In the first six months of this year, Elektroprivreda Srbije (EPS) made a loss of 418 million euros, according to the report on the implementation of EPS’s three-year business plan, Danas reported. From January to the end of September 2021, EPS made a profit of 8.5 billion dinars (72 million euros), and since then, in the next nine months, ending with the last day of June, a loss of about 610 million euros was made.
From January to the end of September 2021, EPS made a profit of 8.5 billion dinars (72 million euros), and since then, in the next nine months, ending with the last day of June, a loss of about 610 million euros was made, Danas announced. In the last quarter of 2021, expenses exceeded revenues by 185 million euros, and then another 418 million euros were lost in the next six months. Thus, the financial effects of a series of accidents and energy collapse from the last heating season are approaching the sum of one billion euros.
The total financial debt of the largest energy company in Serbia on June 30 of this year rose to 177 billion dinars or 1.5 billion euros, which is 30 billion dinars more than at the beginning of the year. At the end of June, there were only thirty million euros in the EPS accounts. The most important reason for such poor performance of Elektroprivreda is shortages in electricity production. Electricity production in the first half of the year is 16 per cent lower than in the same period in 2021. The production of electricity from renewable sources was lower than planned by 56 per cent, while the production of electricity in thermal power plants was lower than last year by nine per cent. Coal-fired thermal power plants produced 10 per cent less electricity, but Pannonia Elektrane’s TE-TO produced 56 per cent more electricity than in the first half of last year. 3.7 billion dinars were spent on gas for electricity generation in TE-TO, and 6.8 billion dinars were spent on additives and fuel oil for burning coal in boilers in six months. EPS’s plan is to import as much high-quality coal as possible from the surrounding area, primarily from Montenegro, and by mixing it with coal from Kolubara, reduce the potential import of electricity in the winter months, and increase domestic electricity production as much as possible. 1.1 billion dinars were spent on imported coal for thermal power plants.
Another reason for the financial disaster in EPS, closely related to the production shortfall, is the increased import of electricity and, as stated in the report of this company, at record prices. In the first half of this year, 2,356-gigawatt hours were purchased on the market at an average price of 222.08 euros per megawatt hour, which is more than 520 million euros. In June of this year, EPS bought electricity at 236.79 euros per megawatt hour, and on the other hand, sold it to the economy on the commercial market for 67.52 euros per megawatt hour due to the Government’s recommendation to limit the price of electricity. The situation in Europe’s energy sector is deteriorating, so for example last Friday at 12 noon, a megawatt cost 547.78 euros on the stock market, while in Central Europe it was slightly less, but above 500 euros. In previous years, EPS, in addition to importing electricity in the winter months, was an exporter in the second part of the year.
The cost to EPS due to mismanagement, ultimely the mining of coal, is not only measured by the cost of importing expensive electricity due to the lack of its own production, but also by the lost profit it would have had if it had exported electricity at such high prices on the international market. However, for the last three years, from 2019 to 2021, the average annual export of EPS was around 4,300 gigawatt-hours. Last year, for example, 5,400-gigawatt hours were imported into Serbia, and 4,800-gigawatt hours were exported. Given that there is nothing from exports this year, except for the electricity that was returned to the Republika Srpska Electric Power Company (about 20 million euros for the first six months according to EPS balances), the question arises how much money they would have earned if the thermal power plants had worked at their usual capacity as in the previous three years. It should also be pointed out that production, especially for export, is also affected by the operation of hydropower plants, which are not working at full capacity this year due to the drought. For the sake of illustration, if EPS exported 4,300 gigawatt-hours of electricity in 2022 at the average price at which it imported in the first half of the year of 232.8 euros per megawatt-hour, it would earn exactly one billion euros. This does not mean that electricity would not be imported, but the final financial balance would certainly be much more favourable for both EPS and Serbia. In July, the Government of Serbia approved an increase in the fee for Renewable Energy Sources from 0.437 dinars to 0.8 dinars per kilowatt-hour.
Source: https://rs.n1info.com/biznis/danas-gubitak-eps-a-za-prvih-sest-meseci-418-miliona-ukupan-dug-15-milijarda/