According to the latest edition of MAT – Macroeconomic Analyses and Trends, the outstanding debt owed by Serbia’s public power utility, Elektroprivreda Srbije (EPS), increased by half over the first three quarters of 2022 and now exceeds EUR1.5 billion.
The monthly newsletter, co-published by the Serbian Chamber of Commerce and the Economic Institute, explained that “[s]ince May 2021, EPS’s liquidity has steadily decreased due to its hydroplants operating at reduced capacity, followed by the importation of electricity at record-high prices,” which the company was then contact-bound to sell it at much lower prices to the public.
Said importation was financed almost exclusively by loans, MAT stated, which contributed to EPS accumulating EUR678 million in losses over the first nine months of this year.
MAT’s analysis recalled that, in 2020, the power utility achieved EUR110 million in profits, but concluded 2021 with a deficit of EUR127 million.
In the last quarter of 2021, EPS bought 1,244 GWh of power at an average price of EUR233 per megawatt hour (MWh), the total of which amounted to about EUR290 million. This year, by September, EPS had purchased 2,907 GWh at an average price of EUR254 per megawatt hour, which set the company back EUR740 million.
Adding to the previous year’s debt, the company’s losses skyrocketed because it was obligated to sell this electricity on the domestic market at a price four to five times less than was the purchase price, the article explained.