Benefits of Compliance with Environmental Acquis - Final Report

Home , Blagaj, Bosna (river), Kozara National Park, Prenj, Rakitnica, Sava

ARCADIS ECOLAS N.V. IEEP Roderveldlaan 3 Quai au Foin, 55 2600 Berchem 1000 Brussels Belgium Belgium Tel: +32 3 328.62.86 Tel: + 32 (0) 2 738 74 82 Fax: +32 3 328.62.87 Fax: + 32 (0) 2 732 40 04 http://www.arcadisecolas.be http://www.ieep.eu

Contract N° 07010406/2006/441662/MAR/E3

Task 2 - Benefits for fYRoM and

other countries of SEE of compliance

with the environmental acquis Final Report– Part II: Country-

specific report Bosnia and

Herzegovina

The European Commission –

DG Environment

06/11347/AL

October 2007

Patrick ten Brink (IEEP) Ljupco Avramovski (Enviro-L) Stijn Vermoote (Arcadis Ecolas) Samuela Bassi (IEEP) Karen Callebaut (Arcadis Ecolas) Arnoud Lust (Arcadis Ecolas) Alistair Hunt (Metroeconomica)

ARCADIS ECOLAS / IEEP / Metroeconomica / Enviro-L Content 06/11347 - BiH- Benefits of Compliance with environmental acquis - final report

CONTENT

CONTENT...... I LIST OF ABBREVIATIONS ...... III LIST OF TABLES ...... V LIST OF FIGURES ...... VII LIST OF ANNEXES ...... IX EXECUTIVE SUMMARY ...... XI 1 EXECUTIVE SUMMARY – BOSNIA AND HERZEGOVINA ...... XI 1.1 Benefit assessment air related directives...... xi 1.2 Benefit assessment water related directives ...... xii 1.3 Benefit assessment solid waste related directives ...... xiii 1.4 Benefit assessment nature related directives ...... xiv 1.5 Summary overview – Bosnia and Herzegovina...... xvi 2 OBJECTIVES...... 1 3 INTRODUCTION TO BOSNIA AND HERZEGOVINA...... 3 3.1 The environment ...... 3 3.2 The economy ...... 5 4 BENEFITS ASSESSMENT OF AIR RELATED DIRECTIVES...... 7 4.1 Current status of AIR QUALITY ...... 7 4.1.1 National level ...... 7 4.1.2 Regional level...... 9 4.1.3 Air Quality Regulation ...... 9 4.1.4 Air Quality Monitoring ...... 10 4.2 QUANTITATIVE ASSESSMENT: AIR RELATED DIRECTIVES...... 12 4.2.1 Introduction ...... 12 4.2.2 Methodology – The Impact Pathway Approach ...... 13 4.2.3 Emission Reduction Scenarios ...... 14 4.2.4 Extent of Benefits ...... 15 4.3 MONETARY VALUATION...... 16 4.3.1 Benefits upon full compliance...... 16 4.3.2 Trans-boundary benefits...... 17 4.4 Conclusions...... 18 5 BENEFITS ASSESSMENT OF WATER RELATED DIRECTIVES...... 19 5.1 Current status of different water uses and threats ...... 19 5.1.1 Drinking water...... 19 5.1.2 Recreational uses of water...... 20 5.1.3 River ecosystems...... 22 5.2 Assessment using qualitative and quantitative data...... 23 5.2.1 Introduction to the Method of Assessment ...... 23 5.2.2 Benefits from improved drinking water quality and supply ...... 24

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5.2.3 Benefits to recreational users of water...... 27 5.2.4 Benefits to river ecosystems ...... 29 5.2.5 Future strategy on water management ...... 31 5.3 Monetary assessment...... 32 5.3.1 Benefits of Cleaner Drinking Water...... 32 5.3.2 Bathing and other surface water quality – use values...... 34 5.3.3 Improved river ecosystem quality – non-use value...... 37 5.4 Aggregation of Benefits And Conclusions ...... 39 6 BENEFITS ASSESSMENT OF WASTE RELATED DIRECTIVES ...... 45 6.1 Current status ...... 45 6.1.1 Waste generation and coverage ...... 45 6.1.2 Recycling ...... 46 6.1.3 Landfills ...... 47 6.1.4 Packaging waste...... 48 6.1.5 Incineration of waste ...... 49 6.1.6 Hazardous waste (HZW)...... 50 6.1.7 Disposal of waste oil ...... 52 6.1.8 Batteries and accumulators...... 53 6.1.9 Medical Hazardous waste ...... 53 6.1.10 Disposal of PCB and PCT ...... 53

6.1.11 TiO2 Directive ...... 53 6.2 Assessment using qualitative and quantitative data...... 54 6.2.1 Introduction ...... 54 6.2.2 National targets for the future years in the field of waste management ...... 54 6.2.3 Landfill Directive ...... 54 6.2.4 Packaging Directive...... 61 6.3 Summary and interpretation of results...... 63 6.3.1 Summary results of the assessment ...... 63 6.3.2 Extent of the benefits...... 63 6.3.3 Summary of analysis approach...... 64 7 BENEFITS ASSESSMENT OF NATURE RELATED DIRECTIVES ...... 65 7.1.1 Current Status of Biodiversity and Ecosystems...... 65 7.1.2 Indicators used to assess the current state of nature protection and biodiversity...... 65 7.1.3 Threats to Biodiversity in B&H...... 68 7.2 Assessment using qualitative and quantitative data...... 72 7.2.1 Environmental Benefits...... 72 7.2.2 Social Benefits...... 73 7.2.3 Economic benefits...... 74 7.3 CONCLUSIONS ...... 76 8 LITERATURE ...... 79 9 ANNEXES...... 81

ii ARCADIS ECOLAS / IEEP / Metroeconomica / Enviro-L Abbreviations 06/11347 - BiH- Benefits of Compliance with environmental acquis - final report

LIST OF ABBREVIATIONS

BAT Best Available Techniques

CFCs Chlorofluorocarbons

CO carbon monoxide

CH4 Methane

DRF ‘dose-response’ function

ELV emission limit values

EPRTR European Pollutant Release and Transfer Register

HC hydrocarbons

HZW Hazardous Waste

IUCN International Union for the Conservation of Nature

KfW ‘Kreditanstalt für Wiederaufbau’

MEPPP Ministry of the Environmental Protection and Physical Planning

MSW Municipal Solid Waste

NMVOVs non-Methane volatile organic compounds

NOx nitrogen oxides

PPP purchasing price parities

PCB Polychlorinated biphenyls

PCT Polychlorinated terphenyls

SO2 sulphur dioxide

VOCs volatile organic compounds

VPF Value of a Prevented Fatality

VSL Value of Statistical Life

WQO Water Quality Objective

WTP willingness to pay

PPP Purchasing power parity or parities.

iii ARCADIS ECOLAS / IEEP / Metroeconomica / Enviro-L Abbreviations 06/11347 - BiH- Benefits of Compliance with environmental acquis - final report

B&H Bosnia and Herzegovina

FBiH Federation of Bosnia and Herzegovina

RS Republika Srpska

CORINE COoRdination of INformation on the Environment

IUCN International Union for the Conservation of Nature

NEAP National Environmental Action Plan

SAC Special Area of Conservation

EIA Environmental Impact Assessment

WTP Willingness To Pay

SAP Stabilization and Association Process with the EU

EIONET Environmental Information and Observation Network

EEA European Environment Agency

DU Depleted Uranium

iv ARCADIS ECOLAS / IEEP / Metroeconomica / Enviro-L Tables 06/11347 - BiH- Benefits of Compliance with environmental acquis - final report

LIST OF TABLES

Table 2-1: Characteristics of main lakes of Bosnia and Herzegovina ...... 4

Table 2-2: Key economic indicators for Bosnia and Herzegovina ...... 5

Table 3-1.Emissions of air pollutants in Bosnia & Herzegovina – recent years...... 7

Table 3-2. Percentage of air emissions per sector, 2002...... 8

Table 3-3: EU Air Quality Directives Amenable to Monetisation ...... 12

Table 3-4: 2020 Emissions in Bosnia & Herzegovina used for the current study...... 14

Table 3-5: Physical premature mortality impacts avoided in year 2020 ...... 15

Table 3-6: Physical Morbidity Impacts in year 2020...... 16

Table 3-7: Benefits of Full Compliance (Million €) ...... 17

Table 4-1: Laboratory-tested drinking water samples...... 26

Table 4-2: Republika Srpska standards for drinking water quality compared to WHO water quality guidelines (2003) ...... 26

Table 4-3: Characteristics of rivers in Bosnia and Herzegovina (Bosnia and Herzegovina Statistical Office) ...... 30

Table 4-4: Willingness to pay for cleaner drinking water...... 34

Table 4-5: WTP for cleaner coastal water...... 35

Table 4-6: WTP for cleaner inland surface water ...... 36

Table 4-7: WTP for river water quality – non use values...... 38

Table 4-8: Aggregation of Annual Benefits from Full Compliance (million Euro per year) ...... 41

Table 4-9: Total benefits from full compliance with the water-related Directives...... 42

Table 5-1 – Waste management and collection ...... 46

Table 5-2 – Waste recycling...... 47

Table 5-3 – Waste landfilled ...... 48

Table 5-4– Packaging waste ...... 49

Table 5-5– Waste incineration...... 49

Table 5-6 – Hazardous waste...... 51

Table 5-7 – Waste oils ...... 52

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Table 5-8 – Batteries and accumulators ...... 53

Table 5-9: Estimates of reductions in methane emissions per year by 2020 (in ktonnes)...... 56

Table 5-10 : Assumptions for the Municipal Waste Flow for the Period 2004–2020...... 57

Table 5-11 : Assumptions for the Municipal Waste Flow for the Period 2002–2025, Strategy Scenario 2 – Increased Incineration...... 59

Table 5-12 : Recycling scenario for compliance with the Packaging Directive...... 61

Table 5-13: total packaging arisings per capita and inhabitants...... 61

Table 5-14: Estimated tonnes recycled and the changes in recycling levels per year (in tonnes and percentage) due to the Packaging Directive by 2020, ...... 62

Table 6-1: Protected Objects ...... 67

Table 6-2: Species categorized according to IUCN's classification...... 68

Table 6-3: Potential environmental, socio-cultural and economic benefits ...... 77

Table 8-1: Big objects ...... 83

Table 8-2: Small reserves ...... 83

Table 8-3: Reserves of picea omorika Panc...... 83

Table 8-4: Methane Emissions By Component, USEPA (1998) ...... 89

vi ARCADIS ECOLAS / IEEP / Metroeconomica / Enviro-L Figures 06/11347 - BiH- Benefits of Compliance with environmental acquis - final report

LIST OF FIGURES

Figure 2-1: Bosnia and Herzegovina map...... 3

Figure 5-1: Strategy scenario 1 - Estimates of projected volumes of waste generated, collected, recycled, composted, incinerated and disposed for the period 2004-2020 assuming a zero municipal solid waste generation growth ...... 58

Figure 5-2: Strategy scenario 1 - Estimates of projected volumes of waste generated, collected, recycled, composted, incinerated and disposed for the period 2004-2020 assuming a high municipal solid waste generation growth ...... 58

Figure 5-3: Strategy scenario 2 - Estimates of projected volumes of waste generated, collected, recycled, composted, incinerated and disposed for the period 2004-2020 assuming a zero municipal solid waste generation growth ...... 59

Figure 5-4: Strategy scenario 2 - Estimates of projected volumes of waste generated, collected, recycled, composted, incinerated and disposed for the period 2004-2020 assuming a zero municipal solid waste generation growth ...... 60

Figure 6-1: Map of B&H national parks, nature parks and reserves...... 66

Figure 6-2: Forest Fires 1993-1996...... 71

Figure 6-3: Benefits of EU accession for the B&H Protected areas: Increased coverage and increased quality...... 77

vii

ARCADIS ECOLAS / IEEP / Metroeconomica / Enviro-L Annexes 06/11347 - BiH- Benefits of Compliance with environmental acquis - final report

LIST OF ANNEXES

Annex 1: Parks and Reserves in Bosnia and Herzegovina ...... 83

Annex 2: Insights on tourism development potential...... 85

Annex 3: Institutional, legal and economic framework ...... 87

Annex 4 : Quantitative review of methane emissions ...... 89

ARCADIS Ecolas / IEEP / Metroeconomica / Enviro-L Excecutive summary 06/11347 - BiH- Benefits of Compliance with environmental acquis - final report

EXECUTIVE SUMMARY

1 EXECUTIVE SUMMARY – BOSNIA AND HERZEGOVINA

The country specific report for Albania provides an overview of the current status of the environment in the field of water, waste, air and nature and the results of the benefits assessments. A benefit assessment is carried out using quantitative data for Air, Water, Waste and Nature respectively – as in past benefits assessments. Next to this, a monetary analysis is carried out for parts of Air and Water. Nature and Waste are excluded from the monetary assessment since the main benefit values come from air and the benefits from water are also quite transparent and easy to communicate. The more general description of the benefits in qualitative terms is presented in the general report.

Our analysis is based on data collected in the period of March – June 2007 by national environmental experts. To this purpose, IEEP and ARCADIS Ecolas developed questionnaire templates for the national experts to fill out. The questionnaires provided us a picture of the current situation and, whether possible, past trends and future scenarios. The templates are presented in annex of the general report.

In this chapter, a summary is provided on the qualitative, quantitative and monetary (only water and air) benefit assessments. The main results are summarised on the last page of this executive summary. It is advised to consult the full report for background information on the methodology used and assumptions made as these reflect the context in which presented figures should be interpreted.

1.1 BENEFIT ASSESSMENT AIR RELATED DIRECTIVES

The study has assessed the extent of the benefits from lower emissions for the following pollutants: particulates, sulphur dioxide (SO2), nitrogen oxides (NOx), volatile organic compounds (VOC’s), and ammonia (NH3).

In summary, the key benefits identified are: • It is estimated that 1.271 equivalent cases of chronic bronchitis could be avoided per year (domestic and external) through the full implementation of EU air related directives. Of these, 164 are domestic. • Furthermore, the implementation of the air related environmental acquis should lead to approximately 971 fewer cases of premature death arising from lung cancer per year and other related respiratory diseases, 103 of which are domestic.

The key monetary benefits are: • Full compliance should lead to an annual benefit value in a range of 72 to 128 million EUR (reflecting the metric for premature death used) for Bosnia & Herzegovina, starting from 2020. • Total annual benefits to all countries, including EU and third countries have been estimated to equal 1.150 million EUR in 2020 using the VSL metric. This is due to the fact that emissions reductions in Bosnia & Herzegovina will lead to reductions in pollution exposure of the populations in neighbouring countries.

• The gaseous pollutants comprise almost 73% of the benefits whilst PM10 accounts for almost 27% of the total benefits.

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• Avoided early mortality is the largest source of benefit; the value attributed to avoiding early mortality amount to over 64% of the total benefits valued.

The results presented are still likely to be under-estimates of the true benefits of compliance with these standards. The principal reason for this is that the benefits of reductions in some pollutants, notably CO, CO2 and CH4, are not valued since the impact-pathways are not yet defined for all end- points.

It should also be noted that uncertainty remains integral to the analysis – in other words the analysis does not try to hide the uncertainty in the estimates, on the contrary. Two examples of uncertainty include the monetary valuation of the receptor end-points, particularly premature deaths avoided.

Whilst the limitations must be acknowledged, the project team is confident that the results, if seen in the context of the uncertainties, do present very important conclusions on the scale of benefits that can accrue from the proper implementation of the Directives, from which broad policy conclusions can be drawn.

1.2 BENEFIT ASSESSMENT WATER RELATED DIRECTIVES

Benefits of improved drinking water will accrue (i) to households that have a new connection to water supply, and (ii) to households that already have water supply, but are guaranteed better quality water. In Bosnia-Herzegovina about half of the population has access to public water-supply systems, mainly in urban areas. Only 32% of the urban population is supplied with safe, treated drinking water today. It is likely that significantly less than 32% of the rural population is supplied with safe drinking water. Since it was difficult to estimate the number of new connections at this stage, it was preferred to apply an experts’ estimate of 5% increase to calculate future connection percentages. Adding the 5% estimate of new connections to the current connection rate of 50% yields a total share of 55% which can be assumed to benefit from quality improvements of drinking water.

The Urban Waste Water Directive will have a positive effect on the quality of inland waters and, in some cases, groundwater. However, no reliable information is available on the number of tourists in the country due to scarce enforcement of reporting regulations. No beach water standards exist in Bosnia and Herzegovina, no data are available on the beach water quality, no bathing quality standards are reported in official environmental reports. No monitoring data of bathing waters are available, neither are bathing waters designated. No data are available on nitrate and phosphate discharges in Bosnia and Herzegovina. The total population was assumed to benefit from the bathing water quality improvement of inland waters, through a reduction of the nitrates and phosphates load discharged. The population of the municipality of Neum was assumed to benefit from the coastal bathing water quality improvement.

No information is available on the current river water quality classes in Bosnia-Herzegovina. It was assumed that 80% of the rivers have a ‘poor’ quality (classes IV and V) and that 10% of the rivers have a ‘fair’ quality (class III). As it was not possible to assess what will be the precise effect of the implementation of the various water directives (mainly Urban Waste Water Directive, the Nitrate Directive and the Dangerous Substances Directive) on river quality, it has been assumed that the full implementation of the various directives will lead to the effect that the real water quality in all watercourses will be such that the designated Water Quality Objective class I or II will be met. This seems a reasonable assumption, as the main cause of not meeting the WQO is the discharge of various substances by sewage and industrial discharges and these discharges will be dealt with by the directives.

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The total benefits of clean drinking water are estimated to amount to around 57 million EUR/year upon full compliance.

An additional important benefit from the implementation of the water related environmental acquis is the benefit of access to quality bathing and surface waters. The total benefits of an improved surface water quality to the domestic population are estimated to amount to 12.86 million EUR/year upon full compliance – for the lower WTP value. For the high estimate, the benefits to the domestic population are estimated to be at around 33.35 million EUR/year upon full compliance. These figures can be detailed for coastal and inland surface water. The domestic benefits of cleaner coastal water are estimated to lie between 0.01 and 0.04 million Euros per year. The respective range for inland surface waters extends from 12.85 to 33.31 million Euros per year. Due to lack of data, benefits for costal area tourists could not be calculated. As such, the calculated benefits for the coastal area is underestimated.

Next to the recreational value of surface water, which has been covered above, many people have a WTP for improved river ecosystem quality even if they do not visit the respective river at all. The total non-use value of improving river ecosystem quality is estimated to amount to 5.2 million EUR/year upon full compliance.

The total discounted benefits to the domestic population of compliance with the water-related Directives has been estimated at around 117 million EUR (lower estimate) and 172 million EUR (upper estimate). This is equivalent to 53 EUR/person and 78 EUR/person.

1.3 BENEFIT ASSESSMENT SOLID WASTE RELATED DIRECTIVES

The EU Waste Directives will lead to major changes in handling, treatment and disposal of waste in Bosnia & Herzegovina. The country has a wide range of ways in which it can choose to implement the set of waste directives. For example, it can choose to give priority to recycling or to incineration. This choice will affect the extent and value of the benefits arising from each Directive. It is therefore not always possible to identify exactly what will occur as a consequence of a specific Directive.

The main benefits from implementing the Waste Directives are: • Better management and monitoring of waste streams through the Waste Framework Directive. • Lower pollution to groundwater and surface water from leakage of unprotected landfills and, as a result, lower risks of contaminating drinking water. • Reduced health and explosions risks as well as lower impact on global warming as methane emissions from landfills are captured and made to generate energy. A priority is that existing landfill sites will have to be upgraded and illegal dumping sites closed. • Benefits to eco-systems and other environmental resources as emissions from waste activities into air, water and soil are reduced and the recovery of energy is increased through the Incineration Directive (cf. incineration of medical waste). • Reduced health and environmental risks by improved treatment and disposal of hazardous waste, i.e. medical hazardous waste, mining waste, industrial hazardous waste (e.g. the red mud issue from aluminium production plants) and waste from landmines. • Increased efficiency in the use of material and reduced production of primary material as a result of higher levels of recycling. This is a result of the targets of the Packaging Directive, diversion targets from the Landfill Directive and targets of the WEEE Directive, ELV, Batteries, Waste Oils etc. directives. • Lower costs for waste collection, treatment and disposal, as less waste will be produced.

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EU waste directives will help avoid:

• Pollution into air, soil and water (methane, CO2, particulate, heavy metals from sewage sludge, PCBs/PCTs, waste oil) and ecological risks from waste treatment sites and hazardous waste. • Respiratory diseases and noise nuisance to local population, risks to health from contaminated water supplies, air and soil.

Extent of the benefits: • The full implementation of the Landfill Directive will lead to a reduction of methane emissions (captured) of between 19 and 191 ktonnes annually by the year 2020. • Associated with the increase in the levels of recycling/composting and incineration, implementation of the Landfill Directive will lead to a decrease in landfill disposal levels. Estimates for a decrease in landfill disposal levels (per year) by the year 2020 were calculated as the levels of disposal under the Landfill Directive, as a percentage of the non-implementation baseline. Under the recycling/composting scenario the disposal would be around 63% of non- implementation levels (i.e. a 38% decrease), and under the incineration scenario it would be around 55% of non-implementation levels (i.e 45% decrease). • The quantitative assessment of the impacts of the Packaging Directive provide predicted changes in recycling levels across all materials. The estimates for the increases in recycling levels for Bosnia & Herzegovina, per year, by 2020 are: - for glass: +57 ktonnes; - for plastic: + 13 ktonnes; - for paper: +109 ktonnes; and - for metals: +15 ktonnes • For all the recyclables together, the increase will amount to around +194 ktonnes.

1.4 BENEFIT ASSESSMENT NATURE RELATED DIRECTIVES

The current area protected in B&H is about 0.5% of the land area, one of the lowest percentages in Europe. It is very likely that the compliance with the EU nature directive will lead this percentage to rise substantially, as to reach the planned coverage of 16% of the territory (ie more than 800,000 Ha).

The Habitats Directive would encourage increased protection for threatened plant species (such as Pteridophyta and Spermatophyta) and animals. Adequate management, together with national and/or EU funding can also help address the problem related to mines in forest and agricultural land, which currently affects 10% of the B&H territory. This will benefit forests, eg by improving access in case of forest fires or diseases, and agriculture, eg by extending the farming area and reducing land abandonment. Forests in particular have been seriously threatened by the war, and it is estimated that the damages due to illegal logging, mines and fires amounted to about EUR 20 billions. Implementing the EU regulation can avoid additional costs and help mitigating the existing problems. Enhanced nature protection (together with the implementation of other EU directives) will also likely lead to improved water quality, reduction of industrial pollution, regulation or closure of illegal sawmills, better management of municipal waste, reduction of pesticide and agriculture run-offs and more sustainable mining activities, bringing significant environmental benefits especially to the aquatic ecosystems. Implementing the Habitats and Birds Directive can also lead to improve the collection of environmental data, most of which have been destroyed during the war. It may also enhance environmental monitoring, which is currently of very poor quality. The adequate implementation of the EU legislation can also help streamline and give coherence to the current national laws on nature protection and forest management, which are sometimes overlapping and/or unclear.

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Increasing the level of nature protection will lead to social benefits. First of all mines clearance, and decreased fires can make the environment safer, and also increase employment in the agriculture sector. Furthermore, addressing the problem related to depleted uranium will have direct benefits to human health and potentially reduce morbidity cases. In addition, natural parks and biodiversity hotspots will be better managed, therefore offering opportunities for locals and tourists to visit the areas and enjoy open-air activities, enhancing their amenity and recreational value, and offering opportunities for voluntary work and engagement in nature protection activities. Implementing the Acquis may also improve the education and training of institutional staff, and help spread environmental education in schools and among citizens.

There are potential economic benefits of developing niche markets for local/organic products and developing ecologically certificated brands. For instance, the valleys of the rivers Una, Sava, Vrbas, Bosna, Drina, Sana and Spreca are considered to be suitable for sustainable agriculture. Agriculture in general will significantly benefit from mine clearance and improved land management – as currently 50% of land is unmanaged or underused. An improved landscape and protected areas management, together with appropriate branding, could also increase the share of eco-tourism, with positive spin-off effects on the market of local products and traditional goods. Sustainable tourism, eg in the coastline and in Natura 2000 sites, and agriculture activities can provide job opportunities and revenues.

