Report on Implementation of Recommendations for the Removal of Obstacles to Investment in Energy Sector in Bosnia and Herzegovina

The project was implemented by Advanced Engineering Associates International, Inc. (AEAI) and supported by the USAID Energy Investment Activity Project. The project's main objective was to improve the legislative framework governing the permitting procedure for investment in the energy sector. In mid-2018, the Entity governments issued guidance to their respective line ministries and relevant institutions to act upon the recommendations provided in the analysis and reports. The USAID EIA, together with the competent Entity institutions, agreed on a set of activities deemed feasible within the remaining project life. The implementation of these activities was coordinated with the GIZ Promotion of Renewable Energy project to ensure that the activities contributing to the implementation of selected recommendations from both projects were complementary and resulted in a synergy. The USAID EIA participated in the implementation of recommendations stemming from the analyses, which were initiated by the relevant partner ministries and other institutions. These initiatives included the transposition of the Regulation (EC) 347 in the legal framework in BiH, the amendment of the BiH Concessions Law, and the update and adoption of the Spatial Plan of the FBiH. The outputs from these activities are included in Annex 2 to this report. The GIZ ProRE project provided technical assistance for the implementation of recommendations related to the adaptation of the Energy Permit Application Form in the Federation of Bosnia and Herzegovina (FBiH), the procedure for Environmental Impact Assessment (EIA) in FBiH and Republika Srpska (RS), and the harmonization with the requirements of the EU Environmental Impact Assessment Directive. The GIZ ProRE project is also working on the preparation of new laws and by-laws on the Promotion of Renewable Energy in line with the developed Reform of the RE Support Schemes in BiH and a catalogue with criteria for the development of a sustainable small hydropower sector in Bosnia and Herzegovina. In October 2018, general elections were conducted at all levels of government in BiH, and the delay in the establishment of government at these levels is reflected in the implementation of a number of activities. The USAID EIA was actively involved in legal and regulatory initiatives in the areas where obstacles for investments were identified, proposing new or amended legal solutions through representatives of relevant ministries in the working groups. The USAID EIA delivered an Energy Permitting Guide to the Federation Ministry of Energy, Mining, and Industry (FMEMI) in September 2018, acting on one of the recommendations from the analysis aimed at accelerating and clarifying the steps in the issuance of energy permits. The USAID EIA also drafted an Ordinance on Objects of Significant Importance for Zenica-Doboj Canton, which was supposed to be presented to the Federation Ministry of Spatial Planning (FMPP) for consideration. As a first step in the implementation of the recommendation to introduce an e-permitting system in BiH, the USAID EIA embarked on developing a scope of work (SOW) for external consultants who would be engaged to draft a Roadmap. However, the USAID EIA learned of a World Bank project „LIFE“ that was conducting activities to introduce e-permitting for the issuance of construction permits in both Entities, and the USAID EIA recommendation to accelerate and clarify the steps in the issuance of energy permits was taken into consideration by the LIFE project. The implementation of activities at the level of BiH, the FBiH, and some cantons was postponed due to the delay in the establishment of government at these levels. The adoption of regulations at the level of BiH, which would specify in more detail and more precisely the process in case of a denied third-party access to the transmission network, has been postponed until a new Council of Ministers of BiH is appointed.