Buljubašić and Nikšić Crafting an Entry Strategy: Electricity Will Get More Expensive, and With It Everything Else

Written by: Nermin Alihodžić

In recent days, we have witnessed statements by the leaders of Elektroprivreda BiH about a possible increase in electricity prices. Thus, we have the stated observation of the general director of this public company, Sanel Buljubašić, that their obligation is to ensure stable and orderly supply to customers, but also to maintain the stability of the energy sector, and that a financially stable Elektroprivreda BiH is a prerequisite for all this.

Furthermore, Buljubašić concludes that insufficient coal quantities, poor hydrological conditions, and increased consumption have brought this public company into a situation where they must increasingly purchase electricity.

I could agree with the first part of this statement, because the management led by Buljubašić is indeed responsible for the stability and regularity of supply to its customers, and of course, Elektroprivreda BiH, together with the Government of the Federation of Bosnia and Herzegovina, is in charge of maintaining the stability of the energy sector. It is another question how ready Buljubašić really is to take on this type of responsibility, because his statement that insufficient coal quantities and lack of rainfall are to blame for why Elektroprivreda BiH is buying electricity shows a lack of accountability and a shifting of blame onto others, in this case miners, citizens, and climate change, for why in record time we have gone from sellers to buyers of electricity and why in such a situation its price increase is inevitable.

The Prime Minister of the Federation of Bosnia and Herzegovina, Nermin Nikšić, also commented on this issue. Of course, he justified the entire situation in favor of Elektroprivreda BiH and, following established practice, offered an unprofessional, irrational, and utterly condescending explanation to citizens in his statement. First, he presented his observation in the form of a conclusion that we are an "interesting country, where everyone wants to protect the environment, not to build hydroelectric plants, not to run thermal power plants, and for electricity to be cheap," and then he cleverly pointed out and told "all of us who want air conditioners, to heat with electricity, well, we also have to pay when we want to consume." Philosophically, there is nothing to add.

However, the stability of the energy sector, the price of electricity, energy transition, environmental protection, the issue of the future of thermal power plants, i.e., fossil energy, is everything but philosophy. It is a matter of a proper systemic approach, analysis of the current situation on the domestic and world market, and making short-term and long-term projections and plans based on the parameters thus obtained, all with the aim of keeping pace with global trends, assumed obligations, and challenges that are currently happening regarding sustainable development, electricity production, and environmental protection at the global level.

In the third decade of the 21st century, these are the questions of all questions, and whoever has not understood this by now and seriously tackled solving these problems is greatly mistaken.

What receives very little attention when it comes to the issue of electricity production today is also the time factor. Namely, the world has entered a process of energy transition to renewable sources due to the growing problem and negative consequences caused by the phenomenon of climate change. And when it comes to climate change, the main problem is the passage of time and the fact that we have very little left, or almost none, if we want to reduce emissions of gases that cause the greenhouse effect. Any delay by any state in its assumed obligations is costly on the world electricity market and leads to energy dependence on others. That is why states adopt energy strategies and, more importantly, ensure they are implemented in real time.

The goal is coordinated and unified action by countries on this issue at the global level, as well as the individual achievement of set common goals, which results in the redefinition of market rules and the establishment of new models of economic reality. Thus, we also have the ambitious package of policy initiatives aimed at ensuring the green transition of the European Union, with the ultimate goal of achieving climate neutrality by 2050 for all its members, as well as for countries that have expressed a desire to join this community. And everything is determined by guidelines and deadlines, i.e., again by time.

And then, for example, when we read the information that Elektroprivreda BiH last year terminated the contract for the construction of Block 7 of the Tuzla Thermal Power Plant, which had been signed ten years earlier, and that the return of funds paid on this basis by the partners from China is presented as a success, one important fact is concealed, namely the lost time in stabilizing the energy sector in the Federation of Bosnia and Herzegovina and the return of the entire process to the very beginning, while Europe and world economies are already implementing infrastructure projects in the field of renewable sources, modernizing existing thermal power plants and adapting them to CO2 emission standards, and returning to energy obtained from nuclear facilities.

The planned installed capacity of Block 7 was 450 MW, and it was supposed to produce 2,739.81 GWh of electricity and 390.9 GWh of thermal energy annually, and this energy facility was supposed to be one of the instruments for stable and orderly energy supply for the Federation of Bosnia and Herzegovina. The conclusion imposes itself that Elektroprivreda BiH has irretrievably wasted ten years.

With a proper approach to this issue based on scientific foundations, using the most modern world technologies currently available, environmental protection and the construction of energy facilities can go hand in hand, and the price of electricity can be low! This is best evidenced by certain European countries and their practice in this regard.

And then, when Prime Minister Nermin Nikšić states that "in the Federation of Bosnia and Herzegovina, the price of electricity is one of the lowest in the region and thus in Europe," he conceals one important fact, namely that the standard of living of Bosnian citizens is the lowest in Europe. With every increase in electricity prices, an avalanche of price increases for all other products and services is triggered, which will in any case represent an additional blow to the pockets of already impoverished citizens.

Therefore, we should not be surprised by the statements of the general director of Elektroprivreda BiH, Sanel Buljubašić, at the beginning of this text, when he blames the announced price increase on increased consumption, lack of rainfall, and mines that do not produce sufficient quantities of coal, because the same person advised consumers last April "to turn off lights in hallways and use them where they stay." And the Prime Minister of the Government of the Federation of Bosnia and Herzegovina merely added to this recommendation with the conclusion that when we want to cool and heat with electricity, we also have to pay for what we consume.

And none of them tell the truth about why electricity will really get more expensive and who is to blame for the state our energy sector is currently in? Perhaps someone from the crowd is to blame.