The government of Republika Srpska has approved a substantial loan guarantee of €10 million for Hidroelektrane na Drini, a subsidiary of the state-owned electricity company ERS. This financial support comes from the Investiciono-razvojna banka (IRB) and is aimed at addressing ongoing fiscal challenges faced by the hydropower producer.
This borrowing arrangement features a repayment period of 18 months with an interest rate set at 6%. The funds are earmarked for enhancing capital investment projects within the company’s operational framework, reflecting a strategic move to bolster its financial position amidst existing pressures.
The decision to provide this guarantee indicates that Republika Srpska will assume responsibility for any overdue liabilities should Hidroelektrane na Drini, along with ERS, fail to meet its repayment obligations. This safety net is designed to ensure that any outstanding payments are covered directly from the entity’s budget resources, minimizing risk exposure for the lender.
<pEarlier this year, Minister of Energy and Mining Petar Đokić acknowledged that construction activities on the HPP Bistrica hydropower project had been curtailed due to financial limitations. The involvement of Hidroelektrane na Drini as the investor in this project underscores its critical role in local energy production and infrastructure development.
<pRecent financial reports reveal that Hidroelektrane na Drini concluded the last fiscal year with a net loss approximating €1.2 million. This outcome highlights persistent financial strain within the sector, emphasizing the necessity for strategic investments and government support to stabilize operations and foster future growth.