Monetary assessment 2020 onwards for BiH BiH for 2020 onwards countries all 2020 for MEUR at full compliance; annual benefit of 12.86 – 33.35 MEUR; waters (non-use value): annual benefit 5.2 MEUR/year;of 20 years over benefits discounted Total MEUR/year. 117 – 172 of Annual benefit of 72-128 MEUR from Annual total benefit of 1.150 MEUR in Drinking waters: annual benefit of 57 Improved surface water (use value): Improved ecosystem quality of surface

• • • • • •

Quantitative assessment 1.271 equivalent cases of cases of chronic 1.271 equivalent of premature death cases 971 fewer from benefits population 55% of All watercourses improved so that the : 19 to emissions methane Reduced volume 44% of by 38% to A decrease ca. to a volume of 194 An increase bronchitis avoided per year of which of which per year avoided bronchitis 164 domestic which 103 domestic per year of drinking of improvements quality water; Water Objective Quality designated be met; I or II will Classes All surface waters benefiting from improved ecosystem quality; 2020 in 191 ktonnes/year by 2020 under landfilled/year waste of respectively the recycling & scenario and the compositing incineration scenario ktonnes of recyclables (paper, glass, 2020 per year in and metals) plastic protected areas (from 0.5% to 16%) (from 0.5% to areas protected Significantly increased quality and size of and size quality increased Significantly

• • • • • • • •

•

xvi BENEFITS COMPLIANCE WITH ENVIRONMENTAL ACQUIS ACQUIS WITH ENVIRONMENTAL BENEFITS COMPLIANCE

buildings, visibility issues in cities) cities) in issues visibility buildings, waste management (i.e. medical waste, ed agricultureed through mine clearance ng from improved coastal bathing water water bathing coastal improved from ng one damages), economy (impacts on (impacts economy one damages),

environmental acquis - final report acquis - final report environmental ity of surface waters; ca / Enviro-L Qualitative assessment Executive summary ainly ozone), absenteeism, triggers innovative approaches) Improved monitoring and registration system of atmospheric emissions and air General benefits to human health (mortality and morbidity), eco-systems ; quality water drinking Improved ; purposes bathing and recreational for quality water surface inland Improved benefiti and tourists population Coastal Better management and monitoring of waste streams hazardous to linked risks health Reduced Lower pollution of ground- and surface water linked to leakage of unprotected energythrough materials primary of use and better energy of Recovery methane of capture change through climate on impacts Reduced and improv forest protection Increased quality parameters parameters quality oz and acidification (eutrophication, agricultural crops (m historic to damages (e.g. aspects and social improvement; quality Improved ecosystem qual mining waste, industrial waste and waste from landmines), closure and dumps and waste landfills old of remediation landfills recuperation, re-use and recycling activities management land and better territory) the 10% of (affecting Opportunities for eco-tourism

• • • • • • • • • • • • • SUMMARY OVERVIEW – BOSNIA AND HERZEGOVINA SUMMARY

AIR WATER SOLID WASTE NATURE

ARCADIS ECOLAS / IEEP Metroeconomi 06/11347 - BiH- Benefits of Compliance with 1.5 ARCADIS ECOLAS / IEEP / Metroeconomica / Enviro-L Objectives 06/11347 - BiH- Benefits of Compliance with environmental acquis - final report

12 OBJECTIVES

The objective of this country-specific report is to carry out a benefits assessment for Bosnia and Herzegovina, that follows the approach taken in the past Benefits of Compliance Studies for the EU13 and for Croatia.

Chapter 3 consists of an introduction to the main features of Bosnia and Herzegovina.

In chapters 4 to 7 a benefits assessment is carried out using quantitative data for Air, Water, Waste and Nature respectively – as in past benefits assessments. Next to this, a monetary analysis is carried out for parts of Air and Water. Nature and Waste are excluded from the monetary assessment (as in the Croatia study) since the main benefit values come from air and the benefits from water are also quite transparent and easy to communicate.

ARCADIS ECOLAS / IEEP / Metroeconomica / Enviro-L Introduction 06/11347 - BiH- Benefits of Compliance with environmental acquis - final report

23 INTRODUCTION TO BOSNIA AND HERZEGOVINA

Bosnia and Herzegovina (B&H) comprises two entities - a joint Federation of Bosnia and Herzegovina (FBiH) and the Republika Srpska (RS) - each presiding over roughly one-half the territory (see Figure 2 1). The Federation and the RS governments are charged with overseeing internal functions and have separate administrations; this is why the data provided here are often given for the 2 entities and not for the country.

Figure 3-1: Bosnia and Herzegovina map

2.13.1 THE ENVIRONMENT

About half of the country is covered with forest or is declared forestland (44.6% for FBiH in 2001 and 44.0% for RS in 2003). Of the total forest area, 81.3% belongs to the State and 18.7% is privately owned. However, more than half of the forest is low forest or shrub land. Most of the low forests are in the lower oak region, which is affected by the highest human impact since it is close to human settlements. About 10% of the country is bare land (or about one fifth of the forestland). Much of the low forest and shrub land is in the karstic and sub-Mediterranean region. It has little production value, but is important from a biodiversity point of view as it shelters a number of endemic species.

About 21.5%1 of the B&H land is dedicated to agriculture (arable land and permanent crops).

Due to its complex geological history, especially during the glaciations periods, Bosnia and Herzegovina’s biodiversity is extraordinarily rich, but it is under considerable anthropogenic pressure, which may cause some species to be lost forever.

Mining and ore processing are an important sector in Bosnia and Herzegovina. The most important mineral deposits are those of coal, lead, zinc, iron and bauxite. For instance, more than 100 coal deposits are registered. The significant reduction in industrial operating capacity has led to a similar reduction in activity within the mining and ore sector. The production rate for mining and ore processing has declined to about 33% of its pre-war level. Coal and other ore and stone production have been reduced to 40% and 23%, respectively. When rocks containing sulphuric minerals are exposed to water and air, the ongoing oxidation and acidification will accelerate, and trace metals leach out to the environment. The

1 CIA Factbook (2007)

3 ARCADIS ECOLAS / IEEP / Metroeconomica / Enviro-L Introduction 06/11347 - BiH- Benefits of Compliance with environmental acquis - final report environmental impact of mining activities on water resources arises at almost all stages of the production phase, and does not end with the completion of mining activity. On the contrary, the environmental impact can last for centuries after the closure of the mine through seepage from waste rock piles, tailing dams and seepage water from abandoned pits and quarries. Acid mine water containing heavy metals represents a serious threat to the environment and to human health in Bosnia and Herzegovina. The problem with mine water pollution is, however, not recognized or regulated, and today there is no treatment of seepage water at all.

Bosnia and Herzegovina has relatively abundant groundwater resources, which can be found in three geographically and geologically separate areas. In the north, the groundwater reserves are within alluvial sediments of uneven granulometrical composition along the river Sava and its tributaries. In the centre, groundwater accumulates in the caves and cavities of the limestone massifs and emerges on the surface as lime wells in the Una, Sana, Bosna, Drina, and Neretva river basins. In the south, there are large karst fields within the Adriatic Sea catchment area, and the most abundant groundwater wells are found in the Cetina, Neretva and Trebišnjica river basins.

The total outflow from the territory of Bosnia and Herzegovina is 1,155 m³/s, or 57% of total precipitation. Water from the Sava basin, which covers 75.7% of the country, drains to the Black Sea. The main rivers in the Sava basin are the Una-Sana, Vrbas, Bosna, Drina and Sava, with a mean discharge of 722 m³/s. The first four flow into the river Sava, a tributary of the Danube, which drains into the Black Sea. In the Adriatic Sea catchment’s area (24.3% of the country), the main rivers are the Neretva, Trebišnjica and Cetina, with a mean discharge of 433 m³/s. The river Cetina flows entirely through Croatia, but part of its basin is located in Bosnia and Herzegovina.

There are 9 important lakes in Bosnia and Herzegovina. Some of their characteristics are listed in Table 3-1.

Table 3-1: Characteristics of main lakes of Bosnia and Herzegovina

Height above Water Greatest depth, Municipality Area, in km2 sea level, in volume, in in meters 3 meters mil. m Buško Tomislavgrad Livno 55.8 716.5 17.3 782 Blidinje Tomislavgrad Posušje 3.2 1180 4.5 - Boračko Konjic 0.26 402 17.10 - Jablaničko Jablanica, Konjic 13.3 270 70 270 Modrac Tuzla, Lukavac Živinice 17.1 200 17 100 Plivsko (Veliko) Jajce 1.148 424 36.2 21 Perućačko (na Drini) Višegrad 12.4 290 70 340 Ramsko Prozor 15.3 595 - - Zvorničko (na Drini) Zvornik 8.1 140 28 42

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There are also 28 artificial reservoirs in Bosnia and Herzegovina with a volume of about 3.6 million m³, 13 of which are in the Neretva and Trebišnjica river basins and three on the river Drina. The reservoirs are constructed for power generation, but are also important for regulating river flow.

Bosnia and Herzegovina’s total hydropower potential is estimated at 6,100 MW, mostly located within the Drina, Neretva and Trebišnjica river basins. Less than 40% of this potential is so far used, so about 40% of the country’s energy production today comes from hydropower (UNECE EPR). Analyses show that increased use of hydropower would not only be justified from an economic point of view, but would also have positive environmental repercussions (lower emissions of greenhouse gases and fewer discharges of waste water) compared to increasing the use of thermal (coal/fossil fuel) energy. Building artificial reservoirs for hydropower could also be advantageous with regard to flood protection, and could make new irrigation systems possible.

2.23.2 THE ECONOMY

The key economic indicators for Bosnia and Herzegovina are given in Table 3-2.

Table 3-2: Key economic indicators for Bosnia and Herzegovina Indicator Most recent year (ideally 2004) Population in country and growth rate 3.364.825 (March 31, 2001) – Source: UNDP Human Development Report, Bosnia and Herzegovina 2002 Population size per settlement (cities, major No of inhabitants (2005) by town: towns) in your country Bihać 60.843 Orašje 22.532 Tuzla 131.874 Zenica 128.639 Goražde 31.556 Travnik 56.596 Mostar 105.507 Široki Brijeg 30.089 Sarajevo 297.416 Livno 32.424 Population size by region (NUTS2 2 and NUTS 73 – average population density per 3 if possible) square km (2001) – Source: EPR 2003 GDP (ideally 2004 money terms) 6,101,371 Gross domestic product, current prices in 000 USD (2004) – Source: Federal Office of Statistics http://www.fzs.ba/Eng/index.htm GDP per capita 2,143 Gross domestic product per capita, in USD (2004) – Source: Federal Office of Statistics http://www.fzs.ba/Eng/index.htm

2 National unit of territorial space

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Indicator Most recent year (ideally 2004) GDP growth rate – past and projections 2.7% ( Source: 2003, World Bank) Share (%) of agriculture in the GDP FBiH: n/a, RS: 13.6% (2003) Share (%) of forestry in the GDP FBiH: 6.48% (2003), RS: n/a Number of households 1,067,120 Country surface area 51.209,2 km2 of which on land related 51.197 km2 and coastal sea 12,2 km2 – Source: Federal Office of Statistics http://www.fzs.ba/Eng/index.htm

50.7 (total area 1000 km² for 2003): 26.1 (Entity Federation of B&H) and 24.6 (Entity Republika Srpska) - Source: EPR 2003 Purchasing Power Parity n/a Number of tourists per year FBiH: 562.254 (2004), RS: n/a

More information on legislative and economic aspects can be found in Annex 3.

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34 BENEFITS ASSESSMENT OF AIR RELATED DIRECTIVES

3.14.1 CURRENT STATUS OF AIR QUALITY

3.1.14.1.1 National level

Air emissions for the whole country have been calculated by the Meteorological Institute of the Federation of Bosnia and Herzegovina. They cover the major pollutants, (SO2, NOx, NMVOC, CO, CO2, CH4 and N2O). The values include all emissions from fossil-fuel burning, road transport and agriculture and are presented in Table 4-1.

Table 4-1.Emissions of air pollutants in Bosnia & Herzegovina – recent years

However, direct emissions from waste and from process industries are not included. They are estimated to represent an additional 5-8%. As expected, air emissions per capita declined sharply between 1990 (last pre-war data) and the 1999-2001 period:

• From 114.3 kg to 55-60 kg SO2 per year or a 50% decrease; and

• From 5.4 tons to 3.1-3.3 tons of CO2 per year or a 40% decrease CO and NOX emissions per capita

Anthropogenic emissions of SOX are due largely to the combustion of sulphur-containing fuels such as coal and oil. Industry and the power sector were and still are, although to a lesser degree, major emitters. The figures suggest that the energy sector is responsible for 70% of NOx emissions while transport contributes only 20%. For CO, the transport sector generates 98% of the emissions and the energy sector only 2%.

Energy

In Bosnia and Herzegovina energy is produced by both hydro and thermal power plants. Only 39% of the country’s hydro potential is used. Its geothermal potential is neglected, although some studies are taking place in the area of Banja Luka. The country’s thermal power plants are major emitters of air pollutants. They are not equipped with abatement devices such as, in particular, deNOx (nitrogen oxide abatement) units. Electrostatic precipitators (ESP) and desulphurization (deSOx) units – if installed – are often deficient.

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Occasional measurements show that these are inefficient. Poor maintenance and the lack of instruments to monitor combustion efficiency push up fuel consumption and, consequently, increase SO2 emissions. Owing to inefficient combustion, there is also a considerable level of emission of products of incomplete combustion. The situation with district heating boiler plants is similar (many cities have district heating in at least some neighbourhoods). They are not inspected, except in Sarajevo, where the efficiency of combustion is inspected every year.

The main producers of energy such as Energoprivreda are fully aware of the situation. It can be expected that, under pressure from the new Laws on Air Protection but within the limits of their financial capacities, they will take appropriate measures to reduce air emissions.

Industry

The industrial sector has suffered from recession, which has significantly reduced its operating capacities and hence its pressure on the environment, including air quality. However, it remains a large source of air pollution. Most of the industrial facilities installed before the war are still equipped with obsolete technologies; the general economic context means that maintenance is generally poor and the upgrading process slow. This also affects abatement devices.

Another reason for the high air emissions are the poor quality of the fuels burnt as well as the chemical characteristics of the ores used in metallurgy.

The Federation’s Meteorological Institute has labelled some of the major industrial emitters “hot spots”: • The Lukavac cement factory - The particle abatement units are designed to prevent particulate emissions exceeding 200 mg/m3 , but they often fail to do so owing to operating errors and inadequate maintenance. • The Kakanj cement factory was built in the vicinity of the thermal power plant. Problems with dust emissions are said to be related more to the process management than the abatement equipment.

• Zenica Steelworks used to emit very high levels of heavy metals as well as of SO2, mainly caused by the high content of sulphur in the steel ore extracted from Vares mine, near Zenica. The data on levels of lead in the air were kept confidential. An improvement programme is now ongoing but apparently this is carried out without any environmental impact assessment or licensing procedures. • Owing to the high-sulphur fuel used, the Mostar alumina and aluminium plants emit high levels of

SO2.

Table 4-2. Percentage of air emissions per sector, 2002

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3.1.24.1.2 Regional level

The Federation’s Meteorological Institute has already identified traffic as a major source of pollution in Sarajevo and Banja Luka. Traffic emissions are expected to increase in the coming years. Main reasons are: • Incomplete testing and verification during technical inspections; • Increasing number of cars and average age of the fleet; • Low quality of fuels; • Poor maintenance of the vehicles; and • Poor quality of the road network and traffic management.

3.1.34.1.3 Air Quality Regulation

The National Environmental Action Plan (NEAP), adopted by both entities in 2003, aims to identify short- and long-term priority actions and measures providing the basis for a long-term environmental protection strategy. One of its sub-chapters is dedicated to air quality management and focuses mainly on climate change. Although several important measures are listed in this sub-chapter, air quality management is not considered a priority as such, unlike water and waste. However, several priority measures and activities that are recommended could have positive effects on air quality, for instance: • Establishing a pollutant emission cadastre according to the CORINAIR (COoRdinated INformation AIR) methodology; • Encouraging environmentally sustainable transport; • Making fossil fuel use more efficient;

• Reducing SO2 and NOx air pollution by applying desulphurization in selected power plants; and • Preparing a traffic management project for cities.

Additionally, the Mid-term Development Strategy (2004-2007) adopted in February 2004 at the State level includes a section dedicated to air quality and climate change. Priorities as well as measures in line with those mentioned in the NEAP are identified in general terms. They are mainly focused on reducing the emission of air pollutants by increasing energy efficiency, using renewable energy sources and developing a strategy based on the country’s changing climatic conditions. Beside the limited guidance provided in these documents, no air management policy has yet been developed.

Specific legislation includes: • Law on Air Protection of the Federation of Bosnia and Herzegovina (Official Gazette F BiH 33/2003); and • Law on Air Protection of Republika Srpska (Official Gazette RS 53/2002).

These laws cover not only emissions of atmospheric pollutants and air quality but also set out a monitoring and reporting framework. Their provisions on air emissions range from the air study necessary for sources that require an environmental impact assessment to inspections of these sources, as well as possible penalties and sanctions for the infringement of emission limits. These limits are to be fixed in by-laws.

These Laws foresee specific regulations to be developed for combustion plants and other industrial plants according to their rated thermal input as well as for waste incineration plants. Motor vehicle emissions, volatile organic compound (VOC) emissions and fuel quality (sulphur and lead contents) are also regulated.

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A second component of these Laws relates to air quality and follows the principles of EU Directive 96/62/EC on air quality assessment and management. In particular, the Laws call for the development and implementation of action plans in the event that air quality limit values or alert thresholds, to be fixed in by-laws, are exceeded. The Laws also provide for the development of emission inventories and registers with data measured by large point sources, for regular monitoring and an exchange of information on air quality, and for the preparation of reports describing not only the status but also the trends and measures taken to improve air quality.

As indicated above, effective implementation of these Laws requires by-laws: special regulations for specific emitters, provisions and requirements for monitoring, air quality and air emission limit values. Although it was foreseen that these by-laws would be submitted to the competent authorities no later than one year after the entry into force of the Laws, to date none of them has been developed. As a result, air quality management remains in a legal vacuum. In the Federation of Bosnia and Herzegovina, cantonal air quality policy must be harmonized with the Federation’s air quality policy. Cantons have the right to enact their own legislation. In practice, some cantons like Sarajevo, Tuzla and Srednja Bosna have already developed their own law on air quality.

In the absence of by-laws implementing the Laws on Air Protection, there are no effective limit values. Values adopted in some cantons of the Federation or mentioned in some reports are reference levels of air quality rather than levels determining measures for air quality management.

Bosnia and Herzegovina became a Party to the UNECE Convention on Long-range Transboundary Air Pollution in 1992. However, it is a Party to only one of the Convention’s eight protocols: the Protocol on Long-term Financing of the Cooperative Programme for Monitoring and Evaluation of the Long-range Transmission of Air Pollutants in Europe (EMEP). It became a Party in 1992 by succession. Despite having monitoring and reporting obligations under the Protocol, it does not report data to EMEP.

Future improvements are forseen as the part of EU approximation process. Bosnia and Herzegovina the SAP (Stabilization and Association Process with EU) negotiations with Bosnia and Herzegovina started in 1999. A feasibility study on opening SAA negotiations with BiH was adopted in 2003, and it will contribute in general to improvement of air quality management.

3.1.44.1.4 Air Quality Monitoring

Air quality management falls within the jurisdiction of the Ministry of Physical Planning and Environment in the Federation of Bosnia and Herzegovina and the Ministry of Physical Planning, Civil Engineering and Ecology in Republika Srpska. There is currently no plan for measuring air emissions. Emissions are only measured voluntarily by the emitters themselves. The entities but also the cantons (in the Federation) and the municipalities have recently set up inspectorates. Inspections are carried out at the request of or following a complaint from members of the public, but in practice do not result either in penalties or in sanctions.

The statistical data necessary for estimating air emissions rarely exist or are not collected. There is no inventory of industries emitting air pollutants and no register of emissions. In this respect, the new Laws on Air Protection foresee that the emitters, the expert institutions and the Federation’s cantonal authorities will communicate all data necessary for estimating emissions or verifying them. These data will be provided to the Ministry of Physical Planning, Civil Engineering and Ecology in Republika Srpska and to the Ministry of Physical Planning and Environment in the Federation of Bosnia and Herzegovina.

Several institutes and bodies in both entities and in Brcko District monitor air quality: • Republika Srpska - The Hydro-Meteorological Institute: one automatic station in Banja Luka

measuring SO2, CO, NO, NO2 and NOx. This Institute is the proposed reference centre on air quality for Republika Srpska; The Institute for Protection, Ecology and Information Science:

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seven stations in Banja Luka, three in Gradiska and four in other municipalities. These stations measure particles and SO2 three times a week. • Federation of Bosnia and Herzegovina - The Meteorological Institute: one automatic station measuring SO2, CO, NO, NO2, NOx and one station measuring particulate matter and SO2 daily. Both stations are in Sarajevo. This Institute is the proposed reference centre on air quality and air emissions for the Federation; The Cantonal Public Health Institute of Sarajevo: five stations located in Sarajevo that measure SO2 and particles daily; The Institute for Public Health of Mostar; The Department of Environmental Protection in Tuzla with three automatic stations. This Department also operates the two automatic stations – one stationary and one mobile- owned by the thermal power plant of Tuzla, These measure SO2, CO, NO, NO2, NOx, total suspended particles (TSP) and O3; The Cantonal Public Health Institute of Zenica. • Brcko District - The Institute of Civil Engineering of Banja Luka: three stations measuring SO2 and particles daily. These stations belong to Brcko District’s Government, but the yearly contracts to operate them are awarded through a tender.

In addition to these stations run by public institutes, companies and industries also monitor emissions voluntarily. It is important to note that their accuracy is questionable. Indeed, there is no inventory of industrial plants or register of polluters. Input data were either collected directly from the plants or interpolated from data for Yugoslavia, going back to before the war.

Although their exact number is not known, there are probably some 40 monitoring stations in the country. Most still use measuring techniques dating back to before the war and monitor only particles and SO2 on a daily basis. Ozone is measured only in Tuzla. PM10 and metals are not monitored.

Neither the State nor the entities have so far defined a monitoring strategy. Monitoring takes place without any specific objectives such as verifying compliance with limit values, helping policy development, estimating trends or evaluating the population’s exposure.

Furthermore, there is a lack of coordination and active cooperation between the different institutions. Consequently, the scarce resources available are not used efficiently. For example, the Cantonal Public Health Institute of Sarajevo wishes to renew its network with automatic stations but this initiative is not effectively coordinated with the activities of the Meteorological Institute.

No effective quality assurance or quality control procedures are applied; this affects both the reliability and the representativeness of the few data collected. Communication and dissemination are also unsatisfactory: the few existing reports are of very limited interest, and transmitted only to the bodies that are directly involved in them without any further dissemination.

Air monitoring of both emissions and emissions is a basic component of coherent air quality management. In Bosnia and Herzegovina, several institutes and bodies monitor air quality. Their activities are not coordinated, resulting in wasted resources. Neither monitoring objectives nor quality assurance/quality control are defined. Data and information on air emissions are scarce and unreliable. Several international projects currently aim to improve that situation, in particular by developing a monitoring system in line with the EIONET requirements.

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3.24.2 QUANTITATIVE ASSESSMENT: AIR RELATED DIRECTIVES

3.2.14.2.1 Introduction

Table 4-3 below lists the individual EU Directives for which we have attempted to quantify, in physical and monetary terms, the environmental benefits that would result from Bosnia & Herzegovina adopting these Directives. The table indicates the pollutants that are considered in each Directive. Those indicators marked in bold show which pollutants we have been able to include in our adopted methodology.

Table 4-3: EU Air Quality Directives Amenable to Monetisation SO NOx Particulates VOC’s CO CO Heavy metals Dioxins Furans Halogens Ozone CH4

2 2

Air Quality - Relevant Directives Large Combustion Plants x x x IPPC Directive x x x x x x x Emissions from Mobile x x x x x x Sources Air Quality Framework + x x x Daughter Directives for SO2, NOx and Particulates VOC Emissions: Storage & x Transport of Petrol VOC-Solvents Directive x Tropospheric Ozone x Pollution

As agreed with the European Commission, we have adopted an analytical approach that allows us to estimate the aggregate benefits of Bosnia & Herzegovina implementing these Directives by "bundling" the Directives together in the first instance. The benefits of implementing individual Directives are therefore not identified directly - though an indication of the relative importance of the different directives is given below. One reason for this bundling is that benefits from different directives cannot be separated. For instance, a SO2 reduction due to the IPPC directive leads to reduction in SO2 concentration and so helps towards fulfilling the limits in the first daughter directive. Another, more practical, reason centres on data availability and resources available to the project team. The Bosnia & Herzegovina project partners found that little research was publicly available on the quantification of the effects of implementing individual EU Directives in Bosnia & Herzegovina. Nevertheless, when discussing the results of our analysis we put forward some suggestions for the relative importance of individual Directives in accounting for total impacts.

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The four categories of pollution impacts that we quantify are: • Premature deaths avoided (mortality). • Illness avoided (morbidity) – e.g. bronchitis3, asthma. • Crop damage avoided. • Material damage avoided.

