Montenegro’s electricity imports in 2025 became one of the clearest warnings in the Southeast European energy market about the risks of generation dependence and limited system flexibility. State-owned utility EPCG imported 1,341 GWh of electricity during the year, spending approximately €142 million on market purchases. The increase in imports was not caused by a single disruption, but by the combined impact of the prolonged outage at TPP Pljevlja, weaker hydrological conditions and electricity demand exceeding forecasts.
The extended shutdown of TPP Pljevlja, which remained offline for more than eight months due to environmental modernisation works, created the largest pressure on the system. The plant normally provides around 40% of Montenegro’s annual electricity demand, and its absence forced EPCG to replace approximately 780 GWh of lost generation through electricity imports. For a small power system, the loss of such a significant generation source immediately translates into higher exposure to regional market prices.
Hydrological conditions created additional challenges. Lower-than-expected hydro production required EPCG to secure another 320 GWh from the market. HPP Perucica, with an installed capacity of 307 MW, produced only around 64% of planned output, while HPP Piva, with 342 MW of capacity, achieved approximately 75% of its target. At the same time, electricity consumption reached 2,909 GWh, around 4% above forecast, increasing import requirements by an additional 73 GWh.
The financial consequences were significant. EPCG recorded a €92 million net loss in 2025, compared with an €11 million profit in 2024. The company’s improved performance in 2026 demonstrates how strongly earnings depend on domestic generation availability. In the first quarter of 2026, EPCG reported a profit of €36.5 million, compared with €10.2 million a year earlier, while management expects full-year earnings of around €38 million, with projections reaching approximately €143 million by 2030.
The main challenge facing Montenegro is structural rather than temporary. The country has significant renewable energy potential, a strategic geographical position and strong transmission connections with Bosnia and Herzegovina, Serbia, Albania and Italy. However, the domestic electricity balance remains highly dependent on the availability of a limited number of large generation assets, particularly TPP Pljevlja and the two major hydropower plants. When thermal generation is unavailable and hydro output declines, EPCG is forced to rely on regional electricity markets, where prices can rise sharply during periods of high demand, extreme weather or system constraints.
This situation highlights why grid development and generation diversification must progress together. Montenegro’s transmission operator CGES is advancing key infrastructure projects, including the €39 million Perucica and Pljevlja substation modernisation programme, which could enable the connection of around 550 MW of new renewable capacity. Another important project is the cross-border transmission upgrade using high-temperature low-sag conductors, which is expected to increase capacity along the Trebinje–Perucica–Podgorica–Vau i Dejes corridor to approximately 600 MW.
These investments are essential because reducing import dependence requires more than building new renewable projects. New generation capacity must be connected to the grid, while stronger transmission infrastructure is needed to manage domestic production and regional electricity flows more efficiently.
EPCG’s investment strategy is moving in this direction. The company is expanding the Gvozd wind farm through a 21 MW second phase, supported by a €25 million EBRD loan, while also investing around €40 million in the A8 unit at HPP Perucica, adding 58.5 MW of capacity. These projects will not completely eliminate market exposure, but they will reduce the concentration risk revealed during the Pljevlja outage.
Montenegro’s 2025 electricity import surge should therefore be viewed as a strategic balance-sheet warning rather than only an operational challenge. Power systems with high dependence on individual generation assets face a double financial impact during disruptions: they lose domestic production and then purchase replacement electricity at potentially elevated market prices.
The next stage of Montenegro’s energy transition will depend on how effectively the country converts its renewable potential, grid investments and generation upgrades into lower import volatility, stronger energy security and more stable long-term performance for EPCG.