Mediterranean Action Plan

BOSNIA & HERZEGOVINA - – National study
In Federation of BiH Ministry of Energy, Mining and Industry is responsible for energy. All ten
cantons have some ministries responsible for energy.
In Republic of Srpska Ministry of Energy and Mining is responsible for energy in the Republic
of Srpska.
The Law on Electric Power Transmission, System Regulator and Operator of B&H (Of.
Gazette of B&H, No.7/02, 13/03) entered into force on 18 April 2002 and represents the first
step in realization of aims of energy sector reform. The idea of this Law is to make conditions
for unlimited and free trade and continuously supply of electricity according to defined
standard for quality. The intention of this Law and also Entity Laws on Electricity (Law on
electricity in FB&H – Of. Gazette of FB&H 41/02, 24/05, 38/05, as well as Law on Electricity
of RS-Of. Gazette of RS 66/02, 29/03, 86/03, 111/04 and law on Electricity of Brčko District-
Of. Gazette of BD, No.36/04) is to enable and speed the establishment of electricity market
in B&H, integration into the regional market, introduction of the competition and
strengthening the buyer protection.
The Law on Electric Power Transmission, System Regulator and Operator specifies the
institutions of Bosnia and Herzegovina in charge of electricity transmission:
State Electricity Regulatory Commission (Drţavna regulatorna komisija za električnu
energiju - DERK), has jurisdiction over and is responsible for power transmission,
transmission system operations and international trading in electric power. DERK is to be
an independent and non-profit institution, which will operate on the basis of principles of
objectivity, transparency and equality.
Independent System Operator -ISO (Neovisni operator sistema - NOS), is responsible
for the management of the transmission network operating and dispatching in Bosnia and
Herzegovina and for the governing, maintenance planning and coordination, network
construction and expansion in cooperation with the elektroprivredas. NOS will be a nonprofit
agency, independent from any individual the market participant and from electricity
production, distribution and supply activities. ISO shall not venture into trading with
electricity, keeping its independence and authority, and the owners of the Electricity
Transmission Company will devolve all relevant responsibilities for the management of the
system to ISO. ISO will operate in line with objectivity, transparency and equality principles
and will have full authority to coordinate the electric power transmission system.
Single Power Transmission Company is responsible for the transmission, maintenance,
construction, expansions and the management of the electricity transmission network.
With the new Law on establishment of Power Transmission Company in B&H (Of. gazette
B&H No. 35/04) the conditions were created from 1 February 2006 for the entire asset of
high-voltage transmission power network to be transferred to the single newly established
Power Transmission Company (Transco) with the head office in Banja Luka. However, the
production and distribution stayed in the competency of electric power enterprises
described below.
Electric Power has been produced in B&H in hydro and thermo power plants.
In BiH, there are at present three vertically integrated electricity monopolies in charge of the
generation, transmission and distribution:
Elekroprivreda BiH (Electric Power Enterprise) of Bosnia and Herzegovina (EPBiH);
Elektroprivreda (Electric Power Enterprise) of the Croatian Community Herzeg-Bosnia
(EPHZHB); and
Elektroprivreda (Electric Power Enterprise) of the Republika Srpska (EPRS).
For the market to become functional gradually and for the competition to be introduced,
electric power suppliers’ freedom of choice will be limited to qualified consumers and
independent electric power traders, who will be able to purchase power directly from
production or trading companies. There will be three categories of qualified consumers:
Qualified Consumers (QC): In the beginning, this category will include major industrial
consumers, who will have a right to a free selection of their power supplier. While the
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