Albanian Prime Minister Edi Rama said on March 26 that the government plans to float state-owned electricity distribution company OSHEE on the stock exchange by the end of 2018, according to a government statement.

If the deal goes ahead, it will be the first initial public offering (IPO) of shares in a major state-owned company in Albania. The Albanian Securities Exchange launched its operations as the country’s first privately-owned stock exchange at the end of February. At the time, only three banks, two with Albanian capital and shareholders, were listed on the exchange.

“We have launched work on an IPO and hopefully we will be ready to provide Albanian citizens the opportunity to participate as shareholders in the power distribution company by the end of this year,” Rama said during the presentation of the 2030 National Energy Strategy. 

“Our ambition is for citizens to massively participate as shareholders so both the company and citizens will benefit,” Rama said. The Albanian prime minister added that it is necessary to take OSHEE to a “whole new level”.

Claiming credit for the changes since his first government came to power in 2013, Rama pointed out that few years ago the energy sector had been facing a complete breakdown, particularly at OSHEE, which was the main threat to country’s economy. However, due to the reforms and measures taken by his government the distribution company went through a dramatic process of changes and now is a profitable company.

“It might be enough to remind you that in order to maintain the power distribution system operational and to provide electricity supply to consumers, the state budget allocated an average of €150mn in subsidies annually to make up for the massive electricity theft and the grid losses,” Rama recalled.

The rate of electricity losses now has been cut from 50% to just 10%. Albania launched a tough anti-theft campaign in 2014 with prison sentences of up to three years for those found guilty of stealing power.

Among the wider plans to develop the energy sector, Albania also aims to fully liberalise its electricity segment by 2025. Rama said that the government is convinced that liberalisation will “lead to exceptional improvements in all aspects of the power sector activity”.

Rama pointed out that the harmonisation of the Albanian internal energy market market with the regional and the European market is of great importance. 

“This is not an easy process, a process which poses many challenges, but yet indispensable,” he said,

“To this end, advancing the liberalisation of the domestic market by ensuring full competition, high transparency and the encouragement of solar energy production or wind energy are sufficiently well described in the strategic document, both in terms of potential and the steps to be taken to use this potential,” Rama underlined.

The first bourse in Albania, the Tirana Stock Exchange (TSE), was opened in 1996 but it never became fully operational. Initially, it was set up as a department of the central bank of Albania and later became a joint stock company. There was no trading in securities on the TSE. However, there are hopes that the launch of the new Albanian Securities Exchange will finally create a functioning market.