The energy sector in Bosnia and Herzegovina
Bosnia-Herzegovina, a country of around 3.8 million people, is currently a net exporter of electricity. More than half of its electricity generation capacity is made up of hydropower, while the remainder is made up of five lignite power plants. As of 2016 the country had around 2180 MW net installed hydropower capacity and 2156 MW of lignite. However this ratio is not reflected in the actual generation levels, which hover around two-thirds coal to one third hydropower, depending on the hydrological conditions.
Electricity generation BiH in GWh, 2016
By 2016, 14 MW of solar PV had also been installed and in March 2018 BIH’s first wind farm – the 50.6 MW Mesihovina facility in Herzegovina, financed by Germany’s KfW – started operating. Several more wind farms are planned, including the Hrgud and Podveležje (48 MW each, both financed by KfW) but it is not yet clear which of them will come online before 2020.
The coal power plants are situated in Tuzla (715 MW installed capacity), Kakanj (466 MW) Gacko (300 MW) and Ugljevik (300 MW), and – since September 2016 – Stanari near Doboj (300 MW) all with their own mines nearby.
New lignite-fired units are planned as follows:
- Tuzla unit 7 (450 MW) – preliminary financing deal signed with China Exim Bank
- Banovici – greenfield plant (350 MW) – financing expected from the Industrial and Commercial Bank of China
- Ugljevik III (600 MW) – no financing sources yet
- Gacko II (350 MW) – no financing sources yet but Chinese companies are interested
- Kakanj 8 (300 MW) – no financing sources yet
- Kamengrad – greenfield plant (430 MW) – no financing sources yet but Chinese companies are interested
Other lignite plants such as Bugojno and Kongora near Tomislavgrad are also mentioned periodically, however they do not seem to be moving forward at the moment.
As well as new coal capacity, Bosnia-Herzegovina plans a large amount of new hydropower capacity, which is proving equally or more controversial than the coal plants. Numerous concessions have been issued to private companies in the last two decades but construction started very slowly. However in recent years it has picked up, causing increasing resistance in places like Fojnica and Kruščica. Due to the fragmented administrative system and lack of coherent energy planning it is hard to tell exactly which plants will go ahead, but a list of existing, planned and potential plants as of March 2018 can be found here.
Bosnia-Herzegovina has a renewable energy target of 40 percent by 2020 compared to 34 percent of energy in 2009. This relatively high level is accounted for mostly by hydropower and wood use in households.
Estimates of the country’s renewable energy potential vary widely, depending on whether environmental criteria are used and what economic assessment is used. Some estimates of cost-competitive potential for solar PV and wind include:
The EU Road scenario
Bosnia and Herzegovina does not have its own natural gas extraction so it is dependent on the Beregovo – Horgos – Zvornik import route from Russia via Ukraine, Hungary and Serbia. Gas use in the country is limited by the distribution network which is only present in Sarajevo, Zenica, Zvornik and Visoko. As for oil, the Brod refinery on the Croatian border imports crude oil via the Adriatic oil pipeline JANAF. The refinery has caused anger among local people, including those in Slavonski Brod on the Croatian side of the border, with its high levels of air pollution.
Bosnia-Herzegovina could do a lot more to use energy efficiently. Electricity prices are kept artificially low and there is therefore limited incentive to make savings. According to IEA statistics, the country is more than four times as energy-intensive as the average in EU countries and has the highest energy intensity in the Western Balkans. The residential sector is responsible for the highest share of total final energy consumption (more than 50% in 2015) and has high potential for improvements. Under the Energy Community Treaty Bosnia and Herzegovina has a 20 percent target to increase efficiency by 2020, but it has not yet done much to realise its potential.
More on coal in the Balkans
Macedonia made headlines in December when the United Nations ranked its capital city, Skopje, as the most polluted capital city in Europe. If the ranking included non-capitals, it would not miss Novaci – a small village in the country’s south that also gasps for breath.
Prague – Proponents of coal say almost 30,000 jobs will be created or maintained in southeastern Europe if new coal plants are built, while according to new analysis  by Bankwatch, over 5,000 jobs will be lost.