Montenegro to invest EUR 34 million in energy renovation, distribution grid

Montenegro intends to invest EUR 33.8 million in the energy efficiency of public buildings and the modernization of the power distribution network. The activities are scheduled to last from the first quarter of 2025 to April 30, 2030.

Investments in energy renovation and the electricity distribution grid are part of the project Decarbonization of the Energy Sector of Montenegro. Funds for its implementation will be provided from a EUR 31 million loan from the International Bank for Reconstruction and Development (IBRD) and EUR 2.8 million from the state budget.

Energy efficiency measures would be implemented in 23 buildings – 16 belonging to the University of Montenegro, six run by administrative authorities, and one in the health sector. The Ministry of Energy will be in charge and the total value of the activities is estimated at EUR 10.8 million, out of which EUR 8 million is from the loan, and EUR 2.8 million is from the state budget, according to a report on the negotiations with IBRD that the Government of Montenegro adopted.

The modernization of the distribution network has three components

The budget funds for energy renovation would come from the savings in energy consumption in 23 renovated facilities within the current project Energy Efficiency in Montenegro – MEEP 2 with the World Bank.

The investments in the electricity network are envisaged under sub-project Increasing the Operational Efficiency of the Power Distribution Grid. The goal is to increase the system’s reliability, integrate renewable energy, and reduce technical losses.

The first part is the reconstruction of seven 35 kV switching facilities in 110/35 kV substations Pljevlja 1, Nikšić, Tivat, Ulcinj, Budva, Bar, and Berane. Another is the replacement and modernization of 42 transformers in 27 substations of 110/35 kV, while the third one is a pilot investment to improve the visibility of the distribution network.

EUR 2 million has been earmarked for assistance in the implementation of the project

The pilot investment envisages the installation of smart meters and sensors in the low-voltage network, as well as specialized software and an application programming interface (API) for the integration of new devices with the meter data management (MDM) system.

Montenegrin distribution system operator CEDIS is responsible for the investments, worth EUR 21 million. The company would repay a part of the loan.

One of the project’s segments is technical assistance and support in implementation. EUR 2 million is allocated for the purpose, according to the report.