Kosovo Starts Construction of 24.4 Mln Euro Power Substation

The project is co-financed by Kosovo's state budget with 11.05 million euro and German development bank KfW with a grant of 13.35 million euro, the embassy said in a statement.

The substation is expected to be operational by the end of 2009.

The construction of the substation and the overhead lines will stabilise the transmission network in western Kosovo, where over 50% of the 2.1 million population lives.

The Peja project is part of an investment package of the German government on improvements of the energy sector in newly independent Kosovo. Under the package a coal excavator is to be refurbished at the total cost of 8.0 million euro. The project will precede the opening of the Sibovc mine which should feed Kosovo lignite-fired power plants from 2010 on.

Germany has granted Kosovo 68 million euro since 1999 to improve its energy sector.

Kosovo has the world's fifth-largest proven coal reserves, estimated at 12 billion metric tonnes, but due to outdated facilities and lack of funds for extraction it continues to suffer daily power cuts.

($=0.7809 euro)