Djedovic Handanovic Rules Out Nationalizing NIS

Serbia pays $318 for 1,000 cubic meters of Russian gas, while the market price of gas has risen from 400 to more than 900 euros for the same amount, said Dubravka Djedovic Handanovic, the caretaker minister of mining and energy. She gave the figure on October 14 on the show “Redakcija” on Kurir television, where she also rejected the idea of nationalizing NIS.

We previously reported on President Vucic’s statement that talks with the Americans about NIS are not ruled out. On the show, the minister explained why, in her view, the state should not reach for ownership of the company.

Why does the minister reject nationalizing NIS?

In her words, such a move would violate international law and send investors the message that the state can seize property. She recalled that NIS was sold in 2008, when, as she put it, today’s opposition was in power. She described the legal framework this way:

A contract was signed for the sale of NIS, there is a law, but there are also bilateral relations between states

As an example of what follows a seizure of assets, she pointed to Bulgaria: “Bulgaria did that with Lukoil, and then Lukoil sued them,” Djedovic Handanovic said, adding that it remains to be seen how that dispute will end.

What did the minister say about gas and diesel?

The minister ties the gap between $318 and the market price of more than 900 euros per 1,000 cubic meters to the foreign policy that, she says, Aleksandar Vucic has pursued. On diesel, she said that under an agreement between Donald Trump and Vladimir Putin, Russia will release 300,000 tons of diesel onto the market immediately, then 500,000, then a million tons, which should bring prices down. At Serbian filling stations, the minister claims, “nothing was lacking, nor were there any supply difficulties,” while neighboring countries have had fuel restrictions, shortages and price increases over the past six months.

Part of the conversation was electoral. The minister said pressure for sanctions on Russia will be greater on October 27 if Serbia’s political course changes, and she urged citizens to vote for United Serbia on October 25.

How much gas does Serbia have, and what are energy prices?

A day earlier, on October 13 in Kraljevo, the minister outlined the state of supplies. Gas reserves stand at 707 million cubic meters, held in the Banatski Dvor storage facility and in Hungary, which she said is a record level:

They are record levels when it comes to gas: we have 707 million cubic meters

She also cited world market prices: gas up to 900 euros per 1,000 cubic meters, oil at $105 per barrel, electricity above 200 euros per MWh. Low water levels on the Danube have created problems for hydropower plants, and the shortage of water complicates cooling at Kostolac. The refinery, according to her, is operating normally. The state, she says, is responding with lower excise taxes and extra diesel from commodity reserves:

We are intervening, both with reduced excise taxes and with additional quantities of petroleum products

Her statements on district heating plants are not entirely the same. In Kraljevo the minister said that about 60 heating plants had finished test runs or were close to finishing, and that the difficulties in Vrbas should be resolved this week. On the show a day later, she said the plants are ready and the tests are complete.

Why was a boiler switched on in Veliki Crljeni?

The power plant in Veliki Crljeni had not operated for nine months, and since October 13 one boiler has been connected to the grid so that the town can have heating. The minister said there is “no alternative” to this. The goal of the energy transition and of cutting emissions remains, she said, but decisions that would endanger heating in some areas are not made overnight, as she put it.

What discounts and subsidies does the state offer?

For pensioners receiving the minimum pension of 31,092 dinars (~265 euros) who have a meter in their own name, 1,000 dinars (~8.5 euros) is deducted from the electricity bill. The measure applies for the third year in a row. Customers who pay on time get an additional 5% discount, and according to Novosti the condition is that the bill is settled by the 20th of the month. The minister said the total can reach about 1,500 dinars in discounts.

The energy retrofit subsidy program has supported about 50,000 households in Serbia, according to her. Amounts range from 140,000 to 550,000 dinars and cover roughly 50% to 60% of the cost of the work, while socially vulnerable households receive a 90% subsidy. Novosti reports that the goal is to bring another 20,000 families into the program by the end of next year.

In Kraljevo on October 13, the first 100 of 217 contracts under last year’s public call were handed out. The City of Kraljevo and the Ministry set aside a total of 31 million dinars (~265,000 euros) for that call, and among the beneficiaries, according to Novosti, are 89 socially vulnerable households, almost 40% of the total. Sources describe the total set aside in Kraljevo since 2021 differently: Novosti reports 226 million dinars (~1.9 million euros) for retrofitting family homes, while Tanjug says nearly 226 million dinars has been set aside over the past several years for households and public buildings. At the contract ceremony, the minister said:

In total, more than 570 citizens in Kraljevo have so far received support from the state and their local government to reduce energy consumption, cut their bills and improve comfort in their homes

Euro conversions use a rate of about 117 dinars to the euro.