Currently biomass consumption comprises individual, traditional small stoves, ovens, boilers etc., with low efficiencies. The significant use of fuelwood indicates that there could be opportunities for the development of the market for modern biomass heating appliances. Over 54% of the total energy consumption in Bosnia and Herzegovina is in the household sector and 70% of this is fuel wood. Improved stoves and alternative fuels, while outside the scope of this study, are highly relevant in this context [6]).

The study estimated that if 20% of the 18,45 PJ of available fuel wood could be exploited for this purpose this would result in generating 820 GWh of heat annually [5].

6.1.5. Straw fired units

Agricultural residues in Bosnia and Herzegovina consisting primarily of straw account for some 6,63 PJ [5]. Straw may be directly used either in decentralized small, mainly farm based units producing heat for various purposes or in centralized CHP units. Large scale central straw fired units usually require strong economies of scale (capacities in EU are around 100 MW) and are coupled with an alternative fuel, usually conventional one. Considering the significant geographical spread of straw supply and the fact that logistics play a critical role to the economics of such plants it is unrealistic to expect new straw alone fired units to be built. In this respect straw could be merely used for heating purposes either in straw bale fired units or as straw pellet in pellet stoves and boilers. If one third of the technical available straw could be directed to this use it could produce nearly 491 GWh of useful heat [5]. One potential model for utilization of some agricultural residues is in the formation of rural agricultural processing companies. The company supplies seeds, fertilizers, equipment, and training to small rural farmers, and collects harvests (including residues) for centralized, high-tech processing. Sale for process heat and electricity generation converts residues into a valuable marketable product for local and international markets (and ash potentially used for fertilizers). This business model (excluding the energy components) is currently successfully used in some developing countries [6].