Bosnia and Herzegovina’s state-owned power utility ERS has arranged additional short-term financing amid liquidity pressure linked to the shutdown of the Ugljevik coal-fired power plant. The new borrowing totals €7 million secured within days, after an additional €2 million facility was put in place.
The latest arrangement is structured as an overdraft facility intended to cover immediate operating requirements. Interest and associated costs are estimated at around €120,000. It follows a separate financing arrangement worth €5 million aimed at settling overdue supplier payments.
ERS has borrowed more than €50 million since the beginning of 2026, increasing reliance on external funding while domestic generation is under pressure. The immediate operational issue concerns RiTE Ugljevik, one of Republika Srpska’s largest electricity producers. The plant has suspended production due to insufficient coal supplies, reducing baseload generation available to the system.
RiTE Ugljevik liquidity constraints and coal supply issues
RiTE Ugljevik is also dealing with its own liquidity problems, including blocked bank accounts. The government has granted a 90-day delay for overdue tax payments. Coal security remains the central unresolved issue affecting production continuity.
Authorities previously spent more than €120 million in connection with the Ugljevik East 2 concession to secure long-term supply. Mining difficulties have continued, and the plant has struggled to maintain regular output despite that spending.
Overdue payments and tariff debate
The renewed financing comes alongside efforts to address overdue supplier payments through the €5 million arrangement. Reports have also revived discussion of electricity tariffs for households, with suggestions that prices could rise significantly. No increase of the scale discussed publicly has been formally confirmed.
Short-term loans are intended to support ERS in meeting immediate obligations while operational constraints persist. The combination of coal shortages, weak plant availability, and accumulated liabilities leaves the utility’s underlying financial position exposed.
