energy transition

News

Is a new energy crisis on the horizon?

22. 01. 2025. admin

A COLDER Winter Drives Increased Consumption, Emptying European Gas Storage Faster; Gas Flow Disruption Through Ukraine Raises Questions About Prices and Supply.

Source: INDEXHR

“The disruption of natural gas flows through Ukraine has reignited the ever-relevant question: what will happen with gas prices and supply, and is a second wave of the energy crisis approaching?” asks Hrvoje Stojić, Chief Economist of the Croatian Employers’ Association (HUP), in the latest edition of HUP’s Weekly Focus publication.

At the turn of the year, the price of natural gas surged to nearly 50 euros per megawatt-hour (MWh), after remaining relatively stable in the 35-38 euros range last October, HUP reports.

Gas Storage Emptying Faster

The primary reason for the renewed price spike is lower-than-expected temperatures driving higher consumption, which is causing gas storage to empty faster. At the end of December, gas withdrawals from storage were the highest in the last three winter seasons, exceeding the average for this period by 13%.

Until this winter, Europe bridged the gap in gas supply by reducing consumption and procuring liquefied natural gas (LNG) from other countries such as the U.S., Qatar, and Algeria.

However, this season’s consumption is exceeding expectations, leaving the EU’s gas storage at just 69% capacity at the start of 2025, 15 percentage points lower than the same time last year, HUP warns.

In 2023 and 2024, EU gas reserves at the end of March were between 56% and 58%. At the current consumption rate, storage could drop to 30-40%.

“This would imply a strong increase in gas purchases, especially LNG, to replenish storage for the next winter, but at significantly higher prices, which poses a substantial risk for consumers,” the employers’ association notes.

Pressure on Electricity Prices

They also highlight that past winters were milder and windier, facilitating cheaper production from renewable energy sources. Current wind and solar energy production is unstable, further pressuring electricity prices.

Negative news from Germany, teetering on the brink of recession, adds to this dynamic. Rising layoffs in large companies and relatively high financing costs have led German households and businesses to reduce investments in solar panels.

“All of the above underscores the increased possibility of a new energy crisis as long as gas supply remains unstable. Gas is the primary energy source for electricity production, a critical energy source for Croatian industry. While most expected further stabilization of gas prices—and, consequently, electricity prices—it seems Europe will have to contend with higher prices and greater volatility for a longer period. Each colder winter, combined with uncertainty in energy supply channels, significantly impacts prices,” HUP’s analysis states.

This energy situation also heightens negative risks regarding inflation rates across Europe, especially in 2026, when most subsidies for retail natural gas and electricity prices expire.

Croatia Must Open its Market to Boost Investments in Renewable Energy Projects

Given the circumstances, HUP stresses that Croatia must further open its electricity market to competition to encourage innovation and investments in renewable energy sources (RES), reduce electricity costs for companies below the EU average, and ensure more reliable electricity supply.

“The goal is for Croatia to achieve energy self-sufficiency by 2030 through investments in RES,” HUP states.

They emphasize the urgent need to decide on the unit fee for connecting to the electricity grid, delayed by two years, to unlock investments in RES.

“Due to the delay, investments worth 2.6 billion euros are blocked. Investors cannot initiate the development of the Environmental Impact Study or obtain a connection agreement, prerequisites for obtaining permits for RES projects,” the employers’ association warns.

They also argue that investors should only be charged the actual cost of connection, including building substations, transmission lines, cables, and other equipment. Complementarily, the regulation allowing grid connection applications only once a year, between May 1 and 15, must be significantly relaxed.

Lengthy Permit Procedures for RES Projects

They point out that developing RES projects takes too long due to administrative barriers, partly caused by a lack of skilled personnel to carry out the procedures. Croatia is among the four EU member states with the longest permit processes.

A state support program to encourage electricity production from renewable sources and high-efficiency cogeneration must also be urgently introduced, as the last program expired at the end of last year.

