June 21, 2024
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Serbia: EPS to invest 5.4 billion euros in green projects

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The joint-stock company “Elektroprivreda Srbije” is dedicated to development, modernization, and investments to increase the power and safety of the power system of the Republic of Serbia, especially in the field of
renewable energy sources. The goal of the recently initiated reforms is for EPS to operate successfully and profitably, and this is crucial at a time when decarbonisation and the green transition are imperative in global energy.

EPS is a regular member of the Association of RES Serbia and is one of the key factors for the further development of green energy in our country.

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Dušan Živković, Acting General Director of EPS AD, points out that our largest energy company is historically connected to RES because the first hydroelectric plants, “Pod gradom” and “Vučje,”  which are more than a century old, are still operating within EPS today. The hydroelectric power plant “Pod gradom” on Djetinja, in Užice, was put into operation in 1900 and was the first power plant in Serbia that worked according to Tesla’s principles of polyphase currents.

The first transmission of electricity in Serbia was carried out from the small hydroelectric power plant “Vučje” to Leskovac via a 17-kilometre transmission line. The power plant started operating in 1903 for the needs of the famous weaving mills of “Serbian Manchester” and the lighting of Leskovac.

How many RES power plants does EPS AD have in its portfolio? What is the total power of power plants that use RES for electricity production? What is the share of RES in EPS’s portfolio?

Hydropower is the pride of “Elektroprivreda Srbije,” and with a power of 3,026 MW, EPS’s hydropower plants play an important role in the company’s production mix. In its composition, EPS has 16 hydroelectric power plants with 51 hydro aggregates, one reversible hydroelectric power plant with two aggregates, one pumping station with two pumps, and 16 small hydroelectric power plants, as well as one solar power plant with an installed capacity of 330 kW. Thanks to good hydrology and the high reliability of all aggregates, in 2023, records were broken in the production of green kilowatts. It was produced by 41.3 percent more than in 2022, and the annual production plan was exceeded by 13 percent.

In the previous year, hydropower plants produced a high of 12,665 GWh, that is, more than 12 billion kilowatt-hours of electricity, which made the share of green hydropower in the total production reach 36.5
percent.

The EPS portfolio, when it comes to RES, is based on hydroelectric power plants, but we are developing and will develop new projects. For now, the construction of the 66 MW Kostolac wind farm and the 10 MW Petka solar power plant is in the final phase, which will contribute to increasing the share of RES in EPS’s production portfolio.

Hydropower plants contribute the most to the production of electricity from RES. What is the state of our hydropower plants, bearing in mind that some are more than half a century old? What does EPS do to modernise them and extend their working lives?

EPS is dedicated to improving the operation of hydroelectric power plants, extending their working lives, and increasing efficiency. Regardless of whether it is a time of energy crisis or not, every megawatt-hour produced from water has multiple benefits. EPS started the revitalization of HPPs in a planned way, and the revitalization of HPP “Bajina Bašta”HPP “Zvornik”, and HPP “Đerdap 1” was completed. The revitalization of the reversible HPP “Bajina Bašta” is in the process, which should be done in the next two years.

The revitalization of “Vlasinske HPP”, HPP “Bistrica”, and HPP “Potpeć” with the addition of the fourth aggregate as well as HPP “Đerdap 2” is also being prepared. Project documentation has been prepared for all projects; grants of 16 million euros and 7.5 million euros have been approved for Vlasin HPP and HPP “Bistrica” through the Investment Framework for the Western Balkans (WBIF). We expect this kind of assistance for the revitalization projects of HPP “Potpeć” and HPP “Đerdap 2”, a total of around 60 million euros for both projects. 

“Vlasinske HPP” is the closest to the start of revitalization because a loan from the European Bank for reconstruction and development has been approved, the announcement of the tender is expected soon, and the duration of the works is estimated at four years. Tenders are expected to be published for other hydropower plants during this year, that is, after determining the financing method.

RHPP “Bistrica” is under development, and construction has been announced. What does that project mean for EPS, and what for renewable energy sources? When can we expect construction and Bistrica to do operational work?

The reversible hydroelectric power plant “Bistrica” is one of the strategic projects of the EPS, and it is particularly important because an increasing participation of variable renewable energy sources is expected. Then hydroelectric power plants of this type “jump in” and “cover” oscillations in RES operation.

EPS recognises reversible hydropower plants as the most suitable and the project of the reversible HPP “Bistrica” as an excellent option, taking into account the level of documentation development as well as the characteristics of the project itself. The importance of RHE “Bistrica” is reflected in the capacity for energy storage, which enables the balancing of the system, producing electricity when it is most needed.

Therefore, there is no greater energy interest for Serbia than this RHPP. Due to its energy characteristics and position in the Uvac basin, it can, in addition to its own reservoir, use additional water potential from upstream reservoirs and thus improve the way of using all HPPs in Uvac and Lim.

