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Energy Sector Report Montenegro 2021: Montenegro Energy and Water Regulatory Agency of Montenegro
Energy Sector Report Montenegro 2021: Montenegro Energy and Water Regulatory Agency of Montenegro
1.2.5. Daily load diagram and seasonality of gross electric consumption ........................................... 41
1.3. Petroleum and gas sector ................................................................................................................................... 43
2.1.1.2. Contractual relations between suppliers, distribution system operator and buyers .... 55
2.1.5. Transparency and availability of information relating to the electricity market .................... 70
2.1.7. Work and operation of the closed distribution system operator ................................................ 72
5.1.1.1. Operations of the Electricity Transmission System Operator in 2021 .............................. 122
5.1.1.2. Operations of the Electricity Distribution System Operator in 2021 ................................. 124
6.4. Approval of the development and investment plans of system operators ................................... 139
List of graphs
Graph 1.2.1 Share of installed generation facilities in the total installed generation capacities ...... 31
Graph 1.2.2 Share of generation facilities in the total electricity generation .......................................... 31
Graph 1.2.3 Electricity generation in the period 2012 – 2021 ....................................................................... 34
Graph 1.2.4 Transmission network length by voltage levels........................................................................... 35
Graph 1.2.5 Share of individual voltage levels in the total distribution network length .................... 37
Graph 1.2.6 Share of overhead and cable lines by regions ............................................................................ 38
Graph 1.2.7 Electricity consumption by distribution customers in the period 2012-2021 .................. 41
Graph 1.2.8 Average daily load curves in 2021 by seasons............................................................................. 42
Graph 1.2.9 Overview of daily load diagrams for the heating season, cooling season, transitional
season and relieved season for 2019, 2020 and 2021 ........................................................................................ 43
Graph 2.1.1 Comparison of the number of interruptions in the transmission system in 2019, 2020
and 2021 ............................................................................................................................................................................... 58
Graph 2.1.2 Comparison of the number of interruptions in the distribution system in 2019, 2020
and 2021 ............................................................................................................................................................................... 61
Graph 2.1.3 SAIDI values for 2019, 2020 and 2021 for (a) all interruptions and separately for (b)
unplanned and (c) planned ........................................................................................................................................... 63
Graph 2.1.4 SAIFI values for 2019, 2020 and 2021 for (a) total interruptions and separately for (b)
unplanned and (c) planned ones ................................................................................................................................ 65
Graph 2.1.5 Degree of publication of the data of significance for the market functioning for 2018-
2021........................................................................................................................................................................................ 71
Graph 2.1.6 Share of all types of energy sources in the electricity supplied to end users using the
guaranteed structure ....................................................................................................................................................... 72
Graph 3.1.1 Shares of capital investments of EPCG .......................................................................................... 83
Graph 3.2.1 Shares of capital investments of CEDIS DOO Podgorica ......................................................... 86
Graph 3.3.1 Comparison of the energy volume that entered the electricity transmission system
between 2016 and 2021 ................................................................................................................................................. 94
Graph 3.3.2 Comparison of the energy volume that exited the electricity transmission ..................... 95
Graph 3.3.3 Comparison of the transit of energy via the electricity transmission system in 2016 -
2021........................................................................................................................................................................................ 96
Graph 3.3.4 Revenue from allocation of cross-border capacities between 2016 and 2021 ............... 97
Graph 3.4.1 Overview of total CEDIS and CGES investments between 2011 and 2021........................ 98
Graph 4.2.1 Average price of electricity for households in European countries in 2021 ................... 111
Graph 4.2.2 Price of electricity at purchasing power parity for households of European countries in
2021...................................................................................................................................................................................... 111
Graph 4.2.3 Average electricity price of households in the capitals of European countries as of
December 2021................................................................................................................................................................ 112
Grafik 4.2.4 Price of electricity at purchasing power parity for households in the capitals of European
countries as of December 2021 ................................................................................................................................. 112
Graph 5.1.1 CGES business results in the period 2016-2021 ........................................................................ 123
Graph 5.1.2 Overview of CGES investments and net results in the period 2016 to 2021 .................. 124
Graph 5.1.3 CEDIS business results in the period from 2016 to 2021 ....................................................... 126
Graph 5.1.4 Overview of CEDIS investments and net results in the period 2016 to 2021................. 126
Graph 5.2.1 Business results of the market undertakings in the petroleum and gas sector in 2021
................................................................................................................................................................................................ 130
List of figures
Figure 1.2.1 Simplified scheme of power system in Montenegro ................................................................ 29
Figure 1.2.2 Montenegro Transmission System scheme................................................................................. 36
Figure 1.2.3 Montenegro distribution system organization by regions.................................................... 38
Figure 2.1.1 Consumption areas longest affected by interruptions in supply in 2021 ......................... 60
Figure 2.1.2 Value of SAIDI indicator by regions ............................................................................................... 62
Figure 2.1.3 Value of SAIFI indicator per region ................................................................................................ 64
Figure 2.1.4 Electricity flows (GWh) in the transmission and distribution systems in 2021 ............... 70
Figure 4.1.1 Functional scheme of electricity market in Montenegro ..................................................... 105
List of maps
Mapa 1.1.1 Pregledna karta ležišta uglja pljevaljskog područja sa objektima Rudnika i TE Pljevlja
........................................................................................................................................ Error! Bookmark not defined.
Map 1.3.1 Overview of the number of petrol and gas stations and yacht servicing facilities by
municipalities ...................................................................................................................................................................... 46
Lista skraćenica
ACER – Agency for the Cooperation of Energy Regulators
AIT – Average Interruption Time
AMM – Automatic Meter Management
BELEN – Berza električne energije DOO Podgorica (Power exchange)
CEER – Council of European Energy Regulators
CEDIS – Crnogorski elektrodistributivni sistem DOO Podgorica (Montenegrin Distribution System
Operator)
CES – Clean Energy Solutions
CGES – Crnogorski elektroprenosni sistem AD Podgorica (Montenegrin Transmission System
Operator)
COTEE – Crnogorski operator tržišta električne energije DOO Podgorica (Montenegrin Electricity
Market Operator)
OH – Overhead
EMS – Energy Management System
ENTSO-E – European Network of Transmission System Operators for Electricity
ENS – Energy Not Supplied
EPCG – Elektroprivreda Crne Gore AD Nikšić
EBRD –European Bank for Reconstruction and Development
EU – European Union
FU – Funkcionalna Unit
CFD – Chief Financial Directorate
HPP – Hydro Power Plant
HVDC – High-voltage direct current
IAP –Ionian – Adriatic Pipeline
IT –Information technology
ITC – Inter-TSO Compensation
sHPP – Small Hydro Power Plant
NDC – National Dispatch Center
LV – Low Voltage
DSO – Distribution System Operator
TSO – Transmission System Operator
VAT – Value Added Tax
PECI –Project of Energy Community Interest
PMI – Project of Mutual Interest
PMU –Project Management Unit
POWERED –Project of Offshore Wind Energy: Research, Experimentation, Development
REGAGEN – Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
REMIT –Regulation of Energy Market Integrity and Transparency
SAIDI –System Average Interruption Duration Index
SAIFI –System Average Interruption Frequency Index
SCADA –Supervisory control and data acquisition
SPP – Solar Power Plant
SEE CAO –Coordinated Auction Office for South East Europe
MN – Medium Voltage
TANAP –Trans Anatolia Natural Gas Pipeline
TAP –Trans – Adriatic Pipeline
TPP – Thermo Power Plant
TR – Transformer
SS – Substation
LPG – Liquified Petroleum Gas
LNG – Liquified Natural Gas
WPP – Wind Power Plant
HV – High voltage
WBIF –Western Balkans Investment Framework
REGAGEN Energy and Water Regulatory Agency
Energy has always been a sector where changes were slow, Energy has always been an activity in
which changes happened slowly, and energy systems were planned thoroughly and with a time
horizon of centuries ahead. However, we must be aware that we are living the moment of one of the
most significant energy transitions in the history of mankind. We are living the moment in which, in
just a few decades, we will have to see a transition from the energy from fossil fuels to the energy
that will be based entirely on the use of renewable energy sources.
The context is even more complicated because in geographical terms we live in Europe, and
politically, socially and spiritually we aspire to the European Union. The European Union is the most
energy-vulnerable society that spends close to a billion euros every day for energy imports. This
means that in this context, we are the closest to the energy transition, but also under the greatest
risk. Various "incidental" deviations on the path of energy transition, such as COVID-19 and the war
in Ukraine, can push Europe into situations that are impossible to predict. Finally, the situation on
the energy markets of Europe indicates that the energy transition will happen much faster, but also
in a much more painful manner for all of us, especially for us, small countries... and yes, especially
for those of us who have no concept of how to protect ourselves in such a situation from the
unnecessary and irreparable mistakes.
In the sense of the aforementioned, I want to encourage a public debate in our society, which should
answer the questions: is our country aware of the importance of energy, do we manage, produce
and consume energy in the way that serious societies do, are we aware that energy independence
is the fundament of state independence, are we sure that we have a vision for managing our energy
resources.
The moment we live in does not allow me to remain silent and not express my opinion.
Given that we practically do not have a long-term energy development strategy, or any document
of that kind that would determine some strategic commitments, I think we are wandering in the
dark. That is why it is high time to speed up activities on the development of umbrella energy
documents prescribed by the Law on Energy: general energy policy guidelines and the National
Energy and Climate Plan.
13.
REGAGEN Energy and Water Regulatory Agency
All spheres of our society are politicized, and the politicization of energy with all that it means for
each individual country is a catastrophic and irreperable damage. Serious investments in energy are
too slow and too complex to be politically attractive. The same is true with pricing policies - correct
decisions are usually not popular. That is why the depoliticization of the sector would be mutually
beneficial, both for politicians and for the energy sector.
An unclear vision and an uncertain return on invested funds demotivate serious investors to invest
in the construction of new production facilities. That's why changing the status of state ownership
in the sector is a high-risk activity at the moment - both financially and security-wise.
Protection of vulnerable groups must be the priority of all actors in our energy sector. However, this
goal can only be attained through focused and carefully designed measures, and not by any means
by artificially suppressing energy prices for all customers, regardless of their financial status, the
amount of energy consumed, its purpose and degree of efficiency. Everything else is a mere
contribution to the reckless consumption of the limited energy resources that we have at our
disposal as a society.
Board President
Branislav Prelević
14.
1. ENERGY RESOURCES AND CAPACITIES
REGAGEN Energy and Water Regulatory Agency
Exactly the diversification of energy supply constitutes the key activity in preserving energy security,
where the indisputable prerequisite is knowledge of one's own needs for energy and the energy
resources available for the production of primary energy. Households and the economy in
Montenegro meet their energy needs using electricity, firewood, coal, oil derivatives and natural gas.
As primary energy sources in the form of oil derivatives and natural gas are not produced in
Montenegro, the necessary quantities are secured through imports. According to the Energy Balance
of Montenegro, the consumption of oil derivatives and natural gas in 2020 and 2021 represented up
to 45% of the total final energy consumption in Montenegro. While the exploration of hydrocarbon
reserves in the Montenegrin seabed is ongoing, Montenegro currently supplies almost half of its
energy needs through imports, mainly due to the lack of domestic resources for the production of
oil derivatives.
According to the Energy Balance, right after oil derivatives, households and businesses in
Montenegro mostly use electricity, which constitutes slightly more than 35% of the total final energy
consumption. The remaining types of final energy used in Montenegro relate to firewood and coal.
In contrast to the deficit in the availability of resources that could be used for the production of oil
derivatives, Montenegro has significant and diverse energy resources that can be used for the
production of other types of energy, namely: hydropower of large and small river flows, wind energy
and solar radiation, biomass and coal. By exploiting the aforementioned resources, while taking into
account diversification, it is possible to improve the energy security of Montenegro.
Electricity was used in Montenegro for the first time in late July 1904 for the purpose of powering
the radio-transmitter in Volujica (Bar) with the help of batteries and a diesel engine, while when it
comes to public use (electrification of Cetinje) the first diesel-powered power plant started its
operation in August 19101. Efforts from 1911 to begin the exploitation of the available hydro
potential for the purpose of electricity production were, after the passing of the "Law on Concession,
which was granted to Mr. Anto Dešković, an engineer from Pućište on Brač, an Austrian citizen for
1
Source: Borislav-Boro Pravilović, Prva električna centrala u Crnoj Gori Cetinje 1910, Cetinje, 2020 (The first power plant in
Montenegro, Cetinje 1910)
17.
REGAGEN Energy and Water Regulatory Agency
the construction of a hydroelectric power plant on the Morača River near Donja Gorica2", were
hindered by the war, and once the independent state ceased to exist, the priorities in the newly
formed State of the Southern Slavs were defined at the central level. Construction of the first
production facility that used the primary energy source available in Montenegro was completed in
1941, when the "Podgor" hydro power plant was put into operation, with an installed capacity of 300
kW. The main purpose of this power plant was the production of electricity for the operation of
pumps that supplied water from the village of the same name in Crmnica to Cetinje3. Since then, the
electrification process in Montenegro has been dominantly based on the use of its own resources,
namely: hydro potential, as a renewable source of energy (through the construction of two large
hydropower plants in addition to small ones) and coal (through the construction of the Pljevlja
Thermal Power Plant). The construction of production facilities that use renewable energy sources
intensified in the second decade of the 21st century, when the construction of the first wind farms
and solar power plants was recorded and the level of use of hydro potential increased.
