Renewables

Serbia to support large-scale energy projects in 2023 with state guarantees for loans

Budget Serbia 2023 energy sector guarantees

Photo: iStock

Published

December 7, 2022

Country

Comments

comments icon

0

Share

Published:

December 7, 2022

Country:

Comments:

comments icon

0

Share

The proposed 2023 Law on budget envisages state guarantees and project loans for financing several large-scale projects important for Serbia’s energy transition, including pumped storage hydropower plants Đerdap 3 and Bistrica.

Serbia will have the opportunity to kick-start significant energy projects in 2023, as the proposed Law on a budget contains state guarantees and project loans for financing pumped storage hydropower, wind power and solar power projects.

Pumped storage hydropower projects Đerdap 3 on the Danube river and Bistrica in Western Serbia are among the most valuable endeavors for which the government secured financial backing.

The budget proposal envisaged EUR 1 billion for project loans from foreign investment corporations, funds and banks for Đerdap 3 project, compared to EUR 1.5 billion in this year’s budget.

The Government is also ready to support the construction of Bistrica with up to EUR 600 million, with previous studies indicating a capacity of around 600 MW.

Both pumped storage hydropower plants are instrumental in Serbia’s attempt to decarbonize its energy sector. They offer electricity production that could balance the variable output of large wind parks and solar power plants, which Serbia also intends to develop to include more green energy in its energy mix.

Chance for renewable energy projects

The budget proposal also included up to EUR 800 million of guarantees for developing 1 GW solar power plant and EUR 1 billion for wind farms capacity from 800 MW to 1 GW, projects that are likely to be developed in partnership with private investors.

EPS can count for Government guarantees for its own renewable energy projects, including EUR 30 million euros for Kostolac 1 Wind Park, developed with the support of German KfW bank and EUR 250 million for Buk Bijela hydropower plant, joint project of EPS and Elektroprivreda Republike Srpske, where preparatory works begun in 2021. The budget proposal also included heating and electricity CHP power plant using biomass, in thermal power plant Kolubara B, at the amount of EUR 395.5 million.

The state guarantees are necessary for the development of these projects, as EPS would not be able to secure financing for these projects without Government backing.

The Fiscal Council, an independent body charged with assessing fiscal policy, warned in its analysis of 2023 Law on budget proposal that direct costs associated with EPS and Srbijagas, electricity and gas utilities will amount to EUR 1.2 billion, or around one half of predicted next year’s fiscal deficit of 3.3 percent. They added that predicted expenses could go even higher as public companies usually rely on the Government to pay for the guaranteed loans, thus passing the cost to tax-payers.

Comments (0)

Be the first one to comment on this article.

Enter Your Comment
Please wait... Please fill in the required fields. There seems to be an error, please refresh the page and try again. Your comment has been sent.

Related Articles

Serbia EPS PPAs wind parks Alibunar 1 Alibunar 2

Serbia’s EPS signs PPAs for wind parks Alibunar 1, Alibunar 2

08 May 2025 - Serbia's state-owned Elektroprivreda Srbije will offtake electricity from future wind parks Alibunar 1 and Alibunar 2, of 168 MW in total.

Serbia’s TSO EMS signs grid connection contracts for 11 renewable power plants

08 May 2025 - TSO Elektromreža Srbije said the contracts were signed after the second interval for the preparation of grid connection studies

Europe record battery storage capacity growth 2024 expansion slows

Europe has record battery storage capacity growth in 2024 but expansion slows

08 May 2025 - The leap in new battery storage capacity in Europe last year wasn't as impressive as in the previous years

croatia hep floating solar hpp dubrava

Croatia’s HEP to install first floating PV plant on reservoir of HPP Dubrava

07 May 2025 - State-owned company Hrvatska Elektroprivreda (HEP) has already installed one photovoltaic facility near its HPP Dubrava