The EBRD is helping to modernise Serbia’s power distribution network with a €40 million sovereign loan to Elektroprivreda Srbije (EPS), to upgrade the electricity system and install modern smart meters.

EPS is the state-owned electric power utility of Serbia, servicing close to 3.5 million customers. Due to years of underinvestment and the use of outdated technology, the company continues to face a high level of electricity losses in its distribution network and difficulties in collecting bills. The energy and carbon intensities of the Serbian economy are more than twice the EU average.

The proceeds of the EBRD loan will be used to purchase and install modern smart electricity meters for end-users, as well as to implement the associated infrastructure and software required to manage the new system.

The project will enable EPS to reduce significantly the level of electricity losses in its network, increase bill collection levels and raise the company’s overall operational efficiency. These improvements will begin the transformation of EPS’s network into a modern "smart" power grid and reducing CO2 emissions by approximately 200,000 tonnes annually.

"Utilities across the world are increasingly focused on upgrading their distribution networks to become smart grids. This is key firstly to reduce losses and bad debts but in the longer term for the networks to become the backbone of a more sustainable electricity system. We are delighted to be supporting EPS in such an important step for the company," said Nandita Parshad, Director of EBRD's Power and Energy team.

“This project will enable EPS to improve significantly its day to day operations, and to reduce its costs of operation. It is a key component of the company’s development strategy. In the long term EPS plans to replicate this project by installing smart meters throughout the distribution network” said Dragomir Markovic, EPS's General Manager.

The EBRD loan is complemented by technical assistance financing from the Spanish government and from the Bank’s Western Balkans Fund.

The project, with a total cost of €80 million, is expected to be co-financed by a parallel loan from the European Investment Bank.

With this latest project, the EBRD’s committed investment in Serbia reached €2.1 billion.