In addition to improving the energy security of Montenegro, this pace of use of renewable energy
sources contributed to the achievement of the goals of the Paris Agreement, which was ratified by
Montenegro in October 20174, i.e. the Intended Nationally Determined Contribution of Montenegro
in the fight against climate change, by which Montenegro committed itself to reduce by the year
2030 the emission of greenhouse gases by 30% compared to the emission in 1990.
In the following subsections, the energy resources available in Montenegro will be described in more
detail, as well as their exploitation, based on the data and information provided by the Ministry of
Capital Investments, Pljevlja Coal Mine and Berane Coal Mine.
1.1.1. Hydropotential
Hydropower represents an important resource for the production of electricity from renewable
sources, and with adequate exploitation, it can contribute to achieving greater seasonal flexibility of
electricity production. The importance of providing this type of flexibility stands out in the conditions
of increased integration of intermittent renewable energy sources and the shift from fossil fuel power
plants5.
In the Energy Development Strategy of Montenegro until 2025, it is pointed out that: "Montenegro
has a hydropower potential that belongs to the very top in the world according to the Index of
Strategic Priority for Use (ISP), cost-effectiveness and ability of fitting into the ecological and social
environment". The theoretical and technically usable hydro potential in Montenegro was estimated
2
Law on Concession, granted to Mr. Anto Deskovic, engineer from Puciste in Brac, Austrian citizen for the construction of
a hydroelectric power plant on the Morača River near Donja Gorica, the National Assembly of the Kingdom of Montenegro,
1911.
3
Source: Živko Andrijašević, Zvedan Folić, Dragutin Papović i Ivan Tepavčević, Istorija crnogorske elektroprivrede,
Published by: EPCG, Nikšić, 2020
4
Source: Montenegro Third National Communication on Climate Change
5
Source: ACER, ACER’s Final Assessment of the EU Wholesale Electricity Market Design, April 2022
18.
REGAGEN Energy and Water Regulatory Agency
on the basis of the results from the Water Resources Management Baseline Study and studies that
were made in the period 2005-2006. (Table 1.1.1).
The first large hydropower plant in Montenegro - HPP Perućica, started its operation in 1960, after
which another large hydropower plant was built in 1976 - HPP Piva. With the commissioning of these
two hydropower plants, about 39% of the technically exploitable potential of the main running
waters was used. In addition, construction of hydropower plants on the Morača River and HPP
Komarnica are included in the Energy Development Strategy of Montenegro until 2030 as a favorable
scenario for the valorization of hydro potential in Montenegro. However, in the reporting period, no
specific activities were carried out in relation to the construction of hydroelectric power plants on
the Morača River.
When it comes to the construction of HPP Komarnica, after a break of a little more than a year, EPCG
submitted an updated offer, and in March 2022, a Decision was made on granting a concession for
the use of natural resources, for the purpose of building, maintaining and using the energy facility
HPP Komarnica for the purpose of producing electricity.
In addition to the potential of large running waters, in Montenegro there is a significant
hydropotential of smaller rivers and watercourses, which can be valorized by building small
hydropower plants. Hydrometric measurements on small rivers have been carried out since the
beginning of 2007, while research on smaller watercourses, suitable for the construction of power
plants up to 1 MW, began in 2010. In the period from 1939 to the end of 2021, 38 small hydropower
plants were commissioned. The construction of small hydropower plants in Montenegro can be
divided into two phases: the first phase, which was marked by the commissioning of seven power
plants - HPP Podgor, HPP Rijeka Crnojevića, HPP Slap Zete, HPP Glava Zeta, HPP Rijeka Mušovića,
HPP Šavnik and HPP Lijeva Rijeka , while the second phase began in 2013, when the Jezerštica HPP
was commissioned, and after that, by the end of 2021, another 31 small hydropower plants were
commissioned.
6
Theoretical potential of major running waters suitable for construction of large hydro-power plants (including diversion
of water from the Tara to the Morača): Tara (2,255 TWh), Morača (1,469 TW, to Zeta), Zeta (2,007 TWh), Lim (1,438 TWh),
Piva (1,361 TWh), Ćehotina (0,463 TWh), Mala Rijeka (0,452 TWh), Cijevna (0,283 TWh) and Ibar (0,118 TWh).
7
Technically exploitable potential of major running waters excluding diversion from the Tara to the Morača
19.
REGAGEN Energy and Water Regulatory Agency
In addition to the aforementioned study, in the period from 2011 to 2015, Montenegro, in
cooperation with Italian, Croatian and Albanian partners, participated in the international project
"Offshore wind farms: research and development" - POWERED8. This project aimed to identify
strategies and methods for the development of offshore wind farms in the Adriatic Sea. Additionally,
as part of the "Wind Atlas" study, a wind map for the Balkans was created with the aim of identifying
areas with exploitable winds9.
The use of wind potential for the purpose of electricity production in Montenegro began in 2017,
with the commissioning of the 72 MW WPP Krnovo, which utilized part of the estimated potential in
the area around Nikšić. Almost two years later, the Možura WPP was put into commercial operation,
with an installed capacity of 46 MW. Unlike storage hydropower plants, wind power plants belong
to the group of intermittent sources of electricity due to the nature of electricity production, which
depends on the availability of the primary resource - wind.
Given that the wind potential on the Krnovo Plateau was not fully utilized by the construction of the
WPP Krnovo, in 2018 a Location study was prepared, which foresees the construction of the WPP
Gvozd. EPCG is carrying out the activities regarding the construction of WPP Gvozd, and, as pointed
out in subsection 3.1 of this report, in 2021, it invested €59,808 for this purpose. The pace of activities
carried out on this project so far, while appreciating the aforementioned investments in 2021,
indicates the need to intensify activities on the implementation of this project in order not to
jeopardize the closing of the electricity balance planned by the Long-Term Energy Balance for the
period 2023-202510, which foresees commissioning of WPP Gvozd, with installed power of 54.6 MW,
in 2024.
8
Source: http://www.powered-ipa.it/
9
Source: https://balkan.wind-index.com/Info.html
10
Source: Long-term energy balance of Montenegro for the period 2023 to 2025, Government of Montenegro, July 2022
20.
REGAGEN Energy and Water Regulatory Agency
In addition, during 2019, a tender procedure was conducted for the long-term lease of state-owned
land in Brajići, for the purpose of building a wind power plant with an installed capacity of more than
70 MW, in which the consortium of WPD AG from Bremen and the company " Vjetroelektrane Budva"
from Podgorica were selected as the first ranked bidder. The aforementioned German-Montenegrin
consortium has foreseen the construction of a wind power plant with an installed capacity of 100.8
MW. In August 2020, the Land Lease Agreement for the construction of a wind farm was concluded
between the Government of Montenegro and this consortium. At the session held on 3 March 2022,
the Government of Montenegro adopted a Decision on the development of a Detailed Spatial Plan
for the concession area for the construction of a wind power plant at the location of Brajići - Budva
and Bar municipalities11, as well as a Decision on the appointment of the manager for the
development of a Detailed Spatial Plan. The long-term energy balance for the period 2023-2025
does not foresee the production of electricity from the WPP Brajići.
Many years of activities on the use of solar energy in Montenegro by building larger production
capacities resulted in the conclusion of the Land Lease Agreement for the construction of the solar
power plant Briska Gora in the Municipality of Ulcinj, between the Government of Montenegro and
the consortium of companies Fortum and EPCG, in late 2018. The construction of this solar power
plant is planned in two phases: Phase I includes the construction of a 50 MW solar power plant with
accompanying infrastructure and its connection to the system, while Phase II includes the
construction of an additional 200 MW with accompanying infrastructure and connection to the
system. At the session held on 17 November 2021, the Government of Montenegro adopted the
Decision on the drafting of amendments to the Spatial-Urban Plan of the Municipality of Ulcinj12,
Article 4 of which stipulates that the deadline for the development of the aforementioned act is 12
months from the date of signing the contract with the manager responsible for the development of
the planning document (12 January 2023). The pace of the activities carried out in this project so far,
11
Source: www.gov.me
21.
REGAGEN Energy and Water Regulatory Agency
while taking into consideration the mentioned decision of the Government of Montenegro and the
absence of investment on this basis on the side of EPCG in 2021 (specified in subsection 3.1 of this
report), indicates the need to intensify activities on the implementation of this project in order not
to put at risk the closure of the electricity balance planned by the Long-term Energy Balance for the
period 2023-202512, which foresees the commissioning of the first phase of SPP Briska Gora, with an
installed capacity of 50 MW, in 2024.
The commercial exploitation of solar energy in Montenegro for the purpose of electricity production
began in 2019 with the commissioning of solar power plants: SPP DG, SPP Bar-Kod and SPP Invicta.
After that, two more solar power plants were put into operation: SPP Alliance and SPP FSCG, so that
the total power of commercial power plants in Montenegro is 2,233 MW.
In order to encourage the production of electricity from renewable sources and highly efficient
cogeneration by individual customers, the Law on Energy established the institute of Prosumers.
Consumers-producers or Prosumers, among other things, have the option of installing solar panels
on their own buildings, thus using more efficiently f the available space, on the one hand, and on
the other hand, enabling consumers to be active participants in the energy transition through the
production of "green" energy. By the end of 2021, 20 solar power plants owned by prosumers were
connected to the electricity distribution system, one of which has a power of 302.5 kW (SPP EPCG),
while the other 19 have a power of less than 34.5 kW, and thus the total installed power of facilities
that produce electricity using solar irradiation in Montenegro reached 0.59 MW.
The installation of solar panels can also represent an alternative for the electrification of remote
areas, which are characterized by high dispersion of consumption and in which the construction of
the electricity supply infrastructure would require huge investments. In this regard, through the three
phases of the "Solarni Katuni" project, the implementation of which began in 2011 in cooperation
with the Ministry of Economy, the Ministry of Agriculture and Rural Development and local self-
government units, 243 photovoltaic systems were installed on Montenegrin summer pastures, with
a total installed power of 51,48 kW.
When it comes to specific activities aimed at the exploitation of biomass in Montenegro, within the
framework of the ReDEWeB (Renewable District Energy in the Western Balkans) Program of the
12
Source: Long-term Energy Balance of Montenegro for the period 2023 to 2025, Goverrnment of Montenegro, July 2022
22.
REGAGEN Energy and Water Regulatory Agency
European Bank for Reconstruction and Development and the Austrian government, in 2019 the CES
company was hired (Clean Energy Solutions), to produce a Preliminary study of biomass district
heating in Žabljak. The results of the aforementioned preliminary study confirmed that the
implementation of biomass district heating represents the most favorable solution to the heating
problem in Žabljak, and that there are sufficient quantities of available biomass for the unhindered
use of the system. However, activities on this project were suspended in 2021 due to the lack of
spatial planning documentation..13
Reducing the emission of greenhouse gases from the heating sector and mitigating the harmful
impact on the environment can also be achieved through the improvement of individual heating
systems. One of the examples of supporting households to achieve energy savings, taking into
account the impact of the aforementioned aspects, is the "Energy Wood"14 program implemented
by the Ministry of Economy. The program provides interest-free loans for the purchase and
installation of biomass heating systems
1.1.5. Coal
Coal deposits in the territory of Montenegro are located in two geographical areas: nearby Pljevlja
and Berane.
Pljevalja region
Pljevalja region includes three basins:
− Pljevlja basin (deposits: Potrlica, Kalušići, Grevo, Komini and Rabitlje), with gravitating small
basins (deposits: Otilovići, Glisnica, Bakrenjače and Mataruge),
− Ljuće-Šumanski basin (deposits: Šumani I and Ljuće I and II) and
− Maoče Basin.
U periodu od 2015. do 2021. godine, prosječna godišnja proizvodnja uglja u Crnoj Gori je iznosila
oko 1,5 miliona tona, od kojih je za potrebe potrošnje u Crnoj Gori u prosjeku proizvedeno 1,45
miliona tona. U tabeli koja slijedi dat je prikaz ostvarene proizvodnje uglja, kao i njegova prodaja po
kategorijama potrošnje u periodu 2015 – 2021. godine. In the period from 2015 to 2021, the average
annual production of coal in Montenegro was approx. 1.5 million tons, of which an average of 1.45
million tons was produced for consumption in Montenegro. The following table shows the actual
production of coal, as well as its sales by consumption categories in the period 2015 - 2021.
23.
REGAGEN Energy and Water Regulatory Agency
Table 1.1.2 Actual production of coal and its sales by consumption categories in the period 2015 – 2021
MNE
TPP Pljevlja Exports Total
Year Consumption
[t] [t] [t]
[t]
2015 1.657.315,32 32.922,26 44.534,32 1.734.771,90
2016 1.278.077,26 29.499,74 42.159,26 1.349.736,26
2017 1.286.090,26 34.945,74 98.986,04 1.420.022,04
2018 1.411.298,74 32.650,50 95.172,72 1.539.121,96
2019 1.419.967,00 30.349,06 111.301,38 1.561.617,44
2020 1.530.880,00 26.543,00 99.529,00 1.656.952,00
2021 1.360.522,00 23.384,00 164.705,00 1.548.611,00
Sum 9.944.150,58 210.294,30 656.387,72 10.810.832,60
Average 1.420.592,94 30.042,04 93.769,67 1.544.404,66
Data from the Pljevlja Coal Mine indicate an increased export of this resource in 2021, by 65%
compared to 2020. All exports in 2021 were directed to Serbia. From the introductory part of this
section, it can be concluded that Montenegro covers about 55% of the total final energy
consumption needs from its own energy sources, including coal. The remaining 45% of energy
needs, related to oil derivatives, is solely dependent on imports. That is why it is extremely important
to look at each source of energy in the context of the energy and energy sources market mark in the
region (and beyond), in order to avoid possible risk of not being able to meet domestic needs.
