New 1GW Albanian-Italian interconnector to support Italian power demand

Additional reporting by Luka Dimitrov

• Plans for new 1GW Albanian-Italian power cable will likely help with increasing Italian power demand
• The project also involves the development of 3GW of renewable capacity in Albania and up to 1GW of new data centers in Italy
• The interconnector is expected to be completed in 2028

LONDON (ICIS) – A new 1GW subsea power cable between Italy and Albania, expected to come online in 2028, is likely to boost Italian demand in upcoming years, traders told ICIS.

“The feasibility study for the project is currently underway and the results will determine its prospects”, the Albanian energy ministry said at the start of March.

On 15 January Italy, Albania, and the United Arab Emirates signed a cooperation deal to build a 1GW subsea power cable between Italy and Albania.

The deal, valued at more than €1 billion, will connect the Albanian port of Vlore with the Italian region of Puglia, the narrowest point between Albania and Italy.

NEW ALBANIAN RENEWABLES

The project signed by the three countries includes the development of 3GW of new renewable capacity in Albania, a large part of which is to be exported to Italy via the undersea power cable.

On 24 February, the Italian energy company Eni announced it had signed an agreement with the Emirati companies Masdar and TAQA Transmission to be “a preferred off-taker” of the new Albanian renewable energy transmitted to Italy.

Hydropower currently accounts for almost all of Albania’s domestic electricity generation.

“Albanian power producer KESH is every week looking to buy energy due to low hydro stocks. The new project with renewable build-up will be a game changer for Albania and KESH as it will save costs and boost exports,” a local trader told ICIS.

Albania is currently a net importer of electricity, but its increasing renewable capacity and new interconnection with Italy could see it switch to a net exporter in upcoming years, Balkan traders said.

Indeed, Albania’s Energy Minister Belinda Balluku claimed on social media that the agreement would “play a significant role in increasing the country’s energy capacities, as well as supporting Albania’s goal of becoming a net exporter”.

RISING ITALIAN DEMAND

Traders expect the new cable to boost Italian power demand, which is set to rise by 2030 driven by data centers, EV and industrial sector expansion.

In 2024, Italy imported a net total of 79.6GW from Greece, 97.5GW from Montenegro, and 67.8GW from Slovenia.

In 2025 so far, Italy has continued to import more electricity than it exports to the Balkans.

This trend is likely to continue amid rising Italian demand. Italian power demand totaled 312.3TWh in 2024 according to the Italian TSO Terna, and is forecast rise to 355.7TWh by 2030, ICIS analytics shows.

Italian data center demand is forecast to nearly double within the same time-period, rising from 3.64TWh in 2024 to 7.01TWh in 2030.

In February, Eni also signed a letter of intent with the Emirati groups MGX and G42 to develop data centers in Italy with a planned IT capacity of up to 1GW.