Serbia’s EPS Seeks Seasonal Power Import From Bosnia’s ERS

Elektroprivreda Srbije, Serbia’s state-run power monopoly, is close to arranging the import of 574 gigawatt-hours from Elektroprivreda Republike Srpske in neighboring Bosnia-Herzegovina.

The monopoly is, “as we speak,” taking part in the tender in which Elektroprivreda Republike Srpske is offering its surplus production, Energy Minister Zorana Mihajlovic told reporters in Belgrade today. “It’s practically a done deal,” even though the tender is officially still open, she said.

The import will be EPS’s first direct purchase of electricity since 2006, said the minister, who recently pledged to cut costs of electricity imports by making EPS take part directly in such tenders, bypassing energy traders.

The amount may cover Serbia’s need for electricity imports during the winter season, Mihajlovic said. If drought hurts output at Serbian hydro-power plants during the heating season and consumption exceeds projections, the country may need to import as much as 200 megawatt-hours more, she said.

The Serbian company is also allowing a 15 percent discount for customers who consume less than 500 kilowatt hours a month, to help mostly lower-income households cope with recession and high inflation, she said.

The discount will apply to 1.9 million out of 3.16 million households over the six months through March and will cut EPS’s revenue by 4 million euros to 5 million euros a month, said Ljubo Macic, the head of Serbia’s Energy Agency.

The utility agreed to the discount even as it lacks 41 billion dinars for expenses planned this year, said Aleksandar Obradovic, EPS’s general manager appointed last month.

EPS will have to be reorganized to enhance efficiency, or face a “hole in cash flow” of as much as 80 billion dinar in 2013, which “would definitely mean bankruptcy,” he said, as he appeared alongside Mihajlovic.

To contact the reporter on this story: Misha Savic in Belgrade at msavic2@bloomberg.net

To contact the editor responsible for this story: James M. Gomez at jagomez@bloomberg.net

Bloomberg reserves the right to edit or remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.