Restrictive measures such as the ban on the export of firewood, pellets, coal or natural gas, and even
electricity, announced by some countries in the region, would completely nullify the positive effects
of the achieved export arrangements.
24.
REGAGEN Energy and Water Regulatory Agency
Map 1.1.1 Overview map of the coal deposits in the Pljevlja region including facilities of the mine
and TPP Pljevlja
18
19
20
17 16
15
10
5
3 1
23 21 4 2 11
22
7
24 6
8 26
LEGENDA
LEGEND 25
27
PLJEVLJA BASIN POTENTIAL DEPOSIT 9
PLJEVALJSKI BASEN POTENCIJALNA LEŽIŠTA
1. POTRLICA (IN EXPLOITATION) 14. TJEŠANJ
2. DURUTOVIĆI 15. BUŠNJE
3. KALUŠIĆI 16. GOTOVUŠA
4. GREVO 17. GLISNICA
5. KOMINI 18. BOLJANIĆI
6. RABITLJE 19. RAĐEVIĆI 12
20. VOJTINA
DEPOSIT
LEŽIŠZTE LJUĆE-ŠUMANI
LJUĆE-ŠUMANI
7. LJUĆE (COMPLETED EXPLOITATION)
8. ŠUMANI I (COMPLETED EXPLOITATION)
9. ŠUMANI II (IN EXPLOITATION)
14
10. DEPOSIT BAKRENJAČE 13
11. DEPOSIT OTILOVIĆI
12. DEPISIT MATARUGE
13. DEPOSIT MAOČE
Total coal reserves in the Pljevlja region, as of 31 December 2021, amount to 177,874,783 tons. The
energy value, relevant for the assessment of coal quality, varies from site to site and ranges from
5,572 kJ/kg in the Ljuće II basin, over 12,504 kJ/kg in the Maoce basin, to 13,663 kJ/kg in the
Rabitlje basin. Table 1.1.3 shows the state of reserves and the average energy value of coal in the
Pljevlja region on 31 December 2021.
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Table 1.1.3 State of coal reserves in the Pljevlja region as of 31 December 2021 15
Mean
Basin/ Reserves Verification of Share a+b Overburden DTE strip
No. Category
deposit [t] reserves [%] [m3] [kJ/kg] ratio
[m3/t]
CONCESSIONS
Pljevlja basin
Potrlica A+B+C1 26.503.982 balance 99,71 112.728.093 11.746 4,25
Kalušići A+B+C1 15.047.141 balance 97,32 46.627.374 7.957 3,1
1 Grevo C1 2.281.805 balance 0 11.722.118 12.442 5,14
Komini C1 4.958.098 balance 0 6.628.880 11.515 1,34
Rabitlje C1 2.903.059 balance 0 34.684.531 13.663 11,95
TOTAL 51.694.085 212.390.996 4,1
Ljuće-Šumanski basin
Šumani I A+B+C1 200.000 balance 60 230.000 7.684 1,15
2 Ljuće II B+C1 1.056.085 balance 61,21 500.000 5.572 0,47
Ljuće I A+B 269.957 balance 100 793.889 8.600 3,09
TOTAL 1.526.042 1.523.889 1,19
3 Glisnica B 1.701.343 balance 100 4.232.019 9.384 2,49
TOTAL CONCESSIONS RU 54.921.470 218.146.904 3,97
4 Otilovići B+C1 3.421.000 balance 99,5 11.887.300 10.510 3,47
5 Bakrenjače A+B+C1 1.332.313 balance 73,64 1.151.000 10.296 0,86
TOTAL BALANCE 59.674.783 231.185.204 3,87
6 Mataruge C1 8.300.000 estimate 15.000.000 8.000 1,81
7 Maoče B+C1 109.900.000 balance 82,98 497.500.000 12.504 4,53
TOTAL ALL DEPOSITS 177.874.783 743.685.204 4,18
15
Source: Coal Mine in Pljevlja
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REGAGEN Energy and Water Regulatory Agency
Berane basin
The production system of this mine, where the production was restored in 2016, is comprised of the
Petnjik pit and Budimlja coal separation. This mine ceased production on 31 March 2020.
Table 1.1.416 shows the state of coal reserves in the Petnjik pit on 31 December 2021. Energy value
of the coal from this pit amounts to 13,643 kJ/kg.
Table 1.1.4 The state of coal reserves in Petnjik pit on 31 December 2021
A / / / / /
Sizing of the power system is carried out according to the needs to produce, transmit and deliver
electricity in the required quantities over a wider geographical area, while respecting the
requirements for economic efficiency, safety, reliability and quality of electricity supply. In section
1.1 of this report, it is stated that electricity in Montenegro was used for the first time in late July
1904. It was in this decade of the last century that the first distribution systems were developed in
Montenegro, which connected the first diesel power plants with electricity consumers.
Today, the power system of Montenegro consists of 49 power plants, 21,625.43 kilometers of
transmission and distribution networks spread over the entire territory of Montenegro. Presentation
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REGAGEN Energy and Water Regulatory Agency
of the elements of the power system of Montenegro is given in the form of a simplified scheme in
Figure 1.2.1, which shows characteristics of the Montenegrin power system by voltage levels (HV:
400 kV, 220 kV and 110 kV, MV: 35 kV, 10 kV and 6 kV and LV: 0.4 kV), including: the total network
lengths of the respective voltage levels, the total number and installed capacity of production
facilities connected to the observed voltage level, as well as the total number and power of
transformers/substations between the specified voltage levels.
22 sHPP 42,659 MW
v 36 TR; 1.164 MVA
v
v
1 sHPP 0,465 MW
v 21 SS; 4,62 MVA
v
v
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REGAGEN Energy and Water Regulatory Agency
The total installed capacity of all power plants in Montenegro at the end of 2021 was 1.050,812 MW.
An overview of installed capacities by energy undertakings and power plants is shown in Table 1.2.1.
Installed capacity
Energy undertaking Power plant
(MW)
TPP Pljevlja 225,000
HPP Piva 342,000
HPP Perućica 307,000
sHPP Rijeka Crnojevića 0,650
EPCG AD Nikšić
sHPP Rijeka Mušovića 1,950
sHPP Lijeva rijeka 0,110
sHPP Podgor 0,465
sHPP Šavnik 0,200
sHPP Glava Zete 4,480
DOO Zeta Energy Danilovgrad
sHPP Slap Zete 1,672
sHPP Jezerštica 0,844
sHPP Bistrica 5,600
sHPP Rmuš 0,474
DOO Hidroenergija Montenegro sHPP Spaljevići 1 0,650
Podgorica sHPP Orah 0,954
sHPP Šekular 1,665
sHPP Jelovica 2 0,619
sHPP Jelovica 1 3,285
DOO Synergy Podgorica sHPP Vrelo 0,615
sHPP Bradavec 0,954
DOO Igma Energy Andrijevica
sHPP Piševska rijeka 1,080
sHPP Jara 4,568
DOO Kronor Podgorica
sHPP Babino polje 2,214
sHPP Bistrica
DOO Hydro Bistrica Podgorica 3,600
Majstorovina
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REGAGEN Energy and Water Regulatory Agency
U Depending on the energy source used for electricity generation, the generation capacities in
Montenegro can be classified into hydro power plants, thermal power plants, wind power plants and
solar power plants. Thus, the energy mix of Montenegro is represented by hydro power plants with
share of 67.08% (704,904 MW), thermal power plants with 21.41% (225 MW), wind power plants with
18
Power plant was under trial operation in 2021.
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REGAGEN Energy and Water Regulatory Agency
11.23% (118 MW), and solar power plants with 0.28% (2,908 MW) in relation to the total installed
production capacity (Graph 1.2.1).
WPP Možura
4,38%
WPP Krnovo sHPP
6,85% 5,32% TPP Pljevlja
21,41%
SE
0,28%
HPP Perucica
29,22%
HPP Piva
32,55%
TETPPPljevlja
Pljevlja SE
SPP HEHPPPiva
Piva HE
HPPPerućica
Perućica VE Krnovo
WPP Krnovo VE Možura
WPP Možura mHE
sHPP
Graph 1.2.1 Share of installed generation facilities in the total installed generation capacities
In 2021, the production of 3.655,66 GWh was generated by domestic power plants. Graph 1.2.2
shows the production by generation facilities, and it is notable that in 2021 the production of TPP
Pljevlja was dominant in the energy mix and represented 36.45% of total production. The share of
renewable energy sources and highly efficient cogeneration in total electricity generation in 2021
was 63.55%.
Distributed Distributed
generation - generation - SPP
sHPP 0,08%
4,71% Total WPP
8,77%
TPP Pljevlja
36,45%
HPP Piva
22,94%
HPP Perućica
27,05%
TETPPPljevlja
Pljevlja HEHPP
Perućica
Perućica HE
HPPPiva
Piva
distribuirani izvori
Distributed sources - mHE
- sHPP Ukupno
Total WPPVE distribuirani izvori
Distributed sources - SE
- SPP
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REGAGEN Energy and Water Regulatory Agency
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REGAGEN Energy and Water Regulatory Agency
Table 1.2.2 Overview of the generation by power plants in the period 2012 - 2021
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REGAGEN Energy and Water Regulatory Agency
Electricity generation in Montenegro primarily depends on hydropower plants, that in 2021 recorded
increase in generation. Table 1.2.2 gives a detailed overview of electricity generation in the period
from 2012 to 2021 by type of power plants, from which it is evident that the electricity generation in
Montenegro in 2021 was higher by 13.35% compared to 2020, or 8.06% compared to 2019. Owing
to the favorable hydrological conditions and new production facilities, the quantity of electricity
produced in 2021 is 16.31% higher than the average for the period 2012-2020, excluding the years
of maximum and minimum generation.
1.600,00
1.400,00
1.200,00
1.000,00
800,00
600,00
400,00
200,00
0,00
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
TETPP
Pljevlja
Pljevlja HE Piva
HPP Piva HE Perućica
HPP Perućica VEWPP
Krnovo
Krnovo VE Možura
WPP Možura distribuirani izvori
Distributed sources
In addition to electricity producers, the Energy Law has enabled end customers to produce electricity,
too. Namely, end customers who produce electricity from renewable sources or highly efficient
cogeneration for their own needs with occasional transmission of surplus electricity produced to the
distribution system, in a plant of installed power that does not exceed the value of connection
capacity of the end customer, have the right to consume the produced electricity for their own needs,
store and sell surplus electricity generated, individually or through aggregation with other
customers. In the reporting year, 21 prosumers were connected to the distribution system, namely
one small hydro power plant and 20 solar power plants with a total capacity of 601.5 kW.
However, the changes that have taken place in recent decades, mainly due to the need for increased
integration of renewable generation, and also the need to increase the interconnectivity of electricity
transmission systems in Europe to remove physical barriers to creating a single market, have led to
significant increase in the complexity of the transmission system management.
CGES is the energy undertaking responsible for the management, maintenance, planning and
development of the electricity transmission system in Montenegro. In March 2009 it was separated
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REGAGEN Energy and Water Regulatory Agency
from the vertically integrated company - EPCG, and in April 2018 REGAGEN granted it a certificate,
which acknowledged that CGES met the requirements defined in the Energy Law in terms of
separation, independence, financial, material, technical and personnel capabilities.
The transmission system of Montenegro consists of a total of 1.627,8 km of overhead and cable lines,
with rated voltage of 400 kV, 220 kV and 110 kV, and 25 substations with transmission ratio of
400/110/35 kV, 400/220/110 kV, 400/110/35 kV, 400/110 kV, 110/35 kV and 110/10 kV.
The transmission system of Montenegro is dominated by overhead lines (1.618 km) and their share
in the total length is 99.40%. At the end of 2021, the cable lines in the transmission system were of
the total length of 9.8km. The lengths of power lines by type and voltage level are shown in the
following graph.
1.800,00
97,00
1.500,00
616,40
1.200,00
900,00
441,60
600,00
300,00 463,00
9,80
0,00
overhead lines
Nadzemni Kablovski
cable lines
400 kV 220 kV 110 kV 110 kV - koji rade pod
working under3535kV
kV
Out of the total of 25 transmission substations, four have transmission ratio of 400/X kV, two 220/X
kV, while 19 substations have transmission ratio of 110/X kV, with 55 installed transformers having
total installed capacity 4.166,5 MVA.
The Association of Electricity Transmission System Operators from Europe, after the entry into force
of the Third Energy Package of the European Union, continues its work within the new institutional
framework, called the European Network of Transmission System Operators for Electricity (ENTSO-
E). The aim of the association is to ensure secure operation of electric power systems at the European
level, its optimal functioning and development of the single European electricity market while
complying with energy and climate goals19. CGES is among 39 full members of this association from
35 countries.