One reason why our estimates of environmental benefits are likely to be under-estimates of the true benefits of compliance with EU Directives is that we are not presently able to quantify the benefits associated with the following impacts avoided: • Impacts on ecosystems. • Change in biodiversity. • Potential effects of chronic exposure to ozone. • Impacts on cultural heritage and monuments. • Material soiling. • Direct and indirect economic effects of change in forest productivity, and fishery performance.

Nevertheless, we would suggest that those impacts that we can quantify are likely to represent a significant - and majority - share of the total impacts in welfare (monetary) terms.

3.2.24.2.2 Methodology – The Impact Pathway Approach

Within the current project, the “impact pathway approach”, developed within the ExternE project series ‘External Costs of Energy,’ has been used to quantify the benefits from emission reductions (European Commission 1995, European Commission 1999, European Commission 2000b).

Impact pathway assessment is a bottom-up-approach in which environmental benefits and costs are estimated by following - as far as possible - the ‘impact pathway’ from source emissions through air quality changes to physical impacts, before being expressed in monetary benefits and costs. The ECOSENSE model, an integrated software tool for environmental impact pathway assessment developed within the ExternE projects, has been used to make the benefit estimations. ECOSENSE uses harmonised air quality and impact assessment models together with a database containing the relevant input data for the whole of Europe.

Within ExternE, the ECOSENSE model was originally used to estimate external costs from individual power plants. The ‘multi-source’ version that was used in the current project is a modified version, which supports the usage of more complex emission scenarios. In Annex 1 of Part 1 (general part), the models and data used for the benefit estimations in the current project are described in more detail.

3 Benefits include the benefit to the individual of not incurring the illness, and also benefits of reduce hospitalisation days and reduced activity days.

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3.2.34.2.3 Emission Reduction Scenarios

The calculation of the emissions reductions as a consequence of the full implementation of the air- pollution related acquis are outlined for the principal pollutants.

RATIONALE

In this study we have established a baseline for emissions for gaseous pollutants derived from the baseline scenarios identified in the development of the Gothenburg Protocol (UN ECE 1999), reported by EMEP4 (Mylona 19995). The policy scenario is derived from analysis undertaken by IIASA in the current modelling being undertaken in the revision of the National Emissions Ceilings in the EU25. The emission scenarios for the SEE countries we are concerned with – Bosnia & Herzegovina, Bosnia & Herzegovina, Kosovo under UNSCR 1244, fYR of Macedonia, Montenegro and Serbia – are therefore judged to be compatible with those for countries within the EU25 with socio-economic commonalities. The resulting pollution reductions are therefore best viewed as a reasonable approximation to the scale of reductions that would be brought about by adoption of the EU environmental acquis. It is important to note that the scale of reductions is comparable to those assumed in previous equivalent analyses for DG Environment6.

METHOD

The case and reference scenario are outlined below.

CASE SCENARIOS:

Main: Emission ceilings are adopted in the policy scenario as emissions at a country level. Data derived by IIASA are directly reported by the individual country. The emission reductions for Bosnia & Herzegovina are presented in Table 4-4.

Reference scenario: Emission projections that do not include compliance with the emission ceilings are derived from earlier projections reported by EMEP (Mylona 1999). These emission projections are used as non-compliance estimates for the reference scenarios.

Table 4-4: 2020 Emissions in Bosnia & Herzegovina used for the current study.

Emissions for the Policy Scenario Compliance with Emissions for the Baseline Scenario without Emission Emission Ceilings Ceilings

NH3 NMVOC NO2 SO2 PM NH3 NMVOC NO2 SO2 PM [kt] [kt] [kt] [kt] [kt] [kt] [kt] [kt] [kt] [kt] 14 32 38 288 26 17 51 58 380 50

4 EMEP is the Co-operative Programme for Monitoring and Evaluation of the Long-range Transmission of Air pollutants in Europe 5 EMEP/MSC-W Note 1/99, July 1999. "EMEP EMISSION DATA. Status Report 1999". By Sophia Mylona 6 Implementation and Enforcement Capacities in Croatia - Benefits for Croatia of compliance with the environmental acquis – Final Report. European Commission, DG Environment (2005); The Benefits of Compliance with the Environmental Acquis for the Candidate Countries. European Commission, DG Environment (2001)

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3.2.44.2.4 Extent of Benefits The mortality impacts of the pollution emission reductions assumed above for Bosnia & Herzegovina are shown in Table 4-5 below for 2020 – the year in which it is assumed compliance with EU Directives is achieved. The benefits of these reductions in EU25 countries and others – due to reduction of transboundary transport of pollution from Bosnia & Herzegovina - are also given. Details of the Ecosense model from where these results are taken are given in Annex 1 of this report. Note that exposure – response functions are taken from the peer-reviewed literature, surveyed in 2007.

Morbidity impacts are of a disparate nature and so cannot be expressed as a common unit. However, for illustration, the morbidity impacts are presented - in Table 4-6 - as equivalent number of cases of chronic bronchitis avoided.

Units for materials and crop damages are not as readily meaningful and we cannot present these here. However, in the case of materials, the impact being quantified is the premature ageing of various building materials exposed to SO2 deposition from acidification. Thus, in our context, the whole exposed material surface area to SO2 will age at a slower rate than if the Directives were not to be implemented.

Crop damage is measured primarily by the change in yield that results from the change in pollutant concentrations in the air. Thus, with knowledge of the geographical distribution of crop plantations within a country, the acreage of a given crop affected by a change in pollutant concentration can be estimated and the percentage yield change can be derived.

Table 4-5: Physical premature mortality impacts avoided in year 2020

Total NH3 NOX SO2 PM Metric YOLL Deaths YOLL Deaths YOLL Deaths YOLL Deaths YOLL Deaths Bosnia & 924 103 78 9 94 10 402 45 350 39 Herzegovina Outside Bosnia & 7.812 868 106 12 1.003 111 5.340 593 1.363 151 Herzegovina Total 8.736 971 184 21 1.097 121 5.742 638 1.713 190

Table 4-5 shows the number of premature deaths avoided from emission reductions in Bosnia & Herzegovina. The results show that a total of 971 premature deaths per annum are avoided when the emission reductions are implemented. The numbers are for the premature deaths that would be avoided in 2020 - the first year in which full implementation of the EU Directives is assumed in Bosnia & Herzegovina. Note that the reduction in deaths caused by the reduction of emissions is separated into those occurring within Bosnia & Herzegovina and those occurring outside Bosnia & Herzegovina as a result of trans-boundary effects. It is interesting to note that the trans-boundary impacts comprise roughly seven-eighths of the total impacts for Bosnia & Herzegovina’s emissions.

The morbidity benefits for the emission reduction are expressed in terms of the equivalent number of cases of chronic bronchitis avoided in the country in 2020 - the first year of full compliance with the EU Directives assumed. The equivalence between cases of chronic bronchitis and other health conditions is reached simply by dividing the total monetary value of morbidity benefits by the value of one case of chronic bronchitis avoided to give the number of cases of chronic bronchitis-equivalents. The total number of cases per year are approximately 1.300.

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Table 4-6: Physical Morbidity Impacts in year 2020

Morbidity impact (equivalent number of chronic Cases bronchitis cases avoided each year Bosnia & Herzegovina 164 Outside Bosnia & Herzegovina 1107 Total 1271

3.34.3 MONETARY VALUATION

3.3.14.3.1 Benefits upon full compliance

The monetary estimates of the benefits resulting from the air pollution emission reductions assumed above in Bosnia & Herzegovina are presented in summary form in Table 4-7. All values presented are in million Euros (2005 prices), and relate to the year 2020 - the first year of assumed full implementation. A description and analysis of these results is given in this section. The values here look at the benefits to Bosnia & Herzegovina. Additional benefits accrue to the EU, and to third countries, as a result of reducing emissions in Bosnia & Herzegovina, and the relationship between domestic action and foreign benefit is presented in Section 0.

Box 1 : Premature Mortality: Values of Prevented Mortality: Range of Values

Modelling of air quality benefits in monetary terms has historically been challenged by the use of appropriate metrics in monetising premature death impacts. Whilst there is a case for the numbers of deaths to be used on the basis that the Value of a Statistical Life (VSL) has – until recently - been the only metric for which there is empirical evidence, recent studies have tended to use the Value of Life Year (VOLY) measure as more empirical evidence has become available. The reason for the choice of using VOLYs is that for these deaths brought forward (with higher air pollution) or postponed (with lower air pollution) it is misleading to use the full Value of a Statistical Life for monetary valuation, because it attributes the full VSL to what is understood to be only a small portion of a full life expectancy. Put differently, there are many reasons why life is shortened. Air pollution in the days immediately preceding death is but one of them. It is widely understood though not fully established that higher air pollution in the days before death is a contributory factor to earlier death only in people who already have serious cardio-respiratory disease; and it seems reasonable and even necessary to attribute the deaths in greater part to that underlying disease and, perhaps, to the risk factors (smoking, occupation, diet, poverty…) that caused it.

To reflect these issues, recently (e.g. in the CAFE Programme) DG Environment has tended to use both the VSL and VOLY metrics. VOLYs have been calculated through ‘conversion’ of attributable deaths from time series studies to equivalent changes in life years. However, research as part of the NEEDS project has derived directly elicited VOLYs across a range of eight European countries. As a consequence the air quality modelling has made use of these new values. Consistent with the DG Environment approach in the CAFE analysis we use both VSL and VOLY metrics; we use values of €1 million and €40,000 for these, respectively.

The mortality avoided impacts comprise the only impact category that can be easily aggregated from the results. It should also be stressed that mortality avoided impacts typically comprise the majority of the total benefits in valuations undertaken by following the described methodology, and so are by far the most significant.

See the annex of part 1 (general part) for further discussion of the results of the NEEDS VOLY-related research, as well as the valuation of benefits of avoided illness.

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To be consistent with previous analyses of benefits of compliance with the environmental acquis in the following paragraphs we highlight results using the VSL metric for monetising reduced risks of premature death from air pollution. Equivalent results using the VOLY metric can be identified from Table 4-7.

Table 4-7 shows that the total benefits to Bosnia & Herzegovina is equal to 128 million Euro each year following full implementation of the EU Directives in Bosnia & Herzegovina. When considering the period up to 2030, with full implementation by 2020 and including the benefits accruing in the period 2010-202 preceding full implementation, the total benefits for Bosnia & Herzegovina amount to 1.100 million Euros.

Table 4-7: Benefits of Full Compliance (Million €)

Annual Benefits once Total Benefits 2010- Total Benefits 2020- Total benefits over full imp. achieved 2020 before full imp. 2030 after full imp. period until 2030 VSL=€1M VOLY VSL=€1M VOLY VSL=€1M VOLY VSL=€1M VOLY =€0,04m =€0,04m =€0,04m =€0,04m Bosnia & 128 72 468 263 632 356 1.100 619 Herzegovina Outside Bosnia & 1.122 578 4.111 2.113 5.543 2.855 9.654 4.968 Herzegovina Total 1.150 650 4.579 2.376 6.175 3.211 10.754 5.587 * Assuming full implementation in 2020 and linear implementation 2010-2020. The analysis used a 4% discount rate.

3.3.24.3.2 Trans-boundary benefits

Table 4-7 above presented the benefits that accrue to Bosnia & Herzegovina as a result of its own emission reductions and the benefits outside Bosnia & Herzegovina, which compares with the total benefits that accrue to Bosnia & Herzegovina. One key point of this analysis is that there are very significant trans-boundary benefits from reduction in air emissions to levels resulting from EU Directive implementation. Total foreign benefits from domestic action (i.e. excluding domestic benefits from domestic action) amount to 1.122 million annually once implementation is completed.

KEY POLLUTANTS AND KEY BENEFITS

The benefits discussed above are most attributable to the reduced number of premature deaths caused as a result of air pollution. Mortality reduced benefits account for 64% of the total benefits. Morbidity reduced benefits account for 32% whilst reduced damage to materials and to crops account for 4% and 0,0001% respectively.

In terms of pollutants, the gaseous pollutants (SO2, NOx, NH3 and NMVOC) and PM10 can be attributed 73% and 27% respectively.

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3.44.4 CONCLUSIONS

• The gaseous pollutants comprise almost 73% of the benefits whilst PM10 accounts for almost 27% of the total benefits. • Avoided early mortality is the largest source of benefit; the value attributed to avoiding early mortality amount to over 64% of the total benefits valued.

CO2 and CH4, are not valued since the impact-pathways are not yet defined for all end-points.

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45 BENEFITS ASSESSMENT OF WATER RELATED DIRECTIVES

4.15.1 CURRENT STATUS OF DIFFERENT WATER USES AND THREATS

4.1.15.1.1 Drinking water

In the Federation the population is supplied with drinking water from 78 central (public) water supply systems, 742 local water-supply systems, about 10,000 cisterns, and between 18,000 and 22,000 other individual local water-supply facilities (e.g. wells, water springs, open springs). About 50% of the population is supplied with drinking water from central water-supply systems. During the war about 45% of water-supply systems were destroyed. Massive population movements during and after the war made it even more difficult to deliver basic water services. Leakage wastes up to an estimated 70% of the total running water. This leads to a high risk of secondary water contamination by diffuse and indirect pollution. All water-supply systems have considerable losses (25-60%), which appears to be a result of war damage.

In Republika Srpska 48% of the population is supplied with drinking water from public municipal water pipeline systems, while 35.6% are supplied from local water pipeline systems and the rest are supplied from other water plants, deep and shallow drilled wells, dug wells, springs and tanks. The sanitary conditions of 28 out of the 57 municipal pipeline systems are unsatisfactory. Aeration is performed only in two pipeline systems, sedimentation in five systems, coagulation in two, filtration in ten, chlorination in four and disinfection in 37. Purification and disinfection of local pipeline systems are performed only occasionally and are in any case of low quality and without any control.

Gross specific consumption in urban areas ranges from 200 to 600 liters/capita/day, of which 100 to 200 liters are supplied to households.

The extracted water is of varying quality, some is drinkable without any kind of treatment but in other cases the quality is totally unacceptable, especially during the dry season. Water treatment is in many cases insufficient, often just chlorination even when the water needs full treatment. Old and leaking pipelines and insufficient pressure could also pollute water before it reaches the consumers.

In some parts of the country, water shortage is a major problem, especially during the dry season. The situation is the most serious in some rural areas, but water shortages also occur in urban areas. Around Tuzla for instance, people have access to water only a few hours a day during the dry season.

In the future water shortages due increased demands, should also be expected in Sarajevo and Banja Luka unless the capacity of the water-supply system is enlarged. In both cities, however, concrete plans have been drawn up to meet the future demand for drinking water.

The shortage of water in some areas is not only due to seasonal factors, but also to insufficient capacity in the water-supply systems. Leaks from pipelines are also adding to this problem. A special problem is caused by migration within the country as a result of the war or by the general movement of people from rural to urban areas. This has led to substantial pressure on the water-supply system in many areas. During the war nearly 2.7 million inhabitants (about 60% of the population) were displaced, 1,170,000 of them internally and 1.250.000 became refugees. This accelerated the already pronounced movement of people from rural to urban areas.

The water resources are exposed to pollution, the quality of drinking water is deteriorating steadily and the flood control infrastructure throughout the country is damaged and deteriorated. The tourism strategy and current practice do not influence drinking water resources.

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Bosnia and Herzegovina is endowed with abundant water resources though they are unevenly distributed and most precipitation comes when it is least needed. However, there should be no doubt that water resources provide an important economic potential for the future. The quality of water resources is endangered by pollution from various sources, e.g. organic pollution and hazardous substances from municipal and industrial waste water, uncontrolled landfills and tips, industry and mining, pesticides and fertilizers, deforestation and soil erosion. The quality of surface water is considerably influenced by all this pollution, while the quality of groundwater with some exceptions is still quite good. There is, however, an urgent need to take action to prevent the large-scale contamination of groundwater.

To enable prosperous exploitation of the water resources, a number of shortcomings in the water sector have to be overcome. They include a weak and non-transparent administration, an incomplete or confusing legal framework and an unclear division of responsibilities between different authorities.

A significant share of the infectious diseases is transmitted by water and food. In 1998-2000 there was a decreasing trend in epidemics of communicable diseases transmitted by water and food in Republika Srpska. In 1998 there were 28 such epidemics, of which 23 were of diseases transmitted by water and food (trichinellosis, salmonellosis, food poisoning, intestinal bacterial infections, enterocolitis, shigellosis, hepatitis A). The micro-organisms that caused most of the epidemics were confirmed through laboratory tests. In 1999 there were 25 epidemics, of which 18 were caused by infected water and food, and in 2000 there were only 9 epidemics of communicable diseases transmitted by water and food. After peaking in 1986 at 199.9 per 100,000, the reported incidence of hepatitis A plunged to 11.24 in 1999.

An integrated environmental health information system is needed to establish links between environmental conditions, population exposures and human health. A comprehensive monitoring system is needed to collect the relevant indicators regularly and consistently. The collected data have to be of sufficient quality and quantity to link them to health effects and to establish causal relationship. Bosnia and Herzegovina faces many environmental and environmental health problems. The main obstacles to progress are the destruction of the prior information system, the inadequate equipment of laboratories performing environmental analyses, the lack of qualified staff and the lack of accurate indicators. In 2000-2002, the European Union’s Phare Programme conducted a project to provide technical assistance in public and environmental health. One of its objectives was to improve the health status of Bosnia and Herzegovina’s population by supporting efficient and sustainable public and environmental health functions, and by making the network of public health institutes stronger. Throughout the project, the equipment needs (laboratory and information) of the public health institutes were assessed, and training and technical support were developed. This will improve the scope and quality of their environmental health work.

Discharges of untreated municipal waste water have a major impact on the quality of surface water in most of Bosnia and Herzegovina, and they are also potential threats to the quality of groundwater, which is the main source of drinking water. However, the most serious impact is on public health and the environment. Waste water from industrial plants containing organic and hazardous substances are, with very few exceptions, discharged into the nearest watercourse with little or no treatment. This is also true for seepage water containing hazardous substances from mining and ore-processing. The negative impact on water quality is considerable, and there is no doubt that these discharges could represent a threat to public health and the environment. Moreover, this situation must be expected to get much worse when industry recovers from the devastating effects of the war, unless proper action is taken.

4.1.25.1.2 Recreational uses of water

Regions of the country Bosnia-Herzegovina important for water recreation are the rivers Sava, Una, Unac, Sana, Vrbas, Vrbanja, Ukrina, Bosna, Krivaja, Spreča, Usora, Tolisa, Tinja, Drina, Ćehotina, Lim, Prača, Drinjača, Janja, Neretva and Trebišnjica, as well as lakes and the sea coast.

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Important lakes in Bosnia and Herzegovina are Buško, Blidinje, Boračko, Jablaničko, Modrac, Plivsko (Veliko), Perućačko, Ramsko and Zvorničko. All lakes are used for recreation.

Typical ecotourism activities have a low environmental impact and may include rural tourism, spas, trekking, bicycling, rafting and kayaking.

The river Sava with its tributaries the Una, Vrbas, Ukrina, Bosna, Tinja and Drina as well as the river Neretva, which empties into the Adriatic Sea, are important for freshwater fishery. These could be further developed. Construction of hydropower plants on the rivers Neretva, Drina, Vrbas, Rama and Sana created many artificial lakes where fisheries could also be developed. Besides, the natural lakes offer favorable conditions for smaller fish farms (some already in place).

A classification system as to delimit sensitive areas with regard to waste water treatment requirements does not exist in Bosnia and Herzegovina.

Industry was predominant before the war and the main polluter of watercourses. Combined with weak implementation of environmental measures and the use of obsolete, polluting technologies, industry’s impact on water quality was devastating. In 1991 the industrial waste-water load was equivalent to a population of 6.8 million people. By comparison the municipal waste-water load was equivalent to a population of 2.7 million. The huge discharges of waste water polluted almost all rivers, especially the rivers Bosna and Vrbas.

The tax on water supply and waste-water discharges is far too low to cover the full costs, and the sector is either subsidized by the entities (Federation of Bosna and Herzegovina, Republika Srpska and District of Brcko), cantons or municipalities, or it suffers from insufficient maintenance that will jeopardize the water-supply and waste-water treatment systems in the long run. Due to the economic crisis and the poor service, there is, however, stiff resistance against increasing the tariffs. Illegal connections and inadequate systems for collecting the tariffs are also identified.

4.1.2.15.1.2.1 Coastal water recreation

The total length of the coastline of Bosnia and Herzegovina is 21 km (Adriatic Sea). There are no data on the number of tourists visiting the coastal area.

No data are available on whether tourism has an impact on drinking water resources in the coastal area.

Bosnia and Herzegovina became a Party to the Convention for the Protection of the Marine Environment and the Coastal Region of the Mediterranean (Barcelona Convention) by succession in 1998 (Official Gazette SFRJ IA 12/77; Official Gazette BiH 26/98) and to its four protocols, but has not accepted the 1995 Amendments.

4.1.2.25.1.2.2 Inland water recreation

From 1965 to the outbreak of the war, data for both water quality and quantity were collected from 58 monitoring stations all over the country. During the war, all monitoring stations were destroyed, and there were no data available for the period 1992-97. Since the end of the war the monitoring network has been gradually re-established, partly with financial contributions from donors. Still, the number of monitoring stations seems to be far too low, and few automatically measure both water levels and water- quality parameters. At the other monitoring sites, water quality is measured only occasionally, when funding is available.

To meet the need for reliable data and information on water quality, the information needs for decision- making and water management should be analyzed thoroughly before a decision is made to increase

21 ARCADIS ECOLAS / IEEP / Metroeconomica / Enviro L Benefits of compliance with water related directives 06/11347 - BiH- Benefits of Compliance with environmental acquis - final report significantly the number of monitoring stations, the number of analyzed parameters and the frequency of sampling. In any case, the laboratories will have to be upgraded because most of them lack proper equipment for analyzing water quality.

4.1.35.1.3 River ecosystems

The surface water in Bosnia and Herzegovina is, in general, of poor quality and bacteriological unsafe due to extensive pollution from numerous sources. The main threats to the quality of water are the discharge of municipal or industrial waste water directly into the nearest rivers or springs, the direct disposal of waste in rivers or along riverbanks and run-off from agricultural areas where pesticides and fertilizers are used. The quality of groundwater is in general considered to be good; the monitoring data show few examples of groundwater contamination. The lack of reliable data about the quality of surface and groundwater resources is, however, striking, and groundwater contamination might be more widespread.

The intensive use of forest resources combined with outdated technology is causing much organic pollution of many rivers, making then susceptible to eutrophication. In addition agricultural areas (fertilizers) and urban areas (e.g. phosphates in waste water) are susceptible to eutrophication.

A total land area of 250,000 ha is threatened by flooding. This is 4% of the total territory or about 60% of the lowlands. Urban areas that are particularly vulnerable are Tuzla, Banja Luka, Celinac, Prnjavor, Derventa, Modrica, Janja, Zvornik and settlements along the river Sava.

Before the war, substantial investments were made to protect agricultural land and urban areas from flooding, mainly along the rivers Sava and Neretva and their tributaries. In 1992 there were about 420 km of dikes, 220 km of boundary channels, 80 km of flood regulation channels and 30 pumping stations with a capacity of 120 m³/s, and about 80,000 ha of land was protected. Since the outbreak of the war investment in new flood protection facilities has stopped, and the resources for maintaining existing facilities have been negligible. Some of the installations were also used for military purposes and damaged so badly during the war that they no longer function properly. In addition mines have been laid around some flood protection installations. The existing flood protection installations will be restored.

Floods cause enormous damage to crops, private property and infrastructure, lead to the erosion of arable land and increase the likelihood of landslides, in particular along the Sava, but also in other parts of Bosnia and Herzegovina. For instance, the flooding in the Tuzla region in June 2001 was estimated to have caused damage worth approximately € 30 million. In other regions, where there are no flood protection systems at all, the consequences of exceptional high water might be even worse.

Uncontrolled dumping of waste directly into or close to watercourses is a widespread problem and a major threat to water quality, especially in the Bosna, Drina and Una river basins. Hazardous waste from mining and industry is usually dumped at landfills close to the plants or at nearby municipal landfills of poor standards, often directly on the ground without any kind of underground sealing or collection and treatment of water. Coal power plants, the wood and paper industry, the chemical industry and mineral oil processing, the textile and leather processing industry and the metal finishing industry are, in addition to the mining sector, the largest producers of hazardous waste in Bosnia and Herzegovina. The result is that significant environmental problems have been identified in several locations, for instance in Samac, Sava river alluvium (where the spring sources for the drinking-water supply are located), Bijeljina, Modrica, Gorazde and Visegrad. Fly-tipping of household waste is very visible along the rivers, with plastic and other waste floating on the surface of the water or hanging in bushes and trees along the riverbanks. This is, however, mainly an esthetic problem. A more serious effect on the environment is probably that the waste is a significant source of river pollution with hazardous chemicals. Household waste is also adding to the overall pollution with organic matter, but its contribution is assumed to be rather small compared to other sources.

