Bosnia and Herzegovina: Applying miners’ demands could lead to rise in electricity prices

, SEE Energy News

State-owned power utility EPBiH operates a total of seven coalmines: Kreka, Zenica, Breza, Djurdjevik, Kakanj, Abid Lolic and Gracanica.

The withdrawal of the BiH Miners’ Union from the accepted model of coalmines restructuring and resolving the issue of redundancies in a socially acceptable manner and insisting on retaining employment of administrative and management staff for longer than planned, could lead to an increase in electricity prices of at least 15 %. EPBiH said that succumbing to blackmail and pressure over redundancies in mines and accepting Union’s demands would be just one thing – a blow to electricity consumers, especially households. To implement the Union’s request submitted to the Federal Government and EPBiH, it is necessary to find an additional 30 million euros per year for all coalmines operated by EPBiH. From the point of view of mine operations with a continuous increase in losses and outstanding liabilities, the only possible way to ensure insufficient funds is to increase the price of coal by 25 to 30 %, which consequently leads to a significant increase in electricity production and additional financial costs for citizens, reads the statement from EPBiH.

The increase in electricity prices due to meeting Union’s demands can be avoided only by giving up blackmail and pressure, restoring dialogue and a responsible approach of all parties involved in coalmines restructuring, a process that is not a matter of will or choice but of BiH’s commitment to energy transition and EU policies for gradual reduction in the use of coal for electricity production, until the complete phase-out.

At the end of 2020, the total liabilities of coalmines operated by Bosnian power utility EPBIH amount to 470 million euros. Of this amount, debts to the state reached over 250 million euros and in 2020 alone, the mines recorded a total loss of 40.5 million euros. Despite the more than 250 million euros that EPBiH has invested in the mines, their economically sustainable business has not been ensured.