Bosnia and Herzegovina’s state-owned power utility ERS has arranged additional short-term financing of €2 million amid liquidity pressure linked to the shutdown of the Ugljevik coal-fired power plant. The new borrowing brings total short-term funding secured within days to €7 million. The latest facility is intended to cover immediate operating requirements.
The financing is structured as an overdraft facility. Interest and associated costs are estimated at around €120,000. ERS also has a separate €5 million arrangement aimed at settling overdue supplier payments.
Ugljevik production suspended over coal supply
The operational issue involves RiTE Ugljevik, one of Republika Srpska’s largest electricity producers. The plant has suspended production due to insufficient coal supplies, reducing baseload generation available to the system. ERS’s reliance on external funding has increased, with the utility having borrowed more than €50 million since the beginning of 2026.
RiTE Ugljevik is also dealing with liquidity problems, including blocked bank accounts. The government has granted a 90-day delay for overdue tax payments. Coal security remains the central unresolved issue affecting output levels.
Ugljevik East 2 concession spending and tariff debate
Authorities previously spent more than €120 million related to the Ugljevik East 2 concession to secure long-term supply. Mining difficulties have continued, and the plant has struggled to maintain regular output. The resulting financial strain has also revived discussion on electricity tariffs.
Reports have suggested household prices could rise significantly, although no increase of the scale discussed publicly has been formally confirmed. While short-term loans may support ERS in meeting immediate obligations, coal shortages, weak plant availability, and accumulated liabilities leave the utility’s underlying financial position exposed.