Power utility Elektroprivreda Crne Gore (EPCG) will pay a market price of EUR 75 for carbon dioxide emissions, according to the company’s President of the Board of Directors Milutin Đukanović.
Paying a national carbon tax is important because the European Union’s Carbon Border Adjustment Mechanism (CBAM) entered into force on January 1 this year. The mechanism introduces a CO2 tax on imports of various goods into the EU, including electricity, from countries that do not tax carbon. Paying a domestic tax can reduce liabilities under CBAM.
Speaking at a meeting of the Green Parliamentary Group in the Parliament of Montenegro, Milutin Đukanović said that, based on a government decree establishing the country’s CO2 emissions trading system (ETS), state-owned company Elektroprivreda Crne Gore (EPCG) will pay the full market price of EUR 75 per ton of emitted CO2 to the Eco-Fund.
The tax has been increased from EUR 24 to EUR 75
It is a change from the earlier EUR 24, in his words. On an annual basis, this amounts to around EUR 70 million, he added.
Therefore, CBAM cannot be addressed through administrative measures alone, but strictly through a fundamental shift in EPCG’s power generation mix, Đukanović stressed.
He noted that due to the undefined application of CBAM, EPCG recorded a EUR 12-13 million lower revenue in the first quarter. He believes stability under CBAM can be achieved if funds paid to the Eco-Fund for CO2 emissions are allocated to energy sector projects.
Of note, Serbia’s state-owned power utility Elektroprivreda Srbije (EPS) expects its electricity export revenues to fall by EUR 150 million due to the introduction of CBAM.
Montenegro was the first in the Western Balkans to introduce CO2 taxation
Montenegro was the first in the Western Balkans to introduce a national ETS, back in 2020. The minimum price of the emission credits was set at EUR 24 per ton of carbon dioxide equivalent.
Paying a national carbon tax is important because it can be recognized during the calculation of CBAM or a cross-border tax by countries that have implemented one.
For example, the United Kingdom recently recognized carbon pricing schemes from the European Union and 15 countries, including Montenegro and Serbia.
The price of CBAM certificates is around EUR 75
This means that carbon taxes paid in these countries will be recognized when calculating tax liabilities under the UK’s CBAM.
Serbia introduced taxes on greenhouse gas emissions, and imported carbon-intensive products on January 1, 2026. Both taxes are set at EUR 4 per ton of CO2.
The price of CBAM certificates, which must be submitted for each ton of CO2, amounted to around EUR 75 in the first two quarters.
If a company decides to export goods to the EU, paying a national carbon tax is a more favorable option than purchasing CBAM certificates. In the first case, the funds remain in the country, while the alternative is that they end up in Brussels.
