Montenegro is preparing amendments to its pellet price regulations that would tighten controls on retail charges and require producers and distributors to maintain domestic deliveries, as authorities seek to protect households from rising winter heating costs.
The government has set maximum retail prices of €250 per tonne for A2 pellets and €270 per tonne for A1 pellets. Inspections have identified cases in which packaging, transport and other charges were used to increase the final price beyond the permitted limits. The Ministry of Economic Development is preparing amendments designed to prevent businesses from circumventing the price ceilings through mandatory packaging, handling or similar fees. The proposed rules would also oblige pellet producers and distributors to supply the domestic market at volumes no lower than their average deliveries over the previous 12 months.
Domestic Supply Requirements and Export Exposure
The proposed supply obligations could significantly affect producers because exports remain an important source of revenue for Montenegro’s pellet industry.
Domestic production increased from approximately 107,040 tonnes in 2024 to 118,685 tonnes in 2025, while international sales continue to provide manufacturers with an alternative to the regulated domestic market. Requiring businesses to maintain domestic deliveries could oblige them to allocate a share of production to a market where permitted selling prices may offer lower margins than export sales. Manufacturers must also cover expenditure on timber, electricity, transport, packaging and labour, placing pressure on profitability under regulated pricing conditions.
Inspections Identify Pricing Irregularities
Inspections conducted since the price controls were introduced identified eight irregularities, resulting in 16 penalty notices with a combined value of €6,500. The government’s measures are intended to limit increases in household heating expenditure while ensuring sufficient pellet availability during the winter season.
The proposed amendments would address the treatment of additional charges, particularly transport and packaging expenses that can increase the amount paid by consumers above the regulated price.
Transport Costs and Producer Margins
The treatment of delivery expenses remains an important issue for the industry. Pellets are bulky products, and transport costs vary according to delivery distance, order size and whether customers collect their purchases directly from producers. If businesses are prevented from charging separately for additional logistics services, they may have to absorb those expenses or seek adjustments to the regulated prices.
The balance between consumer protection and production economics is particularly relevant in Montenegro’s northern municipalities, where biomass is widely used for heating and alternative energy sources can be more expensive. The amendments have not yet entered into force. Their eventual impact will depend on the final definition of the retail price, the treatment of transport costs and enforcement of domestic-supply obligations for producers operating under existing export contracts.
