Page 131 - SE Outlook Regions 2023

signed an agreement on financing the production of electric cars at the
Fiat factory in Kragujevac in April. The value of the new investment in
the Kragujevac car factory is €190mn, of which €48mn will be allocated
from the national budget.

President Aleksandar Vucic said in April that preparation for the
production of the new car model will last until the end of 2023, and the
production in Kragujevac will start in the third quarter of 2024.
Workers from the plant will be retrained.

In another recent development, EV battery technology company InoBat
signed a declaration of intent with the Serbian government on the
construction of a major new EV battery factory in November.

3.10.4 Energy & power

Serbia, like other countries in Europe, is struggling to produce enough
electricity to secure a stable power supply. While it signed a new
long-term gas supply contract with Russia’s Gazprom in May 2022, oil
imports have been disrupted by EU sanctions on Russia as they were
routed via EU member Croatia.

In October, President Aleksandar Vucic outlined plans for the country to
overcome the energy crisis, including building energy infrastructure with
its neighbours.

Serbia is looking to invest into renewable energy as it moves ahead
with the green transition but for the moment coal is an important part of
its energy mix.

Not only does Serbia have several coal fired power plants, it is in the
process of building the new unit B3 of the Kostolac thermal power plant.
(TPP). The new 350-MW unit, which is part of the state-run power
producer Elektroprivreda Srbije (EPS), is one of the largest investments
in the country’s energy sector in the last three decades.

In October 2022, EPS announced that the construction of B3 unit was
entering its final stages and is slated for commercial operation in
September 2023. The last contingent of equipment needed to complete
construction of the new unit arrived in Serbia on November 26.
Previously Belgrade had been concerned about the slow pace of
construction by China Machinery Engineering Corporation (CMEC), as
well as the quality of the delivered equipment.

Another investment, the combined-cycle power plant (CCPP) in
Pancevo, started electricity production in November. CCPP Pancevo is
the first gas-steam power plant in Serbia, which will produce electricity
and thermal energy using natural gas. The company’s entire production

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