In 2021, Serbia emitted approximately 62 million tons of greenhouse gases, with around 40% coming from facilities operated by Elektroprivreda Srbije (EPS). Despite a Belgrade High Court order to reduce sulfur dioxide emissions, EPS’s output in 2023 was 34,808 tons higher than in the previous year.
Transitioning to a low-carbon economy is crucial for Serbia, requiring EPS to play a central role in promoting renewable energy sources. A successful transition would not only benefit the environment but also enhance the country’s economic competitiveness.
Following a significant disaster at the “Nikola Tesla B” thermal power plant in late 2021 and a loss of 74 billion dinars in 2022, EPS rebounded to achieve a profit of 114 billion dinars in 2023. However, this financial success is accompanied by pressing challenges, particularly regarding its annual CO2 emissions of about 25 million tons and the imperative to join the EU emissions trading system.
In 2021, EPS accounted for 25.8 million tons of CO2 emissions, nearly 40% of Serbia’s total greenhouse gas emissions. Without effective measures to reduce these emissions, Serbia cannot meet its commitments under the Paris Agreement and the Green Agenda for the Western Balkans. According to Climate Analytics, Serbia needs to cut greenhouse gas emissions by 40-51% by 2030 compared to 2010 levels to align with the goal of limiting global warming to 1.5°C. This includes developing a clear plan to phase out coal and establish a timeline for joining the EU’s CO2 emission market. Currently, the only indication of a timeline is a 2050 deadline for halting coal-based energy production mentioned in a law related to loans from the European Bank for Reconstruction and Development.
EPS’s record profit may also be attributed to a lack of investments in pollution controls and the non-implementation of cost-internalization for emissions. Despite a court ruling mandating reductions in sulfur dioxide emissions, EPS’s emissions in 2023 increased, with two thermal power plants operating illegally against Energy Community Treaty stipulations.
Earlier this year, EPS announced a “Green Path” initiative aimed at shutting down thermal power plants by 2035 and generating 63% of its electricity from renewable sources by 2038. However, this plan has not yet been formally adopted, leaving questions about how EPS will balance business interests with climate neutrality goals while maintaining energy security and supporting its workforce of over 19,000 employees.
The Serbian government has yet to adopt an action plan for a just transition, with the relevant Working Group meeting only once since 2022. Furthermore, a clear definition of “green jobs” remains absent, hindering the development of policies for new employment and retraining in the renewable energy sector, essential for ensuring dignified working conditions and sustainable community development.
