Fidelity Consulting recently shared on Facebook that Montenegro is set to gradually phase out electricity production at the Pljevlja Thermal Power Plant, which indicates its eventual closure. This announcement stems from two official sources: the Montenegro Reform Agenda 2024-2027, approved by the government in September, and an assessment from the European Commission regarding this agenda.
The Reform Agenda highlights that the emissions trading system will likely drive a gradual reduction in coal-based energy production, necessitating a just transition in the Pljevlja region.
Focus on a “Just transition”
The document emphasizes the importance of collaboration between the government’s General Secretariat and relevant ministries, involving key stakeholders like the Pljevlja Coal Mine and the Montenegro Power Company. This cooperation aims to achieve effective retraining and re-employment outcomes for those affected in the coal sector.
According to the European Commission’s evaluation, the reform agenda aims to diversify energy sources—such as wind and solar—reduce dependence on hydropower, and enhance integration with the EU energy market. The agenda will also introduce initiatives to facilitate the phased shutdown of the Pljevlja coal power plant.
In its Facebook post, Fidelity Consulting called for local stakeholders to prepare for this transition, noting that the estimated cost for implementing these reforms will be around €30.7 million.
A local resident shared the post, citing coal mine director Nemanja Laković, who mentioned that 1,600 individuals are employed at the coal mine and power plant, making these operations vital for the town’s economic stability.
“We must proceed carefully and quickly, hoping for realistic timelines for shutting down current operations and creating alternatives for jobs and revenues,” Laković said during the Second Economic Dialogue between Montenegro and the United States in Washington.
A commenter expressed frustration over the lack of local input in these decisions, questioning why external parties can decide to close local industries without consulting the community. They pointed out that Pljevlja has significantly contributed to the economy but is receiving only a fraction of that back in transition funds.
Concerns over employment
Unconfirmed reports indicate that in addition to the 1,600 permanent employees, around 400 contractors work at the power plant and mine.
Interestingly, Energy Minister Saša Mujović stated in July, shortly before a government reshuffle, that there were no immediate plans to shut down the plant, insisting it wouldn’t happen until a secure alternative for energy supply is established.
However, the government has already submitted a document to Brussels seeking EU funding, which anticipates the closure of the thermal power plant by 2027.
The document stresses that a key upcoming task is to finalize an integrated National Energy and Climate Plan (NECP), which will outline necessary policies to meet new energy goals by 2030.
It also mentions a comprehensive socio-economic study aimed at ensuring a just energy transition, focusing on the needs of the community and promoting economic diversification in the Pljevlja region.
Despite plans for training and re-employment initiatives, many in the energy sector and local government remain unaware of these proposed changes, raising doubts about the feasibility of the transition.
Mujović has previously indicated that Montenegro lacks the financial resources necessary for closing the power plant. He emphasized that significant funding is required for this transition, which the region currently does not have.
As it stands, preparations for the thermal plant’s closure appear to be in progress, with a government document outlining operational steps and deadlines for retraining initiatives expected by June 2025.
However, skepticism persists regarding the adequacy of training and alternative employment opportunities for workers impacted by the plant’s shutdown. Many question the practicality of the proposed plans.
Transitioning to green energy is a complex process that demands time, financial investment, and a robust plan to ensure job security for those employed at the Pljevlja Thermal Power Plant and coal mine.
