Montenegro is seeking to accelerate its energy transition and reduce dependence on imported electricity by expanding the development of renewable energy sources while making more effective use of existing domestic resources. Policymakers and analysts increasingly view the expansion of renewable generation as essential for strengthening energy security, stabilizing electricity supply and aligning the country’s energy sector with European climate and decarbonization policies.
The structure of Montenegro’s electricity system has historically been heavily dependent on a limited number of large generation facilities. Domestic electricity production is dominated by the hydropower plants Piva and Perućica, together with the Pljevlja thermal power plant, which forms the backbone of baseload generation. In years with favorable hydrological conditions the country can cover most of its electricity demand domestically, but during periods of low water inflows Montenegro often becomes a net importer of electricity.
This variability in hydropower production has been one of the main drivers behind the government’s efforts to diversify the generation mix. By increasing the share of renewable sources such as wind and solar energy, Montenegro aims to stabilize electricity supply and reduce exposure to fluctuations in hydrological conditions and international power markets.
Energy analysts note that Montenegro still possesses significant untapped energy potential. According to economic analyst Predrag Zečević, the country has considerable hydropower resources and substantial coal reserves that have not been fully utilized. In his view, energy policy should focus first on maximizing the use of existing hydro and thermal capacity while gradually expanding renewable energy technologies.
He emphasized that Montenegro already meets a large share of its electricity needs from low-carbon sources, noting that approximately 70 percent of electricity demand is currently covered by “green” energy, primarily from hydropower. This existing renewable base provides a strong starting point for further decarbonization of the energy system.
At the same time, the government is working to create regulatory conditions that encourage investment in renewable energy projects. Matija Medojević, state secretary at the Ministry of Energy, stated that the legislative framework required for renewable energy development has already been adopted. According to him, the government’s reform agenda now focuses on strengthening this framework and creating a stable, predictable environment that can attract investment into new energy projects.
This regulatory modernization is particularly important as Montenegro aligns its energy policy with European Union standards. As a candidate country for EU membership, Montenegro is gradually adopting EU energy legislation, including policies related to renewable energy development, energy efficiency and carbon reduction.
Recent studies indicate that expanding solar and wind energy projects could significantly increase domestic electricity production while maintaining environmental sustainability. Montenegro’s geography provides favorable conditions for both technologies: strong wind resources in coastal and mountainous areas and high solar irradiation levels across much of the country.
Developing these resources is expected to play a key role in reducing the country’s reliance on electricity imports. During years with weak hydropower output Montenegro has historically relied on imported electricity to meet domestic demand, exposing the economy to price volatility in regional power markets.
By increasing renewable generation capacity, policymakers hope to improve energy independence and create a more resilient electricity system capable of meeting demand even during unfavorable hydrological conditions. Renewable expansion could also enable Montenegro to export surplus electricity during periods of strong generation, strengthening its position within regional energy markets.
The broader goal of Montenegro’s energy strategy is therefore to combine several complementary sources of electricity. Hydropower remains the backbone of the system, thermal generation provides stability and baseload capacity, while wind and solar projects are expected to supply a growing share of future electricity production.
This diversified approach reflects the challenge facing many smaller energy systems. Countries with limited generation portfolios must balance decarbonization goals with energy security considerations, ensuring that the transition toward renewable energy does not compromise the stability of electricity supply.
For Montenegro, the expansion of renewable energy sources therefore represents both an environmental and an economic strategy. By reducing reliance on imported electricity and strengthening domestic generation capacity, the country aims to build a more resilient energy system while aligning its policies with the long-term objectives of European energy transition.