“In addition to timely addressing several proposals to ease investment conditions in RES, upcoming investments in a modern electricity grid—worth around 800 million euros over the next decade—are also crucial, as are technologies for storage and balancing new capacities.

Despite available incentives for battery development, spatial plans must be adequately adapted, as they currently do not support battery installations. Alongside strengthening the distribution electricity grid, investments in transmission capacities are also needed. For this reason, a new ten-year development plan for Croatia’s transmission network (2024-2033) must be urgently adopted,” HUP concludes.

News

Tuzla is the first in BiH to develop a green transition strategy

23. 12. 2024. admin

The energy transition, commonly known as the green transition, is one of the primary conditions for Bosnia and Herzegovina’s continued path toward the European Union, and local communities have already taken certain steps in this context. Among them is Tuzla, the first city in the country to develop a green transition strategy.

Source: KLIX

If Bosnia and Herzegovina aims to join the European Union, implementing the energy transition as one of the primary conditions is essential. The issues of energy efficiency and the use of renewable energy sources are particularly relevant in the current period, and local communities have already taken certain actions.

One of these is Tuzla, which has officially begun drafting a green transition strategy, reaffirming the city’s commitment to environmental protection, clean air, and the use of renewable energy sources.

The strategy will include clear guidelines for improving environmental conditions, increasing energy efficiency, and fostering sustainable development over the next ten years. Tuzla Mayor Zijad Lugavić noted that the city has been a pioneer in energy efficiency in Bosnia and Herzegovina since 2019.

sastanak

“In 2019, through four support lines, we began co-financing the installation of heat pumps, building insulation, pellet stoves, and connection to the central heating system. Today, we are taking a new step by leading the green transition and laying the foundation for cleaner air and a healthier environment. This is an opportunity to combine efforts at local, regional, and international levels because polluted air knows no borders,” said Lugavić.

The development of the strategy also represents an entry point for future investments, as the European Union and other donors condition financial support on the existence of aligned strategic documents.

“This is the first step in a multi-year process that will contribute to achieving the goal of reducing CO2 emissions by 2050, in line with European standards and global priorities,” emphasized Lugavić.

Tuzla’s City Administration plans to use its own resources while also applying for funding from European Union funds and bilateral donors to implement green transition projects.

“Tuzla will become the first city in Bosnia and Herzegovina with such a strategic document, demonstrating a visionary approach. The green transition brings benefits on multiple levels – ecological, social, and economic. With a quality plan and international cooperation, Tuzla has the opportunity to set an example for other communities,” said Borut Jurišić, a representative of the Regional Development Agency from Maribor.

The green transition strategy, as a strategic document, is being developed in Tuzla under the program “Strategic Approach to Green Transition – SAGT,” in partnership with the Regional Development Agency from Maribor, BIT Center in Tuzla, and with the support of the German Agency for International Cooperation (GIZ).

News

BiH’s energy transition is of national importance only on paper

16. 12. 2024. admin

Although it is declaratively mentioned at the state level, the energy transition of Bosnia and Herzegovina has largely been relegated to local communities, which are unable to fully address all the imposed challenges, reports Klix.

In practice, it is evident that the speed of progress on the “green path” depends on the strength and financial capabilities of a Bosnian city or municipality, resulting in uneven outcomes.

Tuzla, as a local community, is one of the most aware in Bosnia and Herzegovina in the context of the green transition, which, among other things, involves the use of renewable energy sources, providing additional energy security for citizens.

However, compared to developed European countries, the lag is apparent, highlighting the necessity of engagement from higher levels of government.

“It is important that all the problems we have related to energy security—including energy efficiency, the use of renewable energy sources, and addressing energy-poor households—begin to be resolved more progressively. For this, the support of higher levels of government is extremely important—from cantonal, through federal, to state levels, as well as the goodwill of international institutions to provide us with additional funds,” says Džemila Agić, director of the Center for Ecology and Energy from Tuzla, in an interview with Klix.ba.

