipes and the pontile ofoil?

Mr. Islami Besim : The question is very nice. On the study done from HARZA Company has been thought to be included all investments into the infrastructur coonecting TPP with fuel, water and electricity networks. In the initial investment are included 2.6 millions US.$ for rehabilitation of all terminal for a sicure import and depositing of fuels. (3 Minutes).

9. Has any study been done for their renovation and replacement?

Mr. Islami Besim : Ihave to underline that in the supplementary investments to be included in the supply infrastracture with fuels, water and with electricity system, all these have been taken into consideration and consequently TPP will be sicure in its job. Has to be underlined that also for other places this has been taken into consideration and this is it which gave prioritet the Vlora place, As conclusion I have again to underline that all investments have been taken into consideration for the whole infrastucture (2 Minutes).

10. Has been thought as a variant Vlora-C, because Vlora-A has since the beginning been squali fied?

Mr. Islami Besim: We firtst have chosen the Region. The analyse showed that the best region for this reason is Vlora. Then normaly was passed in the chosing of the place in two zones of Vlora and the more promoting chosings to be examined has been Vlora-A and Vlora-B. Vlora-A has problems with demolated objects and environmental pollution, as was analyzed over, so that consequently the other zone was it which provided the more effective and poore investments for the infrastructure, for supplying with hels, for connection with the network and for the cooling water. We are going to analyse the variant presented here for Akernia zone, but in approximative calculations seems that this zone will need supplementary investments. (about 10- 15 million US$). (4 Minutes).

11. Are to be taken into consideration views resulting from this meeting?

Mr. Islami Besim : Yes of course. We show you that this conversation isn't done like a televisive show, We are totally preocupated to follow all the steps, and as Mrs. Hema Tatjana said, it is

-3- indispensable this meeting to be realized and the study on the environmental impact to analise all preocupations that concern you. Based on Aarhaus Convent, it is the duty of the Albanian institutions to inform the public in reference to all projects phases and with the impact that it will bring to the community and surroundings.

12. What is Vlora going to win and lose from the construction ofthe TPP?

Mr. Islami Besim : The construction of the new TPP is firstly very important in national context and secondly in regional one. In national context the construction of TPP will make possible the diversification of the electricity generation, which will increase the supply security. As far as is concerned Vlora this TPP will make possible the local electricity generation, which will be a help in the development of local economy of the region. On the other side, this project, being combined with this one with the construction of a line 220 kV Fier- Babica (Vlora), will make possible the increasing of the production activities, especially the tourism, on which all we are looking. On the other side we have also to declare for all the problems to be confronted by the construction of TPP in the zone Vlora-B. This zone being near the port may of course not be a protective or touristic zone and showing prudence on choking of the technology and operating of TPP we may decrease in maximum the influence on the environment. (4 Minutes).

13. Has been taken into account the view oflocal govern on the phase of the chosin ofthe place?

Mr. Mitrushi Pirro : The history of the new modern TPP place has begun since 2 years ago. As beginning has been explained the need on a TPP in energetic system. Onward in the study on the rehabilitation of Fier TPP, have been outlined the needs for a study with variants in fuels, tecnologies and eventual places and the import option (HARZA); at last it is this project, which in the first phase examined 6 regions with 2 variants each of them. The views on this phase were not taken from the local govern, because this was not requested from the company for efect of confidence and prudence. This day and a month before we have been passing into these explanatory and indispensable procedurial meetings. On the role of albanian consultant, we have suggested to have 2 variants for each region (one ofwhich in an ex industrial zone and the other in a fie zone). Our suggestions have been opinions within our technical competence and we have been right. (4 Minutes).

14. Is there any study for any free possible industrial zone in Vlora?

Mr. Mitrushi Pirro : The industrial and commercial zones (parcs) are very interesting dhe such long-term and middle-term studies are the duty of the local government, of the civil and business society on each region. These are not to be requested to the central government or Ministry, but if they exist you have to present them to the government. The studies will be wellcomed. (3 Minutes)

15. It wouldn’t be better that this site to be displaced on the North or the South, because the chosen site for the Vlora citiciens have to be a beach on the future?

-4- Mr. Mitrushi Pirro : Firstly, the zone Vlora-3 now and before has not been a beach, there exists only holes from the taking off the sand and bunkers. Secondly, southward between the port and ex Soda-PVC plant there is more pollution and practically we approach the city and the beach. Third, passing towards North we approach to Zvemec-Narta (which is a protected zone) or in Akkerni-Poro, which will request much more investments for the infrastructure. (3 Minutes).

16. The city of Vlora is located on a extension, that has been treated from a UNDP Programm as a protected zone of Narta Lagoona, which contains rare species. This has been the reason that we have had a lot of problems to make possible the approving of the TEC. Is possible to do another investigation?

Mr. Islami Besim : HARZA, KESH and us have begun the investigation of the place ofthe new TEC studying seven zones: Shengjin, Dunes, Elbasan, Cerrik, Rorca, Fier and Vlora. In all these zones were analyzed two zones: the first to be an industrial abandoned zone and the second a virgin zone. All places in ex industrial zones, which were analyzed, are very polluted and the dirtiest is the zone of ex Soda Plant in Vlora. On the one side it is good to be exploited an ex industrial zone for the construction of TPP, but on the other side it would firstly request the razing of everything in that zone and the decontamination of the zone (as exists in Vlora from mercury) and the investments for its realizing are at the level of 15-20 Millions US$. If this value would be used for preparing of the place, this means that about 100 Millions US$ borrowed for construction of the TEC would be decreased and the capacity of the TPP in this case would be 70-80 MW instead of 125 MW. Nevertheless, as we have repeatedly underlined, the chosen place is only 1.3 km way &om the protected zone of lagoon and so is not possible to be included in a protected zone because it is near the port, the pipe network and the oil terminal.

Mr. Ahmeti Petrit : The new TEC we are discussing is a great endevaour of both the American and Albanian specialists to make possible the successful1 conclussion of the study and its implementation. Both the Ministry and the National Agency of Energy are going to do all the efforts for realizing the solution with minimal costs and minimal effect on the environment.

Mr. Habilai Bashkim: Firstly Iwant to discuss as an thermal engineer. From this point of view having a long experience, Iappreciate very good the up to now study. The tecnology and place chosing has been done in conformity with technical principles. What we would request as local authority is that are to be made some simple calculations for Vlora-C in Akerni zone just to compare with Vlora B site. If the new site (Vlora C) will asked an higher value for investment for TPP we of course will agree with the prposed site Vlora B. We are going to sustain the project and request from the study team that on the phase of environmental impact study to be also included the local authorities. As conclussion, I appreciate this meeting very good and congratulate Mr. Islami and the NAE partecipants for the good job done.

Mrs. Hema tatiana : Iappreciate very valuable the meeting organized from Ministry of Industry and Energy. It is the first time that a very detailed study is done in Albania analyzing 7 zones and 14 places in all the country, Icongratulate thecolleges of Ministry of Industry and Energy, especeally NAE and iths chairman Mr. Islami Besim for the good job done. At the same time Iwant to underline that the place chosen from their side is 1.3 km way ofNarta lagoona, so that this zone has not been concluded in a protected zone. As Iwas expressed at the beginning this meeting is very valuable and Ihope that this to be also realized in other phases. I want also to express that is indispensable that all three our institutions make a detailed study on the environmental impact, because on this zone is thought to be constructed the new TEC, fuels deposits and the drilling for oil wells.

Vice Minister Dema Pieter : Our Ministry is working that the study of Vlora-TEC to be concluded on time.-Your appraisements, remarks and suggestions have been very valuable and we will take them into consideration during the the other steps of the study. Both our Ministry and NAE are taking all the measures in order to precede the environmental study, which is expecting to beginn soon. During November we will prepare all the necessary documentations to make possible the getting of licence on the construction place of TEC. We will also study the Bernie variant, doing some quick calculations to verify how more expensive is this variant.

Prefect ofVlora Mr. Giika Shpetim : In conlussion ofthis meeting Iwant to thank Vice-Minister of Industry and Energy Mr. Dema Pjeter, Vice-Minister of Environment Mrs. Hema Tatjana, Vice-Minister of Terrain Rregullation and Tourism Mr. Demeti Arben, Mr. Ahmeti Petrit and National Agency of Energy and especially Mr. Islarni Besim for the great job they have done. Of course all participants gave cnstructive advices and some suggestions on the further improvement of the most important project job for Albania. We as local authorities guarant that we shall go on to sustain the made chosing that the TEC of Vlora to be constructed as sooner as possible and at the same time we request that the environmental impact study to be complete and fiom a good chosen technology to have a minimum impact on the environment.

-6- ANNEX Partecipants list on meeting

1. Mr. Pjeter DEMA Vice-Minister of Industry and Energy 2. Mr. Besim ISLAMI Chairman of National Agency ofEnergy 3. Mr. Arben DEMETI Vice-Minister of Rregulation of Territory and Turismus 4. Mrs. Tatjana HEMA Vice-Minister of Environment 5. Mr. Shpetim GJIKA Prefect of Vlora 6. Mr. Bashkim HABILAJ Chairman of Councel ofDistrict of Vlora 7. Mr. Niko VEIZAJ Chairman of Municipality of Vlora 8, Mr. Ahmeti Petrit Adviser of Minister of Industry and Energy 9. Mr. Mitrushi Pirro National Agency ofEnergy 10. Mr. Leskoviku Artan National Agency of Energy 11, Mr. Hizmo Aheron National Agency of Energy 12. Mr. Dedej Zamir Environment Ministry 13. Mr. Shakaj Kanan Chairman of Novosele Comune 14. Ms.Mbyeti Shpresa Eng. ofNovosele Comune 15. Mr. Kume Arqile Electric Engineer 16. Mr. Sulaj Ferdinand Society of Albanian legitim owners 17. Mr. Suli Vaso Chemist 18. Mr. Rrapaj Adhurixr 1 Engineer 19. Mr. Dumani Dhimo Biolog, Society ofNatyral Environment protection ofVlora 20, Mr. Gjika Mynyr Programmation Sekretary, District of Vlora 21. Mrs.Zunaj Luizaj Environment Regional Agency,Vlora 22. Mr. Monce Monce Liquidator ofSoda-PVC Plant 23. Mr. Qomaj Sotir The Directory ofForest Service, Vlora 24. Mr. Shpata Pajtim Society “ Blue Expedition” 25. Mr. Hoxha Clirim Environment Society “ Kristo Papajani” 26. Mr. Gaxhi Jahri Engineer 27. Mr. Alltari Argent American Bank, Vlora 28. Mr. Islami Patriot Businessman 29. Mr. Haxhiu Vladimir Region Councel, Vlora 30. Mr. Dervishaj Halim Director of SH.A Salt, Vlora 3 1. Mr. Hudhra Spiro Director ofElectro-energetic Filial,, Fier 32. Mr. Gjidede Spiro Industry inspector in prefecture of Vlora 33. Mr. Meksi Arben Urbanistic Engineer 34. Mr. SotaMario 35. Mr. Opari Faslli 36. Mr. Koka Anastas 37. Mr, Andoni Dhionis 38. Ms. Gjika Varvara 39, Mr. Kotom Petrit

-7-

PROCESVERBAL

MINUTAT E TAKIMIT PREZANTUES PER TEC-in E VLORES ( MBAJTUR NE VLORE NE DATE 28.10.2002)

Sot me date 28.10.2002 ne prezence te:

Z. Pjeter DEMA Zeveiides Minister i Industrise dlie Energjitikes Z. Petrit AHMETI Keshiltar i Ministrit per Energjine Z. Besiiii ISLAMI Kryetar i Agjencise Koinbetare te Energjise Z. Arben DEMETI Zevendes Minister i Rregullimit te Territorit dhc Turizmit Ziij Tatjana HEMA Zevendes Ministre e Mjedisit Z Shpetiiii GJIKA Prefekt i Vlores Z. Bashkiiu FJ.4BlLAJ Kiyetar i Keshillit te Qarkut Wore e Z. Niko VEIZAJ Kryetar i Bashkise Vlore

Dhe me pjescinai-rjen c personave le interesuar (Shih Aiieksiii 1 (List3 e Pjeseiiiarrcs\ e). bashkelidliur).

U mbajt takimi prezantues i Studinlit Final per TEC. ce Vlores. ie krycr nga Koiiipania MW Haim.

Pas tij fjalen c iiiori Z. Besim Islami, &-yetar i Agjeiicise Konibetare te Eiiergiise: per prezaiitiinin e projektit. Ai prezantoi projektin ne te tera fazat e zhvilluara deri tani, qe nga projekt ideja per ndei-timiii e iije TEC-i te ri me rendiment te larte. zgjedlijen e sheshit: studimiii c Fisibilitetit, aspekte tekiiike dhc mjedisore te projektit ne fjale. Ai bei-i g~icliaslitiiiije pershltriiii te hapa\\'ete tjere qe pl-iten te hidhen deri realizimin e plote te projektil. Gjate pre. :,:ti!iiit te ti,; pali pyet-je te slikurtra. sidomos mbi ceshtje telcllike si p,sh. per Ilojin e lendes djegzsz qe do perdorer. per tekiiologjine qe do perdoret etj. Ne fund te fjales se tij zoti Islaiiii ftoi te pranisliiiiit te l,cnin pyetje. (20 IuIintita)

Me poslite jeper iijc per-tiibledhje e pyetjeve qe ~ibene dlie e petgiigje\.e qe LI dliriiie per problenict e ngrirura.

1. Sa do te iidikoje ne ujin e detit teiiiperatura e ujit te ngrohte qe ktliehet nga ftalija e koiidensatit le TEC-it ? Zoti Besiiii Islaini : Teiiiperatura e iijjt ftohes hyres ne kvndensator si mesatare gjithevjetore eshtc 15' C. Pasi ftoh kondensatorin kjo temperature rritet ne niveliu I9-20°C. Duke e cuar tubin e iihjerrjes ne thellesi, ne nje distance 3-5 km nga bregu behet e mundur qe temperatura e ujit te detit te inos i-ritet iiie shume se 1.5"C kundrejt vleres se saj. Kjo ben te niundi~rshnianj Y en e

-1- fenomeneve te ngrolijes termike dlie eshte breiida iioiiiiave te lejuara qe bell te m~indiirriiaj tjcn e flores dlie fauiies detare. (i-reth 3 minuta).

