During the first half of 2026, Bosnia and Herzegovina increased electricity output and strengthened its position as a regional exporter. Total generation reached 7.44 TWh, up 3.5% year-on-year, while domestic consumption stayed at about 6.15 TWh. Hydropower generation rose by 32.4% to 3.13 TWh, and transmission-connected wind and solar output increased by 16.1% to 0.64 TWh. The country recorded a net export surplus of 1.44 TWh, up 28.6%.
Thermal output falls while export revenues decline
Despite higher export volumes, the sector’s financial results weakened during the same period. Thermal power generation fell by 16.9% to 3.07 TWh, linked to coal supply challenges, ageing infrastructure and lower availability of several generating units. Export revenues decreased by 16.2% to EUR 168 million, while the electricity trade surplus narrowed to EUR 23 million. The figures indicate that physical export increases did not translate into stronger earnings, with profitability affected by electricity prices, hydrological conditions, generation costs and replacement needs for unavailable thermal capacity.
Ugljevik outage follows emergency overhaul
The operational problems at the Ugljevik thermal power plant reflect broader constraints in the coal-based system. Shortly after completing a 60-day emergency overhaul, the plant was shut down again due to poor coal quality and unresolved technical issues. The associated mine requires approximately 35 haul trucks for normal operations but had only around 20 available, with many vehicles maintained through reused components from other trucks. Analysts estimated the plant needs at least 220 MW to avoid losses and around 270 MW to operate profitably, after output had dropped to about 160 MW before the latest outage.
RiTE Ugljevik reported losses of around EUR 14 million in 2025 and an additional EUR 18 million in the first quarter of 2026.
EPBiH faces pressure from regulated prices and coal losses
Elektroprivreda Bosne i Hercegovine (EPBiH) is also under financial strain tied to ageing coal assets, weak mine performance and regulated electricity prices below production costs. Since 2024, EPBiH has invested about EUR 92 million in thermal facilities, following EUR 72 million invested between 2015 and 2023. A financial review revised the company’s inherited 2023 loss from EUR 28.2 million to EUR 169.5 million. Coal mines within the group accumulated combined losses of around EUR 540 million.
The utility said declining coal availability, rising operating costs and increased exposure to electricity market purchases are reducing resources for future energy transition investments.
Lending costs remain high for RiTE Gacko loan
Lending costs remain high for RiTE Gacko loan
Lending costs remain high for RiTE Gacko loan
The borrowing terms for coal generation continue to signal market concerns about financial sustainability. RiTE Gacko secured an EUR 11.3 million state-guaranteed loan with a fixed interest rate of 6.9% and a processing fee of 2.97%, equal to approximately EUR 330,000.The lender received a state guarantee that lowered credit risk, but the financing cost remained relatively high, reflecting concerns about governance, operational reliability and execution risks within the coal power sector.
Green financing and CBAM risks for exports
The country is also pursuing cleaner energy investment opportunities alongside ongoing generation challenges. The Development Bank of the Federation of Bosnia and Herzegovina launched a green financing programme worth EUR 7.9 million for small and medium-sized enterprises, with loans maturing up to 10 years, a fixed interest rate of 2.5% and a 0.5% processing fee.. Renewable generation continues to expand, supported by favourable hydrological conditions that strengthen export potential.
The gradual introduction of the European Union’s Carbon Border Adjustment Mechanism (CBAM) is expected to increase pressure on carbon-intensive electricity exports unless producers can demonstrate lower emissions intensity and clearer electricity origin tracking.
Twin-track approach for reliability and renewables pipeline
Bosnia and Herzegovina’s future energy strategy is described as requiring two parallel programmes focused on system reliability and long-term decarbonisation goals. One programme would address operational recovery of coal mines and thermal power plants, including transparent decisions on which facilities justify further investment versus retirement timelines. The second programme would build a pipeline of renewable projects covering wind, solar, hydropower modernisation, battery storage and grid expansion.
The transition plan also depends on coordination between these tracks to maintain supply before replacement capacity becomes available.