When it comes to interconnectivity, the Montenegrin transmission system has an important role due
to its extensive connectivity with neighboring systems, namely:
19
https://www.entsoe.eu/about/inside-entsoe/objectives/
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REGAGEN Energy and Water Regulatory Agency
− Electric Power System of Albania, via one 400 kV OHL (OHL Podgorica 2 - Tirana 2) and one
220 kV OHL (OHL Podgorica 1 – Koplik);
− Electric Power System of Bosnia and Herzegovina, via one 400 kV OHL (OHL Lastva – Trebinje),
two 220 kV OHLs (OHL HPP Perućica – Trebinje and OHL Buk Bijela - HPP Piva) and two 110
kV OHLs (OHL Herceg Novi – Trebinje and OHL Vilusi – Bileća);
− Electric Power System of Italy, via 500 kV HVDC cable,
− Electric Power System of Kosovo, via one 400 kV OHL (OHL Ribarevine – Peć 3), and
− Electric Power System of Serbia, via two 220 kV OHLs (OHL B. Bašta – Pljevlja 2 and OHL Pljevlja
2 – Požega) and one 110 kV OHL (OHL Pljevlja 1 - Potpeć).
A scheme of the transmission system of Montenegro as of 31 December 2021 is given in Figure 1.2.2.
20 Source: CGES
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REGAGEN Energy and Water Regulatory Agency
substations increased by five (TS Lastva 400/110/35 kV, TS Brezna 110/35 kV, TS Kotor 110/35 kV,
TS Kličevo 110/10 kV, TS Podgorica 5 110/10 kV).
The Montenegrin distribution system21 consists of power lines with total length of 19.997,63 km,
voltage levels of 35 kV, 10 kV and 0.4 kV, and 4.748 substations with transmission ratio of 35/10 kV,
35/6 kV, 35/0.4 kV and 10/0.4 kV, and total transformation power of 2.747,04 MVA. The following
graph shows the share of distribution voltage levels in the total distribution network length.
18.000,00
15.000,00
12.000,00 11.213,56
9.000,00
6.000,00
3.688,35 2.506,59
3.000,00 1.611,11
895,44
82,58
0,00
Nadzemni
overhead lines Kablovski
cable lines
35 kV 10 kV 0,4 kV
Graph 1.2.5 Share of individual voltage levels in the total distribution network length
The graph shows that the distribution system of Montenegro is dominated by overhead lines
(15.797,36 km), whose share in the total length of the distribution network is 79%.
The electricity distribution system of Montenegro is managed by the distribution system operator –
CEDIS, which was separated from the vertically integrated company EPCG in June 2016. In addition
to the management of the distribution system, CEDIS has the role of maintaining, improving and
developing the distribution system, while complying with the principles of reliability, safety and
efficiency, and environmental protection.
Since mid- 2007, CEDIS, that is, its legal predecessors, are subject to economic regulation, all with
the aim of increasing the efficiency of the undertaking that performs this monopolistic activity. In
21
This data is related to the part of the distribution system that is owned by CEDIS.
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REGAGEN Energy and Water Regulatory Agency
the meantime, the method of organization of distribution system operators in the service area that
includes all municipalities in Montenegro has evolved. Namely, since mid-2015 and after several
years of preparations, the distribution system operator optimized the use of resources that were
once available to 16 distributions and, taking into account the geographical affiliation of consumers,
established the following regions:
Region 7
Region 6
Region 1
Region 3
Region 5
Region 2
Region 4
6000,00
5000,00 20,28%
Length [km]
4000,00
3000,00 7,29%
43,12% 8,95% 5,95%
2000,00 79,72% 14,82%
46,77%
92,71% 94,05%
1000,00 85,18% 56,88% 91,05%
53,23%
0,00
Region 1 Region 2 Region 3 Region 4 Region 5 Region 6 Region 7
Nadzemni
overhead
lines
Kablovski
cable lines
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REGAGEN Energy and Water Regulatory Agency
A significant presence of cable lines exists in regions 4 and 5, while the regions in the north of
Montenegro are characterized by a dominant presence of overhead lines.
The Law on Energy, in addition to the operator of the distribution system, also recognizes the
operator of the closed distribution system, through which electricity is distributed in a geographically
limited area, and which consists of plants, lines and transformers from the point of connection to
the transmission or distribution system to the point of connection of users of that system, as well as
facilities, telecommunication and IT equipment and other infrastructure necessary for its operation.
There are three closed distribution system operators in Montenegro, namely: "PM Power" DOO Tivat,
which manages the distribution system in the area of the nautical-tourist complex Porto
Montenegro, "Uniprom" DOO Nikšić - OC Elektroenergetika, which manages the distribution system
in the area of DUP “Industrial zone Aluminum Plant Podgorica" and "Luštica Bay Electricity Company"
DOO Tivat, which manages the distribution system through which electricity is distributed in the area
of Luštica Bay in Tivat.
In 2021, a 5.79% increase in electricity consumption was recorded compared to the consumption in
2020, which can be attributed to the recovery of economic activity due to the weakening of the
impact of the COVID-19 pandemic on the society.
As regards the consumption in Montenegro, the largest increase in electricity consumption in 2021
was recorded by customers connected to the 10 kV voltage level (9.49% compared to 2020), followed
by other customers connected to the 0.4 kV voltage level (8,76% compared to 2020). An increase in
electricity consumption was also recorded among customers connected to the 35 kV voltage level
(5.01% compared to 2020), while a decrease in electricity consumption was recorded among
customers connected to the 110 kV voltage level (4.24% compared to to 2020).
Table 1.2.3 provides an overview of the actual electricity consumption, number of customers, share
in total electricity consumption, as well as the trend of electricity consumption in relation to the year
2020, while Table 1.2.4 provides an overview of consumption over a ten-year period ( 2012-2021).
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REGAGEN Energy and Water Regulatory Agency
Table 1.2.3 Consumption and number of customers in 2021 and comparison with the previous year
No of
Consumption in Average Share in total Consumption in
Consumption customers Trend
2021 consumption consumption 2020
category on 31 Dec (2021/2020)
(kWh) (kWh/customer) (%) (kWh)
2021
1. Customers 110 kV 606.891.729 10 60.689.173 20,35% 633.755.007 -4,24%
2.1. Customers 35 kV 104.171.340 36 2.893.648 3,49% 99.197.648 5,01%
2.2. Customers 10 kV 359.805.921 564 637.954 12,06% 328.633.157 9,49%
2.3. Customers 0,4 kV 1.911.389.790 421.252 4.537 64,09% 1.757.405.402 8,76%
2. Total distribution
2.375.367.051 421.852 5.631 79,65% 2.185.236.207 8,70%
customers
TOTAL 2.982.258.780 421.862 7.069 100,00% 2.818.991.214 5,79%
Table 1.2.4 Consumption of customers connected to the transmission and distribution system in ten-year period 2012 – 2021
Consumption
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
category
1. Customers 110 kV 1.181,80 793,28 707,00 714,00 606,21 674,59 676,74 625,68 633,76 606,89
2.1. Customers 35 kV 83,84 79,61 82,67 91,00 87,37 92,43 117,87 96,50 99,20 104,17
2.2. Customers 10 kV 292,80 294,78 292,56 321,55 328,69 348,61 361,87 375,13 328,63 359,81
2.3. Customers 0,4 kV 1.678,56 1.676,33 1.642,71 1.748,87 1.767,22 1.829,73 1.834,81 1.869,68 1.757,41 1.911,39
2. Total distribution
2.055,20 2.050,72 2.017,94 2.161,42 2.183,28 2.270,76 2.314,55 2.341,31 2.185,24 2.375,37
customers
TOTAL 3.237,00 2.844,00 2.724,94 2.875,42 2.789,49 2.945,35 2.991,29 2.966,99 2.819,00 2.982,26
Average consumption 2012-2020 (GWh) 2.910
Average 2012-2020 excluding extreme values (GWh) 2.929
40.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
A historical overview of the actual electricity consumption of customers connected to the electricity
distribution system in the period 2012 - 2021 is given in Graph 1.2.7. From the mentioned graph, it
can be seen that the consumption of distribution customers, after years of continuous growth, during
2020 was reduced almost to the level of consumption in 2016, while in 2021 the recorded
consumption was higher than the consumption in 2019, when maximum consumption was recorded
in the observed period. Namely, the consumption of distribution customers during the year 2021 is
higher by 8.7% compared to the consumption during the year 2020, while it is higher by 9.18% than
the average consumption in the period 2012 - 2020 (2,175,601,791 kWh).
2.500.000.000
2.400.000.000
Consumption [kWh]
2.300.000.000
2.200.000.000
2.100.000.000
2.000.000.000
1.900.000.000
1.800.000.000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
ukupno distributivni
total distribution customerskupci Prosjek
average 2012 - 2020
2012-2020
Due to the characteristics of the economy in Montenegro and the fact that due to the absence of
district heating/cooling systems the spaces are predominantly heated/cooled by electricity there are
notable similarities in the daily load diagrams of gross consumption in Montenegro in the following
months: January, February and December (heating season); June, July and August (cooling season);
April, May and October, when heating and cooling needs are typically reduced to a minimum
(relieved season) and March, September and November, which can be considered a transitional
season.
As stated in the previous sub-section, consumption in Montenegro recovered in 2021 after a year in
which electricity consumption was affected by the COVID-19 pandemic. Namely, electricity
consumption in Montenegro increased by 5.79% in 2021 compared to 2020. The increase in
consumption in 2021 is also noticeable compared to 2019, a year that was not exposed to the impact
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REGAGEN Energy and Water Regulatory Agency
of the COVID-19 pandemic, and this is mainly due to the increase in consumption by the economy
and households connected to the 0.4kV voltage level.
The change in the cumulative needs of households and the economy in Montenegro for electricity
during the day, shown in Graph 1.2.8, indicates the existence of a seasonal difference in the needs
for electricity in 2021 as well.
500,00
450,00
400,00
350,00
300,00
Load [MW]
250,00
200,00
150,00
100,00
50,00
0,00
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
Hour of the day [h]
SEZONA GRIJANjA
heating season 2021 2021 SEZONA HLADjENjA
cooling season 2021 2021
PRELAZNA
transitional SEZONA
season 20212021 RASTEREĆENA SEZONA 2021
relieved season 2021
Unlike 2020, in which the needs during the cooling season dropped significantly compared to the
needs in 2019, to the extent that they approached the needs in the transitional season, the recovery
of consumption in 2021 was visible exactly during the summer months (June , July and August).
Namely, the average daily diagram of gross consumption in Montenegro for the months of June,
July and August 2021 is close to the average daily diagram of gross consumption of the comparative
period in 2019 and primarily indicates the recovery of economic activity in the summer period..
DAILY LOAD DIAGRAM DAILY LOAD DIAGRAM
- HEATING SEASON - - COOLING SEASON-
600 500
500
Load [MW]
Load [MW]
400
400
300
300
200
200
100
100
0
0
Hour of the day [h] Hour of the day [h]
SEZONA
heatingGRIJANjA 2019
season 2019 SEZONA
heatingGRIJANjA 2020
season 2020 coolingHLADjENjA
SEZONA season 2019
2019 SEZONA
cooling HLADjENjA 2020
season 2020
SEZONA
heatingGRIJANjA 2021
season 2021 SEZONA
coolingHLADjENjA 2021
season 2021
42.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
400 300
Load [MW]
Load [MW]
300
200
200
100
100
0
0
Hour of the day [h] Hour of the day [h]
PRELAZNA SEZONA
transitional season2019
2019 PRELAZNA SEZONA
transitional 2020
season 2020 relieved season
RASTEREĆENA 20192019
SEZONA RASTEREĆENA SEZONA
relieved season 2020 2020
PRELAZNA SEZONA
transitional season2021
2021 RASTEREĆENA SEZONA
relieved season 20212021
Graph 1.2.9 Overview of daily load diagrams for the heating season, cooling season, transitional season and
relieved season for 2019, 2020 and 2021
As stated in the very introduction of this subsection, changes in the cumulative needs of households
and the economy during the day, with seasonal variations, are subject to the management of the
transmission system operator. In the case of the control area comprised of the Montenegrin power
system, its balance is managed by CGES. The goal of power transmission system management is to
match each consumed and each produced kilowatt-hour at specific locations and in a specific time,
and it implies coordinated implementation of activities in cooperation with entities outside
Montenegro in order to maintain the vital parameters of the system, frequency and voltage, within
the permitted limits. As the system is managed in real time, production facilities with a quick
response, and thus every kilowatt hour that is produced at a time when it is crucial to maintain
system stability and avoid power interruptions, have added value. In addition to management
measures that are implemented in real time, changes in the cumulative needs of households and the
economy must also be taken into account when planning and developing the power transmission
and distribution system.
The largest company in the sector of petroleum products in Montenegro is AD Jugopetrol Podgorica.
The following companies also make a significant contribution to competitiveness in the petroleum
products market: DOO Petrol Crna Gora MNE Podgorica, DOO Ina Crna Gora Podgorica, DOO Lukoil
Montenegro Podgorica and DOO Montenegro Bonus Cetinje.
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REGAGEN Energy and Water Regulatory Agency
In Montenegro, at the end of 2021, the storage activity of petroleum products and liquefied
petroleum gas - LPG was performed by 34 undertakings, of which 23 performed storage of both
petroleum products and LPG, and the storage activity of petroleum products only was performed by
eight undertakings, while the storage of LPG only was performed by three undertakings.
The total storage capacities of petroleum products and LPG at the end of 2021 amounted to 96.546
m³, of which the storage capacities for petroleum products were 93.402 m³, while the capacities for
storage of LPG were 3.144 m³. The total storage capacity in 2021 increased by 1.508 m³, i.e. 1.59%
in comparison to 2020.
Of the total storage capacity (96,546 m³), AD Jugopetrol Podgorica owns 79,669 m³, of which 64,439
m³ is for the installation in Bar, 6,963 m³ for the petrol stations, 8,107 m³ for the airline servicing
facilities in Podgorica and Tivat, and 160 m³ is for the three yacht servicing facilities in Budva, Herceg
Novi and Kotor. The remaining storage capacities (16,877 m³) belong to other energy undertakings
that store petroleum products and LPG at petrol stations and yachting servicing facilities. Among
these undertakings, the energy undertaking with the largest storage capacity for LPG is DOO
Montenegro Bonus Cetinje, with a total of 1,100 m³.
In Montenegro in 2021, the transport of petroleum products and LPG by transport vehicles was
performed by 32 undertakings, of which 26 undertakings carry out the transport of petroleum
products, three undertakings the transport of LPG, while the remaining three undertakings are
engaged in transport of both petroleum products and LPG. The total number of transport vehicles
licensed by the REGAGEN at the end of 2021 is 129. Of the total number of vehicles, 30 belong to
AD Jugopetrol Podgorica, while 99 vehicles belong to other energy undertakings engaged in the
transport of petroleum products and LPG. Out of the total of 129 transport vehicles, 111 are used
for the transport of petroleum products, while 18 transport vehicles are used for transport of
liquefied petroleum gas.
The table below provides an overview of undertakings that own five or more transport vehicles.
44.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
Table 1.3.1 Overview of energy undertakings that own more than five transport vehicles
No of transport
No. Energy undertaking
vehicles
1. AD Jugopetrol Podgorica 30
2. DOO Lukana Podgorica 11
3. DOO Samcommerce plus Tivat 11
4. DOO VV Trans Podgorica 10
5. DOO D trans Cetinje 9
6. DOO Humci Cetinje 7
7. DOO Euro Petrol CG Podgorica 5
8. DOO SMN Transporti Kotor 5
At the end of 2021, the retail trade in petroleum products and LPG was performed at 121 facilities
in Montenegro, of which 115 were petrol and gas stations and 6 yacht servicing facilities. Wholesale
takes place at the installation in Bar, two airline servicing facilities and two storage facilities. AD
Jugopetrol Podgorica owns 50 facilities (44 petrol stations, three yacht servicing facilities (Budva,
Kotor and Herceg Novi), two airline servicing facilities (Podgorica and Tivat), and the installation in
Bar) while the remaining 77 facilities are owned by other licensed undertakings (71 petrol and gas
stations, three yacht servicing facilities and three storage facilities).
The following table shows undertakings that own more than five petrol stations, including gas
stations and yacht servicing facilities, whereas Map 1.3.1 provides an overview of the number of
petrol and gas stations by municipalities in Montenegro.
Table 1.3.2 Overview of energy undertakings that own more than five petrol and gas stations
45.
REGAGEN Energy and Water Regulatory Agency
1 3
1 Pljevlja 2
8
1
2
No of petrol Žabljak 0
Plužine
stations: 11
Bijelo Polje 2
Mojkovac
Šavnik Petnjica
3
Berane Rožaje
7 Nikšić
Kolašin
6 Andrijevica
Plav 4
Danilovgrad
Kotor Podgorica Gusinje 1
Herceg Novi 1
Tivat Cetinje Tuzi 33 0
6 Budva
4
Bar
7 5
8
Ulcinj 5
Map 1.3.1 Overview of the number of petrol and gas stations and yacht servicing facilities by municipalities
In 2021, three petrol stations were opened, two in Podgorica (one owned by AD Jugopetrol
Podgorica and the other one owned by DOO Pigo Petrol Nikšić) and one in Danilovgrad, owned by
DOO Hifa Oil CG Podgorica. Also, a yacht servicing facility was opened in Bar, owned by DOO Novi
Gas.
46.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
fossil fuels, and therefore it will become more and more important as the existing reserves of fossil
fuels deplete.
In 2017, the Government of Montenegro adopted the Montenegro Gasification Master Plan, which
together with the Report on Strategic Environmental Assessment and Guidelines for Planning Priority
Investments in Gas Pipeline Projects makes an overarching document for the natural gas sector in
Montenegro. The Master Plan considers possible scenarios of Montenegro's gas supply and
concludes that the most realistic option for Montenegro is to be supplied with natural gas by
building the Ionian-Adriatic Gas Pipeline (IAP) and valorising its gas reserves from the Adriatic
offshore.
IAP has been the subject of interest of the governments of the countries from the region for many
years. Back in 2007, the Governments of Montenegro, Croatia and Albania signed the Ministerial
Declaration on the support to the IAP project implementation (the Government of Bosnia and
Herzegovina signed the declaration subsequently). Under the auspices of the Energy Community,
the Interstate Committee for Coordination and Support of Activities on the IAP Project was
established in 2010. Subsequently, the Western Balkans Investment Framework approved funding
for a comprehensive feasibility study for the entire IAP project, master plans for gasification of
Montenegro and Albania, including supporting documents, as well as the Preliminary Design of the
Ionian-Adriatic Pipeline in Montenegro and Albania.
The main purpose of the IAP is to connect the existing and planned gas transmission systems of the
Republic of Croatia with the gas originating from the Caspian Basin. The gas from Azerbaijan arrives
to Europe via the Southern Gas Corridor 3,500 km long, which, in addition to the South Caucasus
gas pipeline, consists of the 2,000 km long Trans Anatolia Natural Gas Pipeline (TANAP) and the 867
km long Trans-Adriatic Pipeline (TAP). The IAP is planned to connect with the TAP near Fier in Albania
and going up to the north along the Adriatic coast end up in Split. It is very important for the IAP to
be bidirectional, so that the supply line can also be north-south, from the LNG terminal on the island
of Krk in Croatia or from some other sources. The construction of the pipeline will facilitate the
gasification of Albania and Montenegro, southern Croatia and Bosnia and Herzegovina, and provide
a diversified and reliable supply of natural gas. The pipeline will be 511 km long and will create
preconditions for the development of the natural gas market of Albania, Montenegro, Bosnia and
Herzegovina and Croatia at the level of about 5-7 billion m3.
In 2016, the Project Management Unit (PMU) was established, which consists of one representative
of the state authority competent for energy and one representative of the natural gas transmission
system operator (TSO) from each of the four countries signatories of the Memorandum of
Understanding and Cooperation on the implementation of the IAP project - Albania, Bosnia and
Herzegovina, Montenegro and Croatia. The Azerbaijani company SOCAR and the Secretariat of the
Energy Community have the status of observers in the PMU, without the right to vote. The Ministry
in charge of energy affairs in Montenegro is in charge of coordinating all activities and represents
the permanent PMU Secretariat.
47.
REGAGEN Energy and Water Regulatory Agency
The development of the Preliminary design of the Ionian-Adriatic gas pipeline on the territory of
Albania and Montenegro began in September 2018. The project is funded by the Western Balkans
Investment Framework (WBIF) with €2.5 million and it is expected that the development of the
Preliminary Design will take 2 years. The desired project achievements for the part of the gas pipeline
that will be located on the Montenegrin territory are:
- development of a preliminary design for the Montenegrin section of the gas pipeline,
which will be based on prefeasibility studies and will be harmonized with the relevant
Montenegrin regulations and spatial plans,
- assessment of the impact on society and the environment, which will be done in
accordance with Montenegrin regulations and international requirements, including
public consultations,
- preparation of documents required for obtaining appropriate permits,
- preliminary estimation of investment costs, and
- development of a project implementation plan.
The delay in the implementation of the project occurred for several reasons, among others due to
the COVID-19 pandemic. In April 2021, the municipalities of Tivat, Kotor and Herceg Novi
approached the Ministry of Capital Investments22 regarding the route of the IAP, which was
proposed as part of the conceptual project. These municipalities expressed opposition to the
proposed route, pointing out that they were not adequately informed, nor included in the project
by the previous Ministry of Economy. They emphasized that the proposed route threatens natural
and cultural assets, as well as the planned construction of some tourist settlements in the given area.
The mentioned municipalities proposed their own plan for the route of the gas pipeline in the given
area, which was supported by the Ministry of Capital Investments. At the meeting held on 17 May
2021, in the presence of representatives of IPF6, the EBRD, coastal municipalities and the Ministry of
Capital Investments, a new, alternative route of the gas pipeline was proposed, and all participants
in the meeting agreed to this solution.
Preliminary design of the Ionian-Adriatic gas pipeline on the territory of Albania and Montenegro
was finalized in November 2021.
22
Source: Ministry of Capital Investments of Montenegro
23
Directorate for mining, geology and hydrocarbons in the Ministry of Capital Investments
48.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
− Concession agreement for the production of hydrocarbons in the offshore of Montenegro for
blocks 4219-26 and 4218-30, with a total area of 338 km2, concluded on 15th March 2017 with
Energean Montenegro Limited, Cyprus. The concession agreement envisages that the
exploration phase lasts a total of seven years, with two exploration periods of three and four
years each. At the concessionaire's request, the Government approved the extension of the
exploration phase (the first period until 15 March1 2022, and the second period until 15 March
2026). In accordance with the mentioned contract, during the first period of the phase, the
concessionaire fulfilled the obligations stipulated in the Mandatory Work Program. In
accordance with the Law on Exploration and Production of Hydrocarbons and the Concession
Agreement, Energean is obliged to provide a new partner that will be acceptable to the
Government of Montenegro, in order to enter the second period of the exploration phase.
49.
REGAGEN Energy and Water Regulatory Agency
SUMMARY:
In line with the global energy policy of turning to green energy, in the reporting year, the
potential of renewable energy sources was used in Montenegro through the
commissioning of five new hydropower plants, and thus, the share of hydropower plants
production capacity (67.08%), along with the share of wind power plants (11.23%) ) and
solar power plants (0.28%), makes a total of 78.59% in the energy mix of Montenegro.
Owing to favorable hydrological conditions and new production facilities, the amount of
electricity produced in 2021 is higher by 16.31% compared to the average for the period
from 2012 to 2020, excluding the years of maximum and minimum production.
At the end of 2021, the electric power system of Montenegro included 49 power plants
and 21,625.43 kilometers of transmission and distribution network spread over the entire
territory of Montenegro, serving a total of 414,040 customers, of which 21 are customer-
producers (prosumers).
In 2021, a 5.79% increase in electricity consumption was recorded compared to the
consumption in 2020, which can be attributed to the recovery of economic activity due to
the weakening of the impact of the COVID-19 pandemic on the society. In 2020, the
consumption of distribution customers was reduced almost to the level of consumption
in 2016, while in 2021, consumption was recorded higher than in 2019, when the
maximum consumption was recorded for the period 2012-2020. On the other hand, for
customers connected to the 110 kV voltage level, a decrease in electricity consumption
was recorded (4.24% compared to 2020).
At the end of 2021, 65 energy undertakings were operating in the petroleum products
market of Montenegro; the total storage capacities of petroleum products and LPG
amounted to 96,546 m³; the total number of means of transport licensed by the Agency
was 129; while the activity of retail trade in petroleum products and LPG was carried out
in 121 facilities in Montenegro, including 115 petrol and gas stations and six yacht
servicing facilities.
Preliminary design of the Adriatic-Ionian gas pipeline on the territory o Albania and
Montenegro was finalized in November 2021.
In December 2021, the Government of Montenegro approved the request of the
concessionaires Eni Montenegro and Novatek Montenegro for the extension of the first
exploration period from the Concession Agreement for the Production of Hydrocarbons
by six months. The first exploration well was drilled to a depth of 5,954 meters, but the
well yielded negative results. Based on the mentioned contract, the concessionaires are
obliged to drill another well, the planned depth of which is 1,045 meters.
50.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
51.
2. SUPERVISION OF ENERGY UNDERTAKINGS
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
In 2021, EPCG had a contract concluded with CGES on the use of the transmission system for the
needs of electricity withdrawal, a contract on the use of the transmission system for the needs of
electricity generation, contracts on the procurement of electricity to cover losses in the transmission
system and a contract on the procurement of ancillary services and balancing energy, then a contract
with CEDIS on the use of the distribution system and contracts on the procurement of electricity to
cover losses in the distribution system, while the following contracts were concluded with COTEE: a
contract on balancing responsibility, a contract on purchase and sale of a proportional share of
electricity generated by privileged producers and the contract on the payment of the fee to the
market operator (especially by producers, suppliers and traders.
EPCG, as an electricity supplier has entered into supply contracts with customers directly connected
to the transmission system: Toščelik Alloyed Engineering Steel DOO Nikšić, Željeznička infrastruktura
Crne Gore AD Podgorica, Rudnik uglja AD Pljevlja – Crushing Plant, CGES – Distribution Plant under
the TPP Pljevlja, China Road & Bridge Corporation DOO Beijing, PR Kina, Krnovo Green Energy DOO
Podgorica, Možura Wind Park DOO Podgorica, Monteput DOO. In 2021, the Decision on the supply
of electricity to TPP Pljevlja for its own needs as a direct customer was applicable to the direct
customer EPCG AD – FU Generation, Thermal Power Plant Pljevlja.
In 2021, CGES had a contract entered into with CEDIS on the use of the transmission system for the
needs of electricity withdrawal, then a contract with COTEE on the payment of the fee for the work
of the market operator. Additionally, CGES had contracts on the use of the transmission system for
the concerned wind farms with DOO Krnovo Green Energy and DOO Možura Wind Park, as well as
54.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
a contract on the use of the transmission system for the purpose of withdrawing electricity and a
contract on the provision of ancillary services and balancing energy with UNIPROM Nikšić.
In 2021, CEDIS had a contract with CGES on the use of the transmission system for the needs of
electricity withdrawal and a contract regulating rights and responsibilities at the separation point,
then a contract with COTEE on the payment of the fee for the work of the market operator, a contract
on financial settlement of the balance calculation and a contract on balancing responsibility, while
with DOO PM POWER Tivat and DOO Luštica Bay Electricity Company Tivat contracts were concluded
on the use of the distribution system.
2.1.1.2. Contractual relations between suppliers, distribution system operator and buyers
At the end of 2021, a total of 414,030 customers were connected to the electricity distribution system
in Montenegro, which makes an increase of 2.3% in comparison to 2020 (404,775 customers), of
which: 36 customers were connected to the 35 kV network, 566 customers to the 10 kV network,
40,562 customers from the category of other customers were connected to the 0.4 kV network and
372,866 customers from the household category to the 0.4 kV network.
At the end of the reporting year, EPCG had contracts on the supply of electricity with 160,095
customers connected to the distribution system (39% of the total number of customers), as follows:
− 20 customers out of the total of 36, at medium voltage 35 kV, which makes 56%,
− 265 customers out of the total of 566, at medium voltage 10 kV, which makes 47%,
− 159.810 customers out of the total of 413.428, at low voltage 0,4 kV, which makes 39%, and of
such number:
• with 138.118 customers out of the total of 372.866, from the category of households, which
makes 37%, and
• with 21.692 customers out of the total of 40.562, from the category of other customers,
which makes 53%.
Observing the above data, in 2021, compared to the total number of customers connected to the
distribution system, there was a slight growth (3%) in the number of contracts concluded in
comparison to 2020.
In 2021, a total of 4,077 fixed-term supply contracts were also concluded, or 80 contracts more than
in 2020 when the total of number of such contracts was 3,997.
Based on the number of supply contracts concluded in the previous year compared to the total
number of customers belonging to the category of households, one can conclude that the annual
number of newly-concluded contracts is low. Given the content of the contract concerned specified
by the Law on Energy, it is clear that a higher number of concluded contracts would raise customers’
awareness of their rights, thus ultimately leading to better customer protection. To that end, EPCG
should undertake additional efforts in the following period to ensure compliance with this legal
requirement.
55.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
Until the unbundling of CGES from the vertically integrated undertaking - EPCG, and subsequent
establishment of CEDIS, all the assets used for electricity service were under the ownership of EPCG.
Taking into account the mentioned processes of separation of CGES and CEDIS and the definitions
of the transmission and distribution system introduced by the Law, the need to identify the
separation point between EPCG and CGES, and between CGES and CEDIS, is justified. Thus, the Law
prescribes that the transmission system operator and the electricity producer are obliged to hand
over the facilities and equipment that are part of the transmission system. It further specifies that
the distribution system operator and the transmission system operator are required to hand over
the facilities and equipment that are part of the distribution system.
Mutual rights and obligations in the takeover of facilities and equipment are regulated by contracts
concluded by the above undertakings. In the previous period, the undertakings concluded annual
temporary contracts, and in parallel, activities were carried out in order to conclude permanent
contracts. Activities conducted by EPCG, CGES and CEDIS working teams aimed at identifying the
concerned facilities and equipment and preparing draft contracts on mutual rights and obligations.
The work carried out by CGES and EPCG teams resulted in identification of the facilities and
equipment to be handed over, but specific open issues have also been identified (legal,
organizational, accounting and technical) which, if unresolved, would prevent the completion of all
activities.
In 2021, EPCG did not have any activities related to this issue. The EPCG working team formed in
April this year was tasked with harmonizing the elements of the contract on the takeover of
infrastructure belonging to the transmission system and currently held by producers, in coordination
with the relevant CGES team. According to CGES, in 2021 they did not implement any activities
related to this issue.
On this matter, CEDIS explains that in late December 2021 they initiated a new procurement process
to obtain the services of appraisal of value of the 35 kV plants and equipment in the X/35 kV facilities,
which are to be handed over, after CGES was concluded to have met the requirements for such assets
to be removed from their business books. According to CGES, however, the process of appraisal of
value of the 35 kV plants and equipment in CGES X/35 kV facilities has been reinitiated.
Undoubtedly, once completed, the process of separating the assets of the energy undertakings who
used to belong to a vertically integrated company will ensure a clear distribution of responsibility
among them, concerning the functioning of individual parts of the electric power system they own.
56.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
In Montenegro, service quality regulation efforts started in 2017, when the Rules on the minimum
quality of electricity service (Official Gazette of Montenegro, No. 50/17) (hereinafter: The Minimum
Quality Rules) were adopted. These rules have made a major step forward in improving the quality
of service the system operators and suppliers deliver to consumers, by setting the minimum quality
standards for each individual customer (individual minimum quality) and establishing financial
compensation mechanisms in cases of failure to meet such standards. Given the specific current
situation of the electric power system in Montenegro, this ensures acknowledgement of the
importance of a better quality of supply and timely response of energy undertakings to the
customers’ demands. The Minimum Quality Rules further require the system operators to keep
records of any supply interruptions in the transmission and distribution systems, used as a basis for
determining general quality indicators, and thus quantifying the level of quality of supply for the
customers in any given segment of the system or for all customers in the system.
24
EC, 2020, Communication from the Commission to the European Parliament, the Council, the European Economic and Social
Committee and the Committee of the Regions, Powering a climate-neutral economy: An EU Strategy for Energy System Integration,
COM (2020) 299 final, available at: https://eur-lex.europa.eu/legal-content/EN/ALL/?uri=COM:2020:299:FIN
57.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
unavailability of the transmission system within any given year. According to the Minimum Quality
Rules, ENS is calculated by multiplying the average daily energy by the ratio of duration of
interruptions in minutes and the total number of minutes per day, while the AIT is obtained by
dividing the annual ENS value by the total electricity transmitted through the transmission system
for domestic consumption purposes (excluding losses in the transmission system). The inputs used
to calculate these two indicators are obtained from the records of supply interruptions, maintained
by CGES, based on information in the SCADA system25. SCADA systems allows CGES to obtain
reliable data about the beginning and end of interruptions, along with the data used to calculate
average daily energy in accordance with the Minimum Quality Rules.
According to CGES, in 2021, a total of 217 interruptions were recorded in the transmission system,
of which 165 were not planned, while 52 were planned interruptions. Compared to 2020, the number
of interruptions remained almost the same, as shown in Graph 2.1.1. More precisely, the number of
interruptions which, according to CGES, were caused by force majeure increased by 26 in 2021 from
2020, while the number of interruptions caused by a third party decreased by almost the same
number. On the other hand, the number of interruptions in 2021 decreased by 22.78% compared to
2019, largely due to fewer interruptions caused, according to CGES records, by force majeure and
actions of other parties.
CGES
200
150
100
50
0
Viša
Force
sila
majeure
Tuđe djelovanje
Third
party
2019 2020
Graph 2.1.1 Comparison of the number of interruptions in the transmission system in 2019, 2020 and 2021
Despite significantly improved quality in the transmission system, recorded in 2020 (25% drop in the
value of general indicators compared to 2019), 2021 saw a sudden increase in these values. More
precisely, electricity not delivered to customers on account of interrupted supply in the transmission
25
SCADA is a complex system that enables management and supervision over a specific process (in this specific case:
electric power system operations), or serves to collect data from remote stations, transfer and present such data in the
control centre, on one hand, and transfer control instructions from the central station to remote devices, on the other
hand.
58.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
system (ENS) is estimated at 6,968.74 MWh, while the average duration of such interruptions (AIT)
was 18.96 h (1,137.54 min). Therefore, the transmission system availability was 99.78 %.
It follows from the analysis of the value of electricity not supplied due to different types of supply
interruptions (Table 2.1.1) that the increase in the total ENS value was mostly caused by the higher
amount of electricity not supplied due to planned interruptions, 4.9 times higher than in 2020. CGES
explains that such huge ENS value increase caused by planned interruptions occurred due to higher
volume of works performed in the transmission system facilities, which required more interruptions.
In this respect, particularly high was the ENS value caused by planned interruption in SS 110/35 kV
Kotor in April 2021 (3,508.99 MWh, i.e. app. 50 % of the total annual ENS); CGES underlines that in
this case distribution consumers in this area were supplied from a different transmission substation,
through the distribution system, so this interruption did not necessarily reflect on the consumers
connected to the electricity distribution system.
Table 2.1.1 Number and type of interruptions and quantity of energy not supplied in 2021
In addition to that, Table 2.2.1 shows significant duration of unplanned interruptions of the power
supply in the transmission system in 2021, largely due to unavailability of the SS 110/20 kV Uvač
used as a power source for the motorway infrastructure. More precisely, according to available data,
this interruption lasted one year, but it should be noted that the impact of such interruption on the
total ENS for unplanned interruptions was mitigated by low consumption of the SS 110/20 kV Uvač.
The following figure shows the consumption areas longest affected by interruptions in power supply
in 2021 (total duration of interruption above 4,000 min/year). As already mentioned, the lengthiest
interruption in power supply was recorded in the SS 110/20 kV Uvač (in the figure marked as
Motorway 2), followed by the 110/35 kV SS Kotor, 110/35 kV SS Ulcinj and 110/20 kV SS Mrke.
Consumption areas supplied from the 110/20 SS kV Uvač and 110/35 kV SS Ulcinj were among the
areas with longest interruptions in supply also in the previous two Montenegrin energy sector
situation reports, which could be an important indication that investment should be made in the
segments of the Montenegrin transmission system used for supplying these substations.
CGES recognized the issue with low quality of supply for the 110/35 SS kV Ulcinj and suggested in
its Investment plan 2012-2014 an investment project Construction of 110 kV OHL Virpazar-Ulcinj,
subsequently approved by REGAGEN. The deadline for completion of this investment activity was
set for 2017. However, two unsuccessful tendering processes later, the project is yet to be
implemented, while it should be noted that the Proposal for investment plan of CGES 2023-2025
59.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
sets a new completion deadline (after 2026). In addition to this investment, the plan also nominates
a new one – Revitalization of the 110 kV OHL Bar - Možura and 110 kV OHL Možura – Ulcinj, aimed
at increasing reliability of the overhead lines supplying the 110/35 kV SS Ulcinj.
60.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
Unlike CGES, CEDIS has no functioning SCADA system which would enable better oversight of the
distribution system, and thus higher reliability of supply interruption data. However, to ensure better
oversight of the 35 kV and 10 kV network and enable monitoring of interruptions in the network, in
January 2019 CEDIS started implementing a software for monitoring interruptions, network topology
and creation of interruption reports (ISS). Implementation of this software enables CEDIS to record
interruptions in the 35 kV network.
In line with the Updated three-year investment plan 2022-2024, i.e. the section approved by
REGAGEN, CEDIS plans to implement SCADA and ADMS investment in two stages. The first stage,
which, according to the technical description of this investment, includes the procurement of SCADA
and ADMS systems with the necessary hardware and software, establishment of the project technical
base and connection with other CEDIS systems and integration of the total of 39 x/10 kV and x/35
kV substations and three 10/0,4 kV substations in the regions 2, 4 and 5, is planned to be completed
by the end of 2024. Activities planned for the second stage will be related to the expansion of the
telecommunication infrastructure, preparation and integration of additional 35/10 kV substations in
these regions and covering of regions 1, 3, 6 and 7.
In 2021, CEDIS recorded a total of 34,335 interruptions in supply (3.09 % decrease from 2020, or
3.52% from 2019), of which 29,220 were unplanned, and 5,115 were planned ones. Based on their
causes, such interruptions could be divided into those that resulted from DSO actions, SSO actions,
third party actions and force majeure. Therefore, the following graph shows the number of
interruptions belonging to each of these groups in 2019, 2020 and 2021. According to the CEDIS-
recorded data about the causes of interruptions, the number of interruptions that CEDIS was
responsible for decreased substantially in 2021 compared to the previous two years (by 4,070 – 2020,
and by 5,888 – 2019), while the number of interruptions caused by force majeure rose by 3,089
(2020), and 5,176 (2019).
CEDIS
30.000
25.000
20.000
15.000
10.000
Force
5.000
Viša
majeure sila 0 CGES
Third party
Tuđe djelovanje
2019 2020
Graph 2.1.2 Comparison of the number of interruptions in the distribution system in 2019, 2020 and 2021
In 2021, the SAIDI value was 2,755.03 minutes per customer, i.e. 45.92 hours, which is 9.98 % less
than in 2020. Furthermore, 2021 saw a decrease in the average number of interruptions per customer
61.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
(28.35) compared to 2020 (31.69), or in percentages - 10.52%. The following figure shows the values
of SAIDI indicator in 2021 in different regions.
Unplanned
interruptions
Region 7
Region 6
Region 1
Region 3
Region 5
Region 2
Region 4 – 486,87
Pljevlja
Region 5 – 732.26
Region 1 – 1.465,77
Plav
Danilovgrad Gusinje
Region 5 Region 2
Herceg Novi
Kotor Tuzi
Cetinje Podgorica Planned interruptions
Region 4 – 898.11
Tivat
Region 5 – 1,582.63
Budva
Region 1 – 1,953.02
Region 4
Bar Region 2 – 4,375.82 Region 7
Region 6 – 4,864.00
Ulcinj Region 6
Region 3 – 5,678.34 Region 1 Region 3
Region 7 – 6,255.55
Region 5 Region 2
Region 4 – 411,24
Region 1 – 487,25
Region 5 – 850.37
Region 4 Region 2 – 1.166,68
Region 7 – 1,404.34
Region 3 – 1,855.99
Region 6 – 2,025.03
62.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
Graph 2.1.3 shows SAIDI values for 2019, 2020 and 2021
SAIDI unplanned
Region 1
6.000
2.000
SAIDI total 0
Region 6 Region 3
Region 1
8.000,00
0,00
Region 6 Region 3 (b)
Region 5 Region 4
Region 5 Region 4
(c)
Graph 2.1.3 SAIDI values for 2019, 2020 and 2021 for (a) all interruptions and separately for (b) unplanned
and (c) planned
A downward trend in the average duration of interruptions in supply in 2019-2021 has been noted
in regions 1, 4, 3 and 6. Region 5 has kept almost the same average duration throughout all the
three years, while in Region 7 SAIDI value was lower than in 2020. On the other hand, there has been
an increase in the SAIDI value in Region 2, due to longer duration of both planned and unplanned
63.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
interruptions. It follows from the analysis of the funds invested in 2021 in the framework of the
Revitalization of medium and high voltage network project (more information about investments
can be found in subsection 3.2.3) that the largest amount of funds was invested in Region 2, which
could be one of the reasons for longer duration of the planned interruptions in this region.
The following figure shows SAIFI values in different regions and types of interruptions in 2021.
Unplanned
interruptions
Region 7
Region 6
Region 1
Region 3
Region 5 Region 2
Region 4 – 8,55
Region 1 – 12,76
Pljevlja
Region 5 – 14,68
Region 6 – 31,24
Region 7 Region 4 Region 3 – 35,03
Region 2 – 44,88
Žabljak Region 7 – 48,89
Plužine
Bijelo Polje
Šavnik
Region 6
Petnjica
Region 1 Mojkovac
Berane Rožaje
Nikšić Kolašin
Region 3
Andijevica
Plav Planned
Danilovgrad Gusinje
Region 5
Herceg Novi Region 2
Kotor Tuzi
Cetinje Podgorica
Region 4 – 11,70
Tivat Region 7
Region 1 – 15,77
Budva
Region 5 – 18,86
Region 4 Region 6
Bar Region 6 – 43,01 Region 1
Region 3
Region 3 – 47,15
Ulcinj
Region 2 – 54,42
Region 5
Region 7 – 58,60 Region 2
Region 1 – 3,01
Region 4 – 3,15
Region 5 – 4,18
Region 2 – 9,54
Region 4
Region 7 – 9,71
Region 6 – 11,78
Region 3 – 12,12
64.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
Graph 2.1.4 shows SAIFI values for 2019, 2020 and 2021.
SAIFI unplanned
Region 1
50,00
40,00
Region 7 30,00 Region 2
20,00
SAIFI total 10,00
0,00
Region 1 Region 6 Region 3
80,00
60,00
Region 7 Region 2
40,00 Region 5 Region 4
20,00
2019 2020 2021
0,00
Region 6 Region 3
(b)
10
0
(a)
Region 6 Region 3
Region 5 Region 4
(c)
Graph 2.1.4 SAIFI values for 2019, 2020 and 2021 for (a) total interruptions and separately for (b) unplanned
and (c) planned ones
The effects of numerous interruptions in supply in regions 3, 6 and 7 predominantly recorded at the
end of 2020 and beginning of 2021 (detailed analysis is given in the 2020 report on the situation in
the energy sector of Montenegro) have also reflected on the values of general indicators of the
65.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
quality of electricity supply in these regions. However, due to lower frequency and shorter duration
of interruptions per customer in regions 3 and 6 in the remaining part of the reporting year, SAIDI
and SAIFI values recorded in these regions are lower than in 2020 and 2019.
Individual quality parameters are applied to all users of the system and are established in order to
protect a specific user affected by inadequate quality of service, who, in that case, is entitled to
financial compensation set by the Minimum Quality Rules.
These rules set the minimum service quality standards required from transmission system operators,
distribution system operators and suppliers. In 2021, achievement of the established parameters was
monitored through the analysis of the submitted data, on-site and through online controls.
This undertaking was paid a quality assurance visit and reminded of the need to comply with the
time limits prescribed by the Minim Quality Rules for the submission of monthly reports to REGAGEN.
66.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
− visit to the customer’s facility, if the operator fails to visit the customer’s facility within the
timeframe set in the Minimum Quality Rules, and informs the customer of such intent,
− response to the complaint regarding voltage, if, following the customer’s notice that their
facility is supplied by electricity under the voltage exceeding the limits of allowed variations
set by the rules on distribution system functioning, the operator fails to respond to the
customer within the timeframe set by the Minimum Quality Rules and provide them a notice
on the manner and deadline for removal of the potential voltage violation, and
− removing voltage variations, if the supply to the customer connected to the distribution
system is carried out under the voltage exceeding the limits of allowed variations set by the
rules on the distribution system functioning, and the operator fails to solve the voltage
violation within the timeframe set by the Minimum Quality Rules.
Concerning the listed individual quality parameters, in 2021 CEDIS recorded the following: 603
interruptions in supply at the level of the distribution system, which lasted over 24 hours; 54
interruptions in supply which were not announced within the time period prescribed by the
Minimum Quality Rules; 1,808 cases of failure on the part of CEDIS to respond to applications for
the control of metering device functionality within the time period specified in the Minimum Quality
Rules, 227 cases of failure on the part of CEDIS to respond to complaints regarding voltage within
the time period specified in the Minimum Quality Rules and two cases of failure to timely eliminate
voltage deviation.
Individual quality parameters for the supplier, established by the Minimum Quality Rules, are related
to the following:
− response to questions related to payments, when the customer demands justification of
the calculation or metered values (consumption) stated in the electricity bill in accordance
with the general conditions for supply, if the supplier fails to submit a detailed reasoned
response within the timeframe set by the Minimum Quality Rules and if the customer demands
a response related to non-execution of financial compensation, and the supplier fails to submit
a detailed reasoned response within the timeframe set the Minimum Quality Rules,
− request for reconnection, if the supplier fails, within the timeframe set in the Minimum Quality
Rules, to send a request for connection to the distribution system operator for the customer
who is disconnected due to non-payment, and the customer has settled liabilities towards the
supplier, submitted evidence of the settlement and submitted a request for reconnection, or
the supplier and the customer reached a debt settlement agreement, and
67.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
− response to the request for control of the functionality of the metering device, if the
supplier fails to respond to the customer within the timeframe specified in the Minimum Quality
Rules.
In 2021, a total of 2,289 complaints were filed relating to the minimum quality of electricity service,
of which 485 were found to lack valid reasons. More information on the protection of customers in
terms of non-compliance with the minimum quality requirements is given in Subsection 4.2.3.
Since the beginning of the regulation of the electric power sector of Montenegro (2007), the
regulatory treatment of electricity losses has evolved, which included the refinement of technical,
economic and legal aspects.
The Energy Law, adopted in 2016, for the first time introduced the obligation to prepare studies of
losses in the transmission and distribution system, as well as their reviews. The purpose of these
studies is to determine the justified losses and costs of procurement of electricity for their coverage,
which are borne by users of the electric power system in Montenegro. In accordance with the Law,
the Transmission System Operator (CGES) and the Distribution System Operator (CEDIS) submitted
reviewed loss studies with the aim of setting prices for the period 2020 - 2022.
It is important to point out that the level of justified losses in the distribution system is exclusively
related to technical losses, i.e. that the users of the distribution system in Montenegro do not bear
68.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
the costs of non-technical (commercial) losses in the distribution system. As already stated, justified
losses in the distribution system are determined based on the study of losses. The determined level
of justified losses, as a rule, is still lower than the level of losses actually incurred, predominantly due
to the existence of non-technical losses in the distribution system. The phenomenon of non-
technical losses is also present in other distribution systems, as stated in a comparative analysis
carried out by CEER (Council of European Energy Regulators), and participated by REGAGEN.26
With a view to comparing electricity transmission system of Montenegro with other transmission
systems in the interconnection, the ratio of total losses in the transmission system and the total
energy that entered the transmission system is used. Thus, the total losses in the transmission system
of Montenegro in 2021 of 1.79%, compared to the total energy having entered the transmission
system, were lower than the level of losses incurred in 2020 (1.82%). According to the latest available
comparative analysis of CEER30 from 2020, the total level of losses at the transmission level in Europe
in 2018 ranged from 0.5% to nearly 3%. It can be concluded that the total level of losses in the
transmission system of Montenegro is within the range of Europe and that lower total level of losses
is achieved in the systems that include 750 kV voltage level, which does not exist in Montenegro. An
overview of total losses in the transmission system in the past ten years is given in Table 2.1.2.
The downward trend in losses in the distribution system continued in 2021. Total losses in the
distribution system decreased from 22.76% in 2007 to 12.39% in 2020. Total loss reduction could
primarily be assigned to the implementation of the project including instalment of new remotely
read meters. The network reconstruction carried out in the framework of this project resulted, among
other things, in fewer technical losses. The losses incurred in the previous 10 years are presented in
Table 2.1.2.
While the inevitable nature of technical losses has been confirmed by the physical law, distribution
systems are also characterized by non-technical losses. Electricity buyers in Montenegro bear only
the costs of allowed (technical) losses, thus further encouraging CEDIS to eliminate the existence of
non-technical losses, i.e. reduce total losses to the allowed level. Specifically, CEDIS loss study
anticipates that justified losses in the distribution system in 2021 will account for 8.30%.
26
Report on Power Losses, CEER, March 2020
69.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
Table 2.1.2 Losses in the transmission and distribution systems in 2012 - 2021
Year 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Transmission GWh 153.77 142.42 122.13 135.17 118.98 126.92 142.18 146.46 163.59 158.41
system % 2.45 2.10 1.77 2.28 2.03 2.26 2.21 2.13 1.82 1.79
Distribution GWh 541.00 480.00 432.00 446.00 404.00 399.56 371.61 356.06 328.85 345.53
system % 20.84 18.96 17.65 17.11 15.61 14.96 13.83 13.10 12.93 12.39
Total GWh 694.77 622.42 554.13 581.17 522.98 526.48 513.78 502.52 492.44 503.95
Figure 2.1.4 shows electricity flows in the electric power system of Montenegro in 2021.
DISTRIBUTION
TRANSMISSION
Generation: 175
Consumption: 2,375
Generation: 3,481
Losses: 158
Figure 2.1.4 Electricity flows (GWh) in the transmission and distribution systems in 2021
70.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
In 2021, REGAGEN carried out controls in CGES to check the transparency and availability levels of
the information relating to the electricity market. The September 2021 control activities showed that
CGES had increased the volume of data published on the EMFIP platform (Electricity Market
Fundamental Information Platform), but there was still room for improvement of transparency; CGES
was notified of this. In the follow-up visit, conducted in the late 2021, CGES was found to have
complied with such notification and published an additional dataset on the EMFIP platform, thus
fulfiling almost all the requirements set out in the Regulation.
The following graph shows a comparative overview of the published data for 2018-2021 for each of
the previously listed reporting categories.
100%
90%
80%
70%
60%
2018
50%
40% 2019
30% 2020
20%
2021
10%
0%
Potrošnja
consumption
Prenos
transmission
Proizvodnja
generation
Balansiranje
balancing ukupno
total
Graph 2.1.5 Degree of publication of the data of significance for the market functioning for 2018-2021
A comparative overview of the level of data publication in the Energy Community Contracting Parties
available on the web page of the Energy Community (section reserved for monitoring by the ECRB),
is the result of joint work of the REGAGEN and other regulatory bodies of the Energy Community
Contracting Parties.27
71.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
electricity supplied to end users in the preceding year, calculated by the supplier, as well as to verify
the national residual mix values, calculated by the market operator.
Under the provisions above, in 2021 REGAGEN for the first time conducted checks of the calculations
done by these energy undertakings. COTEE and EPCG eliminated the irregularities identified during
this activity within the set deadline. EPCG included its report on the calculation of the share of all
energy sources in the electricity supplied to end users, updated in line with REGAGEN comments, in
the November 2021 electricity bills.
The tariff model, i.e. a supplier’s offer to customers related to the share of renewable sources in the
electricity supplied, comes with or without guaranteed structure of the electricity supplied to the
customers of such supplier. In 2021, EPCG was offering only one model with a guaranteed structure,
including only renewable energy. In addition to the report above, customers using this model
received by EPCG an overview of the share of all types of energy sources in the electricity supplied
to end users, shown in Graph 2.1.6. All other customers using the model without a guaranteed
structure were supplied by EPCG with the report and an overview of the share of all types of energy
sources in the electricity supplied to end users.