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The intensive use of forest resources combined with outdated technology is, however, causing much organic pollution of many rivers. Another serious consequence of deforestation is increased soil erosion. Deforested and eroded areas were further damaged because they lost their ability to retain precipitation, which caused sudden run-off and increased the risk of flooding. This risk will also increase as a result of deposits in reservoirs and riverbeds in plain areas, which reduce their capacity to receive and transport water. Increased soil erosion will also have a negative influence on the quality of water by increasing its turbidity.

To increase cooperation on transboundary waters Bosnia and Herzegovina has ratified the Framework Agreement on the Sava River Basin, which it signed on 3 December 2002 along with Croatia, Serbia and Montenegro, and Slovenia. The Agreement, which covers all surface water and groundwater of the Sava catchment, aims at establishing an international regime of navigation and sustainable water management.

4.25.2 ASSESSMENT USING QUALITATIVE AND QUANTITATIVE DATA

Many of the directives interrelate and combine in their effect on the environment and many insights on the quantitative benefits are more suitable at the state of environment level (e.g. quality of rivers or bathing waters), rather than at the level of the individual directives. Consequently, the following assessment is structured according to the different end-uses of water rather than by the individual directives.

4.2.15.2.1 Introduction to the Method of Assessment

Health benefits are twofold. They can accrue from improved quality of drinking water as well as from improved quality of bathing water.

Based on the discussion in the qualitative assessment section and the previous benefits study7, the following directives are assumed to have a positive impact on the drinking water quality: Drinking Water, Urban Waste Water Treatment, Surface Waters for Drinking, Dangerous Substances, Groundwater, and Nitrates.

The following directives are assumed to have a positive impact on the water resources used for recreation and hence also on health (mainly through bathing): Bathing Water, Urban Waste Water Treatment and Dangerous Substances.

The quantification of the benefits can be carried out any of three ways:

A. Dose response function between pollutant concentrations and health impact. This can be done in one of two ways: (i) using local pollutant concentrations and health impact statistics, which is the ideal bottom up approach, responsive to local situations, but very data intensive; or (ii) using existing dose response functions, but linking these to local pollutant concentrations to obtain insights into the number of cases of illness and mortality. This is less onerous, marginally less responsive to the local reality, but does rely on the existence of good pollutant concentration data);

B. An avoided illness approach using health incidences without using a dose response function. This assumes that the implementation of the directive will lead to the eradication of health impacts. This approach requires data on illness and mortality incidence related to water pollution and

7 Ecotec, “The benefits of compliance with the environmental acquis for the candidate Countries”, sub-study assignment for EC DG Environment, July 2001

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subsequently some means of identifying what share of the improvements can be attributed to the directive;

C. A willingness to pay (WTP) approach, where the number of parties affected or potentially affected by the contaminants is identified. For the subsequent step of monetisation, these affected or potentially affected parties express a value that they would be willing to pay to avoid the pollution (sometimes studies also give willingness to accept compensation values). The first step is an identification of which parties are affected, which requires knowledge of connection rates (for those that gain new connection), and household numbers that would gain from quality improvements. For the second step, that of valuation, this can be done by a local survey, which would be more accurate, but extremely data and time intense, or by a benefits transfer approach, where the willingness to pay of the same type of situation is thought to be transferable to Bosnia and Herzegovina under appropriate assumptions. No willingness to pay studies for new connections (e.g. to drinking water network) or for water quality improvement (drinking water, bathing-recreational water, non-use benefits use of water) are available for Bosnia and Herzegovina.

Because one of the project requirements is consistency with the methodology used in the previous benefits study, the willingness to pay method (benefits transfer approach) has been selected.

4.2.25.2.2 Benefits from improved drinking water quality and supply

The complete assessment of the benefits of drinking water involves the use of a willingness to pay (WTP) estimate for ‘clean’ drinking water. This methodology requires an estimate of the total number of households that stand to benefit from the implementation of directives affecting drinking water and subsequently attributing a value to these benefits.

Benefits of improved drinking water will accrue (i) to households that have a new connection to water supply, and (ii) to households that already have water supply, but are guaranteed better quality water. In practice, the benefits will relate to both new accesses to supply and to availability of improved drinking water. Where the existing WTP exercises look at quality improvements only, it may thus be unnecessary to distinguish between the population having access to public water supply and those that will gain new access. Indeed, the WTP transfer value we have used is based on quality improvements rather than new connections.

While it is clear that regarding all currently and newly connected households as beneficiaries could slightly overestimate the benefits as some households with existing connection have good quality water, the choice of only focusing the analysis on those households that would gain connection would likely lead to a much more significant underestimate. Furthermore, the linkage of cleaner water to the acquis Communautaire is more explicit than the linkage to increases in connection rates8. Despite this, the overestimation of benefits from quality improvements may be compensated by the negligence of a possibly EU-induced increase in the connection rate.

8 Currently there is no explicit legislative requirement for the extension of the drinking water network. However, it is clearly likely with economic development, the general implementation of the environmental acquis, and the existing policies of extending water supply to more households, that more households will become connected to drinking water supply in the near future. Indeed, a major indirect driver for this is likely to be the Urban Waste Water Directive, as agglomerations with more than 2000 inhabitants will have to have a waste water treatment plant and associated sewage system. It is common practice when digging up the road to ensure that both waste water / sewage networks and drinking water networks are implemented together given cost savings and obvious interconnections. Hence with the progress of the UWWT Directive one could expect progress with the drinking water network.

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Connection percentage to public drinking water supply About half of the population has access to public water-supply systems, mainly in urban areas. The rest uses private wells, small village water-supply systems or local systems which are not under national control. Water supply is mainly based on the use of groundwater (89%), 10.2% comes from rivers and 0.8% from natural lakes and artificial reservoirs.

Estimate of the number (or percentage) of gains of new connections

The maintenance of the water pipelines has been neglected for years, and they are now in poor condition. Some are 50-60 years old, and when serious leaks occur the pipes are often so fragile as to be beyond repair. On average about 40% is estimated to leak from the pipelines, but in some bigger cities it is much higher (Sarajevo 50%, Tuzla 60-65%). It is difficult to estimate the number of new connections at this stage.

In the previous benefits study, some country experts reported on the estimate for the number of new connections. The majority of experts who could make such an estimate gave an estimate of 5% of the total population. In the previous study, this percentage was applied to all accession countries in which more country-specific estimates had not been available. Adding the 5% estimate of new connections to the current connection rate of 50% yields a total share of 55% (or 586,916 households9) which can be assumed to benefit from quality improvements of drinking water.

Drinking water quality

Water pollution caused by human activity reduces the amount of safe drinking water that is available and exposes the population to microbiological and chemical contamination. Unsafe drinking water can be a significant carrier of water-borne infectious diseases such as enterocolitis or hepatitis A, and can cause severe diarrhoeal infections and other health problems. Drinking water can also be tainted with chemical, physical and radiological contaminants with harmful effects on human health.

Continuing and regular laboratory testing of water is ensured for only 55% of the population in the Federation. Only 32% of the urban population is supplied with safe, treated drinking water. Some 42% of laboratory-tested water samples are unsafe, i.e. not according the standards. Microbiological analyses show that 32.5% of all water samples are unsafe. It is likely that significantly less than 32% of the rural population is supplied with safe drinking water. In the country as a whole the number of epidemics of water-borne diarrhoea and hepatitis A is growing. Data on chemical and microbiological quality of drinking water samples, tested in the period 1998-2000, are given in Table 5-1.

9 Assuming that the population is evenly spread over the total number of households

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Table 5-1: Laboratory-tested drinking water samples

In Table 5-2 Republika Srpska standards for drinking water quality are compared to WHO water quality guidelines (2003).

Table 5-2: Republika Srpska standards for drinking water quality compared to WHO water quality guidelines (2003)

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4.2.35.2.3 Benefits to recreational users of water

The following Directives are likely to generate benefits to recreational users of water: Bathing Water, Urban Waste Water, Fishlife, Dangerous Substances and Nitrates. The quantification process requires a calculation similar to that for health benefits in which expert judgement is substituted for dose-response coefficients. The following data are required for this quantification process: • The change in the water quantity and quality due to the implementation of a directive or relevant directives; • How this change will affect the current water-based recreational behaviour (including swimming, angling etc); • The affected population (usually referring to mean current population undertaking the relevant recreational activity and the change in this population with the improvement in water quantity and quality after the implementation of the relevant directives).

There could be a number of reasons why a Directive will have an effect on the quality (and quantity) of water used for recreation. However, there is very limited information about what the implementation of a Directive will entail and hence its resulting improvements to recreational waters in quantitative terms. Although by all means not the only directive of relevance, there is some work about the Urban Waste Water Directive in this context. This Directive will have a positive effect on the quality of inland waters and, in some cases, groundwater. An assessment of the effect on the quality of these various water resources is not available. However, some estimates of the effects on wastewater discharges are available from the estimated reductions of phosphorous (P-tot) and nitrogen (N-tot) discharges as a result of the full implementation of the urban wastewater directive.

Affected population

It is very difficult to describe the present touristic situation given the poor quality of the statistics. The Ministry of Trade and Tourism in Republika Srpska and the Tourism Department of the Ministry of Trade in the B&H Federation report that no reliable information is available on the number of tourists in the country due to scarce enforcement of reporting regulations. No precise information is available on the number of hotels and their categorization either. There is no estimate of the percentage of the national GDP that is accounted for by the tourism industry. The lack of reliable statistical data on the tourist sector, the recent war, the limited road and rail network for fast transit, all constitute important obstacles to the further development of the tourist industry.

Coastal water quality

No beach water standards exist in Bosnia and Herzegovina. No data are available on the beach water quality.

Inland bathing water quality

No bathing quality standards are reported in official environmental reports. No monitoring data of bathing waters are available, neither are bathing waters designated.

Wastewater treatment infrastructure

Current situation

Most of the industrial waste water was, like municipal waste water, discharged to the nearest watercourse with little or no treatment. For instance, there were 122 plants for the treatment of industrial

27 ARCADIS ECOLAS / IEEP / Metroeconomica / Enviro L Benefits of compliance with water related directives 06/11347 - BiH- Benefits of Compliance with environmental acquis - final report waste water before the war, but only 40% of them worked properly. As many industrial plants have shut down and many others have reduced their capacity, the discharge of pollutants to air and water from industry has been substantially reduced and is today approximately 30-35% of its pre-war level. The big reduction in discharges of industrial waste water has led to a significant improvement in water quality. However, the industrial waste-water load is disproportionately high because there are few treatment facilities for industrial waste water in operation, and the negative pressure on water resources is still very high. When industry recovers from the setback caused by the war, river pollution will rapidly get worse unless waste-water treatment facilities are put in place.

Due to the lack of resources the sewerage systems are on the whole poorly maintained. In many cases they have not even been completed, often only partially designed and constructed. In some locations the capacity is insufficient for receiving storm waters, and the systems overflow during the rainy season, affecting (having consequences for) around 65% of the municipal centres of Bosnia-Herzegovina.

At the outbreak of the civil war 1992-95, only seven municipal waste-water treatment plants were built and in operation. The treatment plants were located in Sarajevo, Trebinje, Trnovo, Ljubuski, Grude, Celinac and Gradacac. These plants treated waste water from about 484,000 inhabitants of a total population of about 4.4 million. The treatment plant in Sarajevo was considerably bigger than all the others and received waste water from about 454,000 inhabitants (94% of people with access to waste - water treatment plant before the war) compared to 30,000 inhabitants for all the other plants combined. During the war, five of the seven plants were closed due to war damage, stripping of equipment and installations, lack of maintenance or shortage of electricity. After the war all the plants were put into operation again, except the plants in Sarajevo and Trnovo, and a new treatment plant has been built in Srebrenik. The plants in operation today are, however, all very small and more than 95% of the municipal waste water is discharged directly into water bodies without any kind of treatment.

Today about 30% of the population has access to sewerage systems. In urban areas the connection rate for households is 56%, but in villages and rural areas a maximum of 10% of the households are connected.

Strategic planning documents are in the process of preparation.

Expected evolution under the Urban Waste Water Treatment Directive

No data are available on nitrate and phosphate discharges in Bosnia and Herzegovina.

Due to limitations in data availability, it has not been possible to estimate the residual amount of N-tot discharged and the residual amount of P-tot discharged.

We can safely assume that nutrient removal will be required for all sewage treatment plants above 10000 PE under the Urban Waste Water Treatment Directive.

Situation after the implementation of the Urban Waste Water Treatment Directive

Due to limitations in data availability, it has not been possible to estimate the reduction of N-tot and P-tot discharges due to the Urban Waste Water Directive

While the reductions in N and P are important for the assessment of the extent of benefits, it has not been possible to link the information about the reduction in the N and P discharges to potential benefits to recreational uses of water. This is not only because such a link is missing but also because there are other factors unrelated to N and P concentrations in water that affect the quality of a water-related recreational experience.

Thus, the assessment of recreational benefits that will be presented in section 5.3.3 follows a similar approach to the assessment of health benefits. This requires identification of the affected population and

28 ARCADIS ECOLAS / IEEP / Metroeconomica / Enviro L Benefits of compliance with water related directives 06/11347 - BiH- Benefits of Compliance with environmental acquis - final report an estimate of the demand they have for better water quality for recreational purposes. This demand is based on the relevant WTP estimates found in the literature. Since such demand can be met by implementing a number of Directives and combinations of Directives, it would be wrong to assign these values to the predicted reductions in P and N concentrations alone.

Strictly, the best estimate for the affected population would be those undertaking water-related recreational activities. Fishermen fishing without a license might occur on the small rivers or lakes where there are not many people. There is no data on which specific rivers are already regularly used for recreation. Other data on the specifically affected population could not be collected. As such the total population, including domestic tourists, where appropriate, can be assumed to be the measure for ‘affected population’. Using this definition, willingness to pay studies that only address specific users should not be regarded as representative. Thus, the willingness to pay figures have been taken from studies that use a broader definition of the affected population.

An increase in recreation is expected when the river water quality will improve.

4.2.45.2.4 Benefits to river ecosystems

Table 5-3 shows some characteristics of rivers in Bosnia and Herzegovina.

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Table 5-3: Characteristics of rivers in Bosnia and Herzegovina (Bosnia and Herzegovina Statistical Office)

Relative difference in Height above sea level, in m height above Length of river, in km sea level

Sava 94 87 7 945 331

Una 520 94 426 212 212

Unac 600 300 300 58 58

Sana 940 139 801 140.4 140.4

Vrbas 1780 93 1687 192 192

Vrbanja 1520 164 1356 70.5 70.5

Ukrina 120 96 24 53.3 53.3

Bosna 560 89 471 271 271

Krivaja 560 200 360 65.5 65.5

Spreča 300 143 157 112.3 112.3

Usora 880 145 735 77 77

Tolisa 440 81 359 56.2 56.2

Tinja 500 80 420 69 69

Drina 433 87 346 346 346

Ćehotina 1250 340 910 91 33

Lim 901 299 602 197 40.5

Prača 1460 329 1131 56.9 56.9

Drinjača 730 141 589 78.5 78.5

Janja 600 94 506 53.3 53.3

Neretva 1320 0 1320 225 218

Trebišnjica 398 224 174 96.5 96.5

TOTAL 2630.9

Effect of the implementation of the EU water acquis

As it was not possible to assess what the precise effect of the implementation of the various water directives (mainly Urban Waste Water Directive, the Nitrate Directive and the Dangerous Substances Directive) would be on river quality, it has been assumed that the full implementation of the various

30 ARCADIS ECOLAS / IEEP / Metroeconomica / Enviro L Benefits of compliance with water related directives 06/11347 - BiH- Benefits of Compliance with environmental acquis - final report directives will have the effect that the real water quality in all watercourses will be such that the designated Water Quality Objective class I or II will be met.

This seems a reasonable assumption, as the main cause of not meeting the WQO is the discharge of various substances by sewage and industrial discharges and these discharges will be dealt with by the directives.

4.2.55.2.5 Future strategy on water management

A memorandum of understanding between the Council of Ministers of Bosnia and Herzegovina, the Government of the Federation of Bosnia and Herzegovina, the Government of Republika Srpska and the Commission of the European Communities was signed in September 2004. In it, the Parties agree to reorganize the water sector and to use the EU Water Framework Directive for the purpose of establishing a new water policy. This new water policy, based on the EU Water Framework Directive, will replace both the Republika Srpska’s Law on Water Protection and the Law on Water Protection of the Federation of Bosnia and Herzegovina (not a priori by one policy). Until now, however, two separate legal systems have been developed: • Republika Srpska’s Law on Water Protection was adopted in 2002 (Official Gazette RS 53/2002). It establishes river basins (Danube and Adriatic Sea), river sub-basins (Una-Sana, Sava, Drina, Bosna, Vrbas and Trebišnjica) and parts of river sub-basins as the territorial basis for water protection, planning and implementation. The Law calls for the development of a minimum ten- year water protection strategy and protection plans for Republika Srpska, to be an integral part of the National Environmental Action Plan unless an inter-entity agreement states differently. The Law further stipulates that “water protection consent” is required before other permits (e.g. environmental, construction) will be issued, and it establishes an inspection system • The Law on Water Protection of the Federation of Bosnia and Herzegovina (Official Gazette F BiH 33/2003) was adopted in 2003 and is almost identical. It, too, establishes a regime based on river basin district bodies (Danube and Adriatic Sea) and sub-basins (Una, Sana, Sava, Vrbas, Bosna, Drina, Trebišnjic a, Neretva and Cetina). It calls for the adoption of a ten-year water protection strategy for the Federation, which may be part of the National Environmental Protection Programme, and it establishes consent and inspection systems

Both Laws intend to ensure that water protection in Bosnia and Herzegovina is in line with EU policy, directives, regulations and standards.

The National Environmental Action Plan (NEAP) of March 2003, drawn up by the entities in cooperation with the World Bank, has a brief chapter on integrated water resources management that sets goals and measures for the water sector. Its main goals are to provide sufficient quantities of high-quality water for water supply and other needs, to protect water resources and preserve surface and groundwater quality and to protect from flooding.

Another strategic document, The Mid-term Development Strategy (2004-2007), adopted by the Council of Ministers on 5 February 2004, notes that the sustainable development of water management requires more attention being paid to: the protection against water-related hazards, the planned use of water resources, and water conservation and protection. The emphasis is on integrated river-basin water management. The Mid-term Development Strategy also identifies nine development priorities for water: • Repairing flood-control facilities along the rivers Sava and Neretva; • Regulating the river beds and torrential watercourses in the most vulnerable areas; • Ensuring an adequate supply of clean water to inhabited areas; • Improving the quality of water supplied to the rural population; • Creating the right conditions for the restoration of navigation on the river Sava in cooperation with Croatia, Slovenia, and Serbia and Montenegro;

31 ARCADIS ECOLAS / IEEP / Metroeconomica / Enviro L Benefits of compliance with water related directives 06/11347 - BiH- Benefits of Compliance with environmental acquis - final report

• Repairing and renovating sewerage systems and rehabilitating water treatment plants for urban waste water, as well as building new ones; • Introducing measures to protect existing and potential sources of drinking water; • Ensuring a sufficient volume of water to irrigate cultivated land for intensive farming; • Increasing the level of exploitation of hydroenergy by building multipurpose water management facilities not only for power generation but also for the development of tourism and recreation, flood control, irrigation and fish farming, among other activities.

Bosnia and Herzegovina has not signed any major multilateral environment and water protection treaties since 1992. It is an observer only to important conventions like the Convention on the Protection and Use of Transboundary Watercourses and International Lakes and the Convention on Cooperation for the Protection and Sustainable Use of the Danube River. As it is not a Signatory to these treaties, Bosnia and Herzegovina cannot obtain financial and technical assistance to implement and monitor international procedures or standards. The Government has, however, undertaken procedures for the ratification of the Convention on Cooperation for the Protection and Sustainable Use of the Danube River, and is expected to become a Party in the near future.

4.35.3 MONETARY ASSESSMENT

The monetary assessment is based on the benefits transfer procedure, which involves borrowing the relevant WTP estimates from the existing literature (in other words, applying results from one country and transferring them to another, with appropriate weightings to reflect GDP differences in terms of purchasing power parities). The benefits transfer procedure represents a feasible alternative where country-specific WTP estimates are missing, as in the case of Albania.

Since it has not been possible to estimate the health impacts of water directives in quantitative terms, WTP per unit of impact (such as to avoid a case of morbidity) cannot be used in this part of the assessment. In order to implement the approach adopted here, relevant WTP estimates that are expressed per unit of the affected population (adult individuals or households) and the relevant ‘affected’ population needs to be identified. This section presents the WTP estimates used, while the discussion about affected population can be found in section 5.2.

Total WTP for clean water (drinking and recreational) indicates a lower limit for use and non-use benefits. There may be other use and non-use values that have not been identified or that are not included in the existing WTP estimates. Where WTP is related to avoided health damages, the WTP numbers are based on perceived rather than actual health risks. If people are not well informed about the health risks, their WTP may underestimate the actual health benefits. However, it should be noted that the benefits are based on the assumption that certain water quality improvements can actually be achieved. The analysis does not address the question whether and how the demand for clean water will be met (whether by one or a combination of water related directives or by any other measure).

4.3.15.3.1 Benefits of Cleaner Drinking Water

Choice of WTP

For assessing the benefits of cleaner drinking water, we basically had two options: (i) either update all WTP studies; or (ii) use the same WTP studies that were used in the previous studies for Croatia and for the 13 previous Candidate Countries. For reasons of comparability, we chose the second option, but we re-investigated the robustness of the figures.

32 ARCADIS ECOLAS / IEEP / Metroeconomica / Enviro L Benefits of compliance with water related directives 06/11347 - BiH- Benefits of Compliance with environmental acquis - final report a. Lower bound WTP estimate: this estimate is based on Hanley (1989) which elicited the WTP responses of a sample in the UK for nitrate content of drinking water to meet the standard of 50 g/m3 of water. The result of this study is Euro 25/household/year (in 1999 prices); b. Upper bound WTP estimate: this estimate is the average of the results of the following studies: Jordan and Edwards (1993), Schultz and Lindsay (1990), Edwards (1988), Power (1991) and Mitchell and Carson (1986). All five measure ‘WTP to avoid groundwater contamination’. The causes include contamination by fertilisers and pesticides and WTP reflects the households’ concern for clean drinking water. An average of these five studies (Euro 650/household/year in 1999 prices) is taken. We are no longer confident that the lower bound estimate for the WTP for cleaner drinking water is a realistic figure, given the limited coverage of pollutants in the WTP estimate. We have reasons to think that the resulting WTP of 25,2 €/household/year (in 1999 prices) is a fundamental underestimate. It is apparent that the upper bound estimate is more representative of the benefits than the lower bound estimate and therefore we decided to not longer include the lower bound estimate in our evaluations.

Besides this aspect we largely follow the same approach as in the study for the previous candidate countries, with the exception – as in the Croatia study - that the number of benefiting households is based on the expected connection rate of 91% rather than on the total number of households.

Choice of population numbers affected

Benefits of improved drinking water will accrue (i) to households that have a new connection to water supply, and (ii) to households that already have water supply, but are guaranteed better quality water. In 2001, the total number of households in Bosnia and Herzegovina was 1,067,120 and the connection rate to public water supply is 50%. Assuming additional new connections to public water supply for 5% of BiH households, 55 (or 586,916 households) can be assumed to benefit from quality improvements of drinking water. For a more detailed justification and description of the assumptions and data sources, please refer to section 5.2.2.

33 ARCADIS ECOLAS / IEEP / Metroeconomica / Enviro L Benefits of compliance with water related directives 06/11347 - BiH- Benefits of Compliance with environmental acquis - final report

Table 5-4: Willingness to pay for cleaner drinking water

Country WTP GDP/capita WTP No. of High USA Euro 1999 benefiting WTP Euro households (PPP) country 1999

(high) relative (high) Million Million Euro/year

to USA B D F=B*D G F*G BiH 650 0.15 97.5 0.587 57 Previous 650 0.23 149.5 58.712 8777 CC* * The figures given in this row apply to the aggregate of the previous candidate countries Bulgaria, Cyprus, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Romania, Slovakia, Slovenia, and Turkey. Any averages are weighted averages.

The total benefits of clean drinking water are estimated to amount to around 57 million EUR/year upon full compliance.

4.3.25.3.2 Bathing and other surface water quality – use values

New European WTP studies allow for a distinction between coastal and inland waters (see general report). Thus, the totals for surface water given above consist of an aggregate of the following figures: the domestic benefits of cleaner coastal water are estimated to lie between 0.01 and 0.04 million Euros per year. The respective range for inland surface waters extends from 12.85 to 33.31 million Euros per year.

Due to lack of data, benefits for costal area tourists could not be calculated. As such, the calculated benefits for the coastal area is underestimated.

