Elektroprivreda Crne Gore (EPCG), the state-controlled power utility in Montenegro, is seeking approval from the government for a long-term loan of €64.2 million. The funds are intended to support ten solar and distributed-generation projects that collectively have a capacity of 95.87 MW.
The proposed portfolio includes significant projects such as Solari 5000+, solar installations at the Željezara industrial complex, and additional developments at Vrtac, Slano, Krupac, and Kapino Polje. EPCG anticipates an annual production of 124,518 MWh from these initiatives. Financial projections estimate annual revenues of approximately €20.7 million and EBITDA near €20 million, alongside a projected internal rate of return of 30.44%. The net present value is calculated at €196.2 million, with an expected payback period of 3.29 years. However, these estimates are contingent on various factors including electricity prices, construction costs, connection availability, and operational performance.
EPCG has already committed around €18.9 million of its own funds to these projects. The planned borrowing would not only facilitate new construction but also refinance previous commitments, thereby enhancing liquidity.
The financing initiative follows a challenging year for EPCG in 2025, during which the company reported a net loss of approximately €92 million compared to a profit of €11 million in 2024. This downturn was primarily due to the extended closure of the Pljevlja thermal power plant for environmental upgrades. During that period, EPCG imported around 1,341 GWh of electricity at a cost of approximately €142 million. Nonetheless, the utility rebounded with a net profit of €36.5 million in the first quarter of 2026, up from €10.2 million in the same quarter the previous year.
The proposed financing serves dual purposes: it aims to enhance renewable energy production while mitigating EPCG’s reliance on costly thermal power outages and expensive imports from the wholesale market. While projected returns appear robust, lenders will need to differentiate between operating projects and those still in development, assessing revenue potential against scenarios involving lower prices and grid delays.
In parallel efforts, the Ministry of Tourism and EPCG have agreed to promote solar energy installations at hotels and tourism facilities. More than €2.2 million has already been allocated for energy-efficiency measures in hotels, with an additional public funding call for €500,000 scheduled for September 2026.
This collaboration presents a smaller yet potentially scalable investment opportunity that aligns tourism refurbishment with rooftop solar initiatives, reduced seasonal electricity costs, and compliance with EU environmental standards.
