Ambassador’s Remarks at “Developing a Strong Energy Concept for Europe” Panel Discussion

Honorable Minister Bushati, Minister Gjiknuri, Minister Petkova, Deputy Minister Giro, Director Kopac, Ladies and Gentlemen,

The United States is strongly committed to European energy security, including energy security in the Balkan region.

But we are not Europeans and we are not from the Balkans.  Why should we care?

It is in our strategic self-interest to support a secure and stable European energy market with a diversity of energy types, sources, and delivery routes.  Only through this approach will Europe and the United States build regional security, economic prosperity, and sustainability.

In practical terms, the United States provides strong and consistent political and technical support for regional energy security through the U.S.-EU Energy Council.  We will be holding the seventh meeting of this ministerial-level council next week in Washington, DC.  Energy security and diversification will continue to be at the top of our priorities during this meeting.

Southern Gas Corridor

The United States remains a strong supporter of the Southern Gas Corridor, including the Trans-Adriatic Pipeline, which will cross Albania.  We have strongly supported this project despite the absence of U.S. company involvement because we believe it is vital to European security that Europe has alternate suppliers and routes for its gas.

That also is why we do not see the need for other mega pipeline projects, which may only serve as a distraction from the existing projects and reforms.  There is no clear economic reason to build a big, new pipeline – be it Turkish Stream or Nord Stream expansion – to connect the same Russian gas to the same European customers when the existing pipelines from Russia are only 60 percent utilized.

If these proposed pipelines do not make economic sense, they must serve apolitical purpose.  Governments – and companies – need to be very careful about such political motives that may not be in their best interest.

Next Steps in Albania

In the long-term, TAP has the possibility of bringing abundant, clean and inexpensive natural gas to Albania, and I urge the government to continue planning for the long-term gasification of Albania’s economy.

In Albania, the United States is also supporting energy security by assisting the government in its electricity legal and regulatory reform efforts, helping Albania’s power sector to be compliant with EU standards.  Albania is blessed with plentiful hydropower, but until recently, almost half of domestic production was lost to mismanagement and electrical grid problems.  USAID-provided technical assistance has helped the government reduce these losses from almost 50 percent to 37 percent, saving the Albanian government in 2014 around $130 million.  This benefits consumers, government revenues and businesses.

I commend the government’s commitment to have businesses and citizens pay their electrical bills.  The next step will be to invest in modern transmission and distribution infrastructure, maintain strong and transparent management of the distribution utility, and focus on regional integration.

Hydropower is cheap and clean, but it does have its downsides.  Most notably, it only really works when there is enough rain.  That’s why regional integration is so important.  With proper regional interconnectors, Albania can export its cheap, clean, hydropower during the rainy season and import electricity from its neighbors during the dry season.  The first step in this diversification should be the construction of the 400kv connection line to Kosovo, which will give Kosovo access to Albanian hydropower and Albania access to other sources of energy in the region.

In conclusion, let me stress that energy security is not free.  Spending on infrastructure for energy security is an investment in long-term stability and prosperity.  Governments’ capital expenditures should be targeted and complement the limited financing available from the EU, development banks, and other international partners.

The United States remains dedicated to the goal of improving regional energy security, and through these efforts, regional stability and prosperity.