Montenegro’s state-owned power utility, EPCG, reported a net profit of €10.2 million for 2024, marking a sharp 80.5% decrease from the €52.5 million profit recorded in 2023, according to the company’s published financial statements.
Pre-tax profit stood at €12.47 million, and retained earnings at the end of the year totaled €70.17 million.
Responding to an inquiry about the steep drop in profits and its potential impact, EPCG explained that it faced a series of market and environmental challenges that heavily influenced the final financial results. “The €10 million profit is actually a strong result, considering the difficult conditions, especially an extremely poor hydrological year, which drastically reduced hydroelectric output,” the company stated.
In addition, changes in electricity market dynamics negatively impacted export revenues—a previously important income stream. EPCG also noted that 2023 had benefited from one-off revenues, such as asset-related gains including the acquisition of the Željezara steel plant, which were absent in 2024.
The company emphasized that its financial sustainability remains intact, with ongoing investments in renewable energy, network modernization, and digitalization continuing without disruption. EPCG is also pursuing strategic diversification of energy sources to reduce vulnerability to hydro and market fluctuations.
Sales revenues for electricity—EPCG’s primary income source—fell to €416.4 million, down €36.6 million from 2023. A sharp drop in other operating revenues, from €41.1 million to €7.7 million, was attributed in part to lower asset revaluation income.
This year, EPCG faces further operational pressure due to the ongoing ecological overhaul of the Pljevlja Thermal Power Plant, which will be offline from early April to mid-November. This shutdown will eliminate roughly €90 million worth of electricity generation, though EPCG has already secured about 75% of the required replacement power, valued at €60 million.
Interest and financial investment income remained stable at €4.5 million. A new addition to the balance sheet is €6.56 million in earnings from equity stakes in subsidiaries, not recorded in 2023.
Total expenditures rose to €390.9 million—€7.9 million more than in 2023. While material and energy costs fell from €196.3 million to €189.3 million, other operating expenses (including provisions, taxes, and contributions) increased from €160.5 million to €176.8 million. Wage and salary costs declined to €31 million from €34.2 million, and asset depreciation stood at €24.9 million, slightly down from the previous year.
Company equity decreased from €1.04 billion to €1.01 billion, partly due to retroactive CO₂ emissions cost adjustments and updated accounting standards that required the recognition of past environmental and collection risks. This led to a €12.8 million capital reduction at the start of 2024.
EPCG maintained liquidity and creditworthiness, improved bill collection, and kept electricity prices stable for households and businesses—achieved without state aid, the company emphasized.
Long-term liabilities rose sharply from €60.6 million in 2023 to €107.5 million by year-end, with total debt (including short-term loans) reaching €111.8 million.
In 2024, EPCG secured four major loans totaling €34.5 million from domestic banks to fund the national solar energy project “Solari 5000+70MW.” These loans feature fixed interest rates and long repayment periods:
- Prva Banka: €4 million at 4.3% interest, repayable by July 2031.
- Development Bank of Montenegro (IRF): €10 million at 4%, repayable by September 2034.
- CKB Bank: €10 million at 3.55%, due November 2034.
- NLB Bank: €10 million total, of which €3.52 million has been drawn; due December 2034 with 3.5% interest.
EPCG also owes international financial institutions: €11.74 million to Germany’s KfW for the modernization of the Perućica hydro plant, €5.58 million to the EBRD, €3.7 million to the IBRD, and €196,540 to the EIB.
