Serbia is close to setting up a joint venture with Azerbaijan’s SOCAR to develop a gas-fired combined heat and power plant. The planned facility would have capacity of up to 500 MW. The project is being advanced through negotiations involving Serbian energy and gas entities.
Shareholder agreement talks and planned company structure
Representatives of Serbia’s Ministry of Mining and Energy, state power utility EPS, gas company Srbijagas and SOCAR have completed negotiations on a shareholder agreement. The agreement is expected to be signed in Belgrade within the next month. A new company would bring EPS, Srbijagas and SOCAR into a common structure for financing, developing and building the facility.
The arrangement would represent the first joint investment involving all three companies. The plant is designed to produce electricity alongside usable heat. It would use natural gas as the fuel source.
Role in power balancing and timeline for construction
With capacity of up to 500 MW, the CHP plant would provide dispatchable generation for Serbia’s system. It could also support balancing during periods when wind and solar output are weak. Authorities expect development and construction to take around four years after the project moves into implementation.
Broader electricity-generation link between Serbia and Azerbaijan
The investment would expand the energy relationship between Serbia and Azerbaijan beyond gas supply and associated infrastructure. It would shift cooperation toward large-scale electricity generation through the CHP project. For Serbia, the addition of flexible thermal capacity would come as renewable penetration increases demand for balancing resources.
The long-term economics of the facility would remain exposed to natural-gas prices, carbon costs and the pace of electricity-market decarbonisation.
