Coal shortfalls and ageing plants drive up power costs for Elektroprivreda BiH

Because electricity produced by thermal facilities is up to three times more expensive than hydropower, EPBiH’s heavy reliance on coal remains a decisive factor shaping its overall generation costs. Maintaining continuous operations at its thermal plants leaves the utility exposed to fluctuating coal procurement expenses and rising maintenance demands, while simultaneously requiring substantial financial backing for the mines operating within its corporate group.

Over the first ten months of the year, group mines delivered approximately 700,000 tonnes less coal than projected under the electricity balance, contributing to an annual coal deficit of around one million tonnes. To bridge the gap, EPBiH has been forced to purchase coal on the open market, resulting in reduced thermal electricity output and lower-than-planned stockpiles. Company officials noted that a downward trajectory in power generation began in 2018, driven directly by declining domestic coal deliveries.

EPBiH attributed the mining crisis to decades of neglected overburden removal, the insufficient clearing of waste material, and inadequate preparation of new mining fields. To stabilize production, the utility has previously injected approximately 367 million Bosnian marks (approx. € 187.64 million) into its coal mines through capital increases.

Alongside mining challenges, the utility is grappling with ageing thermal infrastructure that requires extensive rehabilitation, as well as mandatory investments in flue gas desulphurisation and denitrification facilities to meet environmental standards. Between 2024 and mid-2026, EPBiH invested 180 million marks (approx. € 92.03 million) of its own funds into existing thermal power plants, an increase of 40 million marks (approx. € 20.45 million) compared to the entire 2015–2023 period, to safeguard the energy security of the Federation of Bosnia and Herzegovina.

To diversify its energy mix, EPBiH has prepared multiple renewable energy projects, including the Vlasic and Bitovnja wind farms and planned hydropower plants along the Bosna and Drina rivers. The utility also noted that implementation of the Prosumer 5000+ project, developed with the World Bank to install household photovoltaic systems, is set to begin soon, though integrating prosumers into the distribution grid remains an active operational challenge.

However, the rollout of new green energy capacity has been severely delayed by complex legal and administrative hurdles, notably the ban on the disposal of state property and inconsistencies within spatial planning documents. Company representatives also pointed out that a major opportunity was previously missed with the stalled Vranduk hydropower project, which would have substantially boosted the share of renewables in EPBiH’s portfolio.