The EU’s upcoming cross-border carbon tax could severely affect the economy of the Federation of Bosnia and Herzegovina unless swift measures are taken. Federal Minister of Energy, Mining, and Industry, Vedran Lakić, emphasized the importance of simplifying procedures and subsidizing solar panel installations to mitigate the potential economic strain. The Western Balkans, including Bosnia and Herzegovina, are subject to the EU’s Carbon Border Adjustment Mechanism (CBAM), which will come into effect on January 1, 2026. However, preparatory efforts have been limited.

During a recent meeting with cantonal ministers, Lakić highlighted the urgent need for policy updates and financial support to facilitate solar power development. Enhancing regulations would not only boost domestic industry competitiveness but also help citizens lower electricity costs through the prosumer model, where individuals generate and consume their own solar energy. The minister noted that while some cantons have begun addressing these changes, others remain unprepared.

The ministry is collaborating with the Development Bank of FBiH to establish financial assistance programs to support industrial adaptation. Lakić urged cantonal authorities to implement similar initiatives to ensure a cohesive approach. He stressed that prioritizing the economy over political interests is vital for protecting local businesses from the impact of CBAM. Producing clean energy for self-use would allow businesses to bypass the carbon tax on exports, improving their market position and contributing to the region's energy and economic sustainability.

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