Drought to cost Montenegro’s EPCG utility EUR 100 million in third quarter

State-owned coal and power producer Elektroprivreda Crne Gore (EPCG) said it would have to import 294 GWh of electricity in the three months through September due to the drought’s impact on hydropower plant output in Montenegro and estimated the cost at EUR 100 million.

The Balkans and much of Europe are experiencing one of the worst droughts in history and water levels are reaching record lows. Montenegrin government-controlled utility EPCG said it is covering the gap in hydropower production with purchases abroad at 34 eurocents per kilowatt-hour, Vijesti reported. At the same time, it is charging households only four eurocents per kilowatt-hour of electricity, resulting in major losses, the article adds.

Imports in the third quarter will reach 294 GWh, which is equivalent to EUR 100 million at current prices, according to the utility. Including the surcharges for transmission and distribution system operators CGES and CEDIS, respectively, regulators, support for renewables and tax, electricity costs ten cents per kilowatt-hour.

EPCG had a substantial electricity output surplus early in the year, but it had to import large quantities in April and May due to a regular overhaul at coal-fired power plant Pljevlja

The Energy and Water Regulatory Authority of Montenegro (REGAGEN) is due to determine power prices for 2023 by the end of the year. EPCG hopes for rain in the autumn to make up for the current shortfall with exports. It had a substantial electricity surplus early this year, but it had to import large quantities in April and May as the country’s only thermal power plant Pljevlja, which uses coal, was undergoing a regular overhaul ahead of the start of a major reconstruction.

In the first half of the year, EPCG exported 719 GWh, worth EUR 132.5 million, the company revealed. In the same period it imported 664 GWh and paid EUR 107.1 million. The utility warned citizens last week to save electricity to avoid rolling blackouts. Now it clarified that planned power cuts are not planned for now.