Montenegro’s state-controlled electricity provider, Elektroprivreda Crne Gore (EPCG), reported significant challenges in 2025, marked by a staggering €142 million import bill for electricity. The company imported 1,341 GWh of power to compensate for domestic generation shortfalls caused by prolonged outages and increased consumption. This situation has raised alarms regarding the sustainability of Montenegro’s energy generation model, heavily reliant on a limited number of assets.
The primary factor contributing to EPCG’s financial woes was the extended shutdown of TPP Pljevlja, the nation’s sole thermal power plant, which was offline for over eight months due to reconstruction efforts. This outage accounted for approximately 780 GWh of the electricity imports, highlighting the vulnerability of Montenegro’s energy balance when a key facility is unavailable.
Compounding the issue, EPCG’s hydroelectric plants, HPP Perućica and HPP Piva, underperformed in 2025. HPP Perućica, with a capacity of 307 MW, produced only about 64% of its planned output, while HPP Piva at 342 MW achieved roughly 75% of its target. Together, these plants are typically essential for maintaining flexibility in the energy supply; however, their reduced output necessitated an additional 320 GWh in imports.
The overall electricity consumption in Montenegro reached 2,909 GWh—104% of what was planned—leading to further import requirements of 73 GWh. This scenario created one of the most financially challenging years for EPCG, which reported a net loss of €92 million in contrast to a net profit of €11 million in the previous year. The loss stemmed not from isolated incidents but from systemic issues involving tariff policies and import dependencies.
EPCG’s financial statements reflected this strain: long-term borrowing costs surged to €141 million from €96 million in 2024, while short-term liabilities rose to €192.5 million compared to €111 million the prior year. To maintain supply continuity amidst these challenges, EPCG relied on new loans, effectively using its balance sheet to shield consumers from the full impact of production difficulties.
The reliance on TPP Pljevlja is critical as it typically generates around 40% of the country’s electricity. Its operational status directly influences national energy security. The current reliance on imports during periods of low hydrology and unexpected outages underscores the need for diversification within Montenegro’s electricity system.
For investors and stakeholders, EPCG represents more than just a utility; it is integral to public finance and the country’s energy transition strategy. With the government holding a 98.5% stake in EPCG, its financial performance carries significant implications for state fiscal policy and investment capabilities in renewable energy projects.
Despite these setbacks, EPCG continued its investment initiatives throughout 2025, focusing on ecological upgrades at TPP Pljevlja and renewable energy developments. However, this creates a complex capital allocation challenge as increased investments are necessary to mitigate future import risks while managing rising debt levels.
Renewable energy projects are now viewed as strategic assets that can help reduce dependence on imports. Initiatives such as the Gvozd wind farm and various solar developments are critical not only for energy transition but also as financial hedges against future market volatility.
Looking ahead to 2026, EPCG reported an improved first-quarter result with a net profit increase to €36.5 million from €10.2 million year-on-year. The government anticipates that EPCG could return to profitability levels around €38 million this year and potentially reach €143 million by 2030. However, these projections hinge on several factors including the operational status of TPP Pljevlja and overall market conditions.
EPCG’s experience in 2025 serves as a cautionary tale regarding the importance of system redundancy and diversification within Montenegro’s energy sector. The substantial import bill reflects deeper structural vulnerabilities that need addressing through strategic investments aimed at enhancing domestic generation capacity and flexibility.
