Republic of Srpska agrees to compensate Nikšić in Montenegro for using Bileća lake

Ministers of energy and mining of Montenegro and the Republic of Srpska, Saša Mujović and Petar Đokić, agreed at a meeting in Trebinje that the Municipality of Nikšić would receive EUR 600,000 in annual compensation for its land under the Bileća lake.

The Bileća lake is the heart of the Trebišnjica hydroelectric system, a valuable water and energy resource for the Republic of Srpska. The two energy ministers agreed that the company Hidroelektrane na Trebišnjici (HET) would resume compensation payments to the Municipality of Nikšić in Montenegro for the part of its territory under the artificial Bileća lake.

The Republic of Srpska is one of the two political entities making up Bosnia and Herzegovina. The other one is called the Federation of BiH. HET is a subsidiary of state-owned power utility Elektroprivreda Republike Srpske (ERS).

Representatives of Montenegro’s government-controlled electricity producer Elektroprivreda Crne Gore (EPCG) and ERS also attended the meeting in the city of Trebinje in BiH, near Bileća. An initiative was also launched to use water from Bileća lake to supply Nikšić, Montenegro’s second-biggest city.

The compensation will start to be paid retroactively, from January 1, 2024

Lake Bileća was created in 1965 by damming the Trebišnjica river on the border between Montenegro and Bosnia and Herzegovina. Montenegro received compensation from 1971 until it was discontinued in 1991.

“The direct benefit of today’s meeting is that we agreed to resume the payment of the compensation for submerged land or, rather, that the Municipality of Nikšić will continue to collect the tax or compensation on that basis, amounting to about EUR 600,000 annually. Thus, the compensation to the Municipality of Nikšić is reinstated, and we will start it retroactively, from January 1, 2024,” Minister Mujović stressed.

The ministers also discussed using the Bileća lake to supply Herceg Novi and the Bay of Kotor

At the meeting, they also discussed the possibilities of joint project development and highlighted the idea of valorizing the potential of Bileća lake for the municipalities in the Bay of Kotor (Boka Kotorska) in Montenegro with drinking water.

“For Montenegro, it is also important that we touched upon the topic of utilizing the hydropotential of the Bileća lake through the possibility of supplying drinking water to Herceg Novi and the Bay of Kotor. This is very important to us, and I must emphasize that our colleagues in the Republic of Srpska were completely open to supporting this idea and solving this pressing issue for Montenegro in the best possible way,” Mujović said.

Montenegro supporting Buk Bijela project as long as it does not harm its environment

After the meeting, Mujović said that the Buk Bijela hydropower plant could be built if it does not harm the environment in Montenegro, RTCG reported.

Buk Bijela is a joint project of the Republic of Srpska and neighboring Serbia, worth about EUR 250 million. The construction of the hydroelectric plant, with a capacity of 93 MW, officially began in May 2021 but it ran into delays amid objections from the Federation of BiH and Montenegro.

“We want to support this project to the extent and in a manner that does not harm Montenegro. You know that this project has certain problems in the implementation process. One part concerns Montenegro in terms of whether it poses an ecological threat to Montenegro. It is under the jurisdiction of the Montenegrin Ministry of Tourism and Ecology. We will see what their position is,” Mujović said.

Negotiations on the construction of the Buk Bijela hydroelectric plant have been ongoing for several years

Negotiations on the construction of the hydroelectric plant started several years ago. In July 2021, the environment ministries of Montenegro and the Republic of Srpska agreed to form an expert team to examine the potential impact of Buk Bijela on the Tara river in Montenegro. Then, in July 2023, BiH and Montenegro established a working group.

A few weeks later, the entity government announced that it would conduct an additional environmental impact study to analyze the effects of the facility’s construction on the Durmitor national park in Montenegro, which is under the protection of UNESCO.

“What I can promise you is that if we have no negative impact on the environment in Montenegro, we absolutely want this project to be realized. That the Republic of Srpska, Bosnia and Herzegovina, and Serbia have the greatest possible benefit. Because, as I said before, their benefit can only be good for us, Mujović underscored.