EU supports Serbia with loans, grant for power interconnections, smart metering

The EU approved a EUR 17 million donation to Serbia for power interconnections with BiH and Montenegro and the introduction of an advanced system for remote reading of electricity meters. The grants are from the Western Balkans Investment Framework (WBIF). The two projects are worth a combined EUR 81 million and they are financed through loans.

Within the sixth call for proposals for projects from the Western Balkans Investment Framework (WBIF), the European Union approved grants to Serbia for two endeavors in the energy sector, Minister of European Integration Jadranka Joksimović said.

The EUR 17 million donation will be used for the construction of overhead power interconnections with neighboring Montenegro and Bosnia and Herzegovina within the Trans-Balkan Electricity Corridor, and for the development and modernization of electricity distribution network in Serbia. The latter project is called Advanced System for Remote Meter Reading Phase 1A. It covers consumption control and smart metering.

The part of the corridor that is planned to connect the three countries is worth EUR 41 million, of which EUR 11 million is a grant from the WBIF. Germany’s KfW Development Bank approved a EUR 28 million loan, and the remainder is covered by the beneficiaries – state-owned transmission system operators EMS (Serbia), CEGS (Montenegro) and Elektroprenos (BiH). Overhead power lines will be built from Bajina Bašta to Višegrad in BiH and to Pljevlja in Montenegro.

The section of the Trans-Balkan Electricity Corridor is financed from a loan from KfW bank while the EBRD is the lender for the remote metering project

Other investments include transmission links in Serbia between Kragujevac and Kraljevo, which was completed in June, and between Obrenovac and Bajina Bašta. The part of the corridor between Reșița in Romania and Pančevo in Serbia was finished in 2017. The 220 kV network is replaced with 400 kV lines. The construction began in 2009.

According to information from WBIF’s website, the investment in the Advanced System for Remote Meter Reading Phase 1A is worth EUR 40 million. The grant through the investment framework is almost EUR 8 million. The endeavor is financed from a EUR32 million loan obtained from the European Bank for Reconstruction and Development.

The said grants were approved within a EUR 223 million package for seven infrastructure projects valued at a combined EUR 885 million. Three are for the transportation sector and one each is for digital and social infrastructure.

The grants were approved within a EUR 223 million package for seven infrastructure projects valued at a combined EUR 885 million

“All these projects are designed in a way so that they contribute to investment growth in Serbia and deepen Serbia’s overall cooperation in trade and economy with the so-called Western Balkans region and the European Union. Serbia’s accession to the European Union doesn’t only imply achieving the standards set in the negotiation clusters and the harmonization with the union’s legislation, but its primary goal is to improve the living conditions for all our citizens,” Joksimović said.

She stressed the most important goals are an evenly distributed regional development within the country, the improvement in healthcare and the achievement of the goals from the Green Agenda for the Western Balkans.

WBIF is part of the regional Instrument for Pre-Accession Assistance (IPA). The investment framework is one of the main tools for EU and international financial institutions to support priority infrastructure projects from the Economic and Investment Plan for the Western Balkans, which consists of EUR 9 billion in grants.