Montenegro plans to increase the share of renewables in its energy mix with a comprehensive programme of renewable energy auctions that will bring private investment into the sector.
The European Bank for Reconstruction and Development (EBRD) is helping the Ministry of Capital Investments of Montenegro to implement the programme with dedicated technical assistance, financed by grants from the EBRD, the Austrian Federal Ministry of Finance through the High-Impact Partnership on Climate Action (HIPCA) and Italy through the Central European Initiative (CEI).
The aim is to assist Montenegro in boosting the use of clean energy and in building a sustainable and diversified power sector by creating an enabling business environment for private investment. The country, which has strong wind and solar energy potential, will be able to benefit from these resources at competitive prices.
The programme, which was presented in Podgorica, will first support the authorities in developing a comprehensive legal framework in the form of a new renewable energy law that will lay the foundation for accelerating the growth of renewable energy sources. This will be followed by support for the design and implementation of a competitive bidding process to award market-based support for renewable electricity generators.
Remon Zakaria, Head of the EBRD in Montenegro, said: “We are very pleased to support the introduction of best international standards for scaling up renewable energy investments in the country. By reforming the energy sector, Montenegro will be able to harvest its rich sources of renewable energy and positively contribute to the environment and the economy.”
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“Considering that our country has significant potential for renewable energy, such as hydro, wind, solar energy and biomass, our priority was and remains the production of renewable, clean energy. We want to turn climate and environmental challenges into our opportunities and competitive advantages, by ensuring a fair and inclusive transition towards climate neutrality. In line with its priorities in energy sector, Montenegro will continue activities to ensure secure energy supply, the development of a competitive energy market and sustainable energy development, with active cooperation with everyone who has the same goals,” said the Deputy Prime Minister and Minister of Capital Investments Ervin Ibrahimović.
The majority of electricity in Montenegro is produced at the Pljevlja lignite-fired thermal power plant and the Perucica and Piva hydropower plants. Competitive procurement processes for renewables will allow the country to increase its share of solar and wind projects and decrease its reliance on coal.
In addition to environmental benefits, boosting investments in renewables could potentially help the country diversify its economy, which currently relies heavily on tourism. The existing underwater electricity cable that connects Montenegro with Italy, as well as other interconnections with neighbouring countries, could help position the country as clean energy exporter.
The EBRD has been supporting Montenegro in developing a sustainable and diversified energy sector through policy dialogue, technical assistance and investment. To date, the EBRD has invested more than 700 million euros in the country.
Source: EBRD