The production portfolio of EPS will be better optimised, which makes the project of the reversible HPP “Bistrica” superior to other similar projects. The importance of that project is not only reflected in the increase in the performance of EPS’s production portfolio but also in overcoming challenges when it comes to the regulation and balancing of power systems with a high participation of variable renewable energy sources, such as wind and solar, whose participation is permanently increasing. 

According to current estimates, by 2030, several thousand new MW could be expected, as well as an increase in the share of RES in the total electricity production in Serbia to about 45 percent. The construction of RHPP “Bistrica” will enable additional reception of about 1,500 MW from wind and solar energy.

Project documentation is in the final stage of development. Given that, according to the Conclusion of the Government of the Republic of Serbia of August 24, 2022, the construction project of RHPP “Bistrica” is a project of public and general interest, i.e., of special or national importance, it is expected that soon after the adoption of the project documentation, a decision on construction will be made. According to current observations, RHPP “Bistrica” could be in operation in 2032.

And what are the plans and dynamics for “Đerdap 3”?

With the completion of the construction of the RHPP “Bistrica,”  taking into account the existing RHPP “Bajina Bašta” and storage hydropower plants, the flexibility of the electric power system of Serbia will be adequate when it comes to the regulation of variable RES, both existing and those that are planned for construction. There are many factors that determine the need for reversible hydroelectric power plants, but in the event that the strong dynamics of the construction of variable renewable energy sources continue in the period after 2040, the need for additional reversible hydroelectric power plants could arise.

The available documentation for this project was done when the power systems were closed and operated on completely different principles compared to the current ones. During the new analysis of the justification for the construction of the RHPP “Đerdap 3”, it is necessary not only to look at the needs of the Serbian system but also to consider it in a wider regional and European context with regard to the announced
mergers in the electricity market. 

Investment and technical documentation for RHPP “Đerdap 3” was done during the 1970s and 1980s, and after that, in 2010, an analysis of the justification of the construction was done.

At this moment, the preparation of the preliminary justification study for the construction of RHPP “Đerdap 3” is underway, and depending on the results of the study, the further course of activities for the development of the project will be determined.

WP Kostolac is under construction. When can we expect that power plant to be operational?

The wind farm “Kostolac” is a pilot project of “Elektroprivreda Srbije” in the field of electricity production from wind power. It will be spread over the locations of Drmno, Petka, Ćirikovac, and Klenovnik, at the sites of exhausted surface mines and landfills of the thermal power plant and the “Kostolac” mines. The project consists of 20 wind turbines, each with a power of 3.3 megawatts. In accordance with the signed contracts for the delivery and installation of equipment and for the execution of works, the deadline for the completion of the construction of the “Kostolac” hydropower plant is September 2024. It is expected that the WPP “Kostolac” will be connected to the grid in the first quarter of 2025.

Investments in solar were also announced. Apart from the “Petka” solar power plant, which solar projects are realistic and achievable in the near future?

One of the advantages of EPS in the development of these projects is that it owns a large area of land suitable for the construction of solar power plants. In addition to the disposal sites for ash and slag,
from thermal power plants, the areas where the remediation of closed surface mines was carried out, as well as the available areas of the oldest thermal facilities that are scheduled for withdrawal from operational work, have also been recultivated. Considering the time required for the preparation of documentation, obtaining the necessary permits, and construction, according to the current plans, in the next five to six
years, in EPS’s portfolio, in addition to the “Petka” solar power plant, another 1,600 MW could be counted.

What are the plans and value of all EPS green investments until 2030?

In addition to investments in the field of environmental protection, until 2030, the focus of EPS development plans will be projects for the production of electricity from RES. In conclusion, in the year 2030, about 3.5 billion euros are planned for investment in new renewable energy sources (wind and solar), which is about 37 percent of the total EPS investments. Including investments in new hydropower plants and renewable energy sources, the total investments are around 5.4 billion euros, which is more than half of the planned investments.

In addition to producing, EPS also buys green energy. How many contracts have you signed for the purchase of electricity produced from RES (which applies to old preferential electricity producers as well as to all others, including auction winners)?

EPS has signed contracts with preferential electricity producers in the feed-in tariff system with a total annual production of about 2 TWh and a total power of about 570 MW. These are 1 TWh of wind power plants with a total power of 398 MW (373 MW on transmission and 25 MW on the distribution system), 0.3 TWh of small HE with a total power of about 65 MW, 0.8 TWh of other power plants (biogas, biomass, cogeneration, waste) with a total power of about 100 MW, and a 0.01 TWh solar power plant with a total power of 9 MW. There are also contracts with preferential electricity producers in the feed-in premium system. These are contracts in trial and permanent operation with WPP “Vetrozelena,” with an annual production of 0.7 TWh and a power of 291 MW.

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