2. A eshte marre parasysh fakti qe ne lagnne nuk derdhen buriiiie uji te tjera peivec ujit te detit dlie qe tabani detar eshte argjilor ? Zoti Besiiii Islami : Uji ftohes do te merret nga deti dhe do te shkarkoliet ne det. Man-ja dhe shkarkimi i ujit ftohes iiuk ka lidhje iiie lagunen. Studiini i plote iiijedisor do te beje te niuiidlur tc sliikohet iiiipakti qe do te kete ne tabanin argjilor man-ja e ujit te detit. Por analizat paraprake tregojne qe iiuk do te kete asnje ndikiiii negativ. (1 minute).

3. Cila eshte e ardhmja e energjitikes shqiptare? Zoti Besini Islami : Ministria e Industrise dhe Energjitikes se bashku me Baiiken Boterore dhe KESH-in PO ben iije studiin per zhvillimin e sektorit elektroeiiergjitik shqiptar. Ky studim do te mbaroje ne Janar 2003. Gjithashtu qe nga Korriku 2002 ka filluar puna per pergatitjen e Swategjise Kombetare te Energjise nga ana e AKE-se ne bashkepuniin me institucioiiet ensrgjitike sliqiptare. Keto dy doktiinenta se bashku me ate te Politikave Elektroenergiitike do tc perbejne bazeii e ardhine te zhvilliinit te sektorit energjitik shqiptar, ne inenyre te tille qe krizat te iiios perseriteii me. (2 miiiuta).

4. Cfare ndotjesh emetohen ne atmosfere ? Zoti Besiiii Islaini : Per te rediiktuar ciiietimet ne atiiiosfere eshte bere kujdes qe gate zgjedlijcs se lendes djegese qe do te perdoret ne TEC. Si rezultat do te perdoret diesel me perqindje squfitri jo me te larte se 0,5 "A. Kjo se baslzku rile teknologjiiie shuiiie te sofistikuar qe ofron cikli !

kombiiiuar , sidomos turbiiia me gaz, beii te mundur qe emetimet ne atmosfei-e iiga ky I'EC I L' jsne bi-enda iioi-iiiave ie lejuara iiga BB. BEI dlie EBRD. (3 minuta).

5. Dike qene se eshte afer qytetit ajaiie aitalizuar ererat qe mund te slityjne tynirat drzji qytc'tir'.' Zoti Piro Mitrushi : Sikurse thate vete. Vlora-qytet-diu, i nenshtrohet cres Verip'~iidini-JugIin~l-,i. dhe Iuyperendiiii-Verilindje. Ne keto kuslite bazuar ne studimin e treiidafilit te eres te ish-objeliri: Sode-PVC. kushtet per TEC-in ne zone11 Vlora B jaiie te penniresuara, inbasi spostiiiii dreji \ eriperendimi t me 2-3 kin. permireson (shniang) vepriinin e eres. Ju kujtojme se einetiiiiet e TEC' re Ri. do te jene me pak problematike se sa ato te ish uzines Sode-PVC. Vlerat qe ~iafishuaii .iane maksiiiialet per rastiii e perdorimit te nje distilati jo cilesor me pennbajtje Squful-i deri 1 %.( 2 iiiin 11 t a j .

6 Vji qe do le inen-et nga TEC-i a do te slikripezohet ? Zoti Piro MitrLislii : Nevojat e TEC-it per ujejane disa : tiji i pishem do te iiiwi-ci ~igatidci-niiurjil t Vjjesjellesit e Qyteiit; Uji industrial < 200 111.' ne ore, sipas niiuidesise iiga Ndemmiarja t' Lljesjcllesit e Qytetit, por per rast iiioskeiiaqie eventualisht te kesaj kerkese. ne projekt eshte parashikuar iije iinpiant i ckripeziiiiit Osiiiozik te ujit te detit; Uji detar i ftolijes do te merrei e kthehet ne det. Per nevojat e kaldajes. turbinave etj. brenda projektit ka impiaiit zbutje- ckripezini te nevojsheiii. (2 niiniita).

7. A eshte e ndotur zona ku do ndertohet TEC-i? Zoti Besiiii Islami : Zona e zgiedhur eshte 1 ,E kin larg PVC, qe eshte e iidotur iiga zhiva ne nivele shume te laita. Sipas studimeve kjo zone (Vlora B) iiiund te jete pak ose shuiiie pak e ndotur. Poi. kjo zone iiuk muud te jete zone turistike. sepse eshte ngjitur me portiii e ri , (1 niinute) 8. A estite menduar per tubacionet dlie pontilin e naftes? Zoti Besiin Islaini : Pyetja eshte sliunie me vend. Ne studiniin e bere nga koinpania HARZA eshte nieiiduar qe te perfshilien te gjitha investimet per infrastukturen e lidlijes se TEC-it me leiiden djegese, me ujin dhe rrjetat elektrike. Ne investimin fillestar jaiie perfshire 2,6 milione USD per rehabilitiiniii e gjithe terniinalit per iinportimin dhe depozitiiiiiii e sigurte te karbiir ant eve. ( 3 mi iiii t a).

9. A jaiie bere studiine per rinoviiniii dhe zevendesiniin e tyre? Zoti Besim Islami : E theksojme edhe njehere qe ne investimet shtese qe do te fiiten per infiastrukturen e furnizirnit me lende djegese, ujin dhe me sistemin elektrik, jane mane ne lcoiisiderate dhe per pasoje TEC-i do te jete i sigurte ne punen e tij. Duhet theksuar qe edhe per vendet e tjera kjo eshte mane ne konsiderate dhe kjo eshte ajo qe i dha prioritet sliesliit te Vlores. Si koizkluzion e theksojme edhe njehere qe te gjitha investimet jane mane parasysh per te gjithe iii fr as t nik t ure ti. ( 2 minut a) ,

10. .4 eshte menduar per nje variant Vlora- C, duke qene se Vlora- A eshte e skualifikuar qe ne filliin? Zoti Besiin Islami : Ne ne fillirn keiiii zgjedliur rajonin. Dhe analiza tregoi qe ra-joiii iiie i mil-e per kcte qelliiii eslite Vlora. Pastaj normalislit u kalua ne zgjedhjen e vendit ne dy zona te Vlores dlie zgjedlijet me premtuese per tu shqyrtuar qene Viora -A dlie Vlora B. Vlora-A ka pi.oblenie me objektet e deiiioluar dhe ndotjen e injedisit, sic u aiializua me siper, keshtuqe per pasoje zona tjeter islite ajo qe siguronte investimet me efektive dhe me te vogla per infrastruktureii. per fiiiiiizim me lende djegese. per lidhjen me ijetiii dlie per ujin ftohes. Ne do ie analizojnie \ anantiii qe paraqiiet ketu per zoiien e Akeinise, por me llogaritje fare te perafei-ta diiket scajo do te doje iiivestiiiie shtese (i-ret!i 10-15) milion USD.(4 ininuta)

1 I.A do te merren parasysii mendiniet qe do te dalin iiga kjo tiyeze? Zoti Besim Islami : Siginislit ju garantojnie qe kjo bisede nuk eshte bere per silo\\ televizi\/. Ne jeiiii totalislit te preokupuar te ndjekim te gjitha hapat dhe sic tha zonja Tatjana Hema eshte e doinosdoshnie qe ky takiin te behej dhe studirni i impaktit nijedisor te marre ne analize te gjitha preokupiniet qe ju sliqetesojne. Mbeshtetur ne Konventen e Aarhusit eshte detyrc e institucioneve shqiptare te inforinojne piiblikun ne lidhje me te gjittie fazat e projekteve. me impaktin qc do te sjeile ne ltomunitet si dhe iie nijedk(3 iiiinuta)

11. Cfare do te fitoje dhe cfare do te tiuiiibi Vlora nga ndertiini i TEC-it? Zoti Besirti Islami : Ndertimi i iije ceiitrali te ri temiik duhet para ne kontekstiti koiiibelar sc" pw-i die ne ate rajonal se dyti. Ne kontekstin koinbetar iidertimi i TEC-it do tc beje te iiiLundui. diversifikiniin e prodhimit te eiiergjise elektrike gje e cila do te nise sigurine e fui-tiiziiiiit. Persa lidhet me Vloren ky TEC do te beje te mundurprodhiniiii lokal te eiiergjise de e cila do te ndihiiioje ne zhvilliiiiiii e ekonoinise lokale te vendit. Nga ana tjeter duke u konibiiiiial- ky projekt me ate te iidei-tiniit te nje linje 220 kV Fier-Vlore do te behet e mundur qe te slitohen aktivitetet prodhuese sidoiiios turizmi qe shpresoliet kaq shume. Nga ana tjeter duhet te deklarojnie se citat do te jeiie edhe problemet e ndet-timit te TEC-it ne zonen Vlora B. Kjo zone duke qene prane Poi-tit nuik inund te jete zone e mbrojtur apo turistike dhe duke bere kujdes me zyjedhijeii e teknoloaise dlie operimin e TEC-it ne iiiuiid te zvogelojme ne maksimum iidikiiiiiii ne nijedis. po~asiijelier ta zerojine ate.(4 ininuta)

-3- 13. A eslite niaire parasysh iiieiidimi i pushtetit lokal ne fazen e perzgjedhjes se shesliit? Zoti Piro Mitmshi : Historiku i slieshit te TEC-it te ri e modem ka filluar para dy vjetesli. Si fillim eshte shprehur nevoja per nje TEC ne sistemiii energjitik. Me tej ne studimin per reliabilitiniin e TEC-it te Fierit, jane skicuar nevojat per iije studim rne variante lendesh djegese, teknologjish dhe sheshesh eventuale si dhe opsioiii i importit (HARZA); dhe se fundi, eshte ky projekt i cili ne fazen e pare shqyrtoi 6 rajonet me nga 2 variante. Mendimet per kete faze nuk LL moren nga pushteti lokal, pasi nuk u kerkua nga kompania per efekt konfidence dlie maturie. Sot dhe iije iiiuaj me pare ne po kalojme ne keto takime sqaruese dhe te nevojshme proceduriale. Ne roliri e konsulentit iokal, ne kemi sugjeruar qe per cdo rajon te kishim 2 variante (njeri nga te cilet ne ish zona industriale dhe tjetri ne zone te lire). Sugjerimet tona kane qene opinione brenda ltompetences sone teknike dhe ne kemi patur te drejte.(4 minuta).

14. A ka ndonje studini per ndonje zone te lire te mundshme industriale ne Vlore? Zoti Piro Mitrushi Zonat (Parqet) industriale e tregetare Jane shunie interesante dlie studinie te tilla afatmesine dhe afatgjata jane detyra le vete pushtetit Iokal, te shoqeise civile dhe asaj te biznesit per cdo rajon. Ato nuk duhet t’i kerkohen as Qeveriase dhe as Ministrise, por iiese keni duhel t’ja paraqitni Qeverise. Studiinet do jeiie te niirepritura. Persa i takoii zoiiave te lira (Porti etj.). lcetyre toiiave ju ka ikur koha per \!elide qe aspirojne Komunitetin Eiiropian.(3 minuta).

15. h40S eshte iiie inire qe kjo zone te spostohet me tie Veri ose me ne Juge, mbasi vendi qc keni zgjeedhiir per ne vloiijatet eshte plazh me te ardhme? Zoti Piro Mitritshi : Se pan, zona Vlora -B sot nuk eshte plazh. atje ka vetern gropa iiga inai-rjet e reres dlie bunkere. Se dyti, me ne Jug ndemjet poi-tit dhe Sode-PVC-se ka ndotje me shumc dhe praktikislit i afi-ohemi qytetit dhe plazhit. Se treti, kaliiiii nie ne Veri na coli ne Zvemec-Nartc (cle shte zone e iiibrojtur) osc tie BLketiii-Poro, ge qe do te kei-konte me teper in\*estiriis.(3 iiiiniitli\

16. Vlora eshte e lokalizuar ne iije slitrirje e cila eshte trajtuar nga nje program i LrNDP si iijc Zone e Mbrojtur e Lagunes se Nartes e cila pennban specie te rralla. Kjo ka bere te keie veshtiresira per te bere te mundur aprovimin e TEC-it. A nuk do te ishte e mundur te beliej nje i n\.estigim tjeter? Z. Besini ISLAMX: HARZA s bashku me KESH-in dhe me ne filluan iiivestigiiiiin per \ endodlijen e TEC-it te ri duke studjuar shtate zona: Sheiigjiii, Durres, Elbasan, Ceiik Korce, Fier dhe Vlore. Ne te gjitha keto zona u analizuan dy \.elide: Ipari te ishte iije zone industriale e abondonuar kurse e dyti nje zone e virgjert. Te gjitha vendet ne ish zonat industriale qe LL iiiiatizuan jane shuine te iidotura dhe me e ndotura eshte ajo e zones se ish Zones se Sodes Kaustike ne Vlore. Nga iijera aiie esbte mire qe te shfiytezoliet iije ish zone industriale per ndertimin e TEC-it. por nga ana tjeter kjo do te kerkonte se pari raffshimiii e cdo gieje ne ate zone dlie dekontaniinimin e zones (sic eshte ne Wore iiga iiierkuri (zhiva)) dhe investimet per te realizuar kete jane te nivelit 15-20 Milion USD. Ne se do te perdoreshin keto 20 Milion Usd per te bere gati vendiu do te thote qe do te zbriteshin nga 100 Milion USD qe do te jepet hua per TEC-in per pasoje TEC-i nuk do te ishte me 125 MW por i-reth 70-80 MW. Megjiithate sic e kemi tl~eksiiardisa here, vendi i zgjedliur eshte 1.3 kni larg zones se mbrojtur te Laguiies dhe nuk ka si te perfshihet ne nje zone te mbrojtur kur ajo eshte prane nje porti, tubacioni dhe tenninali nafte.

