Sustainable Asset Valuation of the Kalivaç and Poçem Hydropower Projects

The SAVi assessment concludes that the Poçem and Kalivaç hydropower projects are not preferable electricity solutions for Albania, as their lifetime costs, societal burdens, and tax losses outweigh their benefits. The analysis shows negative cost-benefit results of EUR 233 million for Poçem and EUR 321 million for Kalivaç, driven by adverse effects on ecosystems, agriculture, and tourism along the Vjosa River. Financial analysis indicates that these projects are not financially attractive based on domestic market offtake prices, with an internal rate of return (IRR) of 9.32% falling below the 13.5% hurdle rate. The report suggests that solar photovoltaic energy represents a more beneficial and viable alternative for generating comparable electricity in Albania.

• The Poçem and Kalivaç hydropower projects result in negative cost-benefit outcomes, with Poçem amounting to negative EUR 233 million and Kalivaç to negative EUR 321 million, due to adverse impacts on the Vjosa River's ecosystems and economic sectors like tourism and agriculture.
• Integrating valued externalities significantly increases the levelized cost of electricity (LCOE) for both projects; Poçem rises from EUR 121 to EUR 184 per MWh, and Kalivaç rises from almost EUR 158 to EUR 203 per MWh. These costs increase further if climate change risks materialize.
• The projects are not financially attractive for the domestic market, as the project internal rate of return (IRR) of 9.32% is lower than the 13.5% hurdle rate. The IRR drops to 3.15% when sediment dredging costs are included and becomes negative if externalities are internalized.
• Solar photovoltaic energy is identified as a more viable and beneficial alternative for generating a similar amount of electricity in Albania than the two hydropower assets.

APA

Perera,, A. B. W. U. R. (2020). Sustainable Asset Valuation of the Kalivaç and Poçem Hydropower Projects. International Institute for Sustainable Development. https://www.iisd.org/publications/savi-hydropower-albania

Chicago

Perera,, Andrea Bassi,Laurin Wuennenberg,David Uzsoki,Qendresa Rugova,Oshani. Sustainable Asset Valuation of the Kalivaç and Poçem Hydropower Projects. International Institute for Sustainable Development, 2020. https://www.iisd.org/publications/savi-hydropower-albania.

Wikipedia

{{cite report |last1=Perera, |first1=Andrea Bassi,Laurin Wuennenberg,David Uzsoki,Qendresa Rugova,Oshani |title=Sustainable Asset Valuation of the Kalivaç and Poçem Hydropower Projects |publisher=International Institute for Sustainable Development |date=10 July 2020 |url=https://www.iisd.org/publications/savi-hydropower-albania |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{perera2020sustainable, author = {Perera,, Andrea Bassi,Laurin Wuennenberg,David Uzsoki,Qendresa Rugova,Oshani}, title = {{Sustainable Asset Valuation of the Kalivaç and Poçem Hydropower Projects}}, institution = {International Institute for Sustainable Development}, year = {2020}, month = jul, url = {https://www.iisd.org/publications/savi-hydropower-albania}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }