Renewable energy lies at the center of Montenegro’s long-term strategy, yet the current model exposes clear economic limits. Hydropower dominates the renewable mix, while other sources remain underdeveloped or poorly integrated into system balancing.
The limitation is not a lack of environmental ambition but rather system design. Renewables reduce emissions and, under favorable conditions, lower costs. However, without sufficient flexibility and diversification, they can increase volatility rather than mitigate it. Montenegro’s experience highlights this tension clearly.
Solar and wind capacity hold significant potential, but integrating them requires investment in grids, storage, and market mechanisms. Without these measures, additional capacity risks exacerbating balancing challenges instead of resolving them.
From an economic perspective, the key concern is reliability. Investors, businesses, and households value predictability. A renewable system that offers low average costs but high volatility imposes hidden economic costs.
Acknowledging these limits does not imply abandoning renewables. It calls for evolving the model to balance sustainability with stability. The next phase of Montenegro’s energy transition will be judged not only by capacity additions but by its ability to deliver consistent, affordable power that supports economic growth.
