EPCG and PowerX target 500 MWh of batteries to coordinate Montenegro’s power system

Montenegro’s power utility EPCG has signed a memorandum of understanding with Japan’s PowerX targeting about 500 MWh of battery energy storage over an initial three-year period. The investment case centres on coordinating storage with EPCG’s hydro resources, rising solar generation and cross-border trading, rather than using batteries solely for standalone arbitrage. The targeted volume is significant for Montenegro’s relatively small power system.

Montenegro’s 2026 energy balance envisaged roughly 198 GWh of solar generation, with solar capacity expected to reach around 215 MW as prosumer and utility projects expand. Batteries can respond within seconds, absorb short-term solar surpluses and support intraday trading without changing reservoir water releases. Reservoir hydro can shift larger volumes over longer periods, although operations are constrained by hydrology and water management.

Coordinating batteries and hydro could preserve reservoir value for periods when hydro’s longer-duration flexibility is more valuable. Battery storage could also help EPCG reduce imbalances in a portfolio combining weather-dependent solar generation and hydro inflows. Montenegro’s power system is connected to Serbia, Bosnia and Herzegovina, Albania and the Italy link.

These connections could enable batteries to charge during domestic surpluses or when imported power is cheap, then discharge to meet domestic demand or regional scarcity. EPCG’s commercial assessment should focus on the battery’s incremental contribution to its portfolio of hydro, solar, imports, exports and balancing, rather than treating the battery storage system as an isolated profit centre. Coordinated system-level value could make the investment case stronger than day-ahead arbitrage alone.