Bosnia: Small HPPs attracts biggest number of private investors, high potentials of rivers to be exploited; case studies

11. July 2013. / SEE Energy News

Hydro potential that BiH has is being spoken about for decades and every new projects of its use draws big attention in one or another entity. Small HPPs, that turned out to be ecologically justified and economically profitable, are very interesting among new investors.

Experts say that advantage of small HPPs with reference to the big ones is arranging the watercourse next to electricity supply to citizens (it solves the problem of torrents, prevents silt making and similar), it makes possibility for irrigation, sport and industrial fishing and for arrangement of recreation zones.

As HPP use renewable energy source, bad influence on environment is minimal so confrontations to its construction are smallest. All of the water which is required for production of electricity is being returned to watercourse, without losses and fear from eventual pollution.

The question is: How big is power in small HPPs? Limit of 5MW is being mentioned in literature- small HPPs are below it and big HPPs are above.

Many years’ experience

Example of corporations “Paloc” from Gornji Vakuf- Uskoplje which has participated in construction and financing of several such projects, shows previously recognized potential of rivers and profitability of small HPPs. The newest project which is close to the end is the construction of small HPP “Voljevac” in Gornji Vakuf- Uskoplje which should be launched in two or three months. This small HPP will have power of 1 MW and “Paloc” is co-investor in this project.

Igor Zeko, Director of Commercial Department stated that they entered this area with construction of small HPP “Duboki potok” and small HPP “Sastavci” which is 1MW strong and which is still in his ownership.

-Four more HPPs followed after it in cooperation with Sarajevo’s company “Tehel” and company “Rose Wood” from Gornji Vakuf- Uskoplje. We worked on small HPPs “Crima” in the municipality Prozor Rama. Small HPPs in Central Bosnian Canteen are planned and we are planning to apply for competition in concessions’ issuance- Zeko says.

Seko said that they started this business because it is “green economy” i.e. renewable energy sources and acceptable conditions. They own it own mechanization, enough experience and professionalism to launch these projects. They have used potential of Vrbas River mostly so far where they constructed “Sastavci”, but Lasva Valley is also tempting.

-Every river in BiH has potential for construction of small HPPs. The most important thing in functioning of these facilities is fall and amount of water from water intake until entrance in operator station.

Paperwork is the main obstacle

Experts say that small HPPs are projecting in upper river streams which are usually unapproachable, without basic infrastructure so their development directly influences development of this environment which is surely big significance for a municipality

Many conditions are required to be fulfilled until launching operation and collecting necessary documentation is still a big problem for investors who decide for this step. Concession from the Government of certain canton needs to be issued first, then approval from the government and to determine the ownership of the land which is planned for constructing the HPP. All of this is very difficult in BiH and it demands lifting to the higher level which will provide faster and more efficient procedure implementation so investors don’t transfer to another market.

Zeko says that we needed two to three years only to fight against paperwork “which is big minus”.

-But, the effort will be paid off at the end, as from ecology point, as for economy profitability.

4 to 7 years need to pass so investment can be paid off and benefit can come earlier also. Investors in Bih in this area are mostly Austrians, Slovenians, Germans, Croatians that already have experience in electricity market and who are familiar with importance of investments in hydro power.

Ambitious plans

Small HPPs are constructed on streams, channels even water supply systems next to small rivers.

According to the way of water usage, they are classified to circulating (without accumulation basin) and accumulation plants (with natural or artificial accumulation basin).

Around 500 small HPPs are planned to be constructed in BiH. “Elektroprivreda BiH” is interested in the projects on the Neretvica River’s basin and “Elektroprivreda HZ HB” is interested in rivers Cetina, Trebizat, Mlada and Listica…

Neighbor Serbia announced a tender for approvals and energy licenses’ issuance in February 2013. These constructions would bring them investments that are 120 to 200 million EUR worth and employment of 1.000 people.

Source;Bosnian government/Serbia Energy See desk

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