The thermal power sector in Serbia is experiencing significant operational challenges, as evidenced by the occurrence of 79 unplanned outages across coal-fired power plants since the start of 2026. This trend highlights the vulnerabilities within an aging infrastructure that remains crucial to the country’s electricity supply. Data from ENTSO-E indicates that there were instances when up to 1,865 MW of generation capacity was unavailable due to technical failures and unexpected interruptions.
These outages represent a considerable portion of Serbia’s thermal fleet, which has an installed capacity of approximately 4.8 GW. At times, nearly 40% of this capacity was affected by maintenance issues and operational failures. The increasing frequency of disruptions points to deeper systemic issues within Serbia’s energy landscape. Much of the coal generation infrastructure was constructed decades ago, with key units in the Kolubara and Kostolac systems operating beyond their optimal lifespan. Underinvestment in modernization and delayed maintenance cycles have intensified pressures on these facilities.
In thermal power operations, an “outage” signifies an unplanned shutdown of a generating unit caused by various factors such as equipment failure or mechanical breakdowns. Such frequent outages have serious implications for operations and finances, as system operators must quickly compensate for lost generation through imports or activating reserves.
Several factors contribute to this growing instability. The age and condition of Serbia’s lignite-based power stations are critical concerns. Many units, particularly those at the Nikola Tesla and Kostolac complexes, were designed according to outdated technological standards and have undergone only partial overhauls instead of complete upgrades. Energy analysts have noted that financial constraints have often led to postponed maintenance cycles within the state-owned utility company, EPS.
Operational overloading has also become a significant issue following the domestic production collapse during the 2021 energy crisis. Thermal units designed for stable baseload operation are now subject to greater cycling pressures due to fluctuations in renewable energy generation and changing market conditions. This increased operational strain accelerates wear on essential components such as boilers and turbines.
Coal quality remains another persistent challenge for Serbia’s thermal fleet, which relies on lignite from local mines. Variations in calorific value and moisture content can negatively impact combustion stability and overall plant efficiency, leading to increased mechanical stress during periods of poor coal quality.
Moreover, the regional electricity market is evolving, with Southeast Europe’s system becoming more volatile due to greater renewable energy integration and fluctuating prices. Serbian thermal plants now face dynamic balancing requirements as they respond to variable outputs from neighboring countries like Romania and Hungary.
Interestingly, this surge in outages coincides with improved financial results reported by EPS, which announced first-quarter profits of approximately €129 million for 2026. However, profitability does not address the critical need for substantial investments aimed at revitalizing coal generation assets.
The situation raises broader concerns regarding Serbia’s energy transition strategy. While efforts are underway to expand renewable energy capacity, the country continues to rely heavily on coal-fired generation for stability and security during winter months. This reliance complicates policy decisions, especially amid increasing pressure from the European Union to reduce coal dependency and enhance emissions standards.
A recent development, the commissioning of the Kostolac B3 unit—a 350 MW coal-fired block financed by Chinese investments—highlights this contradiction. While positioned as a cornerstone of future energy security, it underscores the challenges posed by an aging fleet requiring extensive rehabilitation in a context where Europe is moving towards phasing out coal.
The financial ramifications of frequent outages are becoming more pronounced as well. Increased balancing costs and heightened import dependence during peak demand expose EPS to volatile regional electricity prices. In tight supply situations, unexpected thermal failures can lead Serbia into costly electricity imports.
As Serbia expands its renewable generation capacity, grid reliability risks become even more critical. The addition of wind and solar resources necessitates flexible backup generation capabilities. Without sufficient storage solutions or balancing infrastructure, persistent technical instability among coal units could result in escalating operational vulnerabilities.
This complex situation reflects a transitional gap for Serbia as it strives to balance aging coal infrastructure with renewable integration while modernizing its grid and adhering to European environmental commitments—all while maintaining affordable electricity prices and ensuring energy security. The rising number of thermal outages illustrates the challenges inherent in managing this delicate equilibrium.
