Serbia’s state-owned utility Elektroprivreda Srbije (EPS) is preparing for winter as historically low Danube inflows of around 1,200 cubic metres per second constrain hydropower production and increase reliance on coal-fired generation, pumped storage and regional electricity imports. EPS holds 1.85 million tonnes of coal and aims to increase inventories to 2 million tonnes. Maintenance at several major thermal power units is nearing completion as the utility prepares for higher seasonal electricity demand.
The weak hydrological conditions raise concerns about generation costs, electricity imports and wholesale-price volatility, particularly if cold weather or unexpected power plant outages coincide with limited hydropower availability.
Danube Drought Reduces Hydropower Output
The Đerdap 1 and Đerdap 2 hydroelectric plants are among Serbia’s most important renewable electricity assets, but their output depends on river flows. Low inflows previously reduced daily production at Đerdap 1 to slightly more than 5,000 MWh, approximately one-third of its normal daily output during the reported period. EPS has warned that Danube hydropower production could rank among the weakest in the plants’ operating history.
Although all six generating units at Đerdap 1 have undergone rehabilitation, equipment upgrades cannot compensate for insufficient water. Lower hydropower output increases dependence on coal-fired generation and electricity imports, exposing Serbia to additional fuel and wholesale-market costs.
Coal Inventories and Thermal Plant Maintenance
EPS plans to add approximately 150,000 tonnes of coal to its existing stockpiles to reach its 2-million-tonne winter target. Maintenance at mining operations has been completed, while thermal power plant servicing is nearing completion. Rehabilitation of Kostolac A1 has been completed, while extended maintenance at TENT A1 and A2 included repairs to critical boiler systems.
Coal reserves alone cannot guarantee adequate supply. Electricity production also depends on fuel quality, mining equipment availability, coal extraction rates and thermal plant reliability. Low river levels could create additional constraints if cooling-water availability becomes an issue at facilities such as Kostolac.
Pumped Storage and Regional Electricity Imports
The rehabilitated Bajina Bašta pumped-storage hydropower plant is operating at full available capacity, supporting electricity-system flexibility as conventional hydropower production weakens. Pumped storage allows electricity to be used to move water into an upper reservoir before generating power during periods of higher demand. Although it supports peak-demand management and takes advantage of hourly price differences, it does not increase net electricity supply because pumping and conversion involve energy losses.
Serbia is also advancing plans for the Bistrica pumped-storage project, with evaluation of bids for project preparation progressing. Modernisation of the Vlasina hydropower system has also begun. Reduced domestic generation could increase electricity purchases through bilateral contracts and regional wholesale markets, including SEEPEX, Hungary’s HUPX and Romania’s OPCOM. Import costs will depend on regional demand, renewable generation, thermal plant availability and cross-border transmission capacity.
Industrial Consumers Face Electricity Cost Risks
Serbian manufacturers in metals processing, chemicals, construction materials and machinery remain exposed to electricity prices and supply reliability. Businesses with market-linked contracts could face greater volatility than those operating under fixed-price arrangements. Higher wholesale prices could weaken industrial profit margins, increase working-capital requirements and put pressure on debt repayment for electricity-intensive businesses.
EPS has also reported that major thermal facilities used for heating are prepared for the heating season and that sufficient fuel oil supplies have been secured. Winter electricity security will ultimately depend on coal production, thermal plant availability, hydropower inflows, domestic demand and regional import prices. Serbia’s generating infrastructure provides multiple supply sources, but drought can reduce the effective contribution of hydropower assets even when their equipment remains operational.
