Coal news and updates

WB-6 countries struggling to secure electricity production in their old coal power plants

It’s going to be a long winter in several Western Balkan countries as old coal-fired power plants have become unreliable and lignite is scarce. A series of breakdowns have weakened the electric power systems in Serbia, North Macedonia and Kosovo*.

Expensive imports of coal and electricity are straining state-owned power utilities in Western Balkan countries and drying up funds required for the energy transition but also for maintaining the existing facilities.

Serbia’s Elektroprivreda Srbije, EPS, has just reached a deal with the Banovići coal mine in Bosnia and Herzegovina to buy 100,000 tons this year. Earlier it signed a contract with Montenegro’s Pljevlja coal mine for the delivery of the first 40,000 tons of the agreed package for 300,000 tons through 2023.

Serbia’s EPS has to import four million tons of lignite through the end of next year to prevent the need for power imports

But EPS actually needs at least four million tons in total in the period. In addition to being chronically late in developing lignite deposits, a giant excavator that deposits mine tailings in the Kolubara coal mining basin was heavily damaged in a fire in January.

The company has been delaying and shelving key investments over the lack of funds. Deputy Prime Minister and Minister of Mining and Energy Zorana Mihajlović has revealed that EPS paid EUR 507.7 million for 2.23 TWh in electricity that it imported between December 12 and April 20. On the other hand, the government is still pushing the Đerdap 3 pumped storage hydropower project.

Both coal-fired plants in Kosovo* to be reconstructed

After initially postponing some of the projects, Kosovo Energy Corporation (KEK) revealed it would conduct the necessary overhauls at its two coal plants from July to the end of November.

There are three units in Kosova A, with a 550 MW connection to the grid, and two in Kosova B – 520 MW in total. However, they normally work with a much smaller capacity because of technical issues.

Minister of Economy of Kosovo* Artane Rizvanolli says both facilities would be reconstructed. One unit in Kosova A will be revitalized by 2024 and another one after that, at EUR 120 million per unit, she estimated. The plan is to then switch them to reserve and shut down the third active unit, according to the minister.

Last winter’s outages triggered the need for emergency power imports for Kosovo* and Serbia and caused disturbances in the European transmission system

Rizvanolli pointed out that the reconstruction of Kosova B would cost “a little less,” adding the facility’s lifespan would be prolonged to 2040. The project includes the installation of electrostatic precipitators by 2025.

Last winter, Kosovo* imposed rolling outages to keep the electric power system together. After several outages, the instability due to the urgent need for imports in both Kosovo* and Serbia caused European-wide disturbances in transmission. Decision makers in Serbia are still debating how much to raise prices and Kosovo’s courts have blocked a decision to boost tariffs.

In both cases, the issue remains whether they can get loans and find contractors for thermal power plant reconstruction, given that investment in coal is frowned upon among international banks and engineering companies and on the international stage overall.

If coal plants in Western Balkan countries aren’t modernized in the coming years, they will all need to be closed, which would leave the region with an unbearable power deficit.