Bosnia-Herzegovina has significant room to improve in using energy efficiently. Electricity prices are kept artificially low and there is therefore limited incentive to make savings. 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 while the country exports electricity generated mostly in lignite power plants. The residential sector is responsible for the highest share of total final energy consumption and has high potential for improvements.
Bosnia and Herzegovina is a South-eastern European country located in the Western Balkans. Bosnia and Herzegovina occupies an area of 51,200 km2. The country has a population of 3.53 million inhabitants. The nation’s capital is Sarajevo. The country is home to three main ethnic groups, Bosniaks are the largest group, second are Serbs and Croats third. Official languages are Bosnian, Croatian, and Serbian.
BiH is politically divided, the comprising two entities are the Federation of Bosnia and Herzegovina (in the central, and western part of the country), and the Republika Srpska (in the northern and southern part of BiH). The Federation and the Republika Srpska governments are charged with overseeing internal functions. Each has its own government, flag and coat of arms, president, parliament (FBiH) and assembly (RS), police force, customs, and postal system.
The city of Brčko in northeastern Bosnia is a self-governing administrative unit; it is part of both the Federation and Republika Srpska. The district remains under international supervision.
Bosnia-Herzegovina, a country of around 3.8 million people, is currently a net exporter of electricity. The country’s electricity capacity is made up of hydropower, while the remainder is made up of five lignite power plants. On top of minimal wind and solar power, generation levels hover around two-thirds coal to one third hydropower, depending on the hydrological conditions.
Bosnia-Herzegovina plans a large amount of new hydropower capacity, which is proving at least as controversial as the coal plants (protesters cite the planned dam project’s environmental impact).
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. In 2017 it reached only 22.7 per cent, partly due to poor hydrology but also due to lack of investments.
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.
Bosnia and Herzegovina has common frontiers with the Republic of Croatia (931 km), the Republic of Serbia (375 km) and the Republic of Montenegro (249 km). To the North, BiH has access to the Sava River, and to the south to the Adriatic Sea (23.5 km of sea border). The land is mainly hilly to mountainous, with an average altitude of 500 meters, (0 m at the seacoast and 2 387 m at the highest peak, Maglić mountain). Of the total land area, 5 % is lowlands, 24 % hills, 42 % mountains, and 29 % karst region. Forest lands cover about 2.5 million ha, or 49 % of the total land area, which is among the highest forest coverage in Europe.
General climate characteristics of Bosnia and Herzegovina are greatly influenced by characteristics of the Adriatic Sea, local topography and atmospheric circulation on a macro scale. The climate varies from a temperate continental climate in the Northern Pannonian lowlands along the Sava River and in the foothill zone, to an alpine climate in the mountain regions, and a Mediterranean climate in the coastal and lowland areas of the Herzegovina region in the South and Southeast. Average annual precipitation in Bosnia and Herzegovina is about 1 250 mm, heaviest precipitation occurs between October and January.
Bosnia and Herzegovina has a transitional economy with limited market reforms. The economy relies heavily on the export of metals, energy, textiles, and furniture as well as on remittances and foreign aid. A highly decentralized government hampers economic policy coordination and reform, while excessive bureaucracy and a segmented market discourage foreign investment. Bosnia and Herzegovina’s manufacturing industry is mainly export-oriented. The energy generation sector was one of the drivers of industrial production in the previous period and is expected to continue its positive growth trend. Metal manufactures, iron and steel, sawn wood and wood products, food, and textiles are among the products produced in various parts of the country. The largest portion of the labour force is engaged in services, followed respectively by manufacturing and agriculture. The main challenge remains to be the high unemployment rate and economic inactivity of the working-age population.
Unemployment rate: 33.28% in 2019.
The major obstacle to transportation in Bosnia and Herzegovina has always been the mountainous topography. The railway system, connects Sarajevo with major towns to the north and with Zagreb (Croatia) and Belgrade (Serbia). Another line runs south from Sarajevo to Mostar and on to Ploče on Croatia’s Adriatic coast. However, few lines are direct, and as a result roads of variable quality have in many cases been the preferred means of passenger and freight transportation. Scheduled air services connect Sarajevo with other Balkan capitals, such as Belgrade and Zagreb, as well as with other European and international destinations. In terms of waterways, the Sava River in the Northern border is open to shipping but the use is limited.