COASTAL WATERS

The following table presents the benefit estimates for coastal waters.

34 Million Euro/year 2512.0

Low WTP Low High WTP Euro/year 0.04 0.01 _ approach chosen in the

Tourists Tourists at seaside resorts

Population Population (in coastal counties) nefits of compliance with water related directives tonia, Hungary, Latvia, Lithuania, Malta, Poland, Poland, Malta, Lithuania, Latvia, Hungary, tonia, pulation, as this was the

WTP: country

WTP: country row refers to adult national po

WTP: country 35 untries Bulgaria, untries Bulgaria, Es Czech Republic, Cyprus,

GDP/capita Euro 1999 averages. Population in this 785494 0.49359 3.141976 9.822441 - 9.822441 785494 0.49359 3.141976 0.004 -

GDP/capita Euro 1999 relative relative (residents, (tourists, Table 5-5: WTP for cleaner coastal water for cleaner coastal WTP Table 5-5: 5 1.34 0.87 _ 17.5 _ 131.052 _ 5 1.34 _ 0.87 17.5 _ 131.052

WTP Poland WTP Poland Euro 1999 Zylicz et al. 1995 visitors,

environmental acquis - final report acquis - final report environmental the aggregate of the previous candidate co

WTP Poland WTP Poland Euro 1999 Zylicz et al. 1995 (residents, (domestic

Turkey Euro 1999 Goksen et al. 2000

WTP (low) high) high) (PPP) to Turkey to Poland (PPP) (low) high) high) Million Million Million

Country Country BiH Previous CC* _ A 4 19.9 B 19.9 97. 97.5 C 0. D E F=A*D G=B*E H=C*E I J F*(I+J) G*I + H*J Romania, Slovakia, Slovenia, and Turkey. Any averages are weighted are averages Any Romania, Slovakia, Slovenia, and Turkey. * The figures given in this row apply to ARCADIS ECOLAS / IEEP / Metroeconomica /ARCADIS ECOLAS / IEEP Metroeconomica Enviro L 06/11347 - BiH- Benefits of Compliance with Be study. previous ARCADIS ECOLAS / IEEP / Metroeconomica / Enviro L Benefits of compliance with water related directives 06/11347 - BiH- Benefits of Compliance with environmental acquis - final report

Choice of WTP

For coastal waters, there are three studies that lend themselves for a benefit transfer approach: • Goksen et al. (2000) found a WTP of 4 Euros per person and year for a clean-up project at the Bosporus (Turkey). This study reflects a rather low estimate, such that this WTP figure is suitable as a lower bound. • Georgiou et al. (1996) received an average WTP response for cleaning up UK’s Great Yarmouth beach, which had failed to meet the EC Bathing Water Quality Directive standard, of 19 Euros (at 1999 prices). After a benefit transfer procedure, the resulting WTP for Croatia (6.8 Euros) would be only slightly above the Goksen et al. figure (5.7 Euros). Thus, the results from Georgiou et al. are close to the lower bound, which we leave unaltered. • The upper bound is represented by a study by Zylicz et al. (1995) on WTP for pollution control at the Baltic Sea in Poland, which was also used in the study for the previous candidate countries. Zylicz et al. determined WTP numbers of 19.9 Euros/year for the general adult population and 97.5 Euros for domestic visitors. Especially the WTP for visitors is rather high – and even higher after a benefit transfer to foreign tourists – such that the results of this study lend themselves as an upper bound.

Choice of population numbers affected

The canton Herzegovina-Neretva is the only canton in Bosnia and Herzegovina with access to the sea via the municipality of Neum. Neum has 4,268 inhabitants. No information is available on the number of domestic or foreign tourists visiting the seaside annually. Thus, we regard the total domestic population of Neum that benefits from increased confidence in high water quality of coastal waters, being 4,268 people. As such, the WTP study by Zylicz et al. was not used to differentiate between residents and tourists in terms of the applicable WTP in calculating the high estimate.

INLAND SURFACE WATERS

The following table presents the benefit estimates for inland surface waters.

Table 5-6: WTP for cleaner inland surface water

Country WTP WTP GDP/capita GDP/capita WTP WTP Benefiting Low WTP High WTP Latvia Balaton Euro 1999 Euro 1999 country Euro Euro 1999 1999 Mourato Ready 1999 (PPP) (PPP) country population et al. 2002

(low) (high) relative relative (low) (high) Million Million Million Euro/year Euro/year

to Latvia to Hungary

A B C D E=A*C F=B*D G E*G F*G BiH 5.7 22.5 0.67 0.44 3.8 9.9 3.36 12.9 33.3 Previous ------CC* * In the previous study on 13 CC, the benefits of cleaner inland surface waters were not calculated separately

36 ARCADIS ECOLAS / IEEP / Metroeconomica / Enviro L Benefits of compliance with water related directives 06/11347 - BiH- Benefits of Compliance with environmental acquis - final report

Choice of WTP

Ready et al. (2002) estimated the benefits from making the Gauja river in Latvia suitable for swimming and fishing at Euro 5.7 per person and year. This study reflects a rather low estimate, such that this WTP figure is suitable as a lower bound.

Mourato (1999) received an average WTP response of Euro 22.5 per person and year for a clean-up programme of the Hungarian Balaton lake. Due to the great tourist importance of the Balaton lake in Hungary, this estimate can be regarded as rather high, which is why we use it as an upper bound. It should be said, however, that much higher figures could be produced by transferring US estimates for angling alone. A large number of US studies give WTP values for angling of between 57 and 380 Euros per household and year (see general report). However, we regard the transferability if these studies as limited, especially in comparison with the studies from Latvia, which explicitly includes angling benefits, and from the neighbouring country Hungary.

Choice of population numbers affected

The studies used for benefit transfer measure WTP per person of the general population. The WTP figures are averages across the part of the population who undertake water-related recreational activities and the part that do not. Due to lack of such data, the total population of 3,364,825 was assumed to benefit from the bathing water quality improvement.

4.3.35.3.3 Improved river ecosystem quality – non-use value

37 WTP for the total change (Million Euro year)

WTP for fair to good year) 5.22 0.17

nefits of compliance with water related directives WTP for poor to good (Million Euro year) (Million Euro es. thuania, Poland, Romania, Slovakia, and Slovenia. For and Slovenia. Romania, Slovakia, Poland, thuania,

% of rivers classified as 'fair' (fYRoM: class III)

% of rivers classified as 'poor' classes IV & V)

River length (km) 38

Total no. of no. Total households (fYRoM: 0006 1.067 2630.9 80% 10% 5.05 1.067 2630.9 0006

WTP per WTP per HH, km & yr fair to good Euro 1999 Million 51% 39% - 58.712 330213 0.001 - 2373.0 to carry out this analysis. Any averages are weighted averag are weighted Any averages to carry out this analysis. previous candidate countries Bulgaria, Czech Republic, Latvia, Li Latvia, Czech Republic, Bulgaria, candidate countries previous

WTP per WTP per HH, km & yr poor to fair Euro 1999 Table 5-7: WTP for river water quality – non use values for river water quality – non WTP Table 5-7:

environmental acquis - final report acquis - final report environmental GDP/ capita Euro 1999 (PPP) country country relative to UK

UK WTP per HH, km & yr fair to good Green and Willis 1996 Euro 1999

UK WTP per HH, km & yr poor to fair Green and Willis 1996 Euro 1999

Country Country BiH CC* Other 0.0078 0.0029 0.34 0.0027 0.0078 0.0029 0.21 A 0.0016 0. B C D=A*C E=B*C F G H I J=(D+E)*F*G*H K=E*F*G*I L=J+K * The figures given in this row apply to the aggregate of the * The figures given ARCADIS ECOLAS / IEEP / Metroeconomica /ARCADIS ECOLAS / IEEP Metroeconomica Enviro L 06/11347 - BiH- Benefits of Compliance with Be countries there was insufficient data the other previous candidate ARCADIS ECOLAS / IEEP / Metroeconomica / Enviro-L Benefits assessment of water related directives 06/11347 - BiH- Benefits of Compliance with environmental acquis - final report

Choice of WTP

The study chosen for benefits transfer to estimate the non-use values attached to the improved river ecosystem quality is the one by Green and Willis (1996). This study elicits the non-use value attached by UK households to the changes in the classification of rivers from ‘poor’ to ‘fair’ and ‘fair’ to ‘good’. WTP for a change from ‘poor’ to ‘fair’ is given as Euro 0.0078 per UK household, km of river, and year (in 1999 prices). The respective WTP number for a change from ‘fair’ to ‘good’ is calculated as Euro 0.0029.

For the purpose of this study, it is assumed that implementation of the environmental acquis will lead to ‘good’ water quality in all rivers, which corresponds to classes I and II. Class III is considered to be ‘fair’ quality and classes IV and V are regarded as ‘poor’ quality. This implies that class III rivers will be subject to the change from ‘fair’ to ‘good’ (WTP: 0.0029 Euros per UK household, km and year). Classes IV and V will be subject to the change from ‘poor’ to ‘good’ (WTP: 0.0078 + 0.0029 = 0.0107 Euros per UK household, km and year).

Water classification and total length of rivers

The total river length of the rivers in Bosnia and Herzegovina is 2,630.9 km (see section 5.2.4).

The existing river water quality classification system is outdated and does not reflect the actual situation in Bosnia and Herzegovina. As such, no information is available on the current river water quality classes. The surface water in Bosnia and Herzegovina is, in general, of poor quality and bacteriological unsafe due to extensive pollution from numerous sources. Local experts estimated that more than 95% of the municipal waste water is discharged directly into water bodies without any kind of treatment. Furthermore, most of the industrial waste water is discharged to the nearest watercourse with little or no treatment. Based on this information, it was assumed that 80% of the rivers have a ‘poor’ quality (classes IV and V) and that 10% of the rivers have a ‘fair’ quality (class III).

Choice of population numbers

The proximity of the settlements to a river throughout the country is unknown. It can it be assumed that almost everyone lives reasonably close to a river.

Given that almost everyone lives reasonably close to one of the 2,630.9 km of river in Bosnia and Herzegovina, the total number of households, i.e. 1,067,120 is regarded as the relevant multiplier.

4.45.4 AGGREGATION OF BENEFITS AND CONCLUSIONS

Benefits covered and benefits neglected

The study has assessed the extent and value of the following benefits: • Benefits from the availability of drinking water and its improved quality; • Recreational benefits from cleaner coasts, lakes and rivers for bathing and other recreational uses; • Non-use benefits due to improved quality of river eco-systems.

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Given data availability and other considerations, the study has not included the following benefits • Benefits to industrial abstractors, agriculture and aquaculture, although these are likely to be significant; • Non-river eco-system benefits; • Some of the social benefits and wider economic benefits mentioned in the general report; • Transboundary benefits to EU Member States and other countries.

This means that the total benefits will in fact be higher than estimated here.

Extent of the benefits

The households of Bosnia and Herzegovina are expected to benefit from access to drinking water quality as well as from its improved quality in the order of magnitude of 57 million Euros annually. With a population of 3,364,825, this is equivalent to around 17 EUR/person. All EUR values given in the section refer to Euros of 1999.

Recreational benefits of an improved quality of inland surface waters to the Albanian residents are estimated to be between 12.9 and 33.3 million Euros annually. Recreational benefits for coastal waters are estimated to be between 0.01 and 0.04 million Euros annually.

The non-use value of the expected improvement of river ecosystem quality is estimated to be 5.2 million Euros per year.

The total annual benefit to the domestic population of compliance with the water related Directives has been estimated at around 75.3 million EUR/year upon full compliance (lower estimate) and 95.8 million EUR/year (upper estimate). This is equivalent to 22 EUR/person and 29 EUR/person – per year upon full compliance. These estimates are based on the aggregation of the estimated benefits to health, recreational use of water and the non-use benefits of improved (river) water resources.

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Table 5-8: Aggregation of Annual Benefits from Full Compliance (million Euro per year)

Country Drinking Coastal Water Inland River Total Annual Total Annual Water Surface quality Benefits from Benefits from Water (use (non- Full Full value) use Compliance#, Compliance# Domestic Benefits to @ benefits@ foreign value) (domestic (including visitors population foreign only) tourists) Low High Low High Low High Low High Low High Low High esti- esti- esti- esti- esti- esti- esti- esti- esti- esti- esti- esti- mate mate mate mate mate mate mate mate mate mate mate mate

J = B K = B A B C D E F G H I + C + + D L=J+E M=K+F G+I +H + I

Million EUR of 1999 per year

Bosnia and NA10 57 0.01 0.04 - - 12.9 33.3 5.2 75.311 95.8 75.3 95.8 Herzegovina

Other CC* 504 8733 - 2512 - - - - 2373 5389 13618 - -

EUR of 1999 per capita of total population per year

Bosnia and Herzegovina NA10 17 0 0 - - 3.8 9.9 1.6 22.411 28.5 22.4 28.5

Other CC* 3.8 66.6 - 19.2 - - - - 18.1 41.1 103.9 - -

* The figures given in this row apply to the aggregate of the previous candidate countries Bulgaria, Cyprus, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Romania, Slovakia, Slovenia, and Turkey. The high estimate in this row consists of the sum of columns B, D and G. For details on the methodology for the low estimate in this row, please refer to the previous study.

# It would be misleading to present a single central estimate as this would implicitly suggest a very accurate knowledge of the relationship between pollutant, impact and monetary benefit. Hence, the lower and upper bounds reflect the bounds of confidence in the results given methodological uncertainties.

The estimates in Table 5-8 refer to annual benefits that would accrue to Bosnia and Herzegovina from full implementation of the acquis, with the values reflecting the amount at the date of full implementation. Until then, the benefits will grow to the levels given above, and be lower in the first years as progress is made (e.g. not all rivers would move to Class I or Class II in the first years). Furthermore, there are clearly benefits that would accrue after the date of full implementation, because any water quality improvements can be assumed to be permanent and to offer benefits long into the future.

10 NA = not applicable

11 This figure is not comparable to the below figure for the previous 13 CC, because the estimae for the 13 CC is based on the low estimate for the WTP for drinking water (column A).

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The total benefits (net present value) of the implementation of the water-related Directives depend on the assumptions with respect to the years that the calculated annual benefits apply to. Furthermore, they depend on the discount rate. For the calculation of total benefits to Bosnia-Herzegovina in Table 5-9, we use a discount rate of 4% and assume full implementation by 2020. Benefits are assumed to start in 2005 and to increase linearly until 2020. Beginning with the year of full implementation (2020), five years of full annual benefits are taken into consideration (until 2025). This implies that the underlying water quality improvements would have been achieved also without the environmental acquis by 2025. In reality, benefits from approaching EU standards may have started earlier than 2005, and implementation in the reference situation would be a process over several decades. We believe that, all in all, the assumptions taken are sufficiently conservative to ensure that the total benefits displayed in Table 5-9 are not an overestimate.

The total discounted benefits to the domestic population of compliance with the water-related Directives has been estimated at around 616 million EUR (lower estimate) and 783 million EUR (upper estimate). This is equivalent to 183 EUR/person and 233 EUR/person.

Table 5-9: Total benefits from full compliance with the water-related Directives

Annual benefits Total discounted benefits#

Low estimate† High estimate† Low estimate† High estimate†

Million Euro of 1999

Bosnia-Herzegovina 75.3 95.8 616 783

Other CC* 5 389 13 618 52 400§ 132 600§

Euro of 1999 per capita of total population

Bosnia-Herzegovina 22.4 28.5 183 233

Other CC* 41.1 103.9 399.6§ 1 011.3§

# Assumptions for the fYRoM: 4% discount rate;full implementation in 2020; linear increase of benefits between 2005 and 2020; 5 years of full benefits (2021-2025).

* The figures given in this row apply to the aggregate of the previous candidate countries Bulgaria, Cyprus, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Romania, Slovakia, Slovenia, and Turkey. Due to differences in the applied methodology, the figures given in this row are not directly comparable with the other rows. For details on the methodology in this row, please see below and refer to the previous study.

§ In the previous study for other CCs, full implementation was assumed for 2010. Thus, the assumptions for calculating total discounted benefits in this row are somewhat different. The previous study assumed a linear increase of benefits until full implementation, and ten years of full benefits thereafter.

† It would be misleading to present a single central estimate as this would implicitly suggest a very accurate knowledge of the relationship between pollutant, impact and monetary benefit. Hence, the lower and upper bounds reflect the bounds of confidence in the results given methodological uncertainties.

Whether to look at annual benefits or at total discounted benefits is a matter of preference. Usually, annual benefits are the indicator which is easier to relate to. However, one needs to bear in mind that this indictor represents the benefits for a single year only and that the respective numbers will apply – fully or partially – to a multitude of years.

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Interpretation of the results

The benefits given in the first row of Table 5-9 accrue to the national population. They are based on the relatively low (relative to EU and indeed average other New Member States) per capita GDP values, which explains a significant element of why the benefits/capita values for X are lower than the average of the then 13 Candidate countries under the previous benefits study.

Clearly, the estimates suggest that the benefits of improved water quality need to be taken into account when the relevant decisions on funding priorities, investments and policies are due.

Despite this, all figures should be seen in the light of the uncertainties that are associated with the methods used. These uncertainties mostly refer to • uncertainties related to the methodological challenges of WTP studies in general, • uncertainties regarding the accuracy of the benefit transfer procedure that makes it possible to apply the results of foreign WTP studies to Albania, • uncertainties connected to the lack of information regarding current water quality and, as a consequence, the lack of adjustment for local environmental circumstances in the transfer of foreign WTP estimates, • uncertanties regarding full implementation of the Directives and the related water quality improvements.

These uncertainties underline the need to see the valuation results in conjunction with the more extensive qualitative analysis.

It is not really possible to identify explicitly what benefits can be attributed to which particular directive. This is especially so for the water related directives given the inter-linkage of the effects of the upstream emissions related directives (e.g. UWWT and dangerous substances directives) and the down stream quality related directives (e.g. bathing water and drinking water directives). It is clear that there can be no full and appropriate implementation of the downstream directives without the upstream directives being addressed in parallel.

Finally, many will be tempted to carry out a simple cost benefits analysis, taking the benefits results from this study, and comparing them to the cost estimates from other studies and drawing their own, and often incorrect, conclusions regarding the “appropriateness” of implementing the acquis. The aim of this analysis has not been to carry out such a comparison, or indeed to provide information for others to do so. While such comparisons are inevitable, it is important that those carrying out such comparisons bear in mind the meaning of the results, the limitations to the coverage of the benefits value, and the many other benefits as outlined in chapter 2 of the general report that are not monetised but equally important to decisions of prioritisation of funding for the environment.

ARCADIS ECOLAS / IEEP / Metroeconomica / Enviro-L Benefits assessment of waste related directives 06/11347 - BiH- Benefits of Compliance with environmental acquis - final report

56 BENEFITS ASSESSMENT OF WASTE RELATED DIRECTIVES

5.16.1 CURRENT STATUS

The management of waste, whether municipal, hazardous or non-hazardous industrial waste, medical waste, obsolete pharmaceuticals or contaminated sites, is one of Bosnia and Herzegovina’s environmental priorities. Strategic documents such as the Solid Waste Management Strategy, the National Environmental Action Plan and the Mid-term Development Strategy (2004-2007) provide important guidance for improving this sector in the short, medium and long term.

The good start with the development of policy and strategy documents needs to be complemented with favorable conditions for their implementation, including the drawing-up of concrete regulations, projects, financial support, and the mobilization and training of the population to actively participate in the environmentally sound management of all kinds of waste, including hazardous and chemical waste.

The Solid Waste Management Strategy calls for an approach to municipal waste disposal that relies on a multi-municipality district. The practical details of this approach, e.g. location of landfills, are still being worked out, but it involves organizing waste disposal for several municipalities around a single site. The population served per landfill should be at least 200.000; the minimum waste disposal should be 200 tons per day; and the transport distance should be no more than 100 km. The country would be divided into 14 or 16 waste allocation districts (depending on the final decision), taking into account overall economic, geographic and local conditions. In the longer term, the Strategy foresees the construction of five main regional landfills. According to the NEAP, locations for the initial phase are Banja Luka, Tuzla, Mostar, Bijeljina, Bihac, Livno, Sarajevo and Zenica. The Strategy also foresees the rehabilitation of existing sites. Work has begun on designing and constructing multi-municipal sanitary landfills to rationalize capital and operating costs.

5.1.16.1.1 Waste generation and coverage There is no system for waste separation. The only separation that takes place is informal, carried out by a few entrepreneurs and individuals who separate (after the collection of the waste) small quantities of papers and metals from municipal waste.

The country has a specific waste problem with expired drugs and chemicals. Large amounts of medicines and surgical material were sent to Bosnia and Herzegovina as humanitarian aid and now represent a big environmental problem. Other specific problems and risks related to the consequences of war are landmines, other kinds of unexploded ordinance and soil contaminated with depleted uranium. The UNEP report on this issue is available and could be downloaded from UNEP Europe web site.

At present there is no regular reporting system for municipal and industrial waste, although work has begun to introduce such a system under a project financed by the EU. This information is needed to define methods of waste treatment and disposal, allocating the resources and developing concrete measures to improve the overall waste management system.

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Municipal and industrial waste estimates for 1999 from the Solid Waste Management Strategy are given, these are the most recent data available:

Table 6-1 – Waste management and collection

Indicator Year

Total waste generated (t/year) 2.628.522 (1999)

1.764.893 (1999) Total municipal waste (t/year)

Municipal waste generated per capita (kg/inhabitant/year) 452 (1999)

60% of the population in the Coverage of waste collection system (% of population covered) main municipalities and an even smaller percentage in suburban areas. Almost no collection in the rural areas. Type of treatment (% landfilled, recycled, incinerated, etc) n/a

Quantity of waste illegally dumped (t/year) n/a

Quantity of waste imported/exported (t/year) n/a

Source : EPR 2003

5.1.26.1.2 Recycling At present there is no industrial waste recycling or reuse as secondary raw material. Municipal waste recycling is in very initial phase.

The main problem with the separation of municipal waste is the unavailability of equipment for processing the separated components (paper, glass, metal, aluminum, organic waste).

There is some potential for recycling and reuse. Municipal waste contains organic material, durable and non-durable goods, packaging plastics, and textiles. It also contains small quantities of hazardous waste like paint, motor oil, batteries and agrochemicals, from households, shops, small enterprises, workshops, garages, light industry and heavier industry. The share of plastics and packaging in municipal waste is significant. Organic waste could be composted and used as fertilizer. Industrial waste as electro filter ash from thermoelectric plants, red mud from aluminum plants, steel slag and mining waste are valuable sources of secondary raw material that could be used in other industries. Mining waste (overburden), for example, could be used to rehabilitate municipal landfills and repair roads, restore contaminated land for building; spent oil and solvents could be processed to produce low-grade solvents and oil.

Electro filter ash from thermoelectric plants, red mud from aluminum plants, steel slag and mining waste are also sources of secondary raw material and could be used in other industries. This would help to solve two problems by disposing of waste without damaging the environment and manufacturing valuable industrial products, like cement and steel from red mud. Mining waste (overburden) could be used to rehabilitate municipal landfills, repair roads and restore contaminated land for construction. There is considerable wood waste in the country because there are many small wood-processing companies (sawmills). This waste is not being used, but small bricks made of wood waste could be used as a source of energy. No goals/targets have been set for recycling of waste and composting of biodegradable component for future years (2010 – 2020).

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No quantified information is available for the selected key-indicators on waste recycling in Bosnia- Herzegovina: Table 6-2 – Waste recycling

Indicator Year

Total municipal waste recycled (t/year) – detail if available (e.g. paper, metal, glass, etc) N/A.

Number and capacity (t/day) of recycling facilities

Amount (t/year) and share (%) of biodegradable waste produced

Amount (t/year) and share (%) of biodegradable municipal waste composted

Number of composting facilities

Capacity of composting facilities (t/day)

5.1.36.1.3 Landfills

Few landfills meet sanitary requirements. Most landfills, both legal (official) and especially illegal, are neither controlled nor managed. There is no inventory of landfills and no monitoring system for soil, groundwater and air. The construction of new regional sanitary landfills and the rehabilitation of existing landfills have begun recently.

Owing to the increase in waste and inadequate waste management, waste is becoming a major environmental and health problem. Many official municipal waste sites are situated about 5 km from residential areas, and about half of the sites are within 10-15 km. Few sites are situated more than 25 km away. Disposal of municipal waste at these sites, which do not meet sanitary norms and standards, has adverse environmental effects, resulting in soil degradation and contamination as well as air contamination by organic substances, toxic dust and methane released from the decomposition of waste. Contamination from waste may contaminate water and food and cause intestinal infectious diseases (typhus, diarrhoea, dysentery and hepatitis) and many other diseases, too.

