Bosnia and Herzegovina will enter the process of turning from a strong exporter, historically exporting around 20 percent of domestic electricity generation, into an electricity importer, should it not continue with additional investments in electricity generation or with saving.
If investments are implemented, in 2024, BiH could have the capacities ranging from 17.000 to 20.000 gigawatt-hours. If the existing capacities expansion plans were implemented, the country could strengthen the export potential, despite the doubling of domestic demand (in the high consumption scenario).
On the basis of the current Government policy, it seems that BiH is preparing to significantly strengthen its position as an energy exporter. This situation could lead to a considerable dependence on the export market. The analysis has shown that the exporting countries will be competing over export markets in the neighbouring countries. BiH will represent direct competition to Serbia for export markets. Strong competition can come from the EU member countries, Bulgaria and Romania, as well as from Turkey and Ukraine in the near future.
The high dependence on export market indicates towards the possibility of losing the funds invested into projects. From this point of view, the making of the “make-or-buy“ decision should be precisely considered before entering new investments.
When it comes to the analysis of supply and demand during the peak load, BiH is expected to remain vulnerable in this respect.
There are several demand-related issues in BiH that must be particularly mentioned. The transmission and distribution losses amount to around 13 percent. An increase in grid performance can affect the security of supply as well as the county’s position without the addition of new production capacities. The energy efficiency measures may lead to electricity savings.
Bosnia does not have good regional connections within the field of energy policy. The existing infrastructure should be considered from this perspective.
Bosnia has strong exporting ambitions and is potentially one of the biggest exporters among the Western Balkan countries. The decision on constructing new capacities must take into consideration the development in other countries within the region, and beyond.
The decision to buy or make electricity must be strategic and it must take into account the consideration about energy security. It can be concluded that the integration and cooperation within the field of energy policy in the Western Balkans is the key factor for Bosnia and Herzegovina.
