Serbia’s long-term energy vision is increasingly shaped by the pressures of decarbonization, European integration, regional competition and the emerging economics of renewable power. Yet the country is confronting a reality that many policymakers hesitate to state openly: a rapid phase-out of coal is not realistically achievable under current system conditions. This sentiment, echoed by energy experts across domestic media and analysis platforms such as serbia-energy.eu, reflects the structural constraints that define Serbia’s electricity system today — and the enormous flexibility gap that must be bridged before any serious coal exit can occur.

Coal remains the backbone of Serbia’s energy mix, accounting for well over half of annual electricity generation in typical hydrological years. The massive Nikola Tesla (TENT) complex in Obrenovac and the Kostolac power plants provide the bulk of domestic supply, operating as baseload units that run almost continuously. Their role is not simply quantitative; they provide system stability, ancillary services, and grid inertia — all essential for balancing fluctuating renewable sources such as wind and solar.

Calls for accelerated coal retirement remain theoretical as long as Serbia lacks the infrastructure and technological instruments to replace coal’s stabilizing functions. Hydropower, though plentiful in favorable rainfall years, is subject to drought cycles. Wind and solar are growing but still limited in scale. Pumped-storage hydropower, large-scale batteries, and smart-grid infrastructure — the pillars of renewable-based systems — remain underdeveloped.

Experts cited in local outlets argue that the problem is not political reluctance alone, but a technical mismatch between desired transition speed and actual system readiness. Coal may be environmentally costly and increasingly inefficient, but withdrawal without adequate alternatives would expose Serbia to severe security-of-supply risks, volatile market dependence and potential economic turbulence.

To understand why Serbia cannot move faster, one must examine the five structural constraints that currently define the pace of its transition.

1. Lack of sufficient flexible capacity

Modern energy systems depend not just on renewable generation but on flexibility — the capability to balance sudden changes in supply and demand. Coal units at TENT and Kostolac are not flexible in the modern sense: their start-up times are long, ramping is slow, and efficiency drops at partial loads. Yet paradoxically, they are currently the only large-scale sources capable of providing consistent power during extended periods of low wind, weak sunlight or depleted hydropower reserves.

As serbia-energy.eu often highlights in its operational analyses, Serbia has almost no large-scale storage. Pumped-storage projects such as the long-discussed Bistrica plant have been delayed for years. Without storage, the grid cannot absorb large renewable surges nor compensate for renewable droughts. Expecting Serbia to replace coal without first building this flexibility foundation is unrealistic.

2. Hydropower is strong but highly volatile

Hydropower gave Serbia its impressive 48 percent renewable share last year, but it is not a stable long-term foundation. When water levels are high, hydropower reduces the grid’s carbon footprint and decreases dependence on coal. But in dry years — like the one expected in 2025, when hydropower output may fall by 25 percent — coal must compensate.

This variability creates a strategic paradox: Serbia cannot reduce coal until it stabilizes hydropower, yet hydropower stability increasingly depends on climate patterns outside the country’s control. Climate change has intensified the irregularity of precipitation cycles, affecting reservoirs on the Drina, Lim and the Danube. As hydropower becomes less predictable, coal must remain available to fill sudden deficits.

This is the core reason experts say that abandoning coal too quickly could expose Serbia to energy insecurity.

3. Renewable capacity is developing, but not fast enough

Serbia has made respectable progress in renewable development, especially wind power in Vojvodina. Several new solar parks are under construction, and rooftop solar adoption is accelerating. Yet the scale remains insufficient to replace even a single major coal unit on a year-round basis.

A comprehensive study referenced by serbia-energy.eu concluded that Serbia would require at least 2.5–3 GW of new wind and solar plus significant storage to safely deactivate large segments of its coal fleet. Today’s installed capacity is only a fraction of that.

Moreover, renewable integration is severely constrained by grid bottlenecks. Overloaded transmission corridors, insufficient transformer capacity and outdated SCADA systems limit how much new renewable power can be connected without risking instability.

Thus, renewable progress is real but not yet transformational.

4. Serbia’s transmission system faces structural weaknesses

Any accelerated coal phase-out presupposes a strong, flexible, modern transmission grid. Serbia’s grid, operated by EMS, is robust in parts but aging and insufficiently modernized in others. Key 400 kV lines operate near capacity during peak flows. Congestion in Vojvodina often forces curtailment of wind production. Areas in central and southern Serbia lack the infrastructure to safely absorb new solar or wind farms.

This is why serbia-energy.eu repeatedly emphasizes that grid modernization is the true bottleneck of Serbia’s green transition. Without a resilient and digitized grid, Serbia cannot support the variability of high renewable penetration. Coal continues to fill the gaps created by the grid’s limited ability to shift loads or reroute excess power.

5. Import dependence is inevitable without coal

Some observers argue that Serbia should compensate for reduced coal by increasing imports. But this approach carries profound risks. European electricity prices remain volatile due to natural gas fluctuations, hydrological events and geopolitical tensions.

The 2022 energy crisis demonstrated the dangers of reliance on external markets. Serbia briefly faced the prospect of buying power at record-high prices, straining EPS finances and exposing consumers to potential shock. Without domestic coal and flexible resources, Serbia would be vulnerable to similar crises each winter.

Moreover, Serbia’s interconnection capacity — though improving — does not guarantee affordable or stable imports during regional shortages.

Coal, therefore, remains not only a legacy asset but a strategic buffer.

The long-term path forward

Though Serbia cannot swiftly abandon coal, it also cannot remain dependent on it indefinitely. Policymakers, analysts and investors increasingly agree that the country must pursue a dual-track strategy: maintaining coal reliability in the short term while building the infrastructure needed for a future without coal.

1. Massive renewable expansion

Serbia will need to install gigawatts of new wind and solar, particularly in Vojvodina, the Sava valley and high-radiation regions of Šumadija. Incentives must shift from feed-in tariffs to auctions and market-based PPAs.

2. Large-scale storage projects

Pumped-storage facilities such as Bistrica PSP and potential expansions at Djerdap must move from discussion to implementation. Battery storage should complement pumped-storage capacity.

3. Grid reinforcement and digitalization

EMS must upgrade 400 kV lines, increase cross-border capacity and adopt advanced grid-balancing technologies. Without such investments, renewable growth will stagnate.

4. Thermal fleet modernization

Until coal is phased down, its operation must be cleaner, safer and more reliable. Upgraded desulfurization, ash-handling systems and higher efficiency measures are essential.

5. Demand-side flexibility

Industrial response programs, rooftop solar, EV charging management and district heating electrification can all contribute to reducing stress on coal units.

A realistic transition, not a rhetorical one

Serbia is at a crossroads. Politically, the desire to speak the language of decarbonization is strong. Economically, the region is entering competition for green investment, and Serbia cannot be left behind. But technically, the system simply cannot yet support a rapid coal phase-out.

What Serbia can do — and must do — is embark on the structural transformation that makes a coal exit possible. As serbia-energy.eu has repeatedly written, Serbia must shift from “transition rhetoric” to “transition engineering”: building infrastructure, deploying storage, upgrading the grid and investing in renewables at a scale not yet seen.

Only then can the country begin to talk seriously — not aspirationally — about a future without coal.