Serbian electricity and gas state companies must change management type and act within the power market rules, says Minister Mihajlovic

, News Serbia Energy

Serbian Minister of Energy, Zorana Mihajlovic, stressed that she is against the idea that energy price increase should help EPS or Srbijagas to do better business. Citizens won’t pay for EPS’s bad management.

“Bad business or uncharged purchases should never be paid within prices”, Mihajlovic stressed in an interview for International Radio Serbia.

She indicated that EPS’s new Director confronted serious problems and huge purchases of around million EUR, which is the debt of industry and citizens and many years’ problem.

Therefore, Government adopted measures for overcoming difficult financial situation in the company. The first move is interests’ write-off to households where debts’ reprogram will be approved. However, if program is not respected, Serbian citizens will be for the first time in situation to be cut off from the network, Mihajlovic said.

Government asks from EPS to find internal reservoirs and decrease expenses at the same time. Decreasing expenses means that expenses of industrial societies should be checked because it is believed that 10 to 15% can be saved this way.

Debts of state bodies, local governments, health institutions and schools to EPS should be solved within public debt what would facilitate financial situation to the company- Minister emphasized.

EPS will be able to do production, distribution and sale of electricity this way, because of which it was established. It will also be able to participate in investment projects.

“EPS is not in situation to invest at the moment because it has debts of 40 billion dinars, but company will not borrow this but much lower amount”, Mihajlovic underlined.

When she was talking about initiation she launched with reference to recession of intercessors in electricity and gas supply, Mihajlovic highlighted that she has nothing against traders because they are only trying to make a profit.

“But the problem shows from the point of state-owned company. Bad purchase plans used to be intentionally made earlier in order to have urgent import on winter so traders can make a profit”, Mihajlovic explained and added that why occurred the idea of special industrial society to become EPS’s trade direction.

“Srbijagas” is in different situation because 90% of gas is imported by one partner, Mihajlovcic stated and added that there is no possibility of changing this at the moment because Serbia has been importing gas from Russia for years and the problem is only one direction of gas inflow.

This brings limitations in negotiations about the purchase and price- she estimated.
According to her words, the question is how one public company negotiates because Serbia had purchased gas without intercessors in 2006 and then it lost partnership relation in “Jugorgas” because it lost 25% of ownership. It became minor partner and gas policy changed then i.e. “Jugorosgas” became an intercessor.

“When intercessor come to some territory once, it is really hard to be changed and only provision decrease of “Jugorosgas” has been arranged from 4 to 3,2 %”, Mihajlovic stressed.

Source Serbia Energy/IRS