Serbia: Power utility EPS introduces savings measures in the company claim CEO Aleksandar Obradovic

16. January 2015. / News Serbia Energy

The price of electricity will not be increased before the end of winter, Aleksandar Obradović, said General Manager of the Electric Power Industry of Serbia (EPS).The Government has adopted the EPS reorganization plan which will enable 100 thousand euros of daily savings аnd the EPS is expected to achieve a positive business result in 2016.
The announced EPS reorganization should provide the savings of 100.000 euros daily, i.e., around 35 million euros annually, the EPS General Manager said.

The reform of public enterprises is a precondition for making an arrangement with the IMF, аnd the EPS reorganization will be monitored with special attention. The reorganization plan for this company, which the Government had recently approved of, too, should produce big savings and increase the efficiency of business operations, said Obradović.

“There is resistance because the daily savings we are talking about are going somewhere today and they are recorded as losses. When the corporatization process begins, we will conduct centralized procurements which will lead to significant savings “, said Obradović.

The beginning of corporatization did not mean that workers would be targeted, the EPS even had a shortage of manpower in the production itself, particularly when it came to miners, the EPS General Manager said.
“If there are redundant workers, they are primarily in the administration. The reduction in the number of managers will not lower the costs significantly, it is important that reorganization be conducted and the number of sectors be reduced and, thereby, both the administration and the budgets”, says Obradović.

The price of electricity has not been changed since mid-2013 аnd, according to the EPS General Manager, this company did not count upon an increase in the electricity price when making their business plans for this year either.
“It is certain that there will not be any price increase in the first half of the year. However, we will make a financial plan with the IMF for the EPS reorganization and the final decision will be made within the Government. The whole EPS reorganization should show how the public sector reform is done and we expect positive decisions by the end of the year,” says Obradović.

When it comes to debt collection, there are several large systems such as the “Iron Works Smederevo” that consume a lot of electricity and have large debts or that are not paying their bills regularly. However, the EPS General Manager expects that, by finding strategic partners for such companies, the problems will be overcome.
Obradović also said that the ЕPS had been the second most profitable company in Serbia in the previous year. However, realistic profit is not expected this year, but only in 2016, due to the last year’s floods.

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