-4- Zoti Petrit Ahtiieti: TEC-i i ri qe po diskutojnie eshte nje perpjekje e madhe e specialisteve Amerikaiie se bashku iiie ata Shqiptare per te bere te inundur perfuiidiniin me sukses te studiiiiit dlie iiiipleiiieiitiiiiiii e tij, Ne si Ministri do te bejme te gjitlia peiyjekjet, se bashku me AKE-ne, ne ineiiyre qe te realizojme zgidlijen nie kosto miniinale dhe iidikiiii minimal ne nijedis.

Zoti Bashkini Habilai: Ne fjalen time se pari dua te flas si inxhinier terrnik. Nga kjo pikepamje duke pasur iije eksperience te gjate, studimin e deritaiiisheni e vleresoj shume te mire. Zgjedhja e tekiiologjise dhe e vendit eshte bere ne,perputhje me parimet teknike. Ajo qe ne do te kerkoiiim si autoritet lokal eshte qe te behen disa llogaritje te thjeshta per Vlora- C ne zonen e Akeniise. Ne do te vazlidojme te inbeshtesim projektiii dhe kerkojme nga grupi studimor qe ne fazen e studiiuit te iiiipaktit mjedisor te perfshihen edhe autoritetet lokale. Si perfundim, takimin e vleresoj shunie te mire dlie pergezoj pjesetaret e AKE-se per punen shume te mire qe kane bere.

Zoitja Tatjana Hema : Takimin e organizuar nga Ministria e Industrise dhe Energjitikes e vleresoj si shiime te vlefsheiii, Eshte hera e pare qe beliet nje studitii kaq i detajuar ne Shqiperi duke analizuar 7 zona dhe 14 sheshc ne tc gjitlie vendin. Une pergezoj koleget e Ministrise se Industrise dhe EiierszJjitikes, iecanerisht IZKE-ne dhe luyetariii e saj zotiii Besim Islaini per puiien shuiiie te mire qe lane bere. Njekohesisht dua te theksoj qe Ifendi i zgjedhur nga ana e tyre eshte nje zone e cila ndodhet n-et11 13 kni larg laguiies se Nai-tes keshtu qe kjo zone iiuk eshte perfshire ne zoiien e mbrojtur. Ash sic edlie 11 shpreha ne fillim ky eshte iije takiiii shume i vlefshein dhe shpresoj qe kjo tc realizohet dhe ne faza te tjera. Gjithashtu dua te shprehein se eshte e domosdoshine qe te.1.n. iiistitucioiiet tom te behet nje studini i detajuar i cili beje nje stridim te pIote impaktit ne iiijcdi:, iiieqeiiese ne kete zone iiiedohet te ndei-toheii TEC-i i ri. depozi tat e karburaiiteve dhe shpi I-L.:(:%I per piiset e uaftes.

ZL..Ministri Pieter Derna : Ministria jone po punon qe studiini i TEC-it Vlores te perfundoje ne kohe. VJeresiaiet, verejtjet, sugjerimet tmja kane qeiie shume te vlefshme dhe ne do ti maniiii parasysh gate hapave te tjere te studimit. Ministriajone se bashku iiie AKE-ne PO niei-r te gjitha tnasat per ti paraprire studiiiiit nijedisor, i cili pritet te filloje se shpejti. Gjate inuajit Nentor ne do te bejiiie gati te gjitha dokumentacionet e duhura per te bere te muiidur niarrjen e lejes per sheshin e iidertiniit re TEC-it. Gjithashtu ne do te studiojine edhe variantin e Akernise, duke bere disa llogaritje te shpejta per te pare sa me i shtl-eiije eshte ky variant.

Prefekti i Vlores Z. Slipetim Giika Ne mbyllje le keti takimi dua te faleiideroj Zv. Ministrin e Iiidustrise dlie Eiiergitikes Zotin Pjeter Dema. Zv. Ministreii e Mjedisit Zoiijen Tatjana Hema, Zv. Ministrin e Rregullimit te Tei-ritorit dhe Tiirizniit Zotin Arben Denieti, Zotin Petrit Ahmet si dhe Agjeiiciiie Kombetare te Etiergjise dhe ne vecaiiti Zotin Besim Tslami per punen e madhe qe kane bere. Sigurisht te gjithe te praiiishmit dhane vleresiine sliume te niira dhe disa suglerinie per perniiresiinin e inetejsliem te punes se projektit me te reiidesishem per Shqipenne. Ne si autoritete lokale ju garantojme se do te vazlidojnie te nibeshtesiin zgiedlijen e bere qe TEC-i i Vlores te ndertohet sa me shpejt qe te jete e mundur dlie njekohesisht kerkojine qe studimi i iiiipaktit ne nijedis tejete i plote dlie te kete iidikiiii ininitiial ne meiiyi-e te tille qe te iiiai-rim iije teknologji iniqesore karshi nijedisit. Ky pi.ocesverba1 u inbajt dhe u zbardh nga Ing.Alieron Hizmo (AKE)

ANEKS Lista e pjesemarresve ne takirn

I, 2. Petrit Ahmeti Keshilltar i Miiiistrit te Industrise dhe Energjitikes 2. Z. Piro Mitrushi Adencia Kombetare e Energjise 3. Z. &-tan Leskoviku Agjencia Kombetare e Energjise 4. Z. Aheron Hizrno Agjencia Kombetare e Energjise 5. Z. Zarnir Dedej Ministria e Mjedisit 6. Z. Kanan Shakaj Kryetar i Komunes Novosele 7. Zilj. Shpresa Mbyeti Ing. e Komunes Novosele S. Z. Arqile Kunie Iiuthinier Eleklrik 9. Z. Ferdinand Sulaj Shoqata e Proliareve Legjitiine Sliqiptare 10. Z. Vas0 Suli Kirnist 11, Z. Adhuriin Rrapaj Inxhinier Pasurues 12. Z. Niko Duinani Biolog, Shoqata e Mbrojtjes se Mjedisit Natyror Vlore 13. 2. Mynyr Gjika Sekretar i Programacionit. Qarku Vlore 14. Znj. Luiza Zunaj Adencia Rajonale e Mjedisit, Vlore 15. 2. Pandeli Monce Likuidator i Uzines Sode-PVC 16. 2. Sotir Qoiiiaj Drejtoria e Sherbimit Pyjor, Wore 17. Z. Pajtiin Shpata Shoqata '* Ekspedita Blu" 1 S. Z. Cliriin Hoxlia Shoqata Mjedisore " Kxisto Papajani" 19. Z. Jahri Gaxhi Inxhinier 20. Z. Argent Alltari Banka Anierikane, Vlore 2 1. Z. Patriot Islami Biznesrnen 13. Z. Vladimir Haxhiu Keshilli i Qarkut Vlore 33. 2. Haliiii Dewishaj Drejtor i Sh.A. Kr-ipa, Wore 24. 2. Spiro Hudhra Drejtor i Filialit Energjitik. Fier 25. Z. Spiro Gjidede Insyektor i Industrise ne Prefektiire, Wore 16. Z. Arben Mcksi Inxhinier Urbanist 17. Z. Mario Sota 2s. 2. Faslli Opari 29. Z. Aiiastas Koka 30. Z. Dliionis Andoni 3 1 . Znj. Vai-vara Gjika 31. Z. Petrit Kotoi-ri

-6- LC!U(N:Dergolict sltidinii dhe iije perinblcdlijjc per zgjedlijcn c vendit ne te cit iii clo ti. ~ictci~iol~~i TEC-i i ri

EKONOMI

M!@tirnatizimi,, ;::!i', Poqi firmos marreveshjen ne Beograd Mkistri i Ttansportit dhe Telekomunikacionit ka firmosur marreveshjen.p8r informatizimin e shoqeris2. lrnplementimi i saj, si nismi! e Paktit tB Stabilitetit, smon qi! nit vitet nit Mzhdim shumi! shgrbirne publike dhe qeveritare ti! luyhen 'online"

.> &jTEC i ri ne Wore, BB miraton studimin *' Selia e Bankb Botdrore ne Shqiptri e ka vlerksuar te f'lnencueahh studimin e fieibilitetit ptr ndZrtimin e njeTEC te ri ne Wore. Studimi i shpZmdar(! p2r oponend ne intitucione keto dits nga Ministria e Energjitikls, raulton rnt ipranueshtm se studiml i'flzlbilitetit per hldrocentraline Bushatlt

b I

-- ;stria e Transportitdhe Telekomunikacionit oftim ~6%vend

t6 1ir6 pune, 8. , .-.... ?: ' " PAGA - Ntzbatim I# ngjit Nr.8549.datP i1.1 1.1999'Statusl I NPp;nirit Clvil~Departamentii Administrater Publike rhpall konkurlmln pPr 1 vend tY Ilf&ne poFIclonlri . . P~~abruto.epotlclonlitlkiirkuar 74000+9000(+i~shte&rnb190M,pi.r~dovitvfetlrri , . ' . ' pune)lek6n6mua/. , I ParaqllJaedP~umenIsve . :

The new TEC in Vlora, WB approves the study

The World Bank office in Albania has evaluated the feasibility study for the construction of a new TEC in Vlora as financeable. The study, recently distributed by the Ministry of Energy to the institutions for evaluation, is regarded as more acceptable than the feasibility study for Bushat hydropower project.

Blerina Hoxha

The World Bank considers the feasibility study for the construction of a new TEC in Vlora as financeable. Its was finished by “Harza” company few days ago. Sources from the WB Albania office informed Korrieri that the TEC study is more feasible than the project of Bushati hydropower plant. As a result of this evaluation, the project is financeable and the World Bank has long approved in principle an amount of 20 million USD. The Ministry of Industry and Energy has recently completed the feasibility study for the new power project and has submitted it to other relevant institutions for evaluation and remarks. These institutions include most of the ministries of the Albanian government and international institutions such as the World Bank, IMF, etc. After collecting all the evaluations and remarks regarding the feasibility of the project, TEC will be passed onto the procurement process, official sources from the Ministry of Energy affirmed. The preliminary information shows that the project has received an “OK from some of the institutions that are the most important for financing its construction. The cost of one kWh, according to studies, will be at 4,5 lek which, considering the rise of this product’s price, will be fully justified. The process to build the newest energy project includes 4 stages, 3 of which are almost concluded. Soon the feasibility study will be procured and the construction company will be selected in the first semester of 2003. The installed capacity in the first stage will be 100 MW, and funding will be secured through the international finance organizations. This stage is expected to be concluded within one year, and 200 MW capacity will be installed in the next two years.

This capacity is planned to be installed through the concession to private investors, who will complete the stage in two years. The construction of this project remains the only alternative to mitigate somehow the energy crisis.

B PREMTE, 1 NENTOR 2002 -_-- i?&jrii shirat, Ne 3 niuaj 62 ditt ishin me shi. Kantp&$Nnduar mbi 75% e prmimeve' Turqit; Duarn dhe 5 muaj kohe PBRRENJAS-Segmenti fundor i Koridorit rr 848 nt Sh- tire dhe veprat e ortit", ohon Nafl Ahm, njC pic) drejrucrve !fri, a1 Qukk's-QaR Thane nuk do tC plrfundojl brenda virit. rurq ti? firm88 'Mak-Yob . Sipsr rtatlrrikave tyrtare deri tani I tu sic ishte aralajmi?ruarnga rbacuesi i pro'ektir dhe drej- rerultojnC tT asfalruara 14 kin rrugt, nga 20 km qt tshtt gllthsej ies ti! shretit s!qiptar. Per dorrrimin c veprEsdo tt duhen dhe Icy segment rrugor, duke fllluv qC n a pika dopnore. NdCrsa rih 5 muaj tL! rjers. Ky Iakt Mhet idltur nga drejtuesir e firm& meveprat e artit, qE jaoC 'ovCt&n ct sfumta. por dhe ti! vCrhtira irke "Mak-Yol", e cila PO zbaton projektin per ndtrtimin e per Vu reallzuar pb shiak tC terrcnic tC theplsur e kry hi Ecij segmenti. Shkak per ketc rhryrje nC afalin e caktuar, slpar meve rnbi lurnin e Shkumbinir, PO ripas rratirtikave tl! lrej: rejiuerve II firrni!c zbatuesc. eshtk' mori i keq i rnuajve tr tucsve. jant pergatitur e hcdhur nE baramente 33 mill! metro indit. Gjate Ire muajve. sipas staLstikavc qC ofron ndtrtuesl, kub beton. NC pbmbushjc tt pro ekrir, lirma turkc "Mak.Yo1' in5 rezultuar 62 diti! me reshje tE shumta gE kanr sjeilC ren- ka shtuar koher e fundic si fuqlne punEtore arhtu dhe makin- imcnr tE oltr t@punlrnevc, p& shkak 12 terrenit teptr tE v2sh- eritt e pajirjet. Nga rrcth 300 pun2torC qe punojne ne kiitt re e shkarjeve mrsivc malore rnbi aksin e rrugiis nt nderrirn. segment tE Koridorlt 8. me rhurnr re dy tE rrctat janl! punErort ipas drejtuesve iurq. shtyrja e afatit CrhtC e motivuar dhe jrnr shqlptarl! rr zones si dhe r@trevave pEr rrerh (nga Pogradeci. iarre qi? te gjirha masar qi! punimet tC kryhen me intcnsitcr Librazhdi e Blbnsani). Scgmenti Qukts-Qafl! Thmt LishtC reg. he me cilgri. "Deri (ani eshrt kryer mbi 75% e volumit tl! rnenti i 54i Koridorit 8 nt vendln ton8 dhc pika lidhtse me irgiirhshem I$ punirneve. vqanrrisht nii scktoret me re vEsh- vcndln fqin] Msqedonine. Kujtlm BoriqI .. ... I lkswn ne hotelin !KW: ni! UnZn eplazhit Prangu dhe @ WhnZve tk'tjerii Shoq2rohen ni'polki dhe 6 shq@are I ' ' N Kapet ne Dmes anetm 1 Cosa Nostra"

