Montenegro’s 225MW Pljevlja thermal power plant supplied about 40% of domestic electricity generation in 2024, while its ecological reconstruction is addressing sulphur dioxide, nitrogen oxides, particulate emissions and wastewater. The investment, however, does not remove the plant’s dependence on lignite or resolve the need for a long-term closure pathway identified by the European Commission. The reconstruction programme includes flue-gas desulphurisation, nitrogen-oxide and particulate controls, wastewater treatment systems, boiler works and a connection to the district-heating system.
Publicly cited costs range from approximately €58 million for the core environmental contract to around €86 million for a broader package including value added tax. The figures refer to different scopes and are not alternative amounts for the same contract.
Initial testing of the desulphurisation equipment in February 2026 reportedly reduced sulphur dioxide concentration to approximately 61 milligrams per cubic metre, compared with 4,544 milligrams per cubic metre recorded in a March 2025 measurement. The plant remains important to Montenegro’s electricity system. When Pljevlja is unavailable, Elektroprivreda Crne Gore (EPCG) must source electricity from the regional market, exposing the utility to market prices and availability conditions. The ecological reconstruction addresses the plant’s local pollutant emissions but does not eliminate carbon dioxide emissions from lignite-fired generation or the long-term liabilities associated with the mine.
EU requirements remain focused on a closure pathway
The European Commission’s 2025 report said that ecological reconstruction was progressing without resolving the wider issue of a permanent closure pathway and a just transition for the Pljevlja coal region. The environmental requirements governing sulphur dioxide, nitrogen oxides and particulate matter are separate from the broader climate, electricity-market and carbon-cost implications of continued lignite generation.
Montenegro adopted its National Energy and Climate Plan in December 2025, establishing a framework for power-sector reform. The timing of the transition remains linked to replacement generation, electricity storage and transmission capacity. Ending coal generation before those alternatives are available could increase electricity imports and affect security of supply, while continued operation would leave EPCG and industrial consumers exposed to carbon and compliance costs.
The 2025 reconstruction outage demonstrated the cost of a prolonged interruption. EPCG said it had contracted 788GWh of electricity imports for €81.7 million to help cover the shortfall. Hydropower production and regional market prices can change the cost of covering an outage, but the import requirement highlighted the importance of having replacement electricity capacity available before Pljevlja ceases to provide generation.
Replacement capacity and the Pljevlja regional economy
Replacing Pljevlja requires firm electricity supply rather than simply an equivalent volume of installed renewable capacity. The potential replacement portfolio includes the Gvozd wind farm, additional solar and wind projects, upgraded hydropower, battery storage and prospective pumped-storage capacity. These sources can replace annual generation over time but do not automatically provide the same dispatchable output as a thermal unit during periods of low renewable production and high demand.
Interconnections with Serbia, Bosnia and Herzegovina and Italy provide additional flexibility, although electricity imports remain exposed to regional prices and availability. The transition also extends beyond EPCG’s electricity system. The Pljevlja mine and power plant support employment, suppliers and municipal revenue in northern Montenegro, where economic development is slower than in the coastal part of the country. The district-heating connection included in the reconstruction can provide a lasting local infrastructure asset, but it does not replace employment associated with mining.
A regional transition would therefore require funded projects involving remediation, electricity-grid works, renewable-energy construction, forestry, industrial services and worker retraining. EU grants and development-finance institutions can finance infrastructure such as networks, district heating, remediation and worker-transition programmes where their wider social returns exceed direct commercial returns. Commercially viable replacement generation can be financed by EPCG, while non-commercial transition obligations can be separately identified and budgeted by the state.
Reconstruction performance and future operating conditions
A transition framework for Pljevlja can combine annual limits for emissions, operating hours, mine costs and reliability with specific milestones for replacement generation. The electricity system would also need to be tested against periods of low hydrological output, high electricity-import prices and the introduction of carbon costs. A closure date could incorporate defined conditions related to security of supply, but the timing would need to be linked to measurable replacement capacity rather than repeatedly deferred.
EPCG’s reporting on the reconstruction would also need to cover performance and total expenditure consistently. Continuous independent emissions data, coal quality, plant availability and maintenance expenditure would provide indicators for assessing operating performance during the transition. The reconstruction of the Pljevlja plant reduces local pollution while the unit remains in operation, but the investment does not itself establish a permanent operating model for lignite generation or resolve the future of the mine and the surrounding economy.
