Key Conclusions SECW 2025
Content
ACCELERATE REFORMS AND ENABLE SUSTAINABLE INVESTMENTS!
1. Climate change is an existential threat – time for concrete action.
SECW, as a platform, emphasizes the importance of developing a sustainable energy sector and recognizes that climate change poses an existential threat to humanity. Bosnia and Herzegovina and the Western Balkans region are committed to contributing through ambitious plans outlined in their NECPs. Aware that regional efforts alone are insufficient to achieve the long-term goals of the Energy Community Treaty, the Paris Agreement, the Sofia Declaration on the Green Agenda for the Western Balkans, and the 2030 Agenda for Sustainable Development, SECW brings together stakeholders from across the world.
2. Energy transition – the key to climate neutrality and sustainable development.
SECW highlights that the energy transition is essential for achieving climate neutrality and that it significantly affects society, the economy, and policy-making — both regionally and globally. As a regional platform, SECW aims to play a key role in providing recommendations for decarbonization, maintaining, and strengthening the energy security and resilience of the Western Balkans.
3. The green transition drives competitiveness and creates new jobs.
A prosperous future for Bosnia and Herzegovina and the region requires a fast and efficient green transition that takes climate challenges into account. This demands strong political commitment and the active involvement of all societal structures. As experiences from other countries (e.g., the United Kingdom, Germany, Norway, the Czech Republic, Sweden, etc.) show — the green transition should be embraced, not feared. Green economies grow faster, are more competitive, and generate more and better-quality jobs, especially for young people.
4. Political stability is a prerequisite for attracting sustainable investments.
Political stability is crucial for attracting quality investments in Bosnia and Herzegovina. The government and parliament must take responsibility and work closely to draft and adopt the necessary laws and regulatory frameworks in line with EU obligations. This would unlock enormous potential for new businesses and innovation and create opportunities for competitive access to the EU green product market following the implementation of CBAM. With bold steps, Bosnia and Herzegovina can open the door to new investments, skilled employment, and greater prosperity.
5. Coal phase-out – an essential step toward decarbonization and alignment with EU goals.
Bosnia and Herzegovina currently relies heavily on coal-based electricity generation, which accounts for more than 60% of total production. The power sector is a major source of CO₂ emissions, significantly contributing to the carbon footprint of products exported to the EU market. The conclusion is clear — a gradual coal phase-out by 2050, in line with the Sofia Declaration on the Green Agenda for the Western Balkans, is crucial for aligning with EU decarbonization objectives.
6. CBAM will directly impact industrial competitiveness and economic growth.
The introduction of the EU Carbon Border Adjustment Mechanism (CBAM) will significantly affect the competitiveness of Bosnia and Herzegovina’s and the region’s industries in the EU market, potentially costing Western Balkan citizens billions of euros. CBAM will have the greatest impact on the power sector due to high emissions from coal-fired plants — both through electricity exports and the carbon intensity of electricity used in producing goods for the EU market, which account for around 70% of total trade.
The recommendation is to introduce a national ETS with a fixed CO₂ tax price and gradually align it with the EU ETS to reduce financial implications and stimulate investments in green technologies.
7. The vast potential of renewable energy is waiting to be realized.
Bosnia and Herzegovina and the region have enormous potential for developing renewable energy sources (RES), including hydropower, biomass, hydrogen, wind, and solar. The NECP target of increasing the share of renewables in gross final energy consumption by 2030 is achievable with timely investments. Key barriers remain outdated grid infrastructure, regulatory bottlenecks, and limited engagement of key societal actors.
The NECP foresees investments of €2–3 billion in grid modernization and the development of hybrid energy production and storage systems (e.g., solar and battery combinations) to ensure grid stability and improve investment attractiveness.
8. Regional cooperation and knowledge exchange – the foundation for an accelerated transition.
To that end, SECW serves as a regional platform for knowledge sharing, exchange of experiences, and technical solutions — particularly through cooperation with the Energy Community Secretariat and the European Commission — to accelerate the transition toward carbon neutrality in Bosnia and Herzegovina and the Western Balkans.
9. Reforms and harmonization with the EU acquis are urgent.
There is a lack of harmonized legal and administrative procedures that slow down renewable energy projects in Bosnia and Herzegovina and the region. It is therefore crucial to urgently adopt the Law on the Regulator, Transmission, and Electricity Market in Bosnia and Herzegovina and harmonize domestic legislation with the EU acquis. This would enable the establishment of a power exchange and the creation of an organized electricity market — one of the key conditions for exemption from CBAM on electricity exports.
10. Bosnia and Herzegovina is at an energy crossroads – time for decisive reforms.
The energy sector of Bosnia and Herzegovina and the Western Balkans is at a turning point. Without swift implementation of NECP targets and alignment with the EU acquis, Bosnia and Herzegovina and the region risk economic isolation and loss of substantial funds due to CBAM — funds that could instead support the green transition.
However, with strategic investments and regional cooperation, despite existing challenges, Bosnia and Herzegovina has the opportunity to become a leader in the Western Balkans’ green transition.
Key actions include NECP implementation, regulatory reform in line with the EU acquis, construction of renewable replacement capacities, gradual coal phase-out with a just transition in coal-dependent regions, modernization of transmission and distribution networks, and utilization of international funds to finance projects and implement reforms under the EU Growth Plan.
11. The green transition brings economic growth and access to the European market.
Bosnia and Herzegovina and the Western Balkans are at a pivotal point on their path toward the green transition, with vast potential for emission reduction through energy efficiency, innovation, regional cooperation, and inclusive models.
Key conclusions highlight the need for investments in renewables and grid infrastructure, regulatory reform for establishing a functioning electricity market, development of electromobility, and production and use of green hydrogen as a strategic solution for industrial decarbonization.
These efforts could boost GDP by 2–3% through green investments, reduce coal dependency by 2030, and minimize CBAM-related risks. Bosnia and Herzegovina and the Western Balkans must accelerate reforms on their EU accession path.
SECW can serve as a platform for new partnerships and for monitoring progress in the energy sector through annual reports — ensuring a path toward a carbon-neutral future by 2050.
