Sekulić: Coal excise tax to cover Montenegro’s stimulus for renewables

Among her remarks in New Year interviews with several domestic media outlets, Montenegro’s minister of economy insisted households will continue to be exempted from premiums for electricity from renewable sources for the consumption of up to 300 kWh per month. Furthermore, Dragica Sekulić stressed, the 2019 directive on stimulus for such production of electricity and in highly efficient cogeneration paved the way for the polluter to be the one who pays.

The charge will be collected from the excise tax on coal and paid from the state budget, in her words. Sekulić noted the government established the system with a recommendation from the World Bank and that it would keep improving it. The bills will stay the same for up to three years, the minister claimed and asserted the scheme is a transitional solution until the introduction of carbon certificates.

The income is envisaged to be used for supporting the energy transition, innovations, energy efficiency and environmental protection measures, she explained. Sekulić said the government decided to use the tool to lower citizens’ expenses on electrical energy.

Small hydropower plants

Out of 77 small hydropower plants with licenses or concession contracts, 14 are operational, one entered the testing phase, 24 are under construction, in eleven cases the technical documentation is being prepared, eight concession deals have been annulled, while processes for a mutual agreement to scrap the agreement are underway for ten projects, she revealed. Montenegro is negotiating together with legal and financial advisors about six controversial facilities, Sekulić underscored and indicated the ongoing analysis could lead to more scrapped plans.

She noted stimulus was lowered by 10% in 2020 for those that happen to be given the temporary status and that every year it would be cut by another ten percentage points. In the minister’s view, the state’s support for hydropower and wind power resulted in new jobs and took the country out of “the importer lobby’s economically exhausting grip.”

Solar power

The development of the 250 MW solar park on the Briska gora site near Ulcinj is satisfactory and works may begin this year, she asserted. The contract on the lease of 660 hectares of land there was signed a year ago with a consortium made up of state-owned power producer EPCG, Finnish Fortum and Indian company Sterling and Wilson.

Sekulić stated there is great interest for the construction of a photovoltaic facility in Velje brdo in capital Podgorica and that a tender is being prepared with the aim to sign an agreement this year. The project planned on 69 hectares is for a 50 MW system of which 41 MW would be the first phase. The documents show the ambition to generate 53.3 GWh per year.

Komarnica and Pljevlja

First steps toward the construction of hydropower plant Komarnica are expected before the end of December, the minister said. The endeavor is projected at 168 MW and an annual output of 231.8 GWh. The estimated cost is EUR 237.9 million.

The reconstruction of thermal power plant Pljevlja will be initiated during the next regular overhaul, in spring, according to the economy minister. She said the outlet for energy intended to heat the town of the same name will be installed already in the first phase. EPCG will be able that way to repay a part of its debt accumulated over several decades, Sekulić added. Montenegro decided two years ago not to build the second coal-fired unit and opted for refurbishment with a focus on environmental issues.