Transition Challenges for Local Communities

Experts point out that the energy transition is costly, even for developed local communities with significant financial resources, and the process is even more challenging for those with lower economic status.

In Tuzla Canton, eight local communities have developed their own plans to reduce energy poverty and have appealed for help from higher levels of government and the international community.

“They openly seek partners, stating that they have identified the problem and are doing what they can, but they cannot bear the full burden of solving it. Local communities are close to citizens but are not responsible for all problems. Higher levels of government must recognize the problem, come down to the level of citizens, and help them survive this energy transition,” Agić explains.

Tuzla is the first city in Bosnia and Herzegovina to officially begin drafting a green transition strategy, confirming the City Administration’s commitment to environmental protection, clean air, and the use of renewable energy sources. The strategy will include clear guidelines for improving environmental conditions, increasing energy efficiency, and achieving sustainable development over the next ten years.

However, creating this document was preceded by a painstaking start to the transition journey, involving the implementation of a wide range of activities over several years.

Strategic and Operational Measures

Miralem Mulać, assistant mayor of Tuzla for communal affairs, construction, and local community operations, tells Klix.ba that all actions taken so far have primarily impacted reducing air pollution and the consumption of electricity and heat energy.

“Tuzla carries out both strategic and so-called operational activities. We were the first in Bosnia and Herzegovina to start co-financing measures to reduce air pollution, which has also led to increased energy efficiency, including building insulation, the installation of heat pumps, the use of pellet stoves, and connections to the district heating system,” Mulać notes.

miralem mulac — Miralem Mulać (Foto: A. K./Klix.ba)

From 2019 to date, the Tuzla City Administration has issued 11 public calls, and as time passes, citizen interest grows, reflecting an awakening awareness of the importance of preserving the environment.

“To date, we have invested 3.9 million BAM in implementing 1,100 measures. However, we don’t have enough funds to meet the demand from citizens who want to participate in our programs. The strategy addresses issues such as public city transport, so-called green infrastructure, the construction of parks and facades, and finding alternative methods of heat and electricity supply. We are already working on mapping potential sources,” Mulać points out, emphasizing the importance of support from higher levels of government.

Advocacy for Energy Justice

All these topics were discussed during a workshop aimed at strengthening advocacy activities related to energy justice and improving the existing cooperation between civil and public sectors in Tuzla.

Among the organizers was the Front Freedom Association, which expressed concern about the impact of polluting energy sources, particularly coal-fired thermal power plants, and urged authorities and the energy sector to accelerate investments in renewable energy sources and support the transition to a decentralized energy network.

“Without citizen participation and accountability from decision-makers, the energy transition could become another project that neglects the needs of local communities. We demand planning based on science, social justice, and intergenerational solidarity. We call on all levels of government, the private sector, and citizens to collaborate in building an energy-secure and sustainable Tuzla, as the future of our community is in our hands,” says Adnan Gavranović, president of the Front Freedom Association.

Adnan Gavranović (Foto: A. K./Klix.ba)

As an organization dedicated to social justice, environmental protection, and democratic development, Front Freedom emphasizes the importance of a responsible energy transition that guarantees security, sustainability, and the rights of all citizens.

“Tuzla faces a dual challenge: ensuring a stable energy supply and urgently reducing the environmental impact. As representatives of civil society, we call for a transparent, inclusive, and fair energy transition process,” Gavranović stressed.

Bosnia and Herzegovina’s Carbon Neutrality Goal

Finally, it should be noted that Bosnia and Herzegovina is expected to become a carbon-neutral country by 2050, an obligation it accepted by signing the Stabilization and Association Agreement, the Treaty Establishing the Energy Community, the Paris Agreement, the Sofia Declaration, and numerous other documents.

However, to achieve what has been mandated, the energy transition must cease to exist solely on paper as a matter of state importance, which is the current reality in practice.