Montenegro’s EPCG signs financing deal for Gvozd wind power project

Montenegro EPCG financing deal Gvozd wind power

Photo: Ministry of Capital Investments


June 19, 2023



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June 19, 2023



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Elektroprivreda Crne Gore (EPCG), Montenegro’s state-owned coal and power producer, obtained a EUR 82 million loan from the European Bank for Reconstruction and Development for its first wind power project.

EPCG completed the financing framework for the Gvozd wind farm of 54.6 MW. It is set to acquire the project, build and operate the facility near Nikšić, Montenegro’s second-largest city. European Bank for Reconstruction and Development approved a EUR 82 million loan to the country’s national electricity utility and project firm Green Gvozd, which EPCG would take over.

It is a milestone project for the state-owned coal and power producer and supplier, being its first major new asset in over 40 years, as well as its first wind farm. EBRD also financed Krnovo, Montenegro’s first wind power plant. The only other one is Možura, commissioned in 2019. The site for Gvozd, named after a nearby village, is also on the Krnovo plateau.

Project includes new transformer, transmission lines

The agreements were signed today in Podgorica by the EBRD’s Director for the Western Balkans Matteo Colangeli and Head of Montenegro Remon Zakaria, EPCG’s Chairman of the Board of Directors Milutin Đukanović and Chief Executive Officer Nikola Rovčanin, and Krešimir Čondić on behalf of Green Gvozd.

Rovčanin: EPCG is also counting on floating solar power plants to drive its development

The project includes the installation of a 33 kV / 110 kV substation, the reconstruction of the Krnovo 33 kV / 110 kV transformer, a new 3.1-kilometer long 110 kV line between them, a 14.7-kilometer overhead 110 kV link to Nikšić and the reconstruction of the transformer station there.

Đukanović estimated that the wind park would generate 150 GWh per year.

“This is a historic day for EPCG, for the state’s entire energy system, as the formalization of these contracts will establish the foundations of the energy sector’s further development, not only with a new wind park, but also floating solar and a range of other projects,” CEO Rovčanin said.

Construction of Gvozd wind farm to last 18 months

According to the Ministry of Capital Investments, Gvozd is scheduled to be built in 18 months since the start of works. It added that the start of the loan repayment would be delayed until the facility is commissioned.

Čondrić from Green Gvozd, a special purpose vehicle or SPV founded by Austria-based Ivicom Holding, said the call for civil construction and infrastructure works is expected early next month and that the wind power plant is seen coming online in 2025.

New renewable energy capacity is fundamental to the country’s plans to close its only coal-fired power plant, Pljevlja, which currently accounts for almost half of Montenegro’s electricity output, but also substantial pollution, EBRD underscored. The bank said that in addition to financing, it is assisting Montenegro in developing its first renewable energy law and in regulatory reforms aimed at creating an enabling environment for renewable energy investments, as well as the launch of the first renewable energy auction.

The lender earlier said it may syndicate a part of the loan after signing. The Gvozd project is fully financed through the loan.

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