DURRkS ~ ArresiohetnE urres n]E itaiian i iumrkl!rkuar, i dyrhuar si Kan& qent or& e vona ietar i organizark's "Cora tts dit& si! djeshme kur osrra". nj@nga organizatat iafloze me tt njohura ne oh. uniftoma te shumta !tin rqin] II Iralis8. ndrrra policiei janedrejtuar ne sehuertruar 8 kilogram$ :roinE:e palter qC posedohej hotel "Kidit"nje hotel *ej tij.:Xhankarlo Kollgi 29 5 katesh, nl! stacionin eC k'shtt shtetasi italian i ipur nk nagrance ne oret e hekurudha Eplazhit t6 ma rrdlttr srdjerhmc, nder- Dubit.Burimc te rimel pEr "Skkull4n" hand se I bEhet e ditur se ati I lane nE 'I~ME zhvilloher konprai I Ilokuar dhr dy pisto/eta tip policid thane se Radlkal-kve dhe nje NP I quaj- Burime t@. polidre kishim informacionetl! tur'"Murlr& e AljZahut' janC :'adT!!erii, - thane ptr shprchur $e do ta nddojni! me treten'se 29-vjqari perdorre sigurta se n&ktstir hotel @o kurht kongretin nderko- idenritete rc ndryshmc, strehoeshin shtetas m~Utojimi!mau~rnerr di!rsamerohcr nga burirnc jo ~llclashqiprareptr rorcirnln e d dhc c mare re ai kishte hapuredhe italiane!te.dyshimtE Mrlr rigurimin delcg. bar 'nC qyrctin bregdetar, Kmnlru(.tl I Mrlt acionevc nt kryeqytetin sh. je qlptar. Ptr personin e m& ! cilin e kishte marre me e iyrc SIdhc do te zbardhin uettporrlt tt Duntsit. Surime. krpunirni midlr lyre. Duket IC heroine I cili e kalon drogEn rpWm. sipa tC nr!jiave buri. era. Burirnc tT policisi! si! tranzit nga ShqipCris ne rrlnjCr e kEtij rrjeri. Brenda njt t8 drejtodrl! rt policlrE sl Dur- kEraj here kanr qenb tC efekc- meve, ka informouonc re! dy- urresit than@prr gazeten se tt hvku kohor I€ rhkurttr?rhtC rCsit thane prr gazcrrn re ka shme emtrirnet e rcjr nC por- drejrirn Irdlst. Sipas herb rhimu ul ni k&kon ttvijt ne tC tin e Durrtclt. Fall! punb..s# ashkt me rhurnt mevc 16 para Crjashrohet njl! rasci i dytt qe policia e Dur- hrte Fundit, nlkuadlr tl! luftlr ,Shqlprf B.Bcrbcri Brkuarin e policise Italiane lidhje e rnunsKmc e rhtetasve r&it kap rhtetar IF huaj, tl! Im- , kundllr trafikur ttfdo llojl an6 drejtuesve tC kCsaj acrukture, ndaluan edire dy shtetas ii! iraliinr tii ndaluar me pronar- plikaur nE trakun c drog8s. formar masat si nga pohcia glare jithr muajit tC fundir, ere iraliane, ndersa u sho- et e horelit ku ata u kr to. kufitarc c portit t4! Durrtsit yti \a qent nC qendlr tt Crum nC komisiariat cdhc Gjitlisesi, than2 burirnet 80 re Masat ashtu dhc nga policia e drej- ronlkavc tC rendit,, ,p€r (ashta shreras shqiptarC; lene herimel e mttejshmc at0 NdCrkohC masa re forra rorisC si! qyretlt bregdetar. Po ndCshkimin e abuzimeve iqc dddVloreslidhurmedj&jen inrat e dy rhtetarve I@ tjere qr do tC saktesojnt pozkionin /ani!marrCedhe ni! pikEn kufit- . ashtu CshtC rritur edhe bash. Iigjiii. Ll.Ksllw &sk'nahtrntCorisnt. aliant dhe re shqiptarl! ILL mulruar re zjuTLn.uk &hit daluar nuk beiien tC dirur P&faqtsude Fmunkr JNovOselkF nuk kanZpranuar qi; TEC4 le"nd2rtoliet nlAkirnu' vbEqtllimisht, por 'r shluqe ga policia. 11! pmav~hike Ends de. porltCs. Edbe drejtori i ndtr- Aksioni VLORB - Vendi ptr murjer ndtls ni? Corirht KanE qcnii or& e vona re Krirtq Annum1 thaprguct6n iirs s@ djrshme kur unifro- nd6nhin eTEC-it re Viorilr nuk Debati; ku do EndWohet TEC-i u~ruktuarrdjenCnjembledh)e serhknLuirhi~s#irjarritnuk ia te shurnra policie i jan8 q@zgjati mbi ire ore.RdaqrSues &hcl ndikh1 juhtcm, por n$ rejtuar hotel "Kidit" nje ho- re3rtion pimferik. Icili zhvil- !I 5 katesh, iiLLstacionin hck- ti? agjcneist komwjare t@ en. erpilu, IT Ministrid 58 Eneae- iohct brcnda nt koken e de- I rudhq tB plazhit te Durrrsii. POzilES. llir Ruci ; urime it policisk' SIDurrcsit rikb, Mjedirit dhe'Ibriunii, janS iad pur yazeten se kirhim munduarpre] treoesh ILL bindin pj&marrtsit ni? kttt diskudrni T ilorrnacioiie 12 sigurta so nC Well-known German producer of Diagnostic Reagents and Equipment $18 hotel strehoeshin shretas er mund&in(! e ndErtlmit re rE $,EGlt te ri n$ zondn e for medical laboratory use would like to extend, its worldwide business aliani! dyrhlmid. Nisur ,I ga k?io inroriiiacione poli- re Zv.?rnecit, ku ndx%% relationship to Albania. tC ia e DurrLLsit kishie tre dit@ pentili i shoqtris8 hrmo nab tes. Diskumret. dre rues tLL ush- e i rurvejonte ais. Keshtu Ire relit lokal, prckkti &ka. libetasit iralimd, njeri prsj IC For this reoson we are looking for an iiicvc ekrponrnt shuini. i kryektshilltari i qarkut Abili dhe Qclwhkiaku Veizi lune k*rkur brkuar nga pulicia italiane si m@shurne hdltsira rreth projek. jcretar i "Cora Nostra" janE tit rE kerij TEC-i, ndgrkoht t apur ne dhornat e tpre re gcrfag~suesireOlpvettmjedi%t Exlusive distributor 'for diagnos- oielit. Sasia e droges Eshle dhe rpcialiste 18 tier2 te encrgjb apur e fshehur nt vende tC tius kanr Wre njr oponend 11 16 dliorncr. tic ieagenfs and systems dryshmc nderra lorte. duke hcdhur iden5 e ipas burirneve Erhte rekues. ndtrtimit le kEtij TBGl nC njt Companies established in the area of laboratory ond hospital supplies war dhe njr peshore e vogii. tjeti?r zonr rt Vlor&, n8 ate tt blu preferably with diagnostic or inshrnenl sxperience should contad under Iniformat kanc bcre hkgmist. Kjo ide &htC kund2r- ': .:.r;T. -, , No.K 250 our agency. I ,,. dhc shoqrrimin e gjrshte shtiiunp plfaqEstiesite komu- . . Iiieiaqve sliqiptarr, iidersa n8r si! Novorel&, tt! pranlsh&n 111; ptrcaklohel pozicioiii i nediskuiim.Sip;rrcyrei'dlnimii Peter Emrlth-WERBUNO: . (re. TEC-ii ne &mi du I@rrrikonte R0.00k 1805, D-55008 Malriz Uurime tr polidre sq.iru. Telefax +49 6131 687dZl : . , L . ...

Novosela commune representatives have disagreed wifh TEC being build in Akernia Debate: where will the TEC be constructed llir Ruci

VLORE - The location for the construction of the Vlora TEC (Thermal Power Plant) was not decided yesterday in a meeting that lasted over three hours. Representatives of the national energy agency, the Ministries of Energy, Environment and Tourism, have tried for three hours to persuade the participants in the discussion on the possibility to build the new TEC in the area of the new Zvernec port, where the pier of the ARM0 oil company is situated. The discussants, local government leaders, prefect Gjika, the chair of regional council Abili and Mayor Veizi, demanded more details about the TEC project, while the representatives of the environmental NPOs and other energy experts strongly opposed, forwarding the idea of building this TEC in another area of Vlora, in Akernia. This idea was opposed by the representatives of Novosela commune, present in the discussion. According to them, building the TEC in Akernia would endanger many organisms in the area. The defenders of the construction of TEC in the port area near Zvernec, have tried to persuade the participants about the fact that this is a big project, “a chance the World Bank has given to Albania”. The thermal power plant, according to the design, will occupy a 15 ha area of land. After the first stage will be completed, the plant will have a 225 MW installed capacity, and after the completion of the next stages the installed capacity will be up to 400 MW. According to the design, only one unit of this plant will produce 3 million kWh/day, while all three units will generate 1 billion kWh/year. The plant is planned to be constructed 1.3 km from the Narta lagoon. The energy experts from Vlora raised the concern about the acid rain, resulting from the condensations during rainfall, but the experts from the national energy agency have said that it will be insignificant. The plant will use the sea water for cooling the condensers, taken 6 km from the coast, and returned to the same point. But there is no site determined for the construction of this project. Meanwhile, the World Bank has established November as the deadline for determining the site, in order to allocate the funds in March next year.

ite rrugeve ne eVLORE-tetetitMmo*uzhvilluaZ: Kdwsvendosur &tu ';ia&rm d siqn(!nWtin: edhetl! ~sh- : gjyg n~gaBashkia

VOLICIA:~DJ~@AE DEP0ZIT.S BE. NARES NUK HA AKT SABOTAZHI VI.ORE- Burimct nga I V1or;is ban8 dje tC dyt%';: ti: egfA d depozites sli naftQene C- Jrirht tl! VlorEe, nuk kishtc ti bi!nto me nji! akt rabotszhi, pc.r.dpaa hetimeve te bWa, ka crne thjesht nji? reaksioii 6 'mik i cili zkvillohet irga k-n~binlmetperiferike ti+ q-iln~ ji.kakt.>jnl! edlrc vcndwsjcn I: n.:ftYs ni! dppozite. Ndrrko- bt, burlmet nga Ndlrmarrja c !Taftc!s nP Gorirht, kanQ kon-

Extensive discussions regarding the construction site for Vlora TEC

VLORA - Following the decision made, a broad discussion regarding the construction site for the new TEC (Thermal Power Project) was organized yesterday in the Palace of Culture “Laberia” in the town of Vlora. The participants included three deputy ministers of Energy, Tourism and Environment, the Vlora region prefect, Mr. Shpetim Gjika, the Chairman of the Regional Council, Mr. Bashkim Abili, the Mayor of Vlora, Mr. Niko Veizaj, as well as experts from the energy sector, environmental non-governmental organizations, lecturers from the “lsmail Qemali” University of Vlora, intellectuals, etc.

The participants were introduced to the existing alternative for the TEC site in Vlora, its capacity, the land it will occupy, the construction stages, levels of pollution, quantity of fuel to be used, quantity of the waters to be used for cooling the condensers, the temperature of the waters discharged into the sea, etc. After the presentation of the study, the participants made many questions and discussions. They rightfully asked that the representatives of the National Energy Agency present a study for another construction site, mentioning the site in Akernia. The moderators of this discussion said that they will take into consideration all the remarks and suggestions made, while leaving open the possibility for a future broad discussion.

ANNEX6 GOVERNMENTOF ALBANIA RESPONSE TO DRAFTFINDINGS OF THE AARHUSCONVENTION COMPLIANCE COMMITTEE

Ministry of Environment, Forestry and Water Administration

To: Mr. Jeremy Wates Secretary, Convention on Access to Information, Public Participation in Decision making and Access to Justice in Environmental Matters

From: Pellumb Abeshi General Secretary Ministry of Environment, Forestry and Water Administration.

Dear Mr. Wates,

The Albanian Ministry of Environment, Forestry and Water Administration (MoEFWA), as the National Focal Point for the Convention on Access to Information, Public Participation in Decision-making and Access to Justice in Environmental Matters (Aarhus Convention) would like to express its appreciation to the admirable work done by the Aarhus Convention Compliance Committee and the opportunity given to Albania for further comments on the Draft Findings and Recommendations dated on 29 March 2007.

The Draft Findings and Recommendations will certainly help Albania to a better implementation of the Aarhus Convention and a better involvement of the public in the decision-making process.

We believe that the Albanian Society will have great benefits from the democratic spirit of Aarhus Convention and we would like to show our commitment in respecting all the recommendations given by the Convention Secretariat.

However, the MoEFWA, on behalf of the Albanian Government, would like to raise a few comments on the Draft Findings and Recommendations aiming to highlight a few evidences that might have not been taken in account during our previous communications.

I. INTRODUCTION

Comment on paragraphs 1-23. Despite our disagreement with some of the communicant opinions we think that our concerns have to be presented in the next chapters since we want to respect the communicant independent opinion.

II. SUMMARY OF THE FACTS, EVIDENCE AND ISSUES

Industrial and energy park

This section summarizes only the main facts, evidence and issues considered to be relevant to the question of compliance, as presented to and considered by the Committee.

1 Ministry of Environment, Forestry and Water Administration

25. On 19 February 2003, the Council of Territorial Adjustment of the Republic of Albania approved through Decision No. 8 the site of an industn‘al and energy park immediately to the north of the city of Wora. Through this Decision, signed and stamped by Mr. Fatos Nano, Chairman of the Council, who was the Prime Minister at the time, the Council “Decided: The approval of the territory for the development of ‘The Industrial and Energy Park - Vlore.’)’ Decision No. 8 furthermore deemed that the Ministry of Industry and Energy “should coordinate work” with various Ministries and other bodies “to include within this perimeter [of the industn’al and energy park] the projects of the above mentioned institutions, according to the designation ‘Industrial and Energy Park.’” It stated also that various Ministries “must carry out this decision” and “This decision comes to force immediately.”

Comments on Paragraph 25. According to the Secretariat of the Council of Territorial Adjustment of the Republic of Albania (CTARA), the Ministry of Economy) Trade and Industry has proposed the abrogation of the Decision Nr. 8 Date 19/02/2003 “On Approval of the Industrial and Energy Park-Vlore”. It is expected the CTARA will abrogate the decision during its next meeting.

