Montenegro’s public consultation on the draft National Energy and Climate Plan (NECP) concluded last week. The Ministry of Energy stated that a consultation report along with the final plan could be published within the next two months. A decision on which major hydropower project will start construction first is expected by the end of the year.
The NECP addresses two key national priorities: defining a retirement date for the Pljevlja thermal power plant and determining the portfolio of new plants to replace it. Commissioned in 1982, TPP Pljevlja remains the country’s main electricity source, providing both significant volume and stable baseload to balance the system. The draft plan identifies 2041 as a potential end-of-life date for the plant and notes that a full exit from coal is not feasible without the construction of two large pump-storage hydropower stations, complemented by a major expansion of solar and wind capacity.
Pump-storage facilities are designed to complement variable renewable sources by generating electricity during periods of low sun and wind through controlled water releases, and using surplus electricity at other times to pump water back to the upper reservoir. Project preparation is most advanced for the Komarnica and Krusevo sites, although parts of their planned footprints overlap protected areas, which remains a source of dispute. Komarnica is planned as a storage hydropower plant to operate alongside solar and wind generation, while Krusevo is envisioned as a pump-storage facility. The draft targets 2032 for Komarnica’s completion and 2033 for Krusevo, enabling the phased shutdown of Pljevlja by 2041.
From next year, coal-fired plants in the European Union will be subject to an additional levy. Montenegro plans to seek a deferral of similar obligations until 2030 to avoid sharply higher costs for coal-based electricity. The NECP anticipates combined public and private investment of around 2.5 billion euros in new hydro, wind, and solar capacity by 2035.
State-owned EPCG notes that the NECP outlines measures to cut greenhouse gas emissions and meet Montenegro’s international commitments. The utility emphasizes the need for new generation capacity, citing ongoing projects with international partners on solar and wind developments, as well as modernization of existing hydropower plants. EPCG frames new hydro assets as essential for network reliability and for integrating the large pipeline of planned renewables, especially given the recent energy crisis and elevated wholesale prices.
The company also highlights broader benefits of new hydro projects, including low-carbon renewable output, strategic water reserves, flood protection, irrigation support, improved local living and business conditions, and stable long-term revenues. EPCG references international developments such as Norway’s legislative opening for new hydropower on protected rivers and Austria’s 480 MW Linberg 3 pump-storage project. Under EPCG’s memorandum of understanding with French EDF, HPP Krusevo is a priority, with Montenegro and France expected to finalize the legal framework this year to advance the project.
On prospective carbon pricing for coal-based electricity, EPCG notes that Montenegro can seek an exemption until 2030. The EU is introducing the Carbon Border Adjustment Mechanism (CBAM) for high-emission electricity, while Montenegro already applies a national CO2 regulation. Current EU rules allow Western Balkans economies an exemption from CBAM until 2030, aligned with the anticipated adoption of the EU Emissions Trading System by that date. Final decisions on these measures are expected in due course.
