Serbia is attracting billions in engineering investments, from highways and rail modernization to energy grids and industrial parks. However, the country’s electricity system faces significant challenges.
According to energy expert Kapor, households that consume electricity inefficiently or excessively will face higher bills. For those not in the “red zone,” the price increase will be 6.6%, while others could see hikes of up to 30%. He highlighted that in the last 35 years, Serbia has seen no major investments or construction of large-scale power plants.
“Our energy mix is largely the same as it was 35 years ago, while Europe and the world have moved forward significantly. Without major investments in the electricity grid and system, further price increases are inevitable because the cost of producing a kilowatt-hour here is higher than in other European countries,” Kapor explained.
He also noted that from January 1, 2026, a carbon tax under the CBAM system will apply, taxing Serbian exports that rely on energy from fossil fuels, particularly coal. Kapor expressed concern about the future of Serbia’s electricity sector and economy given these challenges.
The recent electricity price increase is seen as a step toward ensuring financially sustainable operations for Elektroprivreda Srbije (EPS). Kapor emphasized that lower electricity prices can encourage inefficient usage, and raising prices encourages citizens to conserve energy. Socially vulnerable households will continue to receive subsidies under law, with the number of beneficiaries recently expanded.
Kapor stressed that EPS must sell electricity at market prices to remain competitive and productive, noting that other companies sell electricity at market rates, and monopolistic practices by EPS would harm its own operations.
Regarding EPS’s current condition, Kapor highlighted that over 60% of Serbia’s energy still comes from coal, which is insufficient. Thermal power plants are in poor condition, and the electricity grid experiences significant losses during winter months due to high consumption. The new regulation allowing subsidies for households using firewood is seen as a temporary measure to reduce pressure on the electricity system during cold months.
“These are temporary measures I support, but in the long term, we need to make massive investments in our electricity infrastructure,” Kapor concluded.
