Elektroprivreda Srbije posts 2022 loss of EUR 630 million

Serbia’s state-owned power utility Elektroprivreda Srbije (EPS) has reported a loss of RSD 73.7 billion (EUR 628.4 million) for 2022, which is almost 400% more than in the previous year – RSD 15 billion (EUR 127.5 million).

Elektroprivreda Srbije blamed the poor results on issues in the production of coal and electricity, a long-term drought, and the global energy crisis.

EPS said it was forced to import electricity at record-high prices last year and added that the projected loss was RSD 97.7 billion (EUR 833 million).

Wet, muddy and sticky coal has caused a collapse in December 2021

In addition, the company pointed out that it had to take loans to pay for imports, which affected liquidity and financial results.

The utility recalled that it achieved net income of RSD 8.5 billion (EUR 72.5 million) in the first three quarters of 2021 and stressed that losses started to mount after that. It was RSD 73.7 billion (EUR 628.4 million) in 2022, according to its report for last year with regard to the implementation of a three-year business program.

In the fourth quarter alone, the company achieved net income of RSD 5.8 billion (EUR 49.5 million)

Of note, severe difficulties in the production of electricity and coal started in the fourth quarter of 2021, when output in EPS’s largest lignite-fired thermal power plants tumbled. The report notes that it all started because of wet, muddy and sticky coal, which led to a collapse in December of that year.

The last quarter of 2022 improved EPS’s financial result, as it recorded a profit of RSD 5.8 billion (EUR 49.5 million).

It is the result of lower and cheaper electricity imports than planned and lower coal procurement costs, the report reads.

Electricity was imported at EUR 248.7 per MWh and sold at EUR 71.5 per MWh

Electricity output in 2022 was 2% below the plan and 8% under the level from the previous year. Thermal power plants produced 3% below plan and the result was equivalent to 2021, while hydropower plants generated 1% more than planned but 23% less than one year before.

In the last quarter, 1,224 GWh was imported at an average price of EUR 232.8 per MWh. Total cost came in at EUR 289.7 million or EUR 278.7 million above the plan.

The Government of Serbia has limited the price for corporate customers

EPS imported 3,278 GWh last year at an average price of EUR 248.7 per MWh, spending EUR 815.2 million. The Government of Serbia has limited the price at which EPS sells electricity to firms. It was EUR 75 per MWh for eight months, after which it was bumped up to EUR 95 per MWh.

EPS said it sold electricity at EUR 71.5 per MWh on average in 2022, compared to EUR 248.7 per MWh that it paid for imports. The price for households was EUR 58.9 per MWh.