28.In October 2005, following a change of government the Prime Minister established an ad hoc commission to consider the economic and environmental aspects of Vlora industrial and energy park project. Three meetings were held with stakeholders, two in Tirana (22 and 29 October 2005) and one in Vlora (11 November 2005). The communicant has not contested that these meetings tookplace and that they enabled the concerned stakeholders to participate, and it has confirmed that its representatives did indeed participate in them. (1)Its objections relate rather to the perception that there was a lack of willingness to from the proponents of the project, including the Government, to “listen and to take into consideration the opinion and the will of the people”, thereby reducing the decision-making process to “a mere rubber stamp”.

Comments on paragraph 28. We believe that the last sentence stated as below “Its objections relate rather to theperception that there was a lack of willingness to from the proponents of the project, including the Government, to “listen and to take into consideration the opinion and the will of the people”, thereby reducing the decision- making process to “a mere rubber stamp”’ expresses only the feelings of the communicant and not the facts, evidences and/or the issues.

We would like to stress that the Albanian Government did organize three consultation meetings with independent experts and high representatives of the Civic Alliance. The meetings were facilitated by the Albanian Council of Ministers in the presence of the Deputy Prime Minister) high political representatives of the Ministry of Economy) Trade and Industry) Ministry of Environment) Forests and Water Administration) members of the Albanian Parliament representing the whole political spectrum) representatives from the Local Authorities of Vlora, representatives from several governmental technical institutions as well as the rector of Vlora University. They were broadly followed by the national and local media. The Civic Alliance as well as the independent experts did have the possibility to express their concerns in this meeting. They took the floor several times and defended their ideas through several presentations and interventions. Based above we believe that this public hearing did show the interest of the government to listen and to take into consideration the

2 Ministry of Environment, Forestry and Water Administration opinions of the communicant. As such we suggest that the upper mentioned sentence is not relevant and/or could be included in the introduction chapter.

Thermal electric power plant (TEP)

30.On 19 February 2003, the Council of Territorial Adjustment approved through Decision No. 20 on the construction site of the TEP in Vlora. Through this Decision, signed and stamped by Mr. Fatos Nano, Chairman of the Council, who was the Prime Minister at the time, the Council “Decided: to approve the construction site with a surface of 14 hectares for the facility of the new Prot of Vlora, within the industrial Energy Park ... according to the attached layout”. It stated also that the Council of the District of Vlora and the Ministry of Energy and industry should carry out this decision” and “This decision comes to force immediately.”

Comments on paragraph 30. We suggest that this paragraph could be removed after paragraph 35. We believe that this order gives a better view of the activities undertaken before the first national decision-making on TEP. Such an order could be more relevant for the discussion held below with regards to paragraph 31.

Indeed the Council of Territorial Adjustment Decision No. 20 on 19 February 2003 “On the construction site of the new TEP in Vlora” was preceded by the following events (see paragraph 34 and 35) : 0 Site selection undertaken during the period April-September 2002, 0 Draft Sitting Report completed on 6 June 2002 recommending Vlora as the best site, 0 On 21 June 2002, the Ministry of Energy and KESH approved the recommendation, On 2 1 October 2002, the feasibility study completed and ‘introduced in Vlora, On 31 October 2002, the Ministry of Energy and Industry convened a public meeting in Vlora, 0 On 21 December 2002, the Council of Territorial Adjustment (Vlora District) approved the choice of the site for the TEP,

31. The Committee has not been provided with any evidence of public participation including notification or public announcement in the process leading up to Decision No. 20.

Comments on paragraph 31. We suggest this paragraph could be revised and re- drafted as follows ” The Committee has been provided by the Party with evidences of public participation in the process leading up to Decision No. 20.”

As stated in paragraph 35 a public meeting was convened in Vlora on 31 October 2002 to introduce the project and begin the public consultation process. The Party had shown evidences of this public hearing through a list of participants. The Party has also informed that this meeting was attended by more 39 people listed in (Annex l), including representatives from local NGOs, members of local business community as well as independent experts. To take only one example, in the list participants in the meeting of 31 October 2002 in Vlora, the persons by number 16, 19, 24 and 25 are

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representatives of local NGOs and the persons by number 15, 17, 18, 26-28 and 33-39 represent interested public that have not specified their institution or organization.

37. As regards the participation of the public in the three public meetings referred to in the previous paragraphs, varying degrees of information are available to the Committee:

(a) The introductory meeting on 31 October 2002 was attended by various representatives of national and local authorities as well as, according to the Party concerned, intellectuals and NWs of Vlora. The communicant disputes the claim that intellectuals and NWs of Vlora participated. The Committee has repeatedly requested2 the Party concerned to provide specific information concerning the process of notification for the meeting for residents, NGOs and other stakeholders) and a list of participants, but no such information has been forthcoming.

Comments on Paragraph 37 a. According the information included in Annex 1 the meeting of 31 October 2002 in Vlora was attended by 39 people, 17 of whom (circa 43%)) represented either NGOs or independent interested public. Based upon we suggest the paragraph 37 could be re-viewed and re-phrased in order to respect the evidences presented above ensure that the Party has provided a list of participants.

(b) The meeting on 2 April 2003 to review the scope of the EL4 was attended by more than 100 people, 40 of whom signed an attendance sheet a copy of which was made available to the Committee. The communicant commented that “there was not a single NGO represented or any important environmental activist in this meeting” and that public opinion was not taken into account in the decision. It stated that those considered to represent the public presence at this meeting and at the third meeting were mostly members of the local government and the Socialist Party who were promoting the construction of the industrial and energy park. Without directly disputing this, the Party concerned maintained that among those actors it had identified as potential participants in the meeting were environmental and public information NGOs. However, it did not provide the Committee with any details of which of these were invited to participate, or more generally of the steps taken to notify the public concerned.

Comments on paragraph 37 b. We suggest the paragraph 37 b could be reviewed in order to reflect the evidences below :

The meeting was attended by participants representing different political parties in a local level, as well as social segments of the community. For example, the individual by number 3 is the Chairman of the Local Opposition Party. The civil society was represented in this meeting by representatives of Vlora University, members of local private sector and two NGO representatives (see the list of people present in the meeting and more specifically the numbers 6, 8, 10, 23, 27, 28, 29, 30, 31, 33, 34, 36, 37). Furthermore we would like to point out that the meeting has been more extended, but the Albanian culture on the organization and participation in public events does not imply confirmation of participation through signature. So, many participants have not signed despite their presence in the meeting.

Initially by letter of 16 December 2005,

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(c) The meeting on3 September 2003 to review the draft EL4 was attended by some 35 people, a list of whom was included in the EL4 study (Appendix E). Of these, five appear to have been technical experts, 15 represented various public authorities, five represented various local enterprises, the affiliation of six was not indicated and four appear to have been associations, including two environmental organizations. Again, information requested from the Party concerned regarding the process of notification of the public concerned which might help to shed light on this apparent imbalance in participation has not been forthcoming.

Comments on paragraph 37 c. A closer look to the list of representatives shows that this meeting was attended by three NGOs out of six local environmental NGOs accounted in Vlora region in 2003. Furthermore we consider that the participation has not been of “apparent imbalance” since 17-18 persons out of 35, circa 50% of the participants, are representatives of the concerned public.

(d) The Party concerned states that notifications of these meetings ”were made available one month prior (according to the information given by the consulting company). ‘5 No further information on the manner or content of the notifications has been forthcoming.

Comments on paragraph 37 d. We would like to clarify that the notification has been done by the local and regional authorities who have been subject of several changes due to elections for the central and the local government. As such it is quite difficult for the Party to find evidences of the notifications.

41. No application for an environmental permit, construction permit or operating permit for the TEP has yet been lodged. The only decision that has been taken concerns the location of the TEP.

Comment on paragraph 30-41. An Environmental Permit on TEP has been issued in February 2007 following a demand from the Ministry of Economy, Trade and Industry, After that the same Ministry has requested nearby the Council of Territorial Adjustment in Vlora the construction permit for Vlora TEP. Up to now, no construction permit has been delivered by Vlora CTA.

Oil storage terminal and port infrastructure

42. On 19 Februay 2003, the Council of Territorial Adjustment of the Republic of Albania approved the construction site for a coastal terminal for storage of oil and by- products and associated port infrastructure through Decision No. 9. On 8 May 2003, the Council of Ministers adopted a decision approving a concession procedure to the benefit of the Italian-Romanian company La Petrolifera. On 13 May 2004, the concession was approved by Parliament. On 11 Februay 2005, the Council of Ministers adopted a decision registering the land in the name of Petrolfera. Any such facility having a capacity of 200,000 tons or more would fall within the scope of annex I of the Convention. The communicant provided information orally at the fourteenth session, which was not contested by the Party concerned, to the effect that the envisaged capacity was of the order of 500,000 tons.

Letter of 25 November 2005

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Comment on paragraph 42. The EIA study on the Oil Storage Terminal shows evidence that the total maximum storage capacity for Phase 1 of the PIA terminal is less than 70.000 tons and even in its largest envisaged future developments of Phase 2 and 3 it could possibly reach a capacity of about 170.000 tons, still well below the 200.000 threshold and by all means not related to the capacity of 500.000 tons assume by the communicant. Based above the Oil Storage Terminal and Port Infrastructure might fall beyond the scope of Annex Iof the Convention.

We would like to stress that the area for the localisation of terminals is a former PVC Soda factory, with ruins of the factory buildings and significant pollution. The area is abandoned and not fit for residential or tourist development. In fact as the terminal will be built on a site previously used for the manufacture of PVC, using chlorine production in mercury cells there is contamination present at the proposed terminal site due to the past site use. The extent of contamination is described in UNEP study “Post Conflict Environmental Assessment and State of The Environment Report” of 1999, qualifying the area as an environmental hot spot.

43. No evidence of public participation in or prior to this sequence of decisions has been presented to the Committee.

Comment on paragraph 43. With reference to the EIA study on Oil Storage Terminal, the Government of Albania started in 1999 to address the issue of finding safe and efficient solutions to the problem of logistics for oil products. The problem was perceived as significant because either oil products arrived into the Country via tanker trucks, mainly from Greek refineries, at a very high cost, or ships were discharged in commercial or passenger ports (mainly Vlora and Durres) without any precaution for safety or environmental protection, with frequent oil spills and occasional accidents, a situation that persists to these days with a last year event in Vlora. In order to solve these problems the Government charged the Institute of Oil and Gas of Fier, a Government body dependant from the then Ministry of Industry and Energy, to carry on a study for the positioning of no more than two ports in the Country, dedicated to the handling and storage of oil products. Such study, issued in January 2001 after considering several alternatives on the coasts of Albania, indicated in a bay north of Durres (Porto Romano) and in the Vlora Bay the two areas. Such orientation was then incorporated in a decision of the Council of Minister (no. 351 dated April 29, 2001), and a call for bids (based on Decision of the Council of Ministers n. 30 of 28th January 2002) from interested parties was published on Albanian newspapers on July 3rd, 2002. At this stage PIR constituted its Albanian subsidiary, PIA, and submitted its proposal to the Government.

In parallel to these events the Government endeavored to obtain appropriate zoning decisions for the construction of one or more oil terminals and of the related port infrastructure. To this end in 2001 it submitted to the competent authority, the Council for the Regulation of Territory of Vlora (KRRT), a first proposal. In its meeting held on 7t11September 2001, with decision no. 9/ 1 the KRRT rejected the proposal of the Government (after analyzing two alternative sites: the former Soda and PVC factory, and the salty area near Akerni). On October 3rd 2002, most national newspapers, including Ekonomi, Dita, Albania and Gazeta Shqiptare, published a

6 Ministry of Environment, Forestry and Water Administration rather detailed description of PIR proposal. On a second meeting held on November 12th, 2002 the KRRT rejected again a Government proposal for zoning the former Soda and PVC factory on the ground that, La. the proposed port solution included a platform at sea for discharge of oil products, whereas such solution was considered at risk of spillages and of significant visual and environmental impact, and because the proposed plan of the Government did not offer any remedy for the existing pollution in the areas interested by the zoning decision.

The Government finally submitted in 2003 to the KRRT of Vlora a proposal which included a protected port facility close to shore, and remedies for the pollution of the area interested by the requested zoning decision, and the KRRT approved the zoning of the area with its decision no. 1, of 17th January 2003 in a public meeting attended by more than 30 people (minutes of the meeting are available at the Vlora Municipality). The zoning decision then required further approval by the National KRRT, which took place on 19th February 2003, by decision no. 9.

When eventually the project of the Terminal was ended, it was presented to all interested parties, public and private and all valid suggestions were carefully taken into consideration and reflected in its final version. The Public Consultation with the Community of Vlora on December 15, 2004.

Comments on paragraph 42-43. An Environmental Permit on Oil storage terminal and port infrastructure has been issued in April 2007 following the demand from PIA. After that the same Ministry has requested nearby the Council of Territorial Adjustment in Vlora the construction permit for Vlora TEP. Up to now, no construction permit has been delivered by Vlora CTA.

Oil and gas pipelines

44. On 5 December 2003, the Council of Tem’torial Adjustment of the Republic of Albania approved the route of the proposed AMBO pipeline. On 26 April 2004, the Council of Territorial Adjustment (Vlora District) approved the route of the pipeline. No evidence of public participation prior to either of these decisions has been presented.4

Comments on paragraph 44. The Oil pipeline Burgas - Vlore is only at the phase of study. It is not decided yet the location of its coastal Terminal. The Albanian government has asked the interested (AMBO Corporation) to submit several proposals on the location of the terminal at the Albanian coast. Up to now, there has been no further proposal from AMBO part. At the moment such a study will be ready, it will certainly be subject of public discussion with the pertaining community.

III. CONSIDERATION AND EVALUATION BY THE COMMITTEE

The Committee is aware ofanother proposal for a gas pipeline passing through Vlora, namely the Trans-Adriatic Pipeline proposal fi-om the Swiss company Elektrizitatz Gesellschaft Laufenburg AG for a pipeline which would bring gas from the Caspian, Russia and the Middle East through Greece and Albania to fuel Italian power stations, but has not received any information concerning the decision-making processes involved.

