Montenegro’s state-owned utility EPCG imported 1,341 GWh of electricity in 2025, spending approximately €142 million on market purchases. The higher import volumes were linked to the combined effect of a prolonged outage at TPP Pljevlja, weaker hydrological conditions, and electricity demand exceeding forecasts.
Replacement power needs during TPP Pljevlja shutdown
TPP Pljevlja remained offline for more than eight months due to environmental modernisation works. The plant normally provides around 40% of Montenegro’s annual electricity demand. With the unit unavailable, EPCG replaced approximately 780 GWh of lost generation through electricity imports.
The scale of the generation shortfall increased exposure to regional market prices for a small power system. EPCG’s import requirement rose further as hydro output underperformed relative to expectations.
Hydropower shortfalls and higher-than-forecast demand
Lower-than-expected hydro production required EPCG to secure another 320 GWh from the market. HPP Perucica, with installed capacity of 307 MW, produced around 64% of planned output. HPP Piva, with capacity of 342 MW, achieved approximately 75% of its target.
Total electricity consumption reached 2,909 GWh, about 4% above forecast. That gap increased import requirements by an additional 73 GWh.
EPCG financial impact and earnings outlook
The import-driven replacement needs translated into losses for EPCG in 2025. The company recorded a net loss of €92 million, compared with a net profit of €11 million in 2024.
EPCG’s improved performance in 2026 was tied to domestic generation availability. In the first quarter of 2026, EPCG reported a profit of €36.5 million, versus €10.2 million in the same period a year earlier.
Management expects full-year earnings of around €38 million. Projections cited by the company reach approximately €143 million by 2030.
Transmission projects and generation upgrades in Montenegro
The challenge described for Montenegro is structural, with the domestic balance dependent on a limited set of large assets, particularly TPP Pljevlja and two major hydropower plants. Montenegro has renewable energy potential and transmission connections with Bosnia and Herzegovina, Serbia, Albania, and Italy. The transmission operator CGES is progressing infrastructure aimed at expanding grid capability.
A key programme is the €39 million Perucica and Pljevlja substation modernisation, which could enable connection of around 550 MW of new renewable capacity. CGES is also developing a cross-border transmission upgrade using high-temperature low-sag conductors, expected to raise capacity along the Trebinje–Perucica–Podgorica–Vau i Dejes corridor to approximately 600 MW.
EPCG investment plans for wind and hydropower capacity additions
EPCG is expanding its generation portfolio alongside grid works. The company is developing a second phase at the Gvozd wind farm, adding 21 MW, supported by a €25 million EBRD loan.
EPCG is also investing around €40 million in the A8 unit at HPP Perucica, adding . The A8 investment adds .
The stated purpose of these projects is to reduce concentration risk associated with outages affecting major generation assets. Even with additional capacity, EPCG would still face reliance on regional markets during periods when domestic thermal generation is unavailable and hydro output declines.