What’s new in Federation of BiH’s draft law on renewables?

The Government of the Federation of BiH has adopted the draft law on the use of renewable energy sources and efficient cogeneration. It would pave the way for auctions for the allocation of feed-in tariffs and feed-in premiums for renewable power plants, and introduce the concept of prosumers and energy cooperatives.

The Government of the Federation of Bosnia and Herzegovina has announced that the draft law on the use of renewable energy sources and efficient cogeneration was submitted to the Parliament of the Federation of BiH.

Of note, similar legal solutions for renewables were recently adopted by the Republic of Srpska, Bosnia and Herzegovina’s other entity.

The draft law was produced to harmonize FBiH with the European Union and Energy Community acquis, improve the legal framework in the renewable energy sector, define more precisely the rights, obligations and responsibilities of all participants in the new incentives scheme and to introduce the categories of prosumers and energy cooperatives.

FiT and FiP auctions

The Government of FBiH said it would approve feed-in tariffs (FiTs) for small plants and feed-in premiums (FiPs) for large plants, both through auctions. The procedures would be carried out by the operator for renewable energy sources and efficient cogeneration – Operator za OIEiEK.

According to the draft, all solar power plants of under 150 kW, wind farms of under 250 kW, and biomass and biogas power plants under 500 kW will be categorized as small. The large ones habe installed capacity above these limits.

A small facility auction or FiT auction is a bidding process for awarding the right to sell energy from such plants. The guaranteed purchase price is the fixed price at which the winner sells energy to the operator.

The government plans to hold auctions for large plants at least once in two years

An FiT auction is con ducted every year in accordance with the available quotas determined by the government upon the proposal of the Federal Ministry of Mining, Energy and Industry, the draft reads.

A large power plant auction or FiP auction is a bidding process for granting a fixed premium for energy produced in such facilities.

A fixed premium is added to the price achieved on the organized day-ahead market, while FiP auctions are held at least once every two years, again in line with the FBiH government’s decisions on quotas.

The prosumer and the renewable energy community

The introduction of the prosumer category enables end customers to produce electricity for self-consumption, and to get net billing and net metering supply schemes. They have the possibility to deliver surplus electricity to the grid and withdraw it when their own production is not sufficient, according to the draft.

The renewable energy cooperative concept enables citizens to unite and jointly build renewable power plants, in order to take part in decarbonization efforts and contribute to environmental protection goals, local community development, and economic benefits.