Integrated Renewables Strategy Will Deliver Bosnia and Herzegovina’s Energy Security, Prosperity

The country needs to harvest its significant renewables potential to avoid the risk of turning into a net electricity importer and missing its climate objective, new report says.

Sarajevo, Bosnia and Herzegovina, 25 September 2023 – Despite being a net electricity exporter, Bosnia and Herzegovina (BiH) bears the heavy cost of air pollution and health impacts due to the dominance of fossil fuels in its current energy mix. The Renewables Readiness Assessment: Bosnia and Herzegovina finds that integrated short- and long-term strategies that aim to increase the share of diverse renewables will not only lead BiH to address those impacts, but also ensure its energy security and increase its readiness to join the European Union (EU).

In order to meet the EU Green Deal objective, BiH recently affirmed its target to achieve a 43.6 per cent share of renewables in gross final consumption by 2030. To better prepare for the potential costs and economic impacts of meeting those objectives, BiH has intensified its activities to finalise the National Energy and Climate Plan (NECP).

To inform the preparation of the NECP, the upcoming Nationally Determined Contribution (NDC) updates, and the implementation of the recently adopted renewables legislation, the International Renewable Energy Agency (IRENA) has developed the Renewables Readiness Assessment, in close co-operation with the Ministry of Foreign Trade and Economic Relations (MoFTER).

Launched on the sidelines of the “Sarajevo Energy and Climate Week”, the report outlines targeted actions to attract significant investments and accelerate the energy transition, as required by the Energy Community Acquis. An integrated strategy will provide investors with certainty and predictability, leading to a diversified economy and sustainable jobs creation.

“The forthcoming National Climate and Energy Plan will put Bosnia and Herzegovina on the right path to ensure the energy security while improving its long-term resilience to climate change. In this process, the country will need to address the potential risks of reduced competitiveness, as well as the shift to an electricity importer position. IRENA is pleased to have contributed to that process with practical recommendations towards improved legislative and regulatory frameworks, streamlined administrative procedures, combined with well-designed financial and de-risking instruments,” said IRENA Director-Country Engagement and Partnerships, Gurbuz Gonul.

“The Renewables Readiness Assessment represents an important step in the process of gradual transition from fossil fuels to renewable energy sources on the way to the decarbonisation of Bosnia and Herzegovina’s energy sector by 2050, for which we are grateful to IRENA. The report is the result of joint work with the IRENA team, the Sector for Energy in the Ministry of Foreign Trade and Economic Relations of Bosnia and Herzegovina, the competent entity ministries and the Government of the Brčko District of Bosnia and Herzegovina,” underlined the Sector for Energy of the MoFTER.

A dedicated chapter comparing the current NECP draft and BiH’s existing NDC ambitions by 2050 reveals that NECP has a more ambitious path towards renewable energy penetration in the power sector, reaching 94% in 2050, while it reaches 81% in the NDC projection. The analysis consequently recommends to boost the implementation of renewables projects through clear targets, incentives and measures for sustainable power sector transformation.

The key areas addressed in the report’s recommendations are:

• legislative and regulatory performance
• integrated planning and investments
• facilitation of renewables projects planning
• financing and implementation
• retail electricity market reform and consumer empowerment
• wholesale power market and efficient investments
• decarbonisation of heating and transport sector
• socio-economic aspects of the energy transition

Read the full recommendations here.