Lignite, as an energy resource, is a mainstay of electricity generation in the Republic of Serbia. Installed capacity of lignite power plants represents 68% of the total installed capacity of Electric Power Industry of Serbia, the only company in Serbia, which manages electricity generation. In the future, with the increase in demand for electricity, both in Serbia and in Europe, we should expect more extensive and effective utilization of lignite as the main energy potential. In addition, due to increased emissions of CO2, NOx and other pollutants, the Republic of Serbia must accelerate the implementation of flexible mechanisms of Kyoto Protocol and the guidelines set by the European Union. Lignite in the future will retain its existential importance in the electricity generation in the Republic of Serbia. (C) 2010 Elsevier Ltd. All rights reserved.