This analysis identifies seasonal volatility and predictive uncertainty in Albania’s hydropower-dependent electricity market, implying the need for diversification.
Key Points
The aim is to assess seasonal volatility and predictive uncertainty in Albania’s hydropower-dependent electricity market.
Analyzed quarterly electricity production data from 2012Q1 to 2025Q3
Utilized Seasonal-Trend decomposition via Loess (STL) to isolate trends
Employed SARIMA(0,1,2)(0,1,1)4 modelling for production forecasts from 2025Q4 to 2030Q4
Implemented a hydrological drought stress test on quarterly net domestic production
Identified a dominant seasonal component (FS = 0.635) with a significant trough in Q3
Observed increased volatility post-2022, indicated by widening 95% prediction intervals
Quantified seasonally concentrated supply gaps under production shocks of −10% and −25%
Highlighted insufficiency of hydropower-centric strategies for medium-term stability