Socio-Economic costs of incentives for small hydropower in Bosnia and Herzegovina (BiH)

Subsidies and feed-in tariffs for hydropower – paid from our electricity bills – has led to a rise in small hydropower projects, which would otherwise not be economically viable. Those projects have considerably social and environmental costs. This analysis compared the benefits from concession fees with the costs of incentives for small hydro power plants in BiH. Its result shows that the current system of incentives for the electrical energy production from small hydropower is socially and economically unjustifiable. On contrary, it produces a direct social loss of more than four million BAM (= over € 2 million) per year. The analysis recommends that the current system of concession fees and incentives for small hydropower needs to be significantly modified in order to avoid further social loss.

Study: Analysis of the socio-economic justification of the existing system of concession fees and incentives for small hydro power plants in Bosnia and Herzegovina a