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50. The Convention, as a treaty ratfled by Albania, is part of the Albanian legal system and is directly applicable, including by the courts. The Party concerned has stated that some aspects of the Convention have been transposed into national law, but has not been specific about this.

Comments on paragraph 50. We believe that information regarding the transposition of the Convention has been sent to the Secretariat in previous years. The last reporting has been delivered on 2006 and it is considered by the Secretariat as quite positive. Please find further information on Annex 2. Nevertheless further efforts should be concentrated in the preparing by law acts.

A. Admissibility and use of domestic remedies

52.The communicant attempted to justify this at one point by asserting that Albanian legislation did not provide domestic judicial or similar remedies of the kind envisaged under article 9; at another stage, by reference to its lack of confidence in the ability of the Albanian courts to safeguard its interests in an effective way, referring to the judicial system as ‘slow and sluggish, in many aspects corrupted’ and asserting that ‘there was not a single case up to this day that would have been decided in favour of an environmental complaint or charge’. Furthermore, it considered its efforts to raise signatures and thereby precipitate a referendum to be a form of domestic remedy, albeit not in a conventional sense.5

Comments on paragraph 52. In order to avoid emphasis with paragraph 21 we suggest the following change:

“The communicant attempted to justify this at one point by asserting that Albanian legislation did not provide domestic judicial or similar remedies of the kind envisaged under article 9; at another stage, by reference to its lack of confidence in the ability of the Albanian courts to safeguard its interests in an effective way. Furthermore, it considered its efforts to raise signatures and thereby precipitate a referendum to be a form of domestic remedy, albeit not in a conventional sense.”

53.Decision I/7 of the First Meeting of the Parties of the Aarhus Convention says that the Committee should “take into account any available domestic remedy” (emphasis added). As previously noted by the Committee (MP.PP/C. 1/2003/2, parag. 37), this is not a strict requirement to exhaust domestic remedies. The Party concerned said in November 2005 that there was no domestic judicial remedy that could be used before the decision was taken, as there was nothing that a court could consider. A year later, the Party concerned presented general information to the effect that according to the Constitution and laws of Albania, there was access to administrative review, Ombudsman and courts. The first statement of the Party Concerned could be seen to imply that the three decisions the text of which it submitted to the Committee in June 2006 (see para. 9 above) were not subject to appeal, which was also the position of the communicant (see para. 23); by contrast, its second statement indicated that they could have been appealed. In any event,

The reasons why the Election Committee, and subsequently the Supreme Court, rejected this initiative despite the requisite number of signatures having supposedly been obtained remain unclear to the Committee.

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there appears-to be a certain lack of clarity with regard to possibilities to appeal certain decisions.

Comments on paragraph 53. Further consultation with legal experts has shown that according to the Constitution and laws of Albania, the communicant has had full access to administrative review, Ombudsman and courts.

54. The Committee regrets the failure of both the Party concerned and the communicant to provide, in a timely manner, more detailed and comprehensive information on the possibilities for seeking domestic remedies. Furthermore, it does not accept the communicant’s assertion that it has tried all possible domestic remedies. Nonetheless, in the face of somewhat incomplete and contradictoy information concerning the availability of remedies, also from the side of the Party concerned, the Committee cannot reject the allegations of the communicant that domestic remedies do not provide an effective and sufficient means of redress.

Comments on paragraph 54. We would like to notice that the contradictory information from the Party does not imply that domestic remedies do not provide an effective and sufficient mean of redress. As in other countries, the court system is independent form the executive system. In this context the contradictory information might rather reflect a lack of know how from the Party rather than lack of “effective and sufficient mean of redress”.

B. Legal basis

59.Decision Nos. 9 and 20 concern activities of types that are explicitly listed in annex I of the Convention. Paragraph 1 of annex I refers to ‘Thermal power stations and other combustion installations with a heat input of 50 megawatts (MW) or more’, Paragraph 18 refers to ‘Installations for the storage of petroleum, petrochemical, or chemical products with a capacity of 200,000 tons or more’. Other paragraphs of the annex may also be relevant to Decision No. 9. As regards Decision No. 8, industrial and energy parks are not listed in annex I as such, even though many of the activities that might typically take place within such parks are listed. If an EM involving public participation for such a park were required under national legislation, it would be covered by paragraph 20 of annex I.

Comments on paragraph 59. We would like to recall our comments with regard to paragraph 42. “Th.e EIA study on the Oil Storage Terminal shows evidence that the total maximum storage capacity is about 170.000 tons, still well below the 200.000. Based above the Oil Storage Terminal and Port Infrastructure might fall beyond the scope of paragraph I8 of Annex I of the Convention.”

C. Substantive issues

Industrial and energy park

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“On the Approval of the Industrial and Energy Park - Vlore”, which approved the development of ‘The Industrial and Energy Park -Wore’, was just a location (sitting) decision. However, this does not detract from its importance, both in paving the way for more specific decisions on future projects and in preventing other potentially conflicting uses of the land. Several Ministries were instructed to cary out this decision. The decision came into force immediately. It is clear to the Committee that this was a decision by a public authority that a particular piece of land should be used for particular purpose, even if further decisions would be needed before any of the planned activities could go ahead.

66. No evidence of any notification of the public concerned, or indeed of any opportunities for public participation being provided during the process leading up to this decision, has been presented to the Committee by the Party concerned, despite repeated requests. The documents provided by the Party concerned do not demonstrate that the competent authorities have identified the public that may participate, as requested under article 7 of the Convention, and that they have undertaken necessary measures to involve the members of the public into the decision-making. To the contray, the evidence provided suggests that the opponents were not properly notified about the possibilities to participate. The Committee is therefore convinced that the decision was made without effective notifcation of the public concerned, which ruled out any possibility for the public to prepare and participate effectively during the decision-making process. Given the nature of the decision as outlined in the previous paragraph, even if public participation opportunities were to be provided subsequently with respect to decisions on specific activities within the industrial and energy park, the requirement that the public be given the opportunity to participate at an early stage when all options are open was not met in this case. Because of the lack of adequate opportunities for public participation, there was no real possibility for the outcome of public participation to be taken into account in the decision. Thus the Party concerned failed to implement the requirements set out in paragraphs 3, 4 and 8 of article 6, and consequently was in breach of article 7.

Comments on paragraph 65-66. The section on Industrial and Energy Park (Chapter Substantive Issues) could also mention that the Secretariat of the Council of Territorial Adjustment of the Republic of Albania, the Ministry of Economy, Trade and Industry has proposed the abrogation of the Decision Nr. 8 Date 19/02/2003 “On Approval of the Industrial and Energy Park-Vlore”. This fact shows clearly that the concerns raised by the communicant as well as other public groups have been seriously taken in consideration by the Government of Albania.

Thermal electric power plant

67. Contrary to the decision-making process leading up to the designation of the site of the industrial and energy park, the decision-making process relating to the proposed TEP involved some elements of public participation, e.g. public notifications, public meetings, availability of EL4 documentation and so on. However, as regards Decision No. 20, dated 19 February 2003, which establishes the site of the TEP, the only element of public participation in this phase of the process appears to have been the public meeting that tookplace in mora on 31 October 2002. The issues of who was notified of the meeting and invited to participate in it, the content of the notification, and who actually participated, are therefore important. As mentioned above (para.

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37(a)), the Pa%y concerned asserted that among those who participated in the meeting were “intellectuals and NWs of Vlora” This assertion has been strongly disputed by the communicant. Unfortunately, despite repeated requests by the Committee, the Party concerned has failed to provide specific information on these points. (1)The obscure circumstances around the meeting in October 2002, and the failure of the Party concerned to provide anything to substantiate the claim that the October meeting was duly announced and open for public participation, (I)clearly point to the conclusion that the Party concerned failed to comply with the requirements for public participation set out in paragraphs 3, 4 and 8 of article 6 of the Convention.

Comments on paragraph 67. We believe that this paragraph could give a better picture of the reality by avoiding expressions as “obscure circumstances around the meeting in October 2002” which at least are not based in evidences that were provided by the Party. We would like to recall our comments regarding the paragraphs 30-41 in the Chapter “Summary of The Facts, Evidence and Issues”.

The Council of Territorial Adjustment Decision No. 20 on 19 February 2003 “On the construction site of the new TEP in Vlora” was preceded by the following events : 0 Site selection undertaken during the period April-September 2002, Draft Sitting Report completed on 6 June 2002 recommending Vlora as the best site, 0 On 21 June 2002, the Ministry of Energy and KESH approved the recommendation, 0 On 21 October 2002, the feasibility study completed and ‘introduced in Vlora, 0 On 31 October 2002, the Ministry of Energy and Industry convened a public meeting in Vlora, On 21 December 2002, the Council of Territorial Adjustment (Vlora District) approved the choice of the site for the TEP,

The first meeting, held on 31 October 2002 in Vlora sought public input on the Sitting and Feasibility Study. It was attended by 39 people, 17 of whom (circa 43%)) represented either NGOs or independent interested public. A list of participants has been provided by the Party.

The meeting on 2 April 2003 was attended by participants representing different political parties in a local level, as well as social segments of the community. Furthermore we would like to point out that the meeting has been more extended but many participants have not signed despite their presence in the meeting.

The third meeting was held on 3 September 2003, in Vlore to discuss the Draft EIA. The Draft EIA was made available to the Public at least thirty days prior to the meeting. This process was coordinated by the National Agency for Energy (NAE). It was attended by governmental representatives, local authorities, regional authorities, students and staff of Vlora University citizens and local non-governmental organizations. During this meeting, additional details about the project and the EIA were disclosed to the public. Participants had the opportunity to discuss the project impacts and provided further input to the EIA process. The meeting was well publicized through local news media outlets. Official Copies of the Draft EIA reside

11 Ministry of Environment, Forestry and Water Administration with the Ministry of Environment, Ministry of Territory and Tourism, Ministry of Industry and Energy, KESH, and the NAE. NAE also sent 10 English copies and 20 Albanian copies of the Draft EIA to the Municipality of Vlore, District of Vlore and Prefecture of Vlore. One English and Albanian copy was also archived in the Vlore Library.

68.The two meetings that took place on 2 April 2003 and 3 September 2003, respectively, obviously occurred after the adoption of Decision No. 20, and therefore cannot be considered as events contributing to the involvement of the public in that decision. Thus, they do not mitigate the failure of the Party concerned to comply with the Convention in the process leading to Decision No. 20 of 19 February 2003.

Comments on paragraph 68. The meetings on 2 April and 3 September were discussing respectively the EIA scope and the EIA study. The TEP location was discussed in a previous meeting held on 31 September 2002, well before the Decision No. 20 of 19 February (see paragraph 31, 35, 37a and 67). According those paragraphs, the comments expressed above and the facts provided by the Party, it seems that the Party has not failed to comply with the Convention in the process leading to Decision No, 20 of 19 February 2003.

69.Even so, the Committee wishes to make a short comment on these meetings as well, since they also give rise to concern. No information has been provided by the Party concerned to demonstrate that the meetings in April and September 2003 were publicly announced, so as to make it possible also for members of the public opposing the project to actively take part in the decision-making. Nor has the Party concerned been able to give any reasonable explanation as to why the rather strong local opposition to the project, indicated by the 14,000 people calling for a referendum, was not heard or represented properly at any of these meetings. It is thus clear to the Committee that the invitation process also at this stage was (1)selective and insufficient. The only public notification, in the form of newspaper advertisements, that was presented to the Committee related to meetings that took place later in 2004. (2)Thus the Committee notes that, despite some subsequent efforts to improve the means for public participation, there were several shortcomings also in the decision-making process after Februay 2003.

Comments on paragraph 69. The party has provided evidences that the meetings were publicly announced (see paragraph 37 and 67) and that the meetings made it possible for members of the public opposing the project to take part in decision- making. The Party would like also to highlight that the Civic Alliance was non-existent in 2003. The signatures of 14,000 people were mainly collected during 2005. The Party is sure that the invitation process is neither selective nor insufficient. As stressed in paragraph 28, the Albanian Government did organize three consultation meetings with independent experts and high representatives of the Civic Alliance. The meetings were facilitated by the Albanian Council of Ministers in the presence of the Deputy Prime Minister, high political representatives of the Ministry of Economy, Trade and Industry, Ministry of Environment, Forests and Water Administration, members of the Albanian Parliament representing the whole political spectrum, representatives from the Local Authorities of Vlora, representatives from several governmental technical institutions as well as the rector of Vlora University. The Civic

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Alliance as well as the independent experts did have the possibility to express its concerns in this meeting. They took the floor several times and defended their ideas even through several Power Point presentations.

Oil storage terminal and port infrastructure

70.Decision No. 9 approving the construction site for a proposed coastal terminal for storage of oil and by-products and associated port infrastructure appears to have been adopted without any prior public participation. Assuming that the proposed oil storage terminal would have a capacity of more than 200,000 tons (see para. 42), it is an activity falling within the scope of annex I of the Convention. Considered under either article, the lack of public participation possibilities leading up to the decision represents a failure to implement the requirements set out in paragraphs 3, 4 and 8 of article 6.

Comments on paragraph 70. The EIA study on the Oil Storage Terminal shows evidence that the total maximum storage capacity is below the 200.000. Based above the Oil Storage Terminal and Port Infrastructure might fall beyond the scope of Annex Iof the Convention.

Oil and gas pipelines

71. The Committee notes that pipelines for the transport of gas, oil or chemicals with a diameter of more than 800 mm and a length of more than 40 km are listed in paragraph 14 of annex I of the Convention and therefore subject to the fill set of public participation requirements under article 6. The AMBO pipeline and other pipeline proposals have not been a particular focus of the Committee’s attention, and the Committee has not received sufficient information from the Party concerned or the communicant to be in a position to conclude whether or not there was a failure of compliance with the Convention.

