• The high capital cost of biomass energy systems is a major barrier to the increased use of these systems, despite such technologies being among the cheapest renewable energy technologies;

• The capacity to assess biomass energy proposals/loan applications is limited or non­existent;

• There are significant other priorities for public and private funds for reconstruction, food security, poverty alleviation, following the war, and local financial resources are consequently scarce;

• Since there are virtually no biomass energy projects there are no economies of scale;

• A large fraction of the energy economy (fuel wood) operates outside the formal economy;

In order to avoid financial barriers, some promotional mechanisms are usually used in realization of bioenergy projects [21]:

• Feed-in tariffs and fixed premium;. These systems exist in various European countries (including Bosnia and Herzegovina) and are characterized by a specific premium or total price, normally set for a period of several years, that domestic producers of green electricity receive. The additional costs of these schemes are either paid by suppliers in proportion to their total sales volume and are passed through to the power consumers, charged directly to buyers of green electricity or paid by national governments using environmental taxes on conventional electricity. Fixed feed-in systems are used, for example, in Austria and Germany. Fixed-premium systems are used in Denmark, the Netherlands and Spain.

• Green Certificate Systems; A system of green certificate systems currently exists in five EU Member States, as well as Australia. In this case, renewable electricity is sold at conventional power-market prices, but with the right to sell government-issued certificates that guarantee the renewable character of electricity to consumers or producers that are obliged to purchase a certain number of green certificates from renewable electricity producers according to a fixed percentage, or quota, of their total electricity consumption/production. Since producers/consumers wish to buy these certificates as cheaply as possible, a secondary market of certificates develops where renewable electricity producers compete with one another to sell green certificates.

• Tendering; Under a tendering procedure, the state places a series of tenders for the supply of renewable electricity, which is then supplied on a contract basis at the price resulting from the tender. The additional costs generated by the purchase of renewable electricity are passed on to the end-consumer of electricity through a specific energy tax. Pure tendering procedures existed until recently in Ireland and France.

• Investment subsidies; In some countries, direct investment subsidies apply for biomass combustion systems. This is the case, for example, in Germany for domestic wood pellet stoves.

• Tax deduction; Support systems based only on tax deduction are often applied as an additional policy tool to support renewable energy. In the Netherlands for example, a company investing in a biomass combustion system may deduct an additional 44 per cent of the investment cost from their taxable income.