Bosnia and Herzegovina’s state-controlled power utility Elektroprivreda Bosne i Hercegovine, or EPBiH, has invested approximately €92 million of its own funds in thermal power plants since the beginning of 2024, accelerating maintenance expenditure as declining coal production and weak hydrology place growing pressure on the company’s generation portfolio.
The latest investment compares with around €72 million spent between 2015 and 2023. EPBiH has therefore committed more capital to its thermal fleet in roughly two and a half years than it did during the preceding nine-year programme. The spending is primarily defensive: it is intended to preserve plant availability and system security rather than materially expand coal-fired capacity.
EPBiH’s present management, appointed in August 2023, inherited a financial position considerably weaker than initially reported. The company’s stated loss of €28.2 million was subsequently revised to €169.5 million following an independent review. Its coal-mining subsidiaries had accumulated combined losses of approximately €540 million by the end of 2023.
The mines remain the most significant operational and financial weakness in the group. Lower output has reduced fuel deliveries to EPBiH’s thermal plants, contributing to a decline in electricity generation that has been evident since 2018. Hydropower has not provided a reliable counterweight because periods of unfavourable hydrology have simultaneously reduced hydroelectric production.
The resulting supply gap has forced EPBiH to purchase electricity on the wholesale market, sometimes at prices substantially above regulated domestic tariffs. This creates a structural mismatch between production and procurement costs on one side and regulated revenue on the other.
EPBiH reduced its net loss to €29.6 million in 2024, with the deficit absorbed by existing reserves. That preserved short-term liquidity, but drawing down reserves does not resolve the underlying economics of the generation portfolio. Thermal refurbishment can improve availability, heat rates and outage performance, yet its financial value remains tied to dependable coal supply and a tariff framework capable of recovering production costs.
The company is also carrying unresolved obligations connected with its mining subsidiaries, earlier compensation commitments and unfinished investments such as HPP Vranduk. These liabilities compete for capital with plant maintenance and new renewable generation.
The current €92 million programme is therefore best understood as a reliability intervention. It may reduce the probability of severe outages and expensive emergency imports, but the return on that expenditure will remain constrained until mining performance, regulated pricing and the company’s longer-term generation strategy are addressed together.
