NDC – related plans and experiences in energy sector of B osnia and Herzegovina

1. NDC – related plans and experiences in energy sector of Bosnia and Herzegovina Ozren Laganin, MoE RS Regional Dialogue on NDC’s Tbilisi, Georgia, 21-23 May 2018

2. Key premises for submission BiH‘s Intended NationallyDeterminedContribution – INDC in October 2015 • a) Results from INC, SNC, FBUR, basis in existing legislation • Baseline year (1990) emissions: 34,043.49 GgCO2e (without LULUCF); i.e. • 26,619.96GgCO2e (with LULUCF), representing ≤ 0.1% of GTE. • Coverage: Energy, Industrial processes, Agriculture, LULUCF (sinks), Waste • Scope: CO2, CH4, N20 • CO2 emission per capita app 8.2 t (2011) • GDP per capita in 2013 valued 3,509 € • purchasing Power Standard (PPS) share in 2013 was 29% of the EU-27 average • Gross total primary energy consumed per unit of GDP is 0.938 toe / USD 2000 • Significant share of GDP consumption for energy (over 20%) • b) Status of Bosnia and Herzegovina as a developing country • c) INDC type : Emission reduction relative to a BAU baseline • d) MRV- system is still under development-organizational setup

3. 3 INDC scenarios S1- BAU: In 2030 expected emissions are 20% higher than the level of emissions in 1990. S2 - Unconditional mitigation scenario: Emission reduction that BiH unconditionally might achieve, compared to the BAU scenario, is 2% by 2030 (e.g. 18% higher emissions compared to the base year 1990.) S3 – Conditional mitigation scenario: Emission reduction of 3% compared to 1990 (e.g. 23% compared to the BAU scenario)- possible if the IF support is provided

4. S1 S2 S3

5. Mitigation activities in ENERGY SECTOR identified by S3 scenario • primary and secondary legislation aligned to EU acquis • co-generation plants fuelled by wood chips and wood waste from wood processing industry(70 MW by 2030) • existing TPP with 30% average efficiency replaced with 40% average efficiency • methane destruction from two underground coal mines (five coal-pits) • small hydro power plants (120 MW by 2030) • wind farms (175 MW by 2030) • PHV modules (4 MW by 2030) • RES introduced in existing and new district heating systems • to reconstruct and modernize district heating distribution system • systemtic approach to rehabilitation of existing buildings (focus on public sector

6. CC Policy Achievements • Paris Agreement ratified by a Decision of Council of Ministers of BiH • published in the Official Gazette BiH 1/17- international • agreements, dated February 9th 2017 • EU – questionnaire, submitted to the EU in February 2018- additional questions for clarification are expected • - Designated National Authority (DNA) for NAMA projects implementation • established and functional since 2014. • Active utilization of GCF fund for CC projects in line with LEDS Strategy (NAP) • Continuous follow-up on UNFCCC negotiation process • Membership to the IPPC Board • Membership in GCF Board • Active membership in GEF, with activities streamlined towards CC financing • - CC models for BiH developed in accordance with IPPC Guidelines

7. Reporting to the UNFCCC • NC 1 submitted on May 26th 2010 • NC 2 and LEDS Strategy submitted on November 11, 2013 • BUR 1 (FBUR) submitted on March 12, 2015 • Third National Communication (TNC) and Second Biennial Updated Report (SBUR) submitted on June 13, 2017 • - INDC submitted on October 8, 2015 • All reports above have integrated the adaptation planning as well as • mitigation actions in particular in the energy sector • In preparation: • Fourth National Communication and Third Biennial Update Report under the UNFCCC- in preparatory stage/ to be finalized in 2019/2021 and in parallel with it • Update of the LEDS Strategy • Update of the NDC • NDC action plan for the period 2020-2030-developed by the end of 2019

8. Other GEF/GCF supported projects in realization Inventory “Integrated reporting and transparency system of Bosnia and Herzegovina”, in proposal stage/ to be implemented throughout following 3 years. GEF financing 1.200,000 Projections “National Adaptation Plan (NAP)” – project document submitted in draft on April 30, 2017. Implementation period 3 years - GCF financing of 3 million US $ “Integrating Climate Change into Floods Risk Reduction in Vrbas River Basin” implementation period: 2015-2020 GEF SCCF financing 5 million US$ Policies and measures “Capacity Development for Integration of Global Environmental Commitments Into National Policies And Development Decision Making in Bosnia and Herzegovina“ – ongoing “Capacity Building Climate Change Mitigation and Adaptation” supported by Austrian EIA- implementation period 2017-2018

9. Financial framework for mitigation- ex.ofRepublikaSrpska (RS) • In RS, according to the Public investment Program (PIP) environmental investments in 3-year period (2017-2019) will be: examples of energy sector related projects in RS: -EE project WB IDA credit of 12.800,000 USD, until June 2018 for rehabilitation of 30 public buildings - Reconstruction of district heating systems in Prijedor and Banja Luka, distribution network and fuel switch -Desulphurization in TPP Ugljevik , JICA support aimed to reduce SO2 by 98,2%