In many cases municipal waste is burned at the sites, and the fumes contaminate the air around the sites, including, sometimes, residential areas. Groundwater is contaminated by heavy metals and organic hazardous substances that are formed during decomposition, and surface water is contaminated by rain water leaching organic hazardous substances, which move to open watercourses. There is also pollution and contamination of rivers by municipal and construction waste. The landfills are not fenced off, and people and animals have access to contaminated sites, which may result in the spread of infectious diseases. There is no information on the degree of soil, groundwater and air contamination at industrial sites or in their vicinity, including residential areas of nearby towns. There are no environmental impact assessments (EIA) of these sites or environmental audits of industrial facilities, including industrial storage facilities. A system to monitor soil, groundwater and air needs to be introduced to identify the threats caused by these industries to the population and the environment. Monitoring data are needed to conduct an EIA (or environmental audit, as EIA is only for new facilities) of these sites.

At the moment, there is no complete inventory of illegal sites, but unofficial sources suggest that they number around 10.000. Illegal landfills are those that are not authorized by municipalities or cantonal governments. In many cases illegal landfills are situated along rivers, which have resulted in the

47 ARCADIS ECOLAS / IEEP / Metroeconomica / Enviro-L Benefits assessment of waste related directives 06/11347 - BiH- Benefits of Compliance with environmental acquis - final report contamination of water. Small plastics bags are a particular problem, as they are being dumped in the rivers and along riverbanks, clogging waterways and generally spoiling riversides.

In many cases hazardous waste and medical waste are dumped together with municipal waste at unmanaged and non-sanitary landfills. An exception is ash generated at the Tuzla power plant, some of which is used in the cement industry.

The demolition of houses during the war and the reconstruction of residential areas in its aftermath have generated large quantities of construction waste. In many cases this waste is disposed of along the riverbanks, constituting a source of contamination and littering rivers. The problem peaked after the war, but is diminishing now. At present construction waste is used to cover illegal landfills on riverbanks.

At the moment, no targets / goals have been defined on landfill gas capture and use as energy source, the diversion of organic waste from landfills, the reduction of leachate into land and groundwater or the reduction of the risk of explosion or heath impacts from gaseous emissions.

Some key-indicators on waste landfilling are presented in following table:

Table 6-3 – Waste landfilled

Indicator Year

Total municipal waste landfilled (t/year) Not reported in this form

75 Number of (official/legal/permitted) landfills– and how many / what There are 25 registered municipal share are compliant with EU standards (eg have landfill liner to protect landfills in Republika Srpska and 50 in against leachates) and which not. the Federation.

Capacity of (official) landfills (t/day) n/a

Area covered by (official) landfills (m2) n/a

Methane emissions from landfills n/a

Unofficial sources suggest that they Number of illegal landfills / waste dumps number around 10.000.

5.1.46.1.4 Packaging waste

As economic conditions improve in Bosnia and Herzegovina, consumption patterns are changing and municipal waste is increasing. For example, people buy more packaged food and other goods, and they tend to discard goods more quickly. Since the consumption of packaged food and goods has increased in the past five years and will continue to do so, it is expected that more municipal /packaging waste will be generated.

There is no waste collection system for non-industrial packaging in place and no packaging recycling targets have been set for glass, plastics, paper or metals.

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No quantified data is available for the selected key-indicators on packaging waste in Bosnia & Herzegovina:

Table 6-4– Packaging waste

Indicator Year

n/a Total packaging waste collected (t/year)

Total packaging waste recycled (t/year)

Total packaging waste landfilled (t/year)

Number and capacity of facilities for the recycling of packaging waste

5.1.56.1.5 Incineration of waste

There are some small incinerators for medical waste in Bosnia and Herzegovina, but they do not meet the technical requirements for medical waste incineration. One such incinerator is at the Uborak landfill. The temperature of incineration is very low (400-600° Celsius), and there is no purification system for its exhaust gases. Toxic substances like dioxins and furans are released into the atmosphere in the vicinity of hospitals. Health effects of no proper medical waste incineration can occur from the non proper incineration of medical waste. To prevent the adverse effects of such incineration on the population and the environment, separate collection systems for medical waste need to be introduced and modern high- temperature incinerators with exhaust gas treatment built.

No targets been set for incineration (tonnes/year) or for residues from incineration for future years have been defined.

No quantified data is available for the selected key-indicators on waste incinerate:

Table 6-5– Waste incineration

Indicator Year

Total waste incinerated (t/year) n/a

Number of incineration facilities

Capacity of incineration facilities (t/day)

Energy recovered annually

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5.1.66.1.6 Hazardous waste (HZW)

There are no systematic data on the quantities of hazardous waste that have been generated or accumulated. Estimates in the Solid Waste Management Strategy are based on the assumption that hazardous waste comprises 1% of industrial waste.

There is virtually no recycling of industrial waste and no separation and treatment facilities for industrial hazardous waste.

An inventory of contaminated industrial waste sites has been started but is not yet complete. Proper hazardous waste management is not in place (from waste generation reporting, to treatment and storage/disposal). Some issues are underlined bellow: • Industrial activity in the country has decreased. Industrial enterprises either do not work or work at 10-15% of their designed capacities. Consequently, there is less industrial waste, including hazardous waste. In the future, the amount of industrial waste will depend on the kind of industry and technology that will be developed and applied in the future. Appropriate decisions and measures should be taken to introduce environmentally friendly industrial processes • There is no separate collection of medical waste and no treatment. According to the NEAP, an estimated 120 tons of medical (health care) waste is generated per day, of which 15% could be considered as very dangerous and toxic, requiring disinfection or incineration and disposal. • Significantly compounding the problem with medical waste is the large number of obsolete pharmaceuticals that accumulated. There are about 1000 tons of these pharmaceuticals in the country, of which 650 tons are in the Federation of Bosnia and Herzegovina and 350 in Republika Srpska. They are stored at over 90 sites (hospitals, warehouses and pharmacies). Some of these pharmaceuticals have been encapsulated with cement. About 1600 drums were encapsulated according to WHO guidelines; however, only 220 drums were disposed of in a sanitary landfill in Mostar. The rest still pose a health risk. Small quantities of these pharmaceuticals were transported for treatment to other countries under the Basel Convention. The remainder is stored. As noted above, there are no facilities for treating obsolete pharmaceuticals. • Industrial waste is either disposed together with municipal waste or stored at the industrial facilities where it is produced. • Each industrial plant has its own disposal site. According to the Laws on Waste Management, the operators of installations that require an environmental permit should draw up a company waste management plan, which sets out, inter alia, the storage conditions of waste on the site. These new Laws have not yet been applied, because there are no regulations, norms and standards. • According to the NEAP, about 6000 ha are used for the disposal of mining waste and about 600 ha for slag and ash from thermal power plants. • Red mud from aluminum plants (Mostar and Zvornik) is dumped on 300 ha and not used or recycled. • Bosnia and Herzegovina has two types of contaminated sites: sites where industrial toxic waste is stored and sites littered with landmines. • There are 15 contaminated industrial “hot spots”. These include thermal power plants, and chemical, paper and metallurgical industries. Depending on the industry, the sites are contaminated. The main industrial waste storage sites include waste containing heavy metals, ash, metallurgical slag, and waste from soda ash production (white sea). An inventory of all such sites is needed to start their rehabilitation or introduce the technologies for their recycling and reuse. Industrial facilities with hazardous waste storage are as follows: Highly toxic waste: Waste from zinc and lead production: Srebrenica (Lead and Zinc Mines) and Vares (Iron Forge-Vares); Red mud (aluminum industry): Zvornik (TG Bihac; Al oxide plan) and Mostar (Aluminij-Mostar);

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Asbestos mud: Bos. Petrovo Selo (Separation Ilici); Toxic Waste: Thermal power plans (ash and slag) : Kakanj, Tuzla, Ugljevik, Gacko; Waste from paper production plants : Maglaj (Natron), Bania Luca (Incel); Ferrosillicate electrolysis waste ; Jajce (Electrobosna); Soda ash waste : Lucavach (Soda Ash Plant); Leather tanning waste : Visoko (KTK, Leather factory); Low toxic waste:Slag from steel industry ; Zenica (Steel plant,Raca steel slag) • Landmines are a significant source of hazardous waste. According to the Bosnia and Herzegovina Mine Action Centre, in 2001, 18.145 minefields remained, 74% of which are located within the Federation. • Strategy for Hazardous Waste Management in Bosnia and Herzegovina has recommendations for all types of hazardous waste. Among these recommendations, there is the idea to be obliged to pay some fees or charges for having generated some hazardous waste, which has not been the case so far. This financing will be covered by the principle “Polluter pays”. It is also “anticipated” that the population will need to take care of part of the costs through higher municipal service fees. Some specific recommendations are also made for improvement of hazardous waste and water management (changing in production processes by introducing cleaner production, water recirculation and reuse systems, raising awareness of industrial plant operators and employees, etc.). In order to control or eliminate acid mine problems, the impacts from the mining sites on the environment should also be monitored, through the use of the following methods: removal of sulphides, exclusion of water, exclusion of oxygen, control of PH value, control of bacteria activity

Bosnia and Herzegovina acceded to the Basel Convention at the end of 2000 (Official Gazette BiH 31/2000). The Federation’s Ministry of Physical Planning and Environment and Republika Srpska’s Ministry of Physical Planning, Civil Engineering and Ecology issue permits for transboundary waste.

The entities’ Ministries participate in the information exchange under the Basel Convention. Bosnia and Herzegovina uses a classification system for hazardous waste according to the Basel Convention, and it began collecting data for reporting under the Basel Convention in 2002. For the movement of waste within the country, only notification between these two Ministries is needed. Although it seems that the transboundary movements of waste are well recorded, detailed information on the quantity of waste imported/exported pursuant to the Basel Convention (t/year) is not reported.

An overview of some indicators on hazardous waste is presented in the following table:

Table 6-6 – Hazardous waste

Indicator

Total hazardous waste generated (t/year) and 31.184-34.184 (hazardous not industrial and not medical waste) – collected (t/year) – detail if possible type of year not exactly in the data source waste According source * there are (tons/year): 18.000-20.000 used oil, lubricants and mixed oil waste 3.160 batteries and accumulators, electrolytes 5.000-6.000 discharged cars 1500 of electrical and electronic equipments 200 of paint, thinners and varnishes 1.280 of packaging waste 1.500 of construction waste 64 of pesticide waste 480 of photo waste Light industry is estimated to generate an additional 11.000 tons of hazardous waste each year Estimated 120 tons of medical (health care) waste is generated

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Indicator

per day, of which 15% could be considered as very dangerous and toxic. Total hazardous waste treated(t/year) – detail if There is no treatment facility for hazardous waste possible type of waste

Number and capacity (t/day) of hazardous n/a waste treatment facilities

Number and capacity (t/day) of hazardous n/a waste disposal facilities

Small quantities of obsolete pharmaceuticals were transported Quantity of waste imported/exported pursuant for treatment to other countries under the Basel Convention to the Basel Convention (t/year) – specify type (lead batteries, medicines, waste paint, etc…)

* Source: Project on Environmental Protection Assessment of Industrial, Medical and Other Hazardous Waste in Bosnia and Herzegovina, Bosnia-S Oil Service Company, book 3, 2002, noted in EPR 2003

5.1.76.1.7 Disposal of waste oil

Although there are recovery facilities for waste oil in the country, with a capacity of 10.000 tons/year, they are running at only 10-15% of its capacity because there is no regular collection system for waste oil. Moreover, their oil recovery method is not environmental friendly, because of obsolete equipment. It is noted that filtration, extraction and distillation for recovery of spent oil and solvent could be used to produce low-grade solvent and oil.

Some key-indicators on waste oils in Bosnia & Herzegovina are presented in following table: Table 6-7 – Waste oils

Indicator Year 16.500-18.500 Total oil produced (t/year) (used oil, lubricants and mixed oil waste); year not specified in UNECE EPR source

Number of power plants exceeding 3 MW n/a

Number of factories using waste oil as an additional fuel (power plants, n/a cement factories etc)

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5.1.86.1.8 Batteries and accumulators

There is no recycling system in place for batteries and accumulators. Some key-indicators on waste from batteries and accumulators in Bosnia & Herzegovina are presented in following table: Table 6-8 – Batteries and accumulators

Indicator Year 3.160 batteries and accumulators, electrolytes Amount of batteries separately collected (t/year) Year not specified in EPR source

Amount of batteries recycled (t/year) n/a

Amount of batteries disposed of at landfills (t/year) n/a

5.1.96.1.9 Medical Hazardous waste See above

5.1.106.1.10 Disposal of PCB and PCT

Estimated quantities of waste oil contaminated by polychlorinated biphenyls (PCBs) amount to 1.500 tons of oil. There is no organized disposal system in place.

5.1.116.1.11 TiO2 Directive

There is no titanium dioxide industry in Bosnia & Herzegovina and no data on potential pollution from waste from the TiO2 production process.

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5.26.2 ASSESSMENT USING QUALITATIVE AND QUANTITATIVE DATA

5.2.16.2.1 Introduction

The directives to be considered in quantitative assessment are the Landfill Directive and the Packaging Directive. A quantitative assessment of these Directives was carried out for the following reasons: 1. The directives in question have specific targets associated with them, which makes analysis manageable 2. The quality and quantity of waste related data, while not perfect, is sufficient to attempt an analysis 3. Compared with a number of the other waste directives, these Directives are likely to have the largest directly attributable impacts 4.

While making all efforts to calculate reliable quantitative impacts is important, it is also important to note the inherent weaknesses of such a quantitative assessment.

While the directives to be examined set quantitative targets for diversion rates, recycling rates and emission levels, there are still a large number of uncertainties associated with for example the reliability of the baseline figures on waste composition, the volumes of waste generated, collected, etc. and how Bosnia & Herzegovina will act in the light of the Directives. Hence, presented quantified benefits should be regarded as orders of magnitude rather than absolute figures.

5.2.26.2.2 National targets for the future years in the field of waste management

No concrete targets have been defined for the future years in the field of waste management.

5.2.36.2.3 Landfill Directive When calculation the quantitative benefits of compliance to the EU acquis on waste, policy targets for the future in the field of solid waste management should be taken into account as they will determine the speed of getting compliant to the acquis.

There are a number of important aspects of the Landfill Directive, which will give rise to significant benefits. This study splits the quantitative assessment into two parts, each one dealing with a different quantifiable aspect of the directive. The first section deals with the requirement to capture methane emissions from landfill. And the second section deals with the impacts from the targets for diversion of biodegradable municipal waste from landfill.

To capture the possible approaches in the quantitative assessment, this study has examined two different scenarios. The first involves meeting these diversion targets purely by a mixture of recycling and composting. The second involves building sufficient incineration plants. In reality the approach taken by Bosnia & Herzegovina is likely to adopt a mixture of recycling/composting and incineration to meet the diversion targets. For the quantitative assessment of this Directive, the study team has therefore been able to address: • Changes in methane emissions from landfill

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• Changes in quantities going to landfill • Increase in recycling and composting of biodegradable component • Increase in the incineration of biodegradable component

What the study team has not been able to quantify, includes: • Level of reduced leachate into land and groundwater; • Reduction in the risk of explosion or health impacts from gaseous emissions; • Reduction in the risk of spread of disease due to reduced potential base for disease; • Reduction in odours and visual disturbance from landfill sites; • Reduction in noise and disturbance from transport to landfills.

5.2.3.16.2.3.1 Methane Capture

ESTIMATING METHANE EMISSIONS

The obligations for the capture of methane emissions (for the short term of operation) and the use as a source of energy (in long term of operation) are set in the environmental permit for new landfills issued from Ministry of Environment

In order to attempt a quantification of the external benefits associated with the Landfill Directive, it is important to have an estimate of the current level of emissions of methane from landfill.

Methane gas is produced from landfills at varying rates from different materials. In order to understand the quantities of methane produced in landfills, one would have to understand the nature of the waste landfilled over the past 30 years or so, and to understand the nature of the landfill conditions.

In this study data has been used from the UNFCCC inventory and high and low value for emissions per tonne of MSW landfilled have been estimated (see Annex 4).

The work has been performed with two values for methane emissions: • Our own low estimate and • Our own high estimate.

UNFCCC data as used for the assessment for fYR of Macedonia and Albania is lacking. Our own estimates result in a range between 32 ktonnes CH4 and 318 ktonnes CH4 emissions for the year 2004, taking into account 1.764.893 tonnes of household waste has been generated in 2004 of which a 100% has been landfilled or dumped.

PROJECTIONS AND BASELINE

Having estimated the amount of landfill methane, the next step in the quantitative assessment involves calculating how much of this methane will be collected and by when.

The amount of methane captured at the landfill is assumed to remain negligible until 2010 and then to increase in one step to a specified maximum percentage (60%) of what is emitted in 2010. We have used a maximum recovery level of 60%, which, upon examination of a number of sources that range

55 ARCADIS ECOLAS / IEEP / Metroeconomica / Enviro-L Benefits assessment of waste related directives 06/11347 - BiH- Benefits of Compliance with environmental acquis - final report considerably, seems sensible. White et al (1995)12 assume that 40% of landfill gas is typically recovered, although estimated recovery efficiencies of around 90% have been reported (Rodríguez-Iglesias et al, 1999; Huber and Wohnlich, 1999)13.

We suspect that the effect of the Landfill Directive will lead to reductions over time but contributions from past landfill deposits will remain significant. Therefore, given the levels of uncertainty concerning future arisings, and given also that we have used a range of estimates for current emissions, we have assumed constant emissions from 2010.

We have assumed: • A baseline of zero methane capture from landfill sites ; • All gas capture is related to the directive itself (though other influences, e.g. climate change policy / politics will play a role).

QUANTITATIVE RESULTS

Table 6-9 presents the amount of methane captured under the three values for methane emissions data.

Table 6-9: Estimates of reductions in methane emissions per year by 2020 (in ktonnes)

Low Estimate High Estimate Bosnia & Herzegovina -19 -191

5.2.3.26.2.3.2 Meeting Landfill Directive Article 5 Targets

We have effectively chosen two strategies for the way in which Bosnia & Herzegovina will meet Article 5 targets of the Landfill Directive: • Maximum Recycling/Composting Scenario: in which Bosnia & Herzegovina pursues an intensive source separation programme generating dry recyclables and compostables. • Maximum Incineration Scenario: in which Bosnia & Herzegovina incinerates an additional quantity of waste next to the quantities defined in the maximum recycling / composting scenario.

The quantitative methodology calculates, using data sets for the present waste arisings and treatment processes, how much biodegradable waste would have to be diverted from landfill by each of the target years. Using this information we are then able to estimate how much waste would be diverted into each possible treatment option depending on the scenario in question.

Given the amount of waste, which needs to be diverted from landfill, we can calculate the difference between an extrapolation of the present situation and the impact of the Landfill Directive in terms of increasing various treatment capacities compared with reducing landfill capacity.

12 White, P.R., Franke, M., Hindle, P. (1995) Integrated Solid Waste Management: A Lifecycle Inventory, Blackie Academic & Professional, Chapman & Hall, pp. 362.

13 Rodriguez-Iglesias, J., Marañón, E., Sastre, H., and Castrillón, L. (1999) ‘Characterisation of extraction wells and recovery of biogas in municipal solid waste sanitary landfills’, Proceedings Sardinia ’99, Seventh International Waste Management and Landfill Symposium, S. Margherita di Pula, Cagliari, Italy; 4-8 October 1999, Volume II, p.457-64. Huber, A., and Wohnlich, S. (1999) ‘Gas collection layers’, Proceedings Sardinia ’99, Seventh International Waste Management and Landfill Symposium, S. Margherita di Pula, Cagliari, Italy; 4-8 October 1999, Volume II, p.465-70.

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STRATEGY SCENARIO 1 - MAXIMUM RECYCLING / COMPOSTING

There are a number of important factors affecting recycling and composting schemes including the need for participation in separation schemes, and the need for reliable markets for end products. In order to reach diversion targets via recycling and composting, Bosnia & Herzegovina would have to implement the necessary schemes over-time, well in advance of the target dates to approach sufficient diversion to meet the Landfill Directive.

Assumptions are based on country specific data collected, estimates from other SEE countries (share organic waste), targets as defined by the Landfill Directive and more general assumptions made on targets as to be reached to be in line with good practice (e.g. share of waste collected).

In the table below, the assumptions made to calculate the projected total waste generated, collected and treated are presented:

Table 6-10 : Assumptions for the Municipal Waste Flow for the Period 2004–2020.

Assumptions for the Forecast for the Flow of Municipal Waste Current situation Target1 Year1 Target 2 Year 2 Population growth 0,31% -0,21% GDP growth 3% 3% Coverage of waste collection 60% 95% Share biodegradable waste 50% 50% Share packaging waste 25% 25% Share MSW landfilling 100% 50% 2020 Share MSW recycling 0% 35% 2020 Share MSW incinerated 0% 0% 2020 Share biodegredable waste composted 0% 65% 2020 Residues: From recycling: 10% From bio-treatment: 20% From incineration: 30%

It is important to remark that at the moment no MSW is incinerated and that this situation is assumed to remain as such in this scenario as no intentions have been made to do so in the Solid Waste Strategy.

The volume of waste generated in the future is an uncertain factor which is covered by calculating the total volumes generated under two separate sub-scenarios based on the population growth and GDP growth: • The first one is a sub-scenario based on a zero growth of the volume of waste generated. The change in volume is solely linked to the change in population. • The second one is a sub-scenario based on a high growth rate of the volume of waste generated. The change in volume is linked to a change in population and for a 100% linked to the change in GDP.

It is a reasonable assumption that the actual waste generation rate will be between these two margins.

The estimate on the future waste flow calculated on the basis of the above-mentioned assumptions is illustrated in following figures:

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Scenario 1- zero MSW generation growth

2.000.000

1.800.000

1.600.000

1.400.000 Generation 1.200.000 Cov erage Recycling 1.000.000 Compos ting ton/year 800.000 Incineration 600.000 Final Disposal

400.000

200.000

- 2000 2005 2010 2015 2020 2025 Years

Figure 6-1: Strategy scenario 1 - Estimates of projected volumes of waste generated, collected, recycled, composted, incinerated and disposed for the period 2004-2020 assuming a zero municipal solid waste generation growth

Scenario 2- high growth MSW generation

3.000.000

2.500.000

2.000.000 Generation Cov erage Recycling 1.500.000 Composting ton/year Incineration 1.000.000 Final Disposal

500.000

- 2000 2005 2010 2015 2020 2025 Years

Figure 6-2: Strategy scenario 1 - Estimates of projected volumes of waste generated, collected, recycled, composted, incinerated and disposed for the period 2004-2020 assuming a high municipal solid waste generation growth

Calculated estimates by 2020 through implementation of the Landfill Directive and adoption of the proposed strategy scenario are: • Total MWS amounts : 1.761 -2.616 ktonnes/year generated of which 1.673-2.485 ktonnes/year collected • recycled material: 585-870 ktonnes/year • composted material: 544-808 ktonnes/year

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• incineration : / • Landfill Disposal : 1.092-1.622 ktonnes/year

The amount of waste diverted from landfill and hence the reduction in the level of waste to landfill thus amounts to a range between 1.129 and 1.677 ktonnes/year for the year 2020.

STRATEGY SCENARIO 2 –INCINERATION

For this scenario, it is assumed that waste incineration plants will be established. Thus, at the end of the planning horizon (year 2020), it is assumed that 35% of the total municipal waste amount is treated by incineration, reflecting a situation in which should be invested in 3 to 4 incinerator plants with a capacity of 240.000 tonnes/year. No changes are made on the targets for re-cycling and bio-treatment as it is considered difficult to implement these measures beyond the actual requirements of the EU legislation.

Table 6-11 : Assumptions for the Municipal Waste Flow for the Period 2002–2025, Strategy Scenario 2 – Increased Incineration.

Assumptions for the Forecast for the Flow of Municipal Waste Current situation Target1 Year1 Target 2 Year 2 Population growth -0,21% GDP growth 3% 3% Coverage of waste collection 60% 95% Share biodegradable waste 50% 50% Share packaging waste 25% 25% Share MSW landfilling 100% 33% 2020 Share MSW recycling 0% 0% 0 35% 2020 Share MSW incinerated 0% 35% 2020 Share biodegredable composted 0% 0% 0 65% 2020 Residues: From recycling: 10% From bio-treatment: 20% From incineration: 30%

The estimate on the future waste flow calculated on the basis of the above-mentioned assumptions is illustrated in Figure 6-3 and Figure 6-4:

Scenario 1- zero MSW generation growth

2.000.000

1.800.000

1.600.000

1.400.000 Generation 1.200.000 Coverage

1.000.000 Recycling

ton/year Composting 800.000 Incineration 600.000 Final Disposal

400.000

200.000

- 2000 2005 2010 2015 2020 2025 Years

Figure 6-3: Strategy scenario 2 - Estimates of projected volumes of waste generated, collected, recycled, composted, incinerated and disposed for the period 2004-2020 assuming a zero municipal solid waste generation growth

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Scenario 2- high growth MSW generation

3.000.000

2.500.000

2.000.000 Generation Coverage Recycling 1.500.000 Composting ton/year Incineration 1.000.000 Final Disposal

500.000

- 2000 2005 2010 2015 2020 2025 Years

Figure 6-4: Strategy scenario 2 - Estimates of projected volumes of waste generated, collected, recycled, composted, incinerated and disposed for the period 2004-2020 assuming a zero municipal solid waste generation growth

Calculated estimates by 2020 through implementation of the Landfill Directive and adoption of the proposed strategy scenario are: • Total MWS amounts : 1.761-2.616 ktonnes/year generated of which 1.673-2.485 ktonnes/year collected • recycled material: 585-870 ktonnes/year • composted material: 544-808 ktonnes/year • incineration : 585-870 ktonnes/year • Landfill Disposal : 974-1448 ktonnes/year

The amount of waste diverted from landfill and hence the reduction in the level of waste going to landfill amounts to a range between 1.714 and 2547 ktonnes/year for the year 2020.

