The Government of the Republic of Srpska (RS) is set to approve a significant borrowing initiative amounting to approximately €204 million. This financial move aims to bolster coal-based electricity generation and enhance the existing electricity distribution network. Energy and Mining Minister Petar Djokić indicated that state guarantees will be utilized to back loans intended for both maintenance and developmental projects within the electricity sector.
As part of this strategy, the coal-fired power plants Gacko and Ugljevik are each projected to receive around €75 million in funding. The remaining €50 million will be dedicated to upgrading the electricity distribution infrastructure. Minister Djokić pointed out that the current infrastructure has shown vulnerabilities, particularly during extreme weather events, which can lead to power outages lasting up to six days.
Moreover, the tariffs currently sanctioned by regulatory authorities are insufficient to generate adequate revenue for distribution companies, hindering their ability to meet infrastructure demands fully. The planned borrowing, along with state guarantees, is expected to alleviate some of the financial strains faced by these companies, potentially paving the way for further investments in the sector.
In addition to the aforementioned plans, the power utility ERS is in discussions for a €43.5 million loan with a European bank aimed at supporting network rehabilitation efforts. ERS CEO Luka Petrović noted that additional investments are being prepared for the modernization of Elektrokrajina, which will include implementing smart technologies designed to enhance monitoring capabilities and minimize technical losses throughout the distribution network.