Comments on paragraph 71. We would like to recall on comments on paragraph 44 where we have stated that the Oil pipeline Burgas - Vlore is only at the phase of study. It is not decided yet the location of its coastal Terminal. The Albanian government has asked the interested (AMBO Corporation) to submit several proposals on the location of the terminal at the Albanian coast. Up to now, there has been no further proposal from AMBO part. At the moment such a study will be ready, it will certainly be subject of public discussion with the pertaining community.

N. CONCLUSIONS

A. Main findings with regard to non-compliance

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tookplace afc& the crucial decision on sitting and were subject to some qualitative deficiencies, leading the Committee to find that the Party concerned failed to comply with the requirements in question.

Comments OR paragraph 77. The Party believes that this finding should be reviewed and re-phrased since they do not comply with the evidences given in paragraphs 31, 35,37,67,68 and 69.

The World Bank has followed meaningful consultations and disclosures as they are required under the regular World Bank safeguard policies.

79.By failing to establish a clear, transparent and consistent framework to implement the provisions of the Convention in Albanian legislation the Party concerned was not in compliance with article 3, paragraph I, of the Convention Ipara. 73).

Comments OR paragraph 79. The Party believes that this finding should be reviewed and re-phrased since it does not comply with the evidences given in paragraph 50. The information regarding the transposition of the Convention has indeed been sent to the Secretariat in previous years. The last reporting has been delivered on 2006 and it is considered by the Secretariat as quite positive. Please find further information on Annex 2. Nevertheless we agree that further efforts should be concentrated in the preparing by law acts ensuring a better implementation of the Convention.

B. Recommendations

80. [Noting that the Party concerned has agreed that the Committee take the measure referred to in paragraph 37 (b) of the annex to decision I/ 7,] the Committee, pursuant to paragraph 36 (b) of the annex to decision I/7, [has adopted] the recommendations set out in the following paragraphs.

81. The Committee recommends that the Party concerned take the necessary legislative, regulatoy, administrative and other measures to ensure that:

(a) A clear, transparent and consistent framework to implement the provisions of the Convention in Albanian legislation is established;

(b) In order to comply with article 7 of the Aarhus Convention, “practical and/or other provisions for the public to participate during the preparation of plans and programmes relating to the environment” are in place not only during preparation of individual projects, including through development of detailed procedures and practical measures to implement article 25 of the EL4 Law of Albania;

(d) Notification of the public is made at an early stage for projects and plans, when options are open, not when decisions are already made;

(e) Notification of the entire public which may participate, including non-governmental organizations opposed to the project, is provided, and notifications are announced by

14 Ministry of Environment, Forestry and Water Administration appropriate means and in an effective manner so as to ensure that the various categories of the public which may participate are reached, and records kept of such notifications;

If) The locations where the drafc EM can be inspected by the public before public meetings are publicized at a sufficiently early stage, giving members of the public time and opportunities to present their comments.

(g) Public opinions are heard and taken into account by the public authority making the relevant decisions in order to ensure meaningful public participation;

82.Having regard to paragraph 37 (d), in conjunction with paragraph 36 (b), of the annex to decision I/7, the Committee recommends the Party concerned to take particular care to ensure early and adequate opportunities for public participation in any subsequent phases in the permitting process for the industrial and energy park and the associated projects.

83. The Committee also recommends that the measures proposed in paragraphs 80 to 82 be taken or elaborated, as appropriate, in consultation with relevant NGOs.

84.The Committee invites the Party concerned to draw up an action plan for implementing the above recommendations and to submit this to the Committee by 15 September 2007. 85. The Committee invites the Party concerned to provide information to the Committee by 15 January 2008 on the measures taken and the results achieved in implementation of the above recommendations.

87.The Committee resolves to review the matter no later than three months before the third meeting of the Parties and to decide what recommendations, if any, to make to the Meeting of the Parties, taking into account all relevant information received in the meantime.

Comments on Recommendations. First of all, we would like to thank the Convention on the recommendation done to the Party and we would like to assure you that the recommendations will be seriously taken into consideration by Albania. On behalf of the Albanian Government, the MoEFWA express its commitment towards a rapid implementation of the recommendations since it believes that they will strongly support the environmental conservation work done so far in our country.

We would like to inform you that the Albanian Government has approved in June 2005 the Strategy and Action Plan for the Implementation of the Aarhus Convention. The Strategy has foreseen also measures needed for its implementation.

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With respect to Albanian EIA Law, the MoEFWA will prepare within 2009, two Minister’s orders about informing public on environmental information, as well as for the procedures of public participation on decision making process.

The Regulation dated 17 August 2004 on “Public Participation in the process of environmental impact assessment” enlists in its article 10 the interested parties. The implementation of this regulation is still lacking due insufficient capacities among local authorities.

We would also like to inform you that recently the MoEFWA has established the Advisory Board of Aarhus Information Centre with the assistance of OSCE. The Board is composed by 7 members, three representatives of MoEFWA, one representing the OSCE and the other three are representatives of the most active national environmental organizations. This Board has organized two meetings so far. During its second meeting the Board took the opportunity to distribute and to discuss the Draft Findings and Recommendations of Aarhus Convention. At last but not the least, Albania welcomes any help given by the Convention and potential donors for reviewing and enhancing its legal and institutional framework in order to better enforce and implement the Aarhus Convention.

Yours Sincerely,

Pellumb Abeshi

16 =PORT

THE MINUTES OF THE PRESENTATIVE MEETING ON VLOFL4 TEC (HELD IN VLORA ON OCTOBER 28,2002

Today on October 28. 2002, in presence of:

Mr. Pjeter DEMA Vice-Minister of Industry and Energy Mr. Petnt AHMETI Advicer of Minister for Energy Mr. Besim ISLAM1 Chairman of National Agency of Energy Mr. Arben DEMETI Vice-Minister ofRregulation ofTerritory and Turismus Mrs. Tatjana HEMA Vice-Minister ofEnvironment Mr, Shpetim GJTKA Prefect ofVlora Mr. Bashkim HABILAJ Chairman ofCouncel ofDistrict ofVlora Mr. Niko VEIZAJ Chairman of Municipality of Vlora

And with participation ofthe interested persons (see Annex 1 (Participation List), here included)

Was held the presentation meeting of the final Study on New TPP of Vlora, executed by MWH Company.

The Meeting was opened by Mr. Gjika Shpetim, Prefect of Vlora, who presented in front of auditorium the participants in meeting and thanked the working body for the chosing made on appointing Vlora as the city ofthe TPP to be built (4 Minutes).

Here unten is given a summary of the questions made and the answers given on the resulted issues.

1. How much is going to influence on the sea water the hot water temperature, turned back from the cooling of the TPP condensation?

Mr. lslami Besim : The cold water temperature entering into the condendenser as average during all year is 15OC. After cooling in the condenser this temperature is increased on the level of 19- 2OoC. Moving the pulled out tube into the depth, in a distance 3-5 km from the seaside, is made posible that the sea water temperature to be increassed no more than 1.5'C towards its value. This

-1- makes possible the phenomenon avoidance of thermic heating and is within the permitted norms making possible the preservation of the marine flora and fauna (about 3 Minutes).

2. Has been taken in consideration the fact that into lagoona are not poured other water sources except the water sea and that the marine sole is clayey.

Mr. Islami Besim : The cold water is going to be obtained from the sea. The taking and unloading of the cooling water has no conection with lagoona. The full environmental study will make possible to be observed the impact which is going to have on the clayey sole the taking of the sea water. But the preliminary analyses show no negativ influence will result (1 Minute).

3. What is the future ofthe Albanian Energy sector?

Mr, Islami Besim : The Ministry of Industry and Energy, the World Bank and KESH are doing a study on the development of the Albanian Electro energetic Sector. This study will finish on Jannuary 2003. Also since July 2002 has begun the work for preparing of National Strategy of Energy from the side of National Agency of Energy in collaboration with Albanian energetic institutions. Both these documents together with Electro energetic Politics will form the hture basis for Albanian energetic sector development, in such a way that no crises to be more repeated (2 Minutes).

4. What kind ofpollutants are emitted into the atmosphere?

5. Having in consideration that the TPP is near the city, have been analyzed the winds which may push the smokes towards the city?

Mr. Pirro Mitrushi : As here mentioned, the Vlora-City-Gulf, influenced from the Northwest- Southeast and Southwest-Northeast winds. On these conditions, based on the study ofthe rose of the wind of ex Soda PVC plant, the conditions for the TPP on the zone Vlora B are improved, because the displacement towards Northwest into 2-3 km improves (deviates) the wind movement. It is to underline that the new TPP emissions will be less problematic as those of ex- Soda-PVC Plant. The underlined values are the maximum ones on the case of using a non qualitative distillates with a Sulk content less than 1% (2 Minutes).

6. Is the water to be taken from TPP to be unsalted?

Mr. Mitrushi Pirro : TPP needs for water are to be resolved : The potable water is to be taken from the water furnishing enterprise of city Vlora; industrial water c 200 m3hour if possible

7. Is polluted the zone chosen from the erecting ofTPP?

Mr. Islami Besirn : The chosen zone is 1.8 km way from PVC, zone which results polluted Erom mercury in very hygh levels. According the studies done this zone (Vlora B) may be not much polluted. But this zone may not be a turistic zone too, because is very near to the new port. (1 Minute)

8. Has been thought for the pipes and the pontile ofoil?

Mr. Islami Besim : The question is very nice. On the study done fkom HARZA Company has been thought to be included all investments into the infiastructur coonecting TPP with fuel, water and electricity networks. In the initial investment are included 2.6 millions US.$ for rehabilitation of all terminal for a sicure import and depositing offuels. (3 Minutes).

9, Has any study been done for their renovation and replacement?

Mr. Islami Besim : Ihave to underline that in the supplementary investments to be included in the supply infrastracture with fuels, water and with electricity system, all these have been taken into consideration and consequently TPP will be sicure in its job. Has to be underlined that also for other places this has been taken into consideration and this is it which gave prioritet the Vlora place. As conclusion I have again to underline that all investments have been taken into consideration for the whole infiastucture (2 Minutes).

10. Has been thought as a variant Vlora-C, because Vlora-A has since the beginning been squalified?

Mr. Islami Besim: We firtst have chosen the Region. The analyse showed that the best region for this reason is Vlora. Then nomaly was passed in the chosing of the place in two zones of Vlora and the more promoting chosings to be examined has been Vlora-A and Vlora-B. Vlora-A has problems with demolated objects and environmental pollution, as was analyzed over, so that consequently the other zone was it which provided the more effective and poore investments for the infrastructure, for supplying with fuels, for connection with the network and for the cooling water. We are going to analyse the variant presented here for Akernia zone, but in approximative calculations seems that this zone will need supplementary investments. (about 10-15 million US$). (4 Minutes).

11. Are to be taken into consideration views resulting from this meeting?

Mr. Islami Besim : Yes of course. We show you that this conversation isn't done like a televisive show. We are totally preocupated to follow all the steps, and as Mrs. Hema Tatjana said, it is

-3- indispensable this meeting to be realized and the study onthe environmental impact to analise all preocupations that concem you. Based on Aarhaus Convent, it is the duty of the Albanian institutions to inform the public in reference to all projects phases and with the impact that it will bring to the community and surroundings.

12. What is Vlora going to win and lose fiom the construction of the TPP?

Mr. Islami Besim : The construction ofthe new TPP is firstly very important in national context and secondly in regional one. In national context the construction ofTPP will make possible the diversification of the electricity generation, which will increase the supply security. As far as is concerned Vlora this TPP will make possible the local electricity generation, which will be a help in the development of local economy of the region. On the other side, this project, being combined with this one with the construction of a line 220 kV Fier- Babica (Vlora), will make possible the increasing of the production activities, especially the tourism, on which all we are looking. On the other side we have also to declare for all the problems to be confronted by the construction of TPP in the zone Vlora-B. This zone being near the port may of course not be a protective or touristic zone and showing prudence on choking of the technology and operating of TPP we may decrease in maximum the influence on the environment. (4 Minutes).

13. Has been taken into account the view oflocal govern on the phase ofthe chosin of the place?

Mr. Mitrushi Pirro : The history of the new modem TPF place has begun since 2 years ago. As beginning has been explained the need on a TPP in energetic system. Onward in the study on the rehabilitation of Fier TPP, have been outlined the needs for a study with variants in fuels, tecnologies and eventual places and the import option (HARZA); at last it is this project, which in the first phase examined 6 regions with 2 variants each of them. The views onthis phase were not taken from the local govern, because this was not requested from the company for efect of confidence and prudence. This day and a month before we have been passing into these explanatory and indispensable procedunal meetings. On the role of albanian consultant, we have suggested to have.2 variants for each region (one of which in an ex industrial zone and the other in a fre zone), Our suggestions have been opinions within our technical competence and we have been right. (4 Minutes).

14. Is there any study for any free possible industrial zone in Vlora?

Mr. Mitrushi Pirro : The industrial and commercial zones (para) are very interesting dhe such long-term and middle-term studies are the duty of the local government, of the civil and business society on each region. These are not to be requested to the central government or Ministry, but if they exist you have to present them to the government. The studies will be wellcomed. (3 Minutes)

15. It wouldn't be better that this site to be displaced on the North or the South, because the chosen site for the Vlora citiciens have to be a beach on the future?

-4- Mr. Mitmshi Pirro : Firstly, the zone Vlora-B now and before has not been a beach, there exists only holes from the taking off the sand and bunkers, Secondly, southward between the port and ex Soda-PVC plant there is more pollution and practically we approach the city and the beach. Third, passing towards North we approach to Zvernec-Narta (which is a protected zone) or in Akkerni-Poro, which will request much more investments for the infrastructure. (3 Minutes).

16. The city ofVlora is located on a extension, that has been treated from a UNDP Programm as a protected zone of Narta Lagoona, which contains rare species. This has been the reason that we have had a lot of problems to make possible the approving of the TEC. Is possible to do another investigation?

