Background

Montenegro is a small and young country in southeastern Europe, which gained independence from Serbia in 2006. Since then, it has been working on its economic and energy development, and has made significant progress in the energy sector. The country has a diverse geography, with mountains, rivers and coasts, making it an ideal location for renewable energy development. In addition, Montenegro has been exploring and producing oil and gas, and has been working on hydrogen projects.

Oil and gas

Oil and gas exploration and production in Montenegro Montenegro has a relatively short history in oil and gas exploration and production. The country began exploring for and producing oil and gas in the 1940s, but efforts were interrupted due to World War II. In the 1970s, Montenegro resumed its oil and gas exploration and production efforts, and in 1981 discovered the Krusevo oil and gas field, which is the largest oil and gas field in the country. Since then, Montenegro has been working on oil and gas exploration and production, and has discovered several smaller fields.

Currently, oil and gas production in Montenegro is limited. In 2020, the country produced around 270 barrels of oil per day and around 1.1 million cubic metres of gas per day. In addition, the country imports most of its oil and gas needs from Serbia and Croatia. Despite its limited production, Montenegro continues to actively explore for oil and gas. In 2020, the country tendered 13 oil and gas exploration blocks in the Adriatic Sea. International oil companies showed interest in these blocks, and oil and gas exploration and production in Montenegro is expected to increase in the coming years.

LNG

Montenegro is also exploring the possibility of importing Liquefied Natural Gas (LNG) as a way of diversifying its energy mix. The country has been working on the development of an LNG terminal, which would allow it to import LNG from around the world. The terminal is expected to have a capacity of up to 8 billion cubic meters of gas per year, which would be a significant boost to the country’s energy security. The project is still in the planning stages, but it has the potential to transform Montenegro’s energy market.

Renewable energy potential in Montenegro

Montenegro has great potential for renewable energy development. The country has a diverse geography, with mountains, rivers and coasts, making it an ideal location for renewable energy development. In addition, the Montenegrin government has set ambitious targets for renewable energy development, with the goal of producing 33% of its electricity from renewable sources by 2020, and 60% by 2030.

Hydropower

Montenegro has great potential for hydropower; the country has a number of rivers that are suitable for hydropower generation, including the Moraca River, the Tara River and the Cijevna River. Hydropower is the main source of renewable energy in Montenegro, and in 2020, it accounted for 27% of the country’s electricity production.

The country has several large hydroelectric power plants, which generate around 40% of the country’s electricity. The largest of these is the Piva Hydro Power Plant, which has a capacity of 360MW. The country has identified the potential for further hydropower development, particularly in small hydropower plants. Montenegro has set a target of producing 50% of its electricity from renewable sources by 2030, and hydropower is expected to play an important role in achieving this goal.

One of the most important hydropower projects in Montenegro is the Komarnica hydropower plant project. This project consists of the construction of a hydropower plant on the Komarnica River, which will generate around 233 GWh of electricity per year. The project is funded by the European Union and is expected to be operational in 2023.

Solar energy

Although Montenegro has great potential for solar energy, it has not been widely developed in the country. In 2020, solar energy accounted for less than 1% of Montenegro’s electricity production.  One of the most important solar energy projects in Montenegro is the Briska Gora solar power plant project. This project consists of the construction of a 200MW solar power plant in northern Montenegro. The project is financed by the European Union and is expected to be operational in 2023.

Wind energy

Montenegro also has great potential for wind energy. The country has a 293 kilometre coastline and a mountainous relief, making it an ideal location for wind power generation. In 2020, wind energy accounted for 4% of Montenegro’s electricity production. One of the most important wind energy projects in Montenegro is the Krnovo wind farm. This wind farm is located in the mountains in the south of Montenegro and has an installed capacity of 72MW. The Krnovo wind farm started operating in 2018 and generates around 200 GWh of electricity per year.

According to the National Renewable Energy Action Plan, the country’s technical potential for wind energy is estimated at 4.2 TWh per year, which is almost 4 times higher than the country’s current electricity consumption. In addition, Montenegro’s coastal areas have high average wind speeds, reaching up to 9 m/s, making them ideal for the development of offshore wind farms.

Hydrogen

Hydrogen is a promising energy carrier that has the potential to play an important role in Montenegro’s energy mix. The country has started to explore the potential of hydrogen as a clean energy source and has been actively participating in various initiatives to promote the use of hydrogen as a fuel.