CHANGES IN LEVELS OF LANDFILL DISPOSAL

Connected with the increase in recycling/composting and incineration (depending on the scenario examined) there will be an associated reduction in landfill disposal. The estimates have been calculated for this reduction in landfill disposal per year, by 2020, under both scenarios. It compares a baseline prediction of landfill disposal levels (a BAU scenario), to the predicted situation under the Landfill Directive.

The increased incineration scenario will lead to larger amounts of waste being diverted from landfill. Therefore, in order to meet Landfill Directive diversion targets, principally adopting incineration would require lower landfill capacities than would be required of recycling/composting. Both the financial costs, and the constraints on access to capital, should favour a strategy based on materials recovery rather than energy recovery.

The level of disposal to landfill is around 38% lower than the level that it would have been without the implementation of the Landfill Directive based on the proposed recycling/composting strategy scenario. Where the Landfill Directive is implemented with support of an increased incineration strategy, the

60 ARCADIS ECOLAS / IEEP / Metroeconomica / Enviro-L Benefits assessment of waste related directives 06/11347 - BiH- Benefits of Compliance with environmental acquis - final report amount of waste sent to landfill in 2020 would be around 45% lower than the amount that would have been landfilled without the directive’s implementation. In the former case, between 669 and 994 ktonnes will have been diverted from landfills and in the latter case between 786 and 1.168 ktonnes. This would significantly reduce the pressure on existing landfills and reduce the need for new landfill site construction.

5.2.46.2.4 Packaging Directive

The Directive sets recycling targets for a number of materials in the waste stream. To calculate the benefits, this study predicted the impact of the directive in terms of future recycling rates for these materials, and compared with an extrapolation of the present situation (in terms of current recycling rates).

At the moment, there is no strategy or action plan for compliance with targets set by the EU Directive on packaging and packaging waste in Bosnia & Herzegovina. Hence, concrete packaging recycling targets have not been set yet.

5.2.4.16.2.4.1 Recycling Rates

One of the most significant uncertainties is how Bosnia & Herzegovina will meet the targets set by the Packaging Directive. The directive sets minimum recycling quotas for the materials. However, there is also an overall cumulative minimum recycling target for all materials.

The scenario for compliance is:

Table 6-12 : Recycling scenario for compliance with the Packaging Directive

Packaging recycling targets 2020 Glass 60% Plastics 22,5% Paper 60% Metals 50%

These are the minimum recycling targets required under the directive. The recovery option makes up the slack between the directive’s requirement for 60% recovery of all packaging (or incineration at waste incineration plants with energy recovery).

5.2.4.26.2.4.2 Packaging Data

General information on the current share of packaging waste is presented in chapter 6.1.4. As a comparison with other SEE countries, total packing arisings per capita are presented in following table:

Table 6-13: total packaging arisings per capita and inhabitants

unit 2004 Total packaging arisings Lower estimate, based on fYR of tonnes/cap. 0,051 per capita Macedonia Estimate for Bosnia & Herzegovina tonnes/cap. 0,073 Higher estimate, based on Slovenia tonnes/cap. 0,081

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Inhabitants (2004) 3.910.000

5.2.4.36.2.4.3 Baseline and Extrapolation

To understand the benefits associated with the directive, one needs to have a baseline from which to proceed.

No figures are available on the composition of packaging waste in Bosnia & Herzegovina in the year 2004. As a second best option, figures from Croatia are used to make a split up of total packaging waste generated and collected between glass, plastics, paper and metals.

Source Average packaging waste composition Croatia Glass 26% Plastics 16% Paper 50% Metals 8%

Source: Ecolas, IEEP, ElectroProject (2005): Implementation and Enforcement Capacities in Croatia - Benefits for Croatia of compliance with the environmental acquis (for EC DG Environment)

Current recycling rates of the most important recyclable waste types are regarded as negligible. We projected forward on a 2% per annum growth (reflecting the supposed linkage between real per capita GDP and per capita packaging waste arisings). We have kept composition constant, though this is bound to change over time.

This study then combined these provided baseline levels of recycling, packaging arisings and composition data with the directive targets for recycling to derive the changes in levels of recycling each year from 2004 to 2020.

Table 6-14: Estimated tonnes recycled and the changes in recycling levels per year (in tonnes and percentage) due to the Packaging Directive by 2020,

Waste type tonnes/year recycled by Change in recycling compared to a BAU scenario implementing the Packaging Directive tonnes/year %

Glass 56.939 +56.939 +100% Plastics 13.140 +13.140 +100% Paper 109.499 +109.499 +100% Metals (households) 14.600 +14.600 +100%

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5.36.3 SUMMARY AND INTERPRETATION OF RESULTS

5.3.16.3.1 Summary results of the assessment

The main benefits from implementing the Waste Directives are: • Better management and monitoring of waste streams through the Waste Framework Directive. • Lower pollution to groundwater and surface water from leakage of unprotected landfills and, as a result, lower risks of contaminating drinking water. • Reduced health and explosions risks as well as lower impact on global warming as methane emissions from landfills are captured and made to generate energy. A priority is that existing landfill sites will have to be upgraded and illegal dumping sites closed. • Benefits to eco-systems and other environmental resources as emissions from waste activities into air, water and soil are reduced and the recovery of energy is increased through the Incineration Directive (cf. incineration of medical waste). • Increased efficiency in the use of material and reduced production of primary material as a result of higher levels of recycling. This is a result of the targets of the Packaging Directive, diversion targets from the Landfill Directive and targets of the WEEE Directive, ELV, Batteries, Waste Oils etc. directives. • Lower costs for waste collection, treatment and disposal, as less waste will be produced.

EU waste directives will help avoid:

5.3.26.3.2 Extent of the benefits • The full implementation of the Landfill Directive will lead to a reduction of methane emissions (captured) of between 19 and 191 ktonnes annually by the year 2020. • Associated with the increase in the levels of recycling/composting and incineration, implementation of the Landfill Directive will lead to a decrease in landfill disposal levels. Estimates for a decrease in landfill disposal levels (per year) by the year 2020 were calculated as the levels of disposal under the Landfill Directive, as a percentage of the non-implementation baseline. Under the recycling/composting scenario the disposal would be around 63% of non- implementation levels (i.e. a 38% decrease), and under the incineration scenario it would be around 55% of non-implementation levels (i.e 45% decrease). • The quantitative assessment of the impacts of the Packaging Directive provide predicted changes in recycling levels across all materials. The estimates for the increases in recycling levels for Bosnia & Herzegovina, per year, by 2020 are:

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• for glass: +57 ktonnes; • for plastic: + 13 ktonnes; • for paper: +109 ktonnes; and • for metals: +15 ktonnes • For all the recyclables together, the increase will amount to around +194 ktonnes.

5.3.36.3.3 Summary of analysis approach

The qualitative assessment as described in the general part covers the following waste directives: Framework Directive on Waste, Landfill Directive, Packaging Directive, Incineration Directives, Hazardous Waste Directive, Disposal of Waste Oil Directive, Sewage Sludge and Soil Directive, Batteries and Accumulators Directive, Disposal of PCBs and PCTs Directive, and the Titanium Oxide and Daughters Directive. Each analysis described the health, non-health exploitation, ecosystem, social and wider economic benefits of compliance.

The quantitative assessment on the other hand, only examined the potential benefits from the Landfill Directive and the Packaging Directive and is covered for each SEE country in this chapter. As described in the methodological discussion, the externalities that we were able to value were principally associated with health impacts. There are obvious gaps in the scope of both the methodology and the directives examined.

The qualitative assessment outlines important possible benefits from the directives not analysed in the quantitative assessment. For example, the potential benefits for health from compliance with the Hazardous Waste Directive (incl. medical waste, hot spots) are significant. Therefore it would be possible to apply this study’s methodology, which has yielded interesting results, to the assessment of other Directives such as this one. An examination of the extent and type of qualitative benefits (especially related to health for this methodology) from the directives not examined in the quantitative section gives a good indication of the scope for expanding the analysis. Examples include quantitative assessment of the benefits from the Hazardous Waste Directive (as mentioned above), the Sewage Sludge and Soil Directive and the Incineration Directive.

The results from this study do allow some important comparisons to be made. The advantage of attempting a holistic assessment of the benefits is that one is able to examine the combined results from the qualitative and quantitative assessments. While these results are not directly comparable, they are informative in a number of other ways.

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67 BENEFITS ASSESSMENT OF NATURE RELATED DIRECTIVES

7.1.1 Current Status of Biodiversity and Ecosystems

Major ecosystem types abound with a great diversity of habitats, ranging from bare rocks (especially in the karstic region – Mediterranean highland landscapes), to different grasslands, a variety of broadleaf and coniferous forests and wetlands.

The area under protection is very small, and biodiversity is threatened by many factors. The only protected species are several tree species and some game species. Wetlands are considered to be among the most endangered habitats. Apart from forests, other ecosystems and habitat types are not well represented in the protected areas.

There is no inventory of all these habitats according to the methodology of European conventions (Bern Convention particularly) or directives (Habitat Directive), although an extensive and precise phytocoenological division exists in the scientific literature. The terms of reference for a COoRdination of INformation on the Environment (CORINE) Biotope project has been prepared, but the project has not yet been carried out. The CORINE project will provide the basis for the transposition of a purely scientific phytocoenological division onto an applied habitat based division of Bosnia and Herzegovina’s biodiversity, and it will enable registration of its habitat types into common European databases. Forest Ecosystem An important characteristic is the presence of large portions of virgin forests or forests in a near-natural state. A very well known example is the Perucica virgin forest (in Sutjeska National Park) and other smaller reserves of about 2.000 hectares. Most of the other forests are naturally reproduced, thus maintaining the original gene fund. There are more than 25 distinct forest communities on the country’s Map of Potential Vegetation, excluding refugial and azonal communities on restricted areas. Agricultural ecosystem According to the former soil classification, which delimited the area on the basis of soil quality, slope and agricultural potential, the best categories of soils are in the valleys of the rivers Una, Sava, Vrbas, Bosna, Drina, Sana and Spreca. In the highlands the agricultural land is of a poorer quality. The war has left it devastated, often with large strips of mined land. Livestock production includes cattle, sheep, pigs, fisheries, bee-keeping, poultry and fish farming.

A large share of agricultural land is suitable for grassland only both for environmental and for economic reasons. The consequence is that extensive animal husbandry, mainly sheep breeding, has developed in both entities, particularly in the hills and mountains. Although the system of nomadic pasture has almost vanished, it still exists in some parts. Shepherds move with their sheep from the centre of the country to the north.

7.1.2 Indicators used to assess the current state of nature protection and biodiversity

The main indicators used to assess the current state of nature protection and biodiversity in the B&H include: • size of protected areas (expressed as per cent of country surface area and number), complemented by number of rare and threatened habitats; • estimates of the expected growth in protected areas; and • species status: total number, endemic and threatened species and species density.

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These indicators can give only a general indication of the nature protection and biodiversity status in the B&H. Each is discussed in more detail below.

SIZE OF PROTECTED AREAS

According to the Law on Nature Protection of the Federation of Bosnia and Herzegovina14 and the Law on Nature Protection of Republika Srpska15, there are four types of protected areas: nature protection areas, national parks, natural monuments and landscape protection areas. Up to 1990, according to the Law on Protection of Nature (1970), and Law on Protection of Cultural, Historical and Natural Heritage, only 0.55% of the territory of Bosnia and Herzegovina was protected (253 areas - 28,127 ha) - under two national parks in Republika Srpska (Kozara and Sutjeska). This is among the lowest percentages in Europe, and it is likely one of the reasons why the National Environmental Action Plan (NEAP) identifies the enlargement of protected areas as a priority. The disposition of protected areas is displayed on Error! Reference source not found. and detailed information is given in Annex 1.

Figure 7-1: Map of B&H national parks, nature parks and reserves

The 1981-2000 Physical Plan for Bosnia and Herzegovina proposed 16 national parks and adopted a target for protected areas of 16% of the territory; however, due to the intervening war, this goal was not achieved. The current structure of the protected areas' system, which remains based on the old system used by the former Yugoslavia, does not correspond to the categorization in the new Laws on Nature Protection or to the IUCN classification. It is therefore important to revise the system in line with the new Laws. Such a revision should also include different ecosystems, since at present most protected areas are forests. Furthermore, of the small area that is officially protected (see Annex 1), little is considered to be really protected.

14 Official Gazette FBiH 33/2003

15 Official l Gazette RS 50/2002

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Table 7-1: Protected Objects

There are no management plans, and the protection regime in the protected areas (except for the national parks and the new Hutovo Blato and Blidinje nature parks) does not meet the requirements of nature protection. There have recently been major efforts to improve the system and to enlarge the area of protection with the support of the international community.

The Federation of Bosnia and Herzegovina’s Ministry of Physical Planning and Environment is planning the establishment of new national parks in the following areas:

River Una on the border with Croatia, for which a feasibility study has been requested by the Ministry to be financed by the Government’s budget;

Igman/Bjelasnica mountain: a feasibility study was financed by the EU in 2001 and is now awaiting financial support for a physical plan;

The Prenj-Cvrsnica-Cabulja area (for its biodiversity characteristics): a feasibility study was also financed by the EU in 2001 and is now awaiting a physical plan; and

Vranica Mountain: a very interesting karst and water area that encloses architectural monuments and the village of Blagaj. The area was also the object of an EU PHARE and World Bank study, which was finished in 2001, and is now awaiting a physical plan by the Government.

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ESTIMATES OF THE EXPECTED GROWTH IN PROTECTED AREAS

There are current initiatives for enlarging existing protected areas (National parks Sutjeska and Kozara) based on the IUCN categorization. Particular attention is given to the protection of virgin forests in the zones of Lom, Janj and Perucica near Sutjeska.

According to the Spatial Plan of Bosnia and Herzegovina and the Law on Physical Planning, it has been planned to protect actively about 16% of the territory of Bosnia and Herzegovina.

The SAP (Stabilization and Association Process with the EU) negotiations with Bosnia and Herzegovina started in 1999. A feasibility study on opening SAP negotiations with B&H was adopted in 2003, and it will contribute in general to the improvement of environmental management.

SPECIES STATUS: TOTAL NUMBER, ENDEMIC AND THREATENED SPECIES AND SPECIES DENSITY

There is no official biodiversity monitoring. Although Bosnia and Herzegovina is a member of the Environmental Information and Observation Network (EIONET) of the European Environment Agency (EEA), the responsibilities for data flows are difficult to meet owing to the lack of human and technical resources, as pointed out by the recent report of the EEA Topic Centre on nature conservation. Concrete measures for establishing and improving the information collection and dissemination system are being taken.

The data available show that most endangered species are vascular plants or birds.

Table 7-2: Species categorized according to IUCN's classification16

Group Endangered Vulnerable Rare Mammals 1 0 0 Birds 16 39 18 Freshwater Fish 8 4 23 Amphibians 0 0 7 Vascular Plants 48 11 303

Few protection programs have been already initiated. Feasibility studies on endangered natural values - eco-system are now being developed. Also, the list of plant species (Pteridophyta and Spermatophyta) for the so-called Red List of Bosnia and Herzegovina has been prepared, including some preparatory work on some animal species.

7.1.3 Threats to Biodiversity in B&H

In this section the major direct and indirect threats to biodiversity in B&H are analysed.

16Ex: Extinct. Not found for 50 years. E: Endangered. Taxa in danger of extinction. V: Vulnerable. Taxa believed to move into the "Endangered" category if the causal negative factors continue operating. R: Rare. Taxa with small populations that are not at present "Endangered" or "Vulnerable", but are at risk. V+: Species of special concern I: Indeterminate. Taxa known to be "Endangered", "Vulnerable" or "Rare", but there is insufficient information to determine which category. K: Insufficiently known. Taxa suspected to belong to one of the mentioned categories. NT: Not threatened.

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7.1.3.1 Direct threats

HABITAT LOSS AND FRAGMENTATION DUE TO POLLUTION, URBANIZATION, INFRASTRUCTURE DEVELOPMENT AND EXTRACTION OF NATURAL RESOURCES

Energy, and particularly hydropower, may pose a threat to biodiversity. Most rivers in Bosnia and Herzegovina are dammed, leading to habitat degradation and conversion and watercourse fragmentation.

The plans to build a highway as part of the European Transport Corridor 5C could be a serious threat if nature conservation concerns are not taken into consideration.

Some 10.000 hectares are damaged by ore mining, and only 10% have been rehabilitated. In addition, 3 of the 14 investigated sites had been contaminated with depleted uranium (DU). Usually soil contamination is found up to 200 meters from the contamination point (where DU was used), and in these areas DU in drinking water and air was reported. Contamination with DU may cause more environmental and health problem in the future in these areas.

OVER-EXPLOITATION OF ECOSYSTEMS AND SPECIES (INCLUDING HUNTING)

No problems related to over fishing where reported and Fish farming has significant potential, thanks to natural resources and imported fish fodder.

There is no evidence in official papers or in other documents that hunting poses a serious threat to biodiversity. However, there are no recent inventories of game or official statistics on the number of hunted game. The general view is that game numbers have decreased since the war to a biological minimum. The users of hunting grounds carry out regular counts (censuses) to draw up annual hunting plans, but these data are not published. According to ministry officials in the two entities, the situation is now improving. Poaching has been reduced and game populations are not disturbed on the same scale as during the war. Hunting is regulated by the Law on Hunting in Republika Srpska (Official Gazette of RS 4/02). A similar law was drafted in the Federation and is now going through parliamentary procedure. The Federation’s current law dates from 1990. The hunting grounds are used by hunting associations, forestry enterprises and other organizations registered for hunting, which have the right to do so in accordance with the law. The hunting grounds are managed according to hunting management plans for a period of at least 10 years. These are based on inventories (or more precisely censuses) drawn up by hunting associations and by experts from the faculties of forestry in Sarajevo and Banja Luka. Republika Srpska’s Law on Hunting grants 10 mammal species and a large number of birds protection (seasonal limitations). The otter and the squirrel, as well as many birds (including vultures), enjoy permanent protection. All game species are listed in the Law. They all fall under a hunting regime defined by the annual plan of the association that manages the particular hunting ground. For protected species there is a special hunting regime with different types of limitations, and the hunting of permanently protected species is banned. • Forest-specific threats

The forests are facing many threats, related mostly to the war and to post-war activities. The basic threats are minefields (it is assumed that more than 10% of the forest area is still mined), degradation due to the illegal exploitation and uncontrolled change in land use in favour of urbanization and infrastructure. Since access to many forests is limited, interventions during forest fires and forest disease outbreaks are impossible.

In addition, the collapse of energy supply during and immediately after the war has resulted in widespread illegal logging for firewood close to settlements. It is estimated that forest density and production will take up to 50 years to recover.

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The damage to forests is estimated at about € 2 billion. However, based on information from the Ministries of Agriculture, Water Management and Forests in both entities, the situation is now improving; control over illegal activities is being re-established, illegal cutting has almost stopped, and the illegal timber trade and export, with some exceptions, is being restrained. Nevertheless, problems remain: about one tenth of the area is still inaccessible due to landmines; there is clear-cutting along existing roads; and the forest structure has been damaged from over-ageing, landmines and other problems. Forest exploitation is low overall, but excessive in certain areas. There are only 8 km of forest roads on 1.000 ha in the country, which is far below the European average. Consequently, accessible forests are overused, remote stands are becoming overgrown and the quality of wood is decreasing. Generally, timber production in the forests is relatively low.

7.1.3.2 Indirect threats

POLLUTION

Pollution, although it has decreased as a result of the recession, is still a serious threat to biodiversity. Aquatic ecosystems are under great anthropogenic pressure, not only from industrial activities, but also from mining, municipal waste water and agricultural runoff. The upper flows of pristine rivers are being polluted with waste from illegal sawmills. Although soil is not monitored, it is expected that it was heavily polluted with prior pesticide uncontrolled and excessive use.

Air pollution is still a problem in some areas (e.g. Tuzla canton).

Contamination with depleted uranium linked to mining activities is also an issue in some particular areas.

More on water and air pollution can be found in the dedicated thematic chapters.

NATURAL HAZARDS

Frequent floods prevent sustainable intensive agricultural production on about 40% of the land – eg in karst fields and in valleys and plains (about 170,000 hectares) in the area of the Mediterranean region, from the southern Dinarides up to the Illyric-Mesian ecological-vegetation region..

Erosion is an important problem and has damaged 89% of the land, 10% badly.

Fires in recent years have burned thousands of hectares of agricultural land and forests.

In this regard, a specific problem is represented by mines, since access to many forests is limited and interventions during forest fires and forest disease outbreaks are impossible.

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1400 200 175 180 1200 158 156 160

1000 140

120 800 104 100 1300 600 1260 80

400 numberfires of forest Total area burned (Ha) burned area Total 709 634 40 200 20

0 0 1993 1994 1995 1996 Year

Total area burned (Ha) Number of forest fires

Figure 7-2: Forest Fires 1993-1996

LAND ABANDONMENT

Land abandonment in B&H is a significant phenomenon. There is no register of agricultural holdings in either entity17. The land-use structure changed after the war, with more land left unused. Furthermore, large areas have been devastated, arable land has been abandoned, large tracts of land are mined, and fires in recent years have burned thousands of hectares of agricultural land and forests. Although there are no exact data from land-use monitoring, estimates suggest that, on average, at least 50% of the agricultural land is underused or unmanaged. The intensive use of fertile soils (ploughed land planted with annual and permanent crops) and pastures, mainly in hilly and mountainous regions of the Federation, is growing. The situation in Republika Srpska appears to be slightly better. The situation is the worst in areas that were abandoned by refugees who have not returned. About 200.000 hectares are mined, and it is estimated that it will take 40 years to clear all the mines in agricultural areas. Some 10.000 hectares are damaged by ore mining, and only 10% have been rehabilitated.

TOURISM

The tourism activity seems relatively small and at the moment do not appear to represent currently a relevant threat to the environment. However, the World Trade Organisation (WTO) noted a sharp increasing trend in the international tourist arrival: +36% from 1995 to 2000.

INSTITUTIONAL AND ECONOMIC CONTEXT

Many problems need to be solved. First of all, there is a need for an efficient regulatory and institutional framework to support development and to protect the natural heritage.

In today's post-war Bosnia and Herzegovina the environmental issues are, according to Dayton Agreement, placed under the jurisdiction of the Entities. One of the consequences of war was the total destruction of valuable documentation, projects, feasibility studies, and databases with results and

17 Only some basic land data are collected: a soil map on a scale of 1:400.000 was completed in 2003, and agro- ecological zoning was carried out in the same year. In addition the Food and Agriculture Organization of the United Nations (FAO) published some basic land use and soil data on a scale of 1:200.000

71 ARCADIS ECOLAS / IEEP / Metroeconomica / Enviro-L Benefits assessment of nature related directives 06/11347 - BiH- Benefits of Compliance with environmental acquis - final report records of previous long term research and observation work on the condition of natural heritage. So, the huge task on rehabilitation and analysis of present condition of eco-system is still to be done.

Implementation of serious environmental management activities is unpredictable and uncertain, due to limiting circumstances at this moment such as: lack of staff in both entities’ Environment Ministries, the country’s complex administration and its lack of financial resources, low social standard, priority given to existing projects with higher economical and social significance, low organisational level, low professional level, long-term communicational isolation, etc.

In B&H there is no substantial domestic funding for nature conservation so far. All funding comes from international donors. The non-existence of permanent financial resources for the protection of biological diversity is a serious problem. B&H is planning to use EU financing programmes for the implementation of nature legislation such as Bird Directive, Habitat Directive, Natura 2000 Network etc.

Nature protection laws18 are in place, but with low level of implementation. Furthermore, the new forest management regulations partially overlap with the previous nature protection laws, leading to uncertainties and confusion. B&H also lacks of a general strategy for nature and biodiversity, although a proposal is being drafted.