Mr. Islami Besim : HARZA, KFSH and us have begun the investigation of the place of the new TEC studying seven zones: Shengjin, Dunes, Elbasan, Cenik, Korca, Fier and Vlora. In all these zones were analyzed two zones: the first to be an industrial abandoned zone and the second a virgin zone. All places in ex industrial zones, which were analyzed, are very polluted and the dirtiest is the zone of ex Soda Plant in Vlora. On the one side it is good to be exploited an ex industrial zone for the construction of TPP, but on the other side it would firstly request the razing of everything in that zone and the decontamination of the zone (as exists in VIora from mercury) and the investments for its realizing are at the level of 15-20 Millions US$. Ifthis value would be used for preparing of the place, this means that about 100 Millions US$ borrowed for construction of the TEC would be decreased and the capacity of the TPP in this case would be 70-80 MW instead of 125 MW. Nevertheless, as we have repeatedly underlined, the chosen place is only 1.3 km way from the protected zone of lagoon and so is not possible to be included in a protected zone because it is near the port, the pipe network and the oil terminal.

Mr. Ahmeti Petrit : The new TEC we are discussing is a great endevaour of both the American and Albanian specialists to make possible the successfill conclussion of the study and its implementation. Both the Ministry and the National Agency of Energy are going to do all the efforts for realizing the solution with minimal costs and minimal effect on the environment.

Mr. Habilai Bashkim: Firstly Iwant to discuss as an thermal engineer. From this point of view having a long experience, Iappreciate very good the up to now study. The tecnology and place chosing has been done in conformity with technical principles. What we would request as local authority is that are to be made some simple calculations for Vlora-C in Akerni zone just to compare with Vlora B site. Ifthe new site (Vlora C) will asked an higher value for investment for TPP we of course will agree with the prposed site Vlora B. We are going to sustain the project and request from the study team that on the phase of environmental impact study to be also included the local authorities. As conclussion, I appreciate this meeting very good and congratulate Mr. Islami and the NAE partecipants for the good job done.

Mrs. Hema tatjana : Iappreciate very valuable the meeting organized from Ministry of Industry and Energy. It is the first time that a very detailed study is done in Albania analyzing 7 zones and 14 places in all the country, Icongratulate thecolleges of Ministry of Industry and Energy, especeally NAE and iths chairman Mr. Islami Besim for the good job done. At the same time Iwant to underline that the place chosen from their side is 1.3 km way of Narta lagoona, so that this zone has not been concluded in a protected zone. As Iwas expressed at the beginning this meeting is very valuable and I hope that this to be also realized in other phases. I want also to express that is indispensable that all three our institutions make a detailed study on the environmental impact, because on this zone is thought to be constructed the new TEC, fuels deposits and the drilling for oil wells.

Vice Minister Dema Pjeter : Our Ministry is working that the study of Vlora-TEC to be concluded on time.-Your appraisements, remarks and suggestions have been very valuable and we will take them into consideration during the the other steps of the study. Both our Ministry and NAE are taking all the measures in order to precede the environmental study, which is expecting to beginn soon. During November we will prepare all the necessary documentations to make possible the getting of licence on the construction place of TEC. We will also study the Akernie variant, doing some quick calculations to verify how more expensive is this variant.

Prefect of Vlora Mr. Giika Shpetim : In conlussion of this meeting Iwant to thank Vice-Minister of Industry and Energy Mr. Derna Pjeter, Vice-Minister of Environment Mrs. Hema Tatjana, Vice-Minister of Terrain Rregullation and Tourism Mr. Demeti Arben, Mr. Ahmeti Petrit and National Agency of Energy and especially Mr. Islami Besim for the great job they have done, Of course all participants gave cnstructive advices and some suggestions on the further improvement of the most important project job for Albania. We as local authorities guarant that we shall go on to sustain the made chosing that the TEC of Vlora to be constructed as sooner as possible and at the same time we request that the environmental impact study to be complete and from a good chosen technology to have a minimum impact on the environment.

-6- ANNEX Partecipants list on meeting

1. Mr. Pjeter DEMA Vice-Minister of Industry and Energy 2. Mr. Besim ISLAMI Chairman ofNational Agency ofEnergy 3. Mr. Arben DEMETI Vice-Minister of Rregulation of Territory and Turismus 4. Mrs. Tatjana HEMA Vice-Minister of Environment 5. Mr. Shpetim GJIKA Prefect ofVlora 6. Mr. Bashkim HABILAJ Chairman of Councel of District of Vlora 7. Mr. Niko VEIZAJ Chairman ofMunicipality of Vlora 8. Mr. Ahmeti Petrit Adviser ofMinister ofIndustry and Energy 9. Mr. Mitrushi Pirro National Agency of Energy 10. Mr. Leskoviku Artan National Agency of Energy 11, Mr. Hizmo Aheron National Agency of Energy 12. Mr. Dedej Zamir Environment Ministry 13. Mr. Shakaj Kanan Chairman ofNovosele Comune 14. Ms.Mbyeti Shpresa Eng. of Novosele Comune 15. Mr. Kume Arqile Electric Engineer 1.6. Mr. Sulaj Ferdinand Society of Albanian legitim owners 17. Mr. Suli Vaso Chemist 18. MI. Rrapaj Adhurim Engineer 19. Mr. Dumani Dhimo Biolog, Society ofNatyral Environment protection ofVlora 20. Mr. Gjika Mynyr Programmation Sekretary, District of Vlora 2 1, Mrs.Zunaj Luizaj Environment Regional Agency,Vlora 22. Mr. Monce Monce Liquidator of Soda-PVC Plant 23. Mr. Qomaj Sotir The Directory ofForest Service, Vlora 24. Mr. Shpata Pajtim Society ‘‘ Blue Expedition” 25. Mr. Hoxha Clirirn Environment Society “ Kristo Papajani” 26. Mr. Gaxhi Jahri Engineer 27. Mr, Alltari Argent American Bank, Vlora 28. Mr. Islami Patriot Businessman 29. Mr. Haxhiu Vladimir Region Councel, Vlora 30. Mr. Dervishaj Halirn Director of SH.A Salt, Vlora 3 1. Mr. Hudhra Spiro Director ofElectro-energetic Filial,, Fier 32. Mr. Gjidede Spiro Industry inspector in prefecture of Vlora 33. Mr. Meksi Arben Urbanistic Engineer 34. Mr. Sota Mario 35. Mr. Opari Faslli 36. Mr. Koka Anastas 37. Mr. Andoni Dhionis 38. Ms. Gjika Varvara 39. Mr. Kotorri Petrit

-7-

Transposition of the Aarhus Convention in the Albania legal framework

Low “On Environmental Protection”No.8934, Date 5.09.2002

Article 3

Definition of terms

38“Public authority of environmental protection” is the Ministry of Environment with its bodies and structures, environmental bodies in state institutions on central and local level, as well as any central or local body established subsequently to them. 39“Public authority of environmental management” refers to the central and local governmental bodies, which are entitled by law to environmental management and its elements.

Article 10

Local environmental plans

Local government bodies develop action plans on environment, in compliance with the requirements of the national environmental strategy. Line ministries assist the development and implementation of the local environmental plans, by providing the necessary information and technical expertise. Local government bodies should involve the public and environmental or professional non-profit organizations and business organizations, in the development and approval of the programs and plans. The chairmen of the municipalities should report to the Region Council about the implementation of the local environmental action plan, every year.

Article 54

Environmental information

1. Information on the state of the environment includes:

Data on the state of environmental elements; Data on the development of the economical sectors, which affect the environment, and their direct factors, which exercise pressure on the environment; Data on the environmental impacts; Data on activities, undertaken for the protection of the environment; Data on the state and exploitation of the natural, biological, mineral and energy resources; Data obtained from the national monitoring program implementation; Data on environmental discharges, on environmental quality and natural phenomena. 2. The information is accompanied with explanations on the likely negative impacts with delayed effect on the environment and human health and with recommendations on the citizens’ action in cases of verification of the negative impacts .

Article 55

Gathering of information

The information on the state of the environment is received and collected by the Ministry of Environment and its Regional Agencies, other ministries and central institutions, and local government bodies. The environmental information is requested, drafted and submitted according to rules, defined by the Minister of Environment. The legal and physical persons should submit the information, within 15 days after the receipt of the request.

Article 56

Publication of information

The state bodies that collect the environmental data and information publish them through mass media or other appropriate means in an easy and understandable form for the public. The state bodies and physical or legal persons, as soon as they observe any environmental pollution or darnage, should inform the population about negative environmental changes, the measures taken for their limitation or avoidance, as well the actions to be undertaken from the citizens to protect their health and safety. The physical and legal persons inform the buyer or consumers, at the time of sale or service provision, in writing or orally, about the hazardous components of their goods or services, as well as about the negative impacts on environment and health. The information which contains confidential data on national security or national commercial confidentiality, is administered according to the requirements of the Law No. 8457, date 11.2.1999, on “Information classified as state secret”.

CHAPTER X

ROLE OF THE PUBLIC

Article 77

The right to environmental information

The public and non-profit organizations are informed about the state of the environment through the publications of the information made by the state bodies and physical and legal persons, as well as by requesting data from the state bodies. The Minister of Environment defines the rules and procedures for the publication and provision of the environmental bodies by the environmental protection bodies. Article 78

Public participation in environmental decision-making

The decision-making bodies ensure the participation and active role of the public and non-profit organizations during the decision-making process. The Minister of Environment defines the rules and procedures that realize the participation of the public in the decision making of environmental bodies. Everybody has the right to complain at the environmental state bodies about any activity that utilizes, threatens, damages or pollutes the environment. Further to taking measures, the state bodies should respond in writing to every request of this kind, within l-month period, from the receiving date. According to the conditions previewed by the law No.7866, of 6.10.1994 “For the referendums”, the public and the non-profit organizations have the right to request the holding of general or partial referendums for environmental matters.

Article 79

Non-profit organization for environmental protection

Environmental non-profit organizations enjoy the right to be opponent to and to cooperate with the environmental protection bodies. The Minister of Environment defines the obligatory rules and procedures for environmental bodies to accomplish the rights of these organizations especially as regards: The formulation of policies, strategies and development plans and environmental protection programs; The preparation and implementation of the management plans for various areas; The preparation and implementation of monitoring programs; The environmental control; The EIA process and approval of the environmental perrnit; The preparation of legal and environmental normative acts

Representatives of non-profit organizations participate as members in councils and committees created for the environmental management and protection. The Ministry of Environment supports the projects of non-profit organizations, according to the regulations approved by the Council of Ministers, upon proposal of the Minister of Environment.

Article 80

Professional business organizations

Professional business non-profit organizations present their views in institutional way for the management and protection of the environment. They participate in the preparation and implementation of programs of development, management and protection of the environment. The Minister of Environment defines the rules and procedures for the communication of the public environmental institutions with the professional business organizations.

Low On Environmental Impact Assessment No.8990, Dated 23.1.2003

Article 17

Review Criteria

1. The review of request from the commission shall be conducted on basis of review criteria that consist of the following: Verification of level of impact on environment; b) Conformity of the project with national and regional plans of social and economic development and with territory adjustment plans; c) Ability of the proposer to bear rehabilitation costs of damaged and polluted environment by its activity; c) Technical and technological characteristics of the project to apply requirements for prevention of pollution and damage to environment; Consideration of opinions of interested parties. 2. Meeting of the commission of request review is open to interested public, non-for profit organizations, the proposer and the media.

Article 19

Consultation with Interested Parties

The Minister of Environment shall require an opinion whether the project is in conformity with national and regional development programs and plans and about the expected level of impact on environment forwarding the description of the project and the profound impact assessment on environment report to: Central organs covering the field of project objective; Urban and tourism development organs; Local government organs of the area where the project will be implemented; s) Specialized institutions in the forecast of impact on environment.

Article 20

Public Debate

1. The project and the report of impact assessment on environment shall undergo a public debate where participate representatives of the ministry which licenses the project, territory adjustment and tourism organs, local government organs, specialized institutions, interested people, environmental non-for profit organizations and the proposer. 2. The debate shall be organized and directed by the local government organ where the project will be implemented which within five (5) days upon receipt of consultation request from the Minister of Environment shall: a) Notify the public and environmental non-for profit organizations and put into their disposal the impact assessment on environment report for a period of one (1- month; b) In collaboration with the Ministry of Environment and the proposer set the debate day, notify participants ten (10) days in advance and within one month deadline organizes the open debate with all the interested. 3. If in the conclusion of the debate participatory parties does not submit their opinions to the Ministry of Environment, the commission of request review shall continue the procedures.

Article 23

Notice and Appeal of Decision

1. The Minister of Environment shall notify its decision which is published and a copy of the environment declaration or permit shall be delivered to the proposer, state organs that license activity and local government organs of area where the project will be implemented. 2. Against the decision the proposer may appeal in court within thirty (30)days of its publication.

Article 26

Public Participation

1. The interested public and environmental non-for profit organizations shall participate in all phases of the impact assessment on environment process decision-making inclusive. The Minister of Environment shall determine with separate normative act duties of environmental organs in order to guarantee public participation and of environmental non-for profit organizations in this process. 2. When the interested public and environmental non-for profit organizations observe irregularities in the process of impact assessment on environment shall require the Minister of Environment partial or entire re- review of the process of impact assessment on environment and the Minister shall reply within twenty (20) days from receipt of request. MAY 30, 2007 MAY IBRD 35504 (approximate alignment) ALBANIA PROJECT REQUEST ALBANIA SELECTED PROJECT SITE 6B PROJECT SITE 6A CANDIDATE PLANNED BABICA 220/110 kV SUBSTATION PLANNED 220/110 kV TRANSMISSION LINE ROAD TO BE PAVED UNPAVED UNDER THE PROJECT PLANNED FUEL STORAGE FACILITIES PLANNED INLET AND OUTLET OF THE COOLING WATER (approximate alignment) EXISTING UNDERSEA/UNDERGROUND FUEL PIPELINE OFFSHORE OIL TERMINAL HISTORIC MONUMENTS SELECTED CITIES AND TOWNS DISTRICT CAPITAL AREAS BUILT-UP RIVERS SELECTED CANALS MARSH SELECTED RAILROADS ROADS SELECTED UNPAVED SELECTED MAIN ROADS POWER SECTOR RESTRUCTURING GENERATION AND GENERATION VLORË PROJECT AREA FOR INSPECTION: 40°30’N Kanina Xhyherina Babica 19°30’E 19°30’E Vlorë

W, alignmentW, TBD To Orikum To

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