In 2021, Montenegro’s Ministry of Economy announced its plans to develop a hydrogen strategy that will focus on promoting the production, distribution, and use of hydrogen in the country. The strategy will aim to create favorable conditions for the development of hydrogen technologies and support the country’s transition to a low-carbon economy. One of the key areas of focus for Montenegro’s hydrogen strategy is the promotion of green hydrogen.

Montenegro has significant potential for the production of green hydrogen, thanks to its abundant solar and wind resources. With the right investments and policies, Montenegro could become a major producer and exporter of green hydrogen in the Balkan region. In addition to promoting the production of green hydrogen, Montenegro’s hydrogen strategy also focuses on developing the necessary infrastructure for hydrogen distribution and use. This includes the construction of hydrogen refueling stations for fuel cell vehicles and the integration of hydrogen into the country’s existing natural gas pipeline network.

Montenegro is also actively participating in international initiatives to promote the use of hydrogen as a clean energy source. In 2020, the country joined the European Clean Hydrogen Alliance, which aims to accelerate the development and deployment of hydrogen technologies across Europe. Furthermore, Montenegro is a signatory of the Hydrogen Initiative launched by the Western Balkans Investment Framework. The initiative aims to promote the development of hydrogen infrastructure and support the deployment of hydrogen technologies in the Western Balkans region.

Montenegro has also been working on hydrogen projects. One of the most important hydrogen projects in Montenegro is the Kotor Bay Green Hydrogen Project. This project consists of the production of green hydrogen from solar and wind energy in the Bay of Kotor. The hydrogen will be used for transport and industry in the Balkan region. The project is funded by the European Union and is expected to be operational in 2024.

The Pljevlja thermal power plant

The Pljevlja thermal power plant is the main power plant in Montenegro and is the only coal-fired power plant in the country. The Pljevlja thermal power plant has been in operation since 1982 and has been generating around 40% of Montenegro’s electricity. In 2020, the Montenegrin government announced that it would close the Pljevlja thermal power plant in 2023 and replace the thermal power plant’s generation capacity with renewable energy and natural gas.

Electricity interconnection with Italy

Montenegro has also been working on an electricity interconnection project with Italy. The 600MW electricity interconnection would connect Montenegro and Italy across the Adriatic Sea and allow Montenegro to export its renewable energy to Italy. The electricity interconnection project is currently in the planning phase and is expected to be operational in 2027.  

Montenegro’s energy potential in the Balkan region

Montenegro has great potential to become a major energy producer and exporter in the Balkan region. The country has a strategic geographical location and a wide variety of renewable energy resources. Montenegro also has a number of bilateral and multilateral agreements with other Balkan countries for energy production and exchange. In 2020, Montenegro signed an agreement with Albania to build a new electricity transmission line that would connect the electricity grids of the 2 countries.

In addition, Montenegro is a member of the Energy Community, a regional organization that aims to improve energy security and promote sustainable energy development in Southeast European countries.

Biomass and biogas

As Montenegro works to reduce its dependence on coal and increase its production of renewable energy and hydrogen, the country is uniquely positioned to lead the transition to a more sustainable energy future in the Balkan region. In addition to hydropower and solar energy potential, Montenegro also has significant potential in the use of biogas and biomass for energy production. In Montenegro, biomass is mainly used for residential and commercial heating. However, the potential of biomass for electricity production is also being explored.

In Montenegro, biogas is mainly used for thermal energy production. In 2020, the country’s first biogas plant was opened in Montenegro, located in the city of Podgorica. The biogas plant has a capacity of 1.2MW and uses organic waste to produce electricity. The biogas plant is a joint initiative of the German company Muller-Gruppe and the Montenegrin company Cistoca.

In addition, Montenegro has a great potential for biogas and biomass production due to its agricultural and livestock sector. Waste from agriculture and livestock farming can be used for biogas and biomass production, which can reduce the amount of waste and provide a renewable energy source. In short, Montenegro has significant potential in the use of biogas and biomass for energy production. The inauguration of the country’s first biogas plant in 2020 is an important step towards increasing renewable energy production from biogas and biomass in Montenegro.

The National Renewable Energy Action Plan estimates that Montenegro’s total biomass potential is around 210 ktoe per year.

Displaying Montenegro’s potential

In March 2023, IN-VR hosted the eighth version of the Balkans Energy Summit in Athens, where the aforementioned topics were discussed; the event had a special focus on hydrocarbons exploration, securing investments, clean project development, and overcoming energy poverty. Furthermore, participants had the chance to display the country’s role in the Balkans region, and the steps needed in order to become one of Europe’s strategic powerhouses and important transportation corridors. This event will be hosted once again in 2024.

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