10. Institutional setup for implementation State level: • Ministry of Foreign Trade and Economic Relations of BiH • Ministry of Civil Affairs of BiH • Ministry of Foreign Affairs Entity level - RepublikaSrpska • Ministry of Physical Planning, Civil Engineering and Ecology of RepublikaSrpska (Focal point for the UNFCCC), • Ministry of Industry, Energy and Mining of RepublikaSrpska • Ministry of agriculture, forestry and water Management of RepublikaSrpska • Ministry of Transport and Communications of RepublikaSrpska • Ministry of Health and Social Welfare of RepublikaSrpska

11. Institutional setup for implementation • Entity level – Federacija BiH   • Federal ministry of environment and tourism • Federal ministry of energy, mining and industry • Federal ministry of agriculture, water management and forestry • Federal ministry of spatial planning • Federal ministry of transport and communications • Federal ministry of health • Agencies and professional organizations: • Agency of statistics of BiH • Plant protection agency • Entity level - RepublikaSrpska • Republic Hydro-meteorological institute of RepublikaSrpska • Statistical Service of RepublikaSrpska • Institute for agriculture of RepublikaSrpska • Entity level – Federacija BiH • Federal hydro-meteorological institute • Federal Statistical Service

12. Challenges and capacity needs • There is no formal legislative framework nor agreement that defines the establishment of a national system of GHG gasses inventory, nor formalized role of individual institutions in monitoring, reporting and verification MRVactivities/NC’s and other reports recommend designing the system within the existing institutions with legally defined competences. • RepublikaSrpska through their legal acts has provided jurisdiction to HMZ RS to work on the development of an inventory for RepublikaSrpska. There is no appointed institutions with similar jurisdictions in FederacijaBiH and BrčkoDistrikt. • There are no clearly defined roles of certain ministries in terms of their jurisdiction for enacting, implementing and supervising polices and measures related to climate change, including the activities on Inventories and projections.

13. …. • In addition, there are no plans for future capacity building in Bosnia and Herzegovina due to limited budgets of relevant institutions, which leads to lack of human and material resources. Significant constraints include the lack of specialized organizational units for climate change within relevant institutions, and lack of professional training and adequate skills for experts to be engaged in the activities to fulfill requirements of the UNFCCC. • The current processes of policy formulation, incentives, and other regulatory instruments required to achieve the de-carbonization of the economy are not coordinated (environmental and energy sector).

14. Way forward- elements for effective implementation • Political will and effective governance to maintain momentum and ensure accountability across diverse actors – national, sub-national, municipal, public and private – overseen by capable institutions and, ideally, supported by legislation. • Long-term mitigation strategies to deliver greenhouse gas (GHG) emissions reductions through national and sector plans aligned with development priorities, and by using the right tools in the policy toolkit to minimise costs and deliver transformational changes. • Integrated adaptation planning that builds long-term resilience to the impacts of climate change by mainstreaming planning into national sectoral strategies to deliver cost-effective interventions. • Climate finance frameworks that match support needs against funding streams and include strategies for how best to access them. • Measurement, reporting and verification (MRV) systems to track implementation and apply lessons learned, so enhancing analytical capacity and understanding about which policies work best and why.

15. … Certain progress has been achieved in Bosnia and Herzegovina concerning policy and strategic framework formulation . Still, significant improvement is required the countries’ strategic low-carbon development policy planning including development of legislative framework, effective governance system, developing effective domestic MRV systems and effective financial mechanisms for project implementation. As a dynamic process, climate policy needs to adjust with new recommendations, such as EC Recommendation 2018/01/MC-EnZ on integrating Energy and Climate plans, Gender Action Plan GAP activities in NDC and Low-carbon Emission Strategy, etc.

16. Final NDC Action Plan (NDC AP 2020-2030) when finally adopted will provide a vision to: • Elaborate and justify what components of NDC implementation plan may be funded by national financial sources (e.g. energy efficiency projects, transportation infrastructure, reforestation actions etc); what can be funded by private sector through development of bankable projects to attract investment and what can be financed by international support (especially for conditional mitigation strategies); • Key elements for developing MITIGATION PLAN, and PLAN FOR ACCESS TO NEW MARKET-BASED MECHANISMS • Develop project pipeline and financing propositions that can be submitted to different international financing sources; engage the private sector by supporting the development of bankable projects and addressing the issue of risks;

17. Final remarks • Implementation of recommendations and actions proposed in Strategic documents strongly depends on access and support of IFI’s and better coordination between institutions; • In order to achieve an effective mitigation actions, in particular in the energy sector, it is important to build capacities on GHG inventories, data collection and information on the progress of implementation of the mitigation actions and the underlying steps taken or envisaged and the results achieved; • It is important to continue with the institutional capacity development in order to enforce and implement climate policies at all levels of authorities in Bosnia and Herzegovina, such as economic instruments, that can change the awareness of people and institutions towards environmental protection; • Integrating climate change considerations in sectoral policies and strategies still needs to be improved;

18. Thank you!