Promotion of renewable energy in Bosnia and Herzegovina

Project description

Title: Promotion of renewable energy in Bosnia and Herzegovina
Commissioned by: German Federal Ministry for Economic Cooperation and Devel-opment (BMZ)
Country: Bosnia and Herzegovina
Lead executing agency: Ministry of Foreign Trade and Economic Relations of Bosnia and Herzegovina (MoFTER)
Overall term: 2016 to 2019

Bioenergy © GIZ

Context

Although Bosnia and Herzegovina has a significant supply of energy resources and is one of the few countries in the Balkans that exports electricity, it does not produce energy sustainably. At the same time, power consumption is increasing in the country due to inefficient usage, while the widespread use of wood and coal as fuel causes air pollution and CO2 emissions.

The existing policy framework does not provide the conditions necessary for an increased use of renewable energy and meeting the country's obligations under the Energy Community Treaty (EnCT). There is a lack of relevant programmes, knowledge and practical experience. Coordination and cooperation in the sector between the state, the entities and the lower levels of government remain generally weak. Hardly any networking or cooperation takes place between the key actors.

Objective

The preconditions have been put in place for a more conducive environment that encourages the increased use of renewable energy in Bosnia and Herzegovina.

Rooftop solar panels owned by community © GIZ

Approach

By supporting the improvement of the legislative and regulatory framework for renewable energy and developing new market-based and target-oriented incentive schemes, the project aims to make the renewable energy sector more attractive to private and public sectors, local and international investors. The project cooperates with partners, both at the state level and in each of Bosnia and Herzegovina’s two entities, including the respective ministries of energy, and the electricity regulatory commissions. It also provides technical assistance to the renewable energy operators in both entities. 

Together with these partners, the project is aiming to improve and strengthen in particular the framework conditions for the increased use of renewable energy in Bosnia and Herzegovina. Therefore, the project focuses on technical support in the following three main areas: 

  • Policy framework (strategic documents and decision-making, energy data, sector coordination)
  • Regulatory Framework (improvements of administrative procedures for licensing and permitting with a focus on the small hydro sector, harmonisation of the regulatory framework)
  • Financing Renewable Energy (introduction of marked-based support schemes, innovative business-models and technology concepts for renewable energy)

In each area, the project conducts supporting activities through: 

  • Specific policy advice to public sector institutions and established working groups on the government level, 
  • Implementation of capacity-building measures for the private and the public sector and 
  • Preparation of specific study reports, potential and costs analysis and legislative documents related to the mentioned fields.

The project also supports the creation of platforms, networks and other initiatives by and for the relevant actors in the energy sector, including policy makers and energy experts.

Results

Communication and coordination between state and entity institutions from different sectors was strengthened through the establishment of regular inter-institutional working group meetings related to RE policies supported and initiated by the project and as a result strategic planning for the sector is improved.

The first result of the improved coordination was the adoption of the National Renewable Energy Action Plan (NREAP) in 2016, with the support of the project. If targets for the share of renewable energy from this document are achieved by 2020, Bosnia and Herzegovina will reduce roughly 830,000 tons of CO2 emissions. 

Further contributions for the strategic decision-making in the sector provided by the project were the preparation of roadmap for adaptations of the existing legislation to increase the share of bio-fuels in transport from current 0 per cent to up to 10 per cent and support to the update of the renewable energy action plan in the Federation of Bosnia and Herzegovina.

Regarding the improvement of the regulatory framework, a comprehensive compilation report with recommendations for the improvement of the administrative procedures for licensing and permitting of RE have been provided to the relevant authorities. The implementation of selected recommendations is supported by the project. This, together with the elaboration of Investor Guidelines, shall reduce the currently minimum needed 750 days for permitting renewable energy facilities significantly.

In order to introduce cost-efficient and target-oriented market-based support schemes and enabling local community-based renewable energy, the project is supporting an inter-institutional working group that prepares the required institutional set-up and legislative documents.

Stakeholders from over 35 public institutions acquired expert skills regarding sustainable small hydropower development, community-energy and innovative RE technologies through implemented study tours and trainings. Over 30 farmers from both entities and stakeholders from the agricultural sector gained knowledge about the financial opportunities and technical aspects of small- and medium scale biogas manure plants through an educational workshop conducted. Around 40 representatives from district heating companies and the wood processing industry gained relevant knowledge about opportunities, potential barriers and solutions of biomass co-generation in trainings and workshops organised by the project to date.

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