7.2 ASSESSMENT USING QUALITATIVE AND QUANTITATIVE DATA

7.2.1 Environmental Benefits

One of the main benefits for B&H will lie in the relevant increase in protected areas – both in the level of protection within the areas and their protection from human activity and in the increased breadth of areas planned. At present, the protected areas cover only 0.55% of the national territory, but it has been planned to rise to 16% (covering more than 800,000 Ha). Although it is difficult to establish whether this should be sufficient to protect the most valuable biodiversity areas in B&H, it can be noted that this is in line with the EU average extension of protected areas (about 15-30%19). In general, the bigger the surface protected, the broader the benefits should be – if the Directive’s requirements for conservation and protection measures are put into place.

The Habitats Directive would encourage increased protection for threatened plant species (such as Pteridophyta and Spermatophyta) and animals, but due to the poor quality of statistics it is impossible to draw any quantitative conclusions concerning threatened species.

The war seriously threatened the B&H forest, and the damages due eg to illegal logging, mines and fires amounted to about EUR 20 billions. Implementing the EU regulation can avoid additional costs and help mitigating the existing problems. For instance, improved forest management, eg in light of the EU Forest Strategy, will likely benefit the forest biodiversity, leading to reduced illegal hunting, poaching and unsustainable harvesting of timber and non-timber products, reduced forest fires, etc, The construction of adequate forest roads can also increase the accessibility to the forest and improve the forest maintenance.

18 The Law on Nature Protection of the Federation of Bosnia and Herzegovina (Official Gazette F BiH 33/2003) and the Law on Nature Protection of Republika Srpska (Officia l Gazette RS 50/2002)

19 Miller, C., Kettunen, M. & P. Torkler. 2007. Financing Natura 2000 – Guidance Handbook (revised version, May 07). European Commission, Brussels, Belgium, 102 pp.(draft version)

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Adequate management, together with national and/or EU funding can also help address the problem related to mines in forest and agricultural land, which currently affects 10% of the B&H territory. This will benefit forests, eg by because of improved access in case of forest fires or diseases, and agriculture, eg by extending the farming area and therefore reducing land abandonment (currently 50% of land is unmanaged or underused). The aquatic ecosystems will benefit from improved water quality (eg implementing the Water Framework Directive20), reduction of industrial pollution, regulation or closure of illegal sawmills, better management of municipal waste (by implementing the Landfill Directive21), reduction of pesticide and agriculture run-offs and more sustainable mining activities. .

Implementing the Habitats and Birds Directive can also lead to improved the collection of environmental data, most of which have been destroyed during the war. A database of hunted game will also help regulating hunting and reducing poaching.

The adequate adoption and implementation of the EU legislation can also help streamline and give coherence to the current national laws on nature protection and forest management, which are sometimes overlapping and/or unclear.

7.2.2 Social Benefits

Increasing the size and level of nature protection will lead for instance to improve the landscape amenity. Natural parks and biodiversity hotspots will be better managed, therefore offering opportunities for locals and tourists to visit the areas and enjoy open-air activities, enhancing their amenity and recreational value. Improved amenity values will be a major social benefit not only for people living in B&H but also for visitors coming from Europe and other parts of the world.

Furthermore, volunteers and community organisations could also be involved in nature protection activities, eg in Natural Parks.

Mines clearance, through adequate management and EU/national funding, and decreased fires can make the environment safer, and also increase employment in the agriculture sector – given that a higher percentage of land could become arable.

Furthermore, addressing the problem related to depleted uranium will have direct benefits to human health and potentially reduce morbidity cases.

Implementing the Acquis may improve the education and training of institutional staff, and can potentially lead to spread environmental education in schools and among citizens. Implementation of the nature protection Directives is then likely to lead to increased awareness of the importance of protecting biodiversity, and opens up the opportunity for the adoption of more integrated approaches towards nature protection.

Natura 2000 sites will also offer opportunities for eco-tourism and leisure activities (see section on ‘recreation and tourism benefits’). Also, stimulating activities like eco-tourism and sustainable agriculture can help maintaining cultural identity, eg preserving traditional agriculture practices and enhancing the value of traditional handicraft (eg in the mountain areas).

20 Directive 2000/60/EC of the European Parliament and of the Council establishing a framework for the Community action in the field of water policy

21 Council Directive 99/31/EC

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7.2.3 Economic benefits

The main economic benefits are grouped into broad categories and described below.

LOCAL PRODUCTS AND ORGANIC FARMING

Organic farming and local crafts in B&H have not been the object of any specific development effort yet. More support could be given to the production of local goods. In particular some efforts could be made to organize cooperatives to help sustain local rural communities in their production of items such as fruit and vegetables, honey and flour.

There is a potential benefit of developing a niche market for local products or to develop ecologically certificated brands (see also section on ‘Recreation and Tourism Benefits’ below). These could be a valuable economic opportunity and could be protected by a particular/Natura 2000 logo22. Organic farming and biodiversity friendly agriculture could be for example a profitable source of revenue that could benefit from an improved environment. For instance, the valleys of the rivers Una, Sava, Vrbas, Bosna, Drina, Sana and Spreca – which have the best soils - are suitable for sustainable crop production (wheat, barley, soybean, corn), cattle breeding, orchards (plums, apples, pears), vegetables and medicinal herbs production.

RECREATION AND TOURISM BENEFITS

Although estimate on tourism potential are not available, it can be noted that current contribution of tourism to B&H GDP is increasing but remains relatively modest. An improved landscape and protected areas management, together with appropriate branding, could increase its contribution further, with positive spin-off effects on the market of local products (eg from agriculture) and traditional goods.

Sustainable tourism in the coastline and in Natura 2000 sites can provide job opportunities and revenues (eg from entrance fees). However tourism may pose threats to protected areas if the flows of visitors are not regulated. Making sure that tourism impacts will not offset the benefits gained will be a challenge for the national and local governments of B&H.

B&H offers unique possibilities for attracting both foreign and domestic tourists, but, so far, the eco- tourism has not been paid significant attention. The territory of Bosnia and Herzegovina is endowed with a valuable natural and cultural heritage, which, if carefully administered, may become a major source of revenue for the country. The main possibilities include: Mountain and adventure tourism (rafting, canyoning, trekking, skiing); Thermal spas; Cultural and rural tourism; and Transit tourism. (See Annex 1 or further details on tourism development possibilities).

In addition, the rivers of B&H could become a source of sustainable quantities of fish for local and tourism consumption, and could also provide a location for a sustainable fishing tourism activity. More information on the benefits related to improved water quality is presented in the chapter on Water. At present, Bosnia and Herzegovina does not have the infrastructure to support such diversified tourism. Providing good-quality rural hotels or guest houses, hiking trails and cycling circuits would help develop sustainable tourism. There are some old hiking trails, but they need to be upgraded and maintained. There are no cycling circuits, and good-quality rural hotels and guest houses are very scarce. In rural communities the focus is on the creation of economic activities that enable inhabitants to remain on the territory rather than migrate to urban environments in search of work. This is done through the

22 see also ten Brink P, C Monkhouse and S Richartz Promoting the Socio-Economic Benefits of Natura 2000. Background Report for European Conference on “Promoting the Socio-economic Benefits of Natura 2000” Brussels 28-29 November 2002 IEEP 2002, www.ieep.org.uk

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DIRECT EMPLOYMENT BENEFITS

The implementation of The National Environmental Action Plan (NEAP), adopted by the two entities (but not the national Government) in 2003 would be a first source of employment. The NEAP identifies a number of biodiversity priorities related to the need for the categorization and development of inventories, for example, of habitats in the Mediterranean coastal belt, of invasive species of plants, animals, fungi and monera, and of native types of plants and breeds of animals. The NEAP calls for an assessment of the current state of endangered plants, animals and fungi, the preparation of red lists, based on IUCN criteria, and the preparation of maps of flora, fauna and fungi. It also foresees the creation of a national gene bank of domestic plants and animals and the propagation of endangered plants and animals in ex situ conditions. The NEAP also stresses the importance of preparing a national strategy and action plan for genetically modified organisms (GMOs) and invasive species, preparing programmes and standards for the sustainable use of biological resources, passing legislation on biodiversity in accordance with EU criteria and ensuring the conditions for signing and ratifying relevant international documents.

The Habitats Directive requires Member States to establish the necessary conservation measures, including appropriate management plans where necessary. Management plans will include activities such as monitoring, reporting and assessment of the conservation status of habitats and species protected within the Natura 2000 network, research and scientific work, as well as daily administrative tasks. As the number of protected areas is going to increase in the near future, activities related to nature protection, including implementation and drafting of management plans are likely to generate some increased employment.

Further job positions could be created in nature conservation/management bodies (eg ministries of the environment, National Park bodies, etc) at national, regional and local level. This potential source of employment is all the more important since it has been planned (according to the spatial Plan of B&H and the Law on Physical Planning) to protect actively 16% of the territory of B&H, a ratio that is far beyond the current level of 0,5%. For instance, it is reasonable to expect that more employment will be generated in park management and other related professional roles.

Increased tourism and eco-tourism induced by improved environmental conditions could also increase job opportunities in the recreation sector, eg for tour guides, hotels, restaurants, local products providers etc.

Mines clearance and the development of sustainable/organic agriculture, eg through incentives such as Payments for Environmental Schemes (PES), could also generate additional employment (and profits) in the primary sector.

MITIGATION/PREVENTION OF NATURAL HAZARDS

Enhanced ecosystem services could mitigate the problem of erosion (affecting about 89% of the country) and floods (affecting 40% of the territory), which represent a serious threat in B&H.

As mentioned above, mine clearance and better forest management can help also reduce fires, which have historically been seriously damaging large areas of forest and agriculture land (eg 1,260 ha in 1996)

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FORESTRY RELATED BENEFITS

Forests cover a nearly half of the B&H territory and are key habitats, but not a relevant economic resource since low forests and shrub lands of low production value are dominant. Improved management could make forests more attractive for (eco) tourism activities.

Furthermore, it has been estimated that the war lead to forest damages amounting to about EUR 2 billions. Adequate management and protection could help not only avoiding further costs, but also recover from the damages in an effective way (eg restoring plants density and production in timely way etc) The NEAP proposes a number of measures and activities, including the development of a long-term programme for forest development, mid-term forest management plans, a programme of widespread forest reproduction, the expansion of protected areas, forest certification, improved accessibility to the forests through road building, removal of mines from the forests and monitoring. Implementing the Habitats and Birds Directive may stimulate the development and implementation of sustainable forestry strategies.

Increased training for forest staff and national expert in the field of nature protection monitoring techniques and management can be seen as a wider economic benefit as it increase the scientific capacity of national staff and can lead to economic benefits in the future for the country (skills can be transferred further to other countries).

7.3 CONCLUSIONS

A wide range of benefits arise from the implementation of the Habitats and Birds Directives as B&H moves towards accession and full implementation. Key results will include the following: • The current area protected in B&H is about 0.5% of the land area, one of the lowest percentages in Europe, but there are plans to increase the total protected area to 16%; the information available does not allow to establish whether this is a sufficient coverage, but is on line with EU average (15-30% coverage). • EU accession may help mitigate some of the major threats to biodiversity in B&H, such as habitat loss and fragmentation due to urban/infrastructural projects not taking into account environmental impacts, overuse of resources and water pollution. • The environmental benefits are mainly those resulting from the effective protection of endangered and endemic species and fragile ecosystems (like forests); implementing the EU legislation will therefore lead to a reduced the level of risk to which species are exposed. • Key social benefits will be increased amenity and recreation value and awareness raising, but also increased social safety (eg if mines will be cleared) and health benefits. • The economic benefits can be various: tourism and ecotourism (currently not key economic resources, but with very high potential in B&H), organic farming, sustainable forestry etc, which can lead to increased employment opportunities. • The environmental monitoring, which is currently of very poor quality will be enhanced. Statistics on biodiversity and habitats will be made available and therefore make possible to launch an actual biodiversity management plan.

The above-mentioned benefits should not be seen solely as a national gain. Protecting biodiversity in B&H will bring biodiversity benefits at the European and global scales as well. The benefits of increasing the size and the level of protection of protected areas are shown below.

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Figure 7-3: Benefits of EU accession for the B&H Protected areas: Increased coverage and increased quality

A summary table of the environmental, social and economic benefits is shown below.

Table 7-3: Potential environmental, socio-cultural and economic benefits

ENVIRONMENTAL SOCIO-CULTURAL ECONOMIC

• Enhanced protection of high • Employment (job creation, • High potential for tourism and eco- biodiversity areas (eg forests), reduced depopulation) tourism (including sport activities, including protection of wildlife visits to nature parks etc) • Volunteer work opportunities habitats for native & migratory • Additional EU-funding (PES, LIFE + species • Recreation (eg open air programme etc…) eg for activities) – for locals and • Sustainable harvesting of timber sustainable agriculture, mines tourists – nationally and Tran and non-timber products and clearance etc boundary reduction of illegal logging • Stimulation of local economic • Amenity value (landscape) – for • Sustainable agriculture development locals and tourists - nationally • Restricted fishing & hunting and Tran boundary • Opportunities from forest (sustainable) harvesting • Improvement of environmental • Increased safety (eg due to data mine clearance • Opportunities for organic farming

• Enhanced water quality, including • Reduced morbidity (eg due to • Job creation (eg forest drinking water through reduced reduced pollution from depleted management, tourism, agriculture) industrial pollution and fertilizers uranium)Increased public

from agriculture, regulated environmental awareness mining activities etc • Preserving cultural identity (eg • Reduced habitat fragmentation in mountain areas) through reduction of uncontrolled • Public participation in decision- change of land use (urbanisation) making and more sustainable infrastructures development • Promotion of education and research (eg NEAP) • Reduction of forest fires through better forest management and mines clearance

• Reduction of land abandonment

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78 LITERATURE

Performance and Trends of International Tourism in Europe, World Tourism Organisation www.unwto.org

The World Fact Book (2005), Central Intelligence Agency www.cia.gov

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89 ANNEXES

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Annex 1: Parks and Reserves in Bosnia and Herzegovina

Table 9-1: Big objects No Name Legal Designation Size (ha) Year of Establish. 1 Sutjeska National Park 17250 1965 2 Kozara National Park 3375 1967 3 Jahorina Nature Park 2000 1954 4 Perucica Primeval Reserve 1434 1954 5 Trebevic Nature Park 1000 1954 Total 25059

Table 9-2: Small reserves No Name Legal Designation Size (ha) Year of Establish. 6 Hutovo Blato Bird Reserve 350 1954 7 Pljesevica Primeval Reserve 50 1961 8 Lom Primeval Reserve 295 1956 9 Zuca Ribnica Primeval Reserve 30 1955 10 Durmisevica Primeval Reserve 44 1980 11 Janj Primeval Reserve 195 1954 12 Mastna Luka Strict Reserve 100 1966 13 Rujiste Strict Reserve 100 Preventive protection 1980 Total 1164

Table 9-3: Reserves of picea omorika Panc. No Name Legal Designation Size (ha) Year of Establish. 14 Veliki Stolac Strict Reserve 40 1955 15 Bozurevac Strict Reserve 10 1955 16 Gastilja Strict Reserve 50 1955 17 Novo Brdo Strict Reserve 20 1955 18 Plistina- Strict Reserve 20 1955 Igrisnik 19 Strugovi Strict Reserve 30 1955 20 Tisovljak Strict Reserve 10 1955 21 Viogor- Strict Reserve 40 1955 Sahdani 22 Sokolina Strict Reserve 30 1955 23 Stula-Karaula Strict Reserve 20 1955 24 Panjak Strict Reserve 30 1955 Total 300

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Annex 2: Insights on tourism development potential

Mountain and adventure tourism: Enclosing part of the mountains belonging to the Dinaric range, which extends to the Prokletija Mountains, the Sutjeska National Park offers a wide range of ecotourism activities. It is the home of Perucica, Europe’s last primeval forest, and of Maglic Mountain, Bosnia and Herzegovina’s highest peak, and it is crossed by the Sutjeska river, which has carved deep canyons. It therefore offers a potential for mountain sports, ranging from trekking to more adventurous winter mountaineering, rafting and canyoning. The Kozara National park is a protected national forest situated between the rivers Una, Sava, Sana and Vrbas in the northwest. It is a popular hunting spot with over 18.000 hectares of regulated hunting grounds with a wide range of game. It also offers more relaxing activities such as photo safaris, walking and biking. Hutovo Blato is a reserve and a shelter for hundreds of species of birds and game, and therefore offers activities such as boating, bird watching and fishing.

Adventure sport activities: The pristine natural sites of Bosnia and Herzegovina offer great potential for adventure tourism. Close to Sarajevo is the Bjelašnica mountain range, which hosted the 1984 Winter Olympics. It stretches from Sarajevo to Konjic and includes traditional Bosnian villages, watermills and mountain huts along canyons, waterfall, rivers and lakes. There are many mountain huts operated by the

Mountain Association of Bosnia and Herzegovina, which is trying to rebuild and renovate the damaged buildings. Many huts used to be located in the Neretva valley and in the Prenj and Cvrsnica mountain ranges. The Bjelašnica and Igman mountains and the Vlasic and Vranica mountains also have huts to accommodate the hikers that follow the mountain trails. Paragliding is possible from the Visocica Peak over the Rakitnica canyon and rafting and kayaking may be done along the Tara, the Una and the Neretva rivers. The highland plateau of Prenj, also known as the Himalaya of Herzegovina, is exceptionally suited for mountain biking.

Cultural and rural tourism: The villages and towns of Bosnia and Herzegovina are testimony of the different cultures that have passed through the country over the centuries. From the unique stecci – medieval tombstones dotted all over the country – to Roman mosaics, Ottoman architecture and ancient Catholic and Orthodox decorations, the country is rich in cultural heritage. Some of the more noteworthy towns are Mostar, Jajce, Bihac, Trebinje, Travnik, and Neum on the Adriatic, the former residence of Ottoman rulers. Also of interest are the capital cities of the two entities, Sarajevo (Federation) and Banja Luka (Republika Srpska). Medugorje, close to Mostar, is well known for its Catholic shrine of the Virgin Mary.

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Annex 3: Institutional, legal and economic framework

Insights on institutional and legal aspects

The Law on Nature Protection of the Federation of Bosnia and Herzegovina (Official Gazette F BiH 33/2003) and the Law on Nature Protection of Republika Srpska (Officia l Gazette RS 50/2002) are in place, but with low level of implementation.

The Federation’s Law on Nature Protection stipulates three main sources of financing for nature conservation – the Federation’s budget, collected fines and other sources (e.g. donations, taxes). It also calls for the establishment of a nature protection fund as part of the Environmental Fund, but this has not yet been set up. Republika Srpska’s Law on Nature Protection stipulates the budget as a source of financing for nature conservation together with the Environmental Fund. The legal basis for the establishment of the Fund was provided in 2002 (Official Gazette of RS 51/02). Sources other than the entity’s budget for the Fund are foreseen, such as licenses for the use of natural resources, funding from polluters and donations. The distribution of the funds will be according to the Fund’s annual financial plan as approved by the Ministry of Physical Planning, Civil Engineering and Ecology. Conservation of the protected areas is one of the Fund’s main aims. However, there is no substantial domestic funding for nature conservation so far. All funding comes from international donors.

The Law on National Parks of the Republika Srpska (Official Gazette RS 21/1996) also has direct relevance to nature protection. The Federation’s cantons are adopting their own laws on nature protection.

Forest management is regulated by the Federation’s Law on Forests (Official Gazette of FBiH 20/02 and 29/03) and Republika Srpska’s Law on Forests (Official Gazette of RS 66/03). Both are new, and it is expected that they will lead to a better organization and development of forestry. The new Laws on Forests assign institutional authority for national parks, nature parks and nature reserves in the forests. They also prescribe the measures and management that should be undertaken in these areas although they are already regulated in the Laws on Nature Protection. Potentially causing even greater confusion, Republika Srpska’s Law on Forests provides for the Law on National Parks to regulate national parks (but not nature reserves and other protected areas). The Federation’s Law on Forests includes provisions for biodiversity protection (of plant and game species) in forest management.

At present there is no strategy for nature in general or for biodiversity protection in either entity, but project proposals are being drafted to request Global Environment Facility (GEF) funding to support the drawing-up of a national biodiversity protection strategy and action plan.

Insights on economic aspects

It is very difficult to describe the present situation of tourism activities given the poor quality of the statistics. The Ministry of Trade and Tourism in Republika Srpska and the Tourism Department of the Ministry of Trade in the Federation of Bosnia and Herzegovina report that no reliable information is available on the number of tourists in the country, due to scarce enforcement of reporting regulations. No precise information is available on the number of hotels and their categorization either. There is no estimate of the percentage of the national GDP that is accounted for by the tourism industry. The lack of reliable statistical data on the tourist sector, the recent war, the limited road and rail network for fast transit, all constitute important obstacles to the further development of the tourist industry. However, there is a real potential for the development of this sector (see Annex 2) and the growth of this sector is among the highest in Europe.

Despite problems related to overexploitation after the war, generally, timber production in the forests is relatively low.

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As for agriculture, the best categories of soils are in the valleys of the rivers Una, Sava, Vrbas, Bosna, Drina, Sana and Spreca. In the highlands the agricultural land is of a poorer quality. This land is suitable for cattle breeding and complementary activities. The war has left it devastated, often with large strips of mined land.

Livestock production makes up about 50% of agricultural production and includes cattle, sheep, pigs, fisheries and bee-keeping. Poultry production depends mainly on foreign inputs. There is a large deficit of animal products (milk and other dairy products, veal), but there is a possibility for the export of sheep and related products. Up to three quarters of milk and dairy products on the market are imported. Although the current level of meat consumption is low, the production deficit of meat is huge. Only poultry and pork production have recently increased. The meat-processing industry, especially beef and veal, depends on foreign raw materials and not on domestic production. The development of sheepherding is not constrained by demand, and imported mutton is not competitive with domestic meat. Sheep-herding is very important in underdeveloped hilly areas and in the mountains where pastures are extensively maintained and used in a traditional way. However, the consumption of mutton lags behind that of other types of meat.

Poultry and egg production have been developed successfully, and they meet the needs of the population.

Fish farming has significant potential, thanks to natural resources and imported fish fodder. Fish production lacks modern facilities for the production and rearing of fish roe.

Bee-keeping recovered relatively fast and many people have made bee-keeping their primary occupation. The biggest problem is the standardization of honey quality.

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Annex 4 : Quantitative review of methane emissions

Table 9-4: Methane Emissions By Component, USEPA (1998)

Methane Yield (ml/dry gram) MTCE/wet tonne Newspaper 74,2 0,259 Office paper 346 1,207735849 Corrugated Boxes 152,3 0,531613208 Coated Paper 84,4 0,294603774 Al Cans 0 0 Steel Cans 0 0 Glass 0 0 HDPE 0 0 LDPE 0 0 PET 0 0 Food Scraps 300,7 0,335 Grass 144,3 0,214 Leaves 56 0,166 Branches 76,3 0,17 Yard Trimmings 0,191 Screenings Textiles Misc Comb Mixed MSW 92 0,273

A range of estimates for methane emissions per tonne of MSW could be generated from different studies in the public domain. CSERGE et al (1993) looked at estimates from Aumonier and from Warren Spring Laboratory (WSL), and found ranges for best estimates of methane generation of between 53-81 m3 per tonne of municipal solid waste (MSW). The full range, from the low estimate assuming 20% methane oxidation, to the high estimate from Aumonier, was from 25-117 m3 per tonne. Powell’s (1992) mini- survey estimated recoverable quantities of the order 100 m3 per tonne (in which case, the actual quantities would presumably be much higher). Entec (1999) on the other hand, used much higher figures of the order 400-500 m3 landfill gas per tonne of MSW of which 50% was assumed to be methane (i.e. 200-250 m3 methane per tonne MSW). Using typical waste composition figures for the UK, and the USEPA (1998) methane generation figures in the Table above, ECOTEC (2000) obtained a value of 50 m3 at 5% oxidation rates, and only 42 m3 at 20% oxidation rates. It should be noted, therefore, that these are relatively low estimates of methane generation.

Because estimates for methane generation range to such an extent, and also because they are likely based on variables such as composition and climate, this study will take a number of different values for methane generation.

Firstly we will use the UNFCCC inventory data for total country methane emissions from landfill. However, because we have no basis to compare the relative merits of the methodologies, we will also use a value

ARCADIS ECOLAS / IEEP / Metroeconomica / Enviro-L Annexes 06/11347 - BiH- Benefits of Compliance with environmental acquis - final report for methane generation based upon emissions per tonne of waste landfilled. As stated above, there is a wide range of values for methane generated per tonne MSW landfilled and hence this study will use a range bounded by a high and a low value. We have used a range of 25 – 250 m3, which equates to a range of 0,018-0,18 tonnes methane per tonne of waste.