Bosnia and Herzegovina’s state-owned power utility ERS has secured another €2 million in short-term financing, bringing the total amount of new borrowing arranged within just a few days to €7 million. The additional funds come as the company faces growing liquidity pressures and the shutdown of the Ugljevik coal-fired power plant.
The latest financing has been structured as an overdraft facility aimed at covering ERS’s immediate operating needs. The interest and other associated costs of the arrangement are estimated at around €120,000, adding further expense to the utility’s already strained financial position.
The new facility follows a separate €5 million financing arrangement intended to settle overdue payments to suppliers. Overall, ERS has borrowed more than €50 million since the beginning of 2026, highlighting its increasing reliance on external financing as domestic electricity generation comes under mounting pressure.
A major source of the current difficulties is RiTE Ugljevik, one of Republika Srpska’s largest electricity producers. The power plant has suspended generation because of insufficient coal supplies, removing a significant source of baseload electricity from the system and increasing pressure on other generating facilities.
RiTE Ugljevik is also experiencing serious financial difficulties. Its bank accounts have been blocked, while the Republika Srpska government has granted the company a 90-day delay on overdue tax payments in an effort to ease its immediate financial burden.
The central unresolved issue remains coal supply security. Authorities have previously spent more than €120 million in connection with the Ugljevik East 2 concession in an effort to secure long-term coal supplies for the plant. However, mining difficulties have persisted, leaving the power station unable to maintain stable and regular production.
The financial problems have also renewed discussion about electricity tariff increases in Republika Srpska. Reports have suggested that household electricity prices could rise significantly, although no increase of the scale discussed publicly has been formally confirmed.
While the latest short-term loans can provide ERS with some breathing room and help it meet immediate financial obligations, they do not address the utility’s deeper structural problems. Coal shortages, weak plant availability and accumulated liabilities continue to expose ERS to significant financial and operational risks.