4,55%
27,27%
68,18%
Hidroenergija
Hydropower (mHE)(mHE)
27.27% 27,27% Energija vjetra
Wind power (VE) 68,18%
(WE) 68.18%
Solarna energija
Solar power (SE) 4,55%
(SE) 4.55%
Graph 2.1.6 Share of all types of energy sources in the electricity supplied to end users using the
guaranteed structure
In that regard, in 2021, REGAGEN controlled the work and operations of all three closed distribution
system (CSD) operators, namely: OC Elektroenergetika, CSD operator owned by DOO Uniprom, DOO
Luštica Bay Electricity Company, CSD operator owned by Luštica Development AD, and DOO PM
Power, both operator and owner of the closed distribution system covering the Porto Montenegro
72.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
geographic area. The controls showed full compliance of DOO Luštica Bay Electricity Company and
DOO PM Power with the requirements specified by the Law and the rules mentioned, while OC
Elektroenergetika was asked to eliminate noted irregularities.
73.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
drafted a report thereby notifying this company that it is not required by the Law on Energy to follow
the orders and instructions of EPCG BoD, which exceeded the limitations specified in this Law.
EPCG acted in accordance with the Supervision Report by providing proof of their compliance with
the REGAGEN orders at the beginning of January 2022, within the deadline set by REGAGEN (six
months from the day of delivery of the report). More precisely, Articles of Association of both EPCG
and CEDIS were aligned with the Law, while the disputed segments of the above-mentioned
decisions of the EPCG BoD, requiring CEDIS to participate in the costs of discount, were repealed.
According to the information received from CEDIS in the course of this supervisory activity, the costs
that CEDIS was to incur based on EPCG requests specified in the EPCG BoD decisions were estimated
at “app. 2.6 million euro“. In this matter, timely reaction by REGAGEN has preserved the sectoral
arrangement stipulated by the Law on Energy, which is in conformity with the EU Third Energy
Package in terms of the way it regulates the independence of electricity distribution system
operators.
The August 2020 Law Amending the Energy Law has additionally strengthened the independence of
the electricity transmission system operator by prohibiting the state administration authority in
charge of finance, which is tasked with nominating management bodies of the transmission system
operator directly and autonomously, from nominating management bodies of the energy
undertakings engaged in electricity generation and/or supply activities. The law further stipulates
that the state administration authority in charge of finance is excluded from voting when the
Government takes decisions on the appointment of management bodies for energy undertakings
that perform the activity of generation and/or supply of electricity. In the opinion of the Energy
Community Secretariat, this kind of legal regime ensures that transmission system operator’s
management bodies are selected in an entirely separate and independent process from the
management bodies of the energy undertakings generating or supplying electricity.
In line with its duty to oversee compliance with certification requirements, in July 2021 REGAGEN
asked CGES to provide information of any changes that might have impacted such compliance. In
response to such request, CGES provided the following information: Board of Directors was selected
74.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
at the General of Meeting of Shareholders, relevant candidates were nominated by the state
administration authority in charge of finance, elected BoD members were not at the same time
members of board of directors or other entities or legal representatives of the energy undertakings
performing electricity generation or supply activities.
According to the Law on Energy, Article 65 paragraph 3 item 6, REGAGEN is to issue a license to
economic operators meeting, among others, the requirement of their members of management
bodies not having been convicted by a final judicial decision of criminal offences making them unfit
for office, while Article 76 paragraph 1 item 1 of the same Law provides for temporary revocation of
the energy activity license if the energy undertaking no longer meets at least one of the requirements
in Article 65 paragraph 3 of this Law. Article 18 paragraph 1 of the Rules on Licenses for Performing
Energy Activities (Official Gazette of Montenegro 31/21 and 48/21) requires entities performing
energy activity to meet the requirements under the Law on Energy, based on which their license was
granted to them, throughout the period of validity of such license.
Based on these provisions, REGAGEN inspected CGES and found non-compliance with the
requirements specified in the electricity transmission license, given that one of the Board of Directors
members did not meet the requirement in the above-mentioned Article 65 paragraph 3 item 6 of
the Law on Energy. Consequently, CGES received a warning in line with Article 12 paragraph 1 of the
Rules on Licenses for Performing Energy Activities regarding its non-compliance with the licensing
requirements, it was given 30 days to address such noncompliance and informed of the
consequences of failure to comply with the time limit. CGES timely informed REGAGEN that the
Board of Directors member concerned was removed from office at the IX extraordinary general
meeting of CGES shareholders, held on 26 October, 2021.
75.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
− reports of relevant inspectors confirming the fulfilment of the conditions and requirements
established by technical regulations, regulations on protection against explosions and fire, as
well as the environmental protection regulations, and
− evidence that employed persons have passed relevant professional exams to perform activities
of technical management, maintenance, exploitation and handling of energy facilities, in line
with the law.
In 2021, the controls found irregularities with six undertakings, which were ordered to eliminate such
irregularities within the set deadlines, while other competent bodies were informed of the
irregularities falling within their scope of authority. These undertakings complied with REGAGEN’s
request and eliminated the irregularities detected.
76.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
SUMMARY:
Supervisory activities concerned with the work and operation of energy undertakings in
2021 included a broad range of matters relevant to harmonising the organisation and
functioning of the energy sector in Montenegro with the same aspects of the European
energy sectors.
At the end of the reporting year, EPCG had supply contracts with 160,095 customers
connected to the distribution system (39% of their total number), indicating the need to
consider updating the legal framework to ensure higher percentage of such contracts.
The legal framework in place leaves it to the transmission system operator and producer,
as well as to the transmission system operator and distribution system operator, to de
facto decide by themselves how to fulfil their duty to divide their assets; their lack of
engagement on this matter, reflected in the fact that completion of this activity is long
overdue, leads to the conclusion that relevant legal provisions should be updated.
In 2021, there was a rapid increase in the values of the transmission system operator
general quality parameters (ENS – 6,968.74 MWh, AIT – 18.96 h), caused by higher volume
of works in the transmission system facilities requiring a substantial number of
interruptions. On the other hand, the value of the distribution system operator general
quality indicators decreased significantly compared to 2020, as follows: SAIDI by 9.98 %,
and SAIFI by 10.52%.
Compared to the total energy having entered the transmission system, in 2021 the
transmission system of Montenegro recorded 1.79% of losses, which is less than in 2020
(1.82%); therefore, it can be concluded that the degree of total losses in the transmission
system of Montenegro ranges within the loss values in Europe, although Montenegro
system does not include 750 kV voltage level. On the other hand, total losses in the
distribution system amounted to 12.39%, which is a great improvement compared to the
period when the regulation of the energy sector in Montenegro started - 2007, when these
losses amounted to 22.76%.
Proactive approach and supervisory activities conducted in the reporting year by the
Agency have preserved independence of the distribution system operator, as required by
the Law on Energy, with a view to ensuring non-discriminatory treatment of the system
users and further development of the electricity retail market, thus also avoiding
additional losses for CEDIS, estimated at 2.6 million euro.
Agency's involvement in international working bodies, along with activities at the national
level, have resulted in a higher degree of transparency of data relevant to the functioning
of the market, and by extension, to the implementation of the Law on Supervision of the
Wholesale Electricity and Natural Gas Market.
77.
In accordance with the updated legal framework, calculations of the share of all types of
energy sources in the electricity supplied to end consumers in 2020 were for the first time
reviewed in the reporting year.
In 2021, a total of 52 controls were carried out in the petroleum products and gas sector;
competent bodies comprising the institutional infrastructure of Montenegro in charge of
overseeing implementation of energy legislation, were made aware of the irregularities
falling within their scope of authority.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
79.
3. ENERGY SECTOR INVESTMENTS
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
As concerns investment in the FU Generation, in 2021 a total of €2,700,363 was invested in this unit.
The most important investment activities in this functional unit of EPCG, implemented or partly
implemented in 2021, were relating to investment in HPP Perućica in the framework of the project
to revitalize generators G1 and G2 and the project for delivery and instalment of block transformers
T1-T5, and investment in HPP Piva in the framework of the project regarding capital overhaul of the
A3 unit.
A total of €657,527 was invested in FU Generation, and €329,114 in the Head Office. Table below
gives an overview of EPCG investments in 2021, while Graph 3.1.1 shows investments in different
functional units of EPCG.
2021
R.b. Capital investments
[€]
28
Source: EPCG
82.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
5%3%
23%
69%
DIREKCIJA ZA RAZVOJ
DEVELOPMENT I INŽENJERING
AND ENGINEERING FC
FUPROIZVODNJA
GENERATION
FCFUSNABDIJEVANJE
SUPPLY DIREKCIJA DRUŠTVA
HEAD OFFICE
Graph 3.1.2 shows investments of EPCG, installed capacity of power plants and net business results
achieved between 2016 and 2021. During the observed period EPCG invested a total of €67,151,404,
or €11,191,901 as an annual average, while the average net result achieved in the same period was
€25,557,406.
83.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
MW
20.000.000 €
18.263.300 € 700
16.155.838 € 600
10.000.000 € 500
400
300
0€ -948.127 € 200
2016 2017 2018 2019 2020 2021
100
-10.000.000 € 0
Investicije
Investments Neto
Net rezultat
result Nominalna snaga elektrana
Nominal capacity
Graph 3.1.2 Overview of EPCG investments compared to net result achieved between 2016 and 2021
EPCG business results depend to a great extent on the hydrological situation and effects of the
purchase and sale of electricity, reflected, as the graph above shows, on the net business results,
which were negative in 2017 due to highly unfavorable hydrological situation, while 2018 saw an
increase in this value due to favorable hydrological situation; this was followed by a significant
decrease in 2020 on account of reduced electricity consumption caused by measures to combat
COVID-19, and finally the profit rose in 2021 based on higher electricity prices in wholesale markets,
which, together with favorable hydrological situation, enabled the sale of electricity at prices
significantly higher than before. The impact of the global energy crisis on the increase in the
electricity prices in the wholesale markets and on the energy sector in Montenegro is further
elaborated in Section 4.1.
The energy crisis that started in 2021 has once again revealed the fact the sovereignty of each
country depends on its energy sovereignty and raised the necessity of utilization of own energy
resources to the greatest extent possible. Graph 3.1.2. shows that generation capacity of EPCG,
despite investments made between 2016 and 2021, has remained almost at the same level.
Considering the above, with a view to ensuring national energy security and economic development
it is advisable to give priority to investment into generation capacity when undertaking efforts and
allocating available resources.
84.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
The total amount of planned investments envisaged by the approved Updated Investment Plan for
2021 is €29,791,194. In 2021 CEDIS realized investment activities with a total value of €17,836,815,
of which €13,155,067 was related to the investments planned for 2021 according to the Updated
Investment Plan, while the remaining portion (€4,681,748) to the investments planned to be realized
in the previous years.
Apart from these investment activities, in 2021 CEDIS purchased €289.190 worth of electricity
infrastructure.
Table 3.2.1 shows realization of investments approved by the 2021 Updated Investment Plan and
investments planned in 2012 – 2020 and implemented in 2021.
85.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
Table 3.2.1 Overview of realization of approved investments in the Updated Investment Plan for 2021 and
investments planned for 2012 – 2020, realized in 2021
2021
Plan Realization Realization
O.no. DESCRIPTION [€] [€] [€] Total
Investments planned [€]
Investment plan
for 2012 – 2020
1 Primary network 3,310,250 144,074 3,129,946 3.274.020
2 Secondary network 9,168,499 482,328 1,300,952 1.783.280
Revitalization of MV and
3 9,100,000 9,769,416 0 9.769.416
LV network
AMR and metering
4 2,040,500 846,922 96,363 943.285
devices
5 Other investments 0 0 132,744 132.744
6 Other fixed assets 5,232,450 1,047,177 21,743 1.068.920
7 Contingency projects 939,495 865,150 0 865.150
TOTAL 29,791,194 13,155,067 4,681,748 17,836,815
8 Purchase program 13,487,472 289,190 0 289.190
Investment and purchase
program realization 43,278,666 13,444,257 4,681,748 18,126,005
(1+2+3+4+5+6+7+8)
In 2021, a total of €3,274,020 or 18.06% was invested in the primary network, €1,783,280 or 9.84%
in the secondary network, €9,769,416 or 53.90% in the revitalization of the medium and low voltage
network, €943,285 or 5.20%, in AMR and metering devices, €132,744 or 0.73% was spent on other
investments, €1.068.920 or 5.90% was invested in other fixed assets, €865,150 or 4.77% in
contingency projects and €289,190 or 1.60% in the purchase of infrastructure. Graph 3.2.1 shows
shares of CEDIS investments by groups of fixed assets.
0,73% 1,60%
4,77%
5,90% 18,06%
5,20%
9,84%
53,90%
Primarna
Primarymreža
network Sekundarna
Secondary mreža
network Revitalizacija SN i NN mreže
MV and LV network revitalisation
AMM
AMMi Mjerna mjesta devices
and metering Ostala
Otherosnovna sredstva
fixed assets Ostala
Otherinvesticije
investments
Nepredviđeni
Contingencyprojekti
projects Program otkupa
Purchase programme
86.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
Plan of investments in the primary, secondary network, AMR and metering devices and other fixed
assets was not fully implemented due to lengthy public procurements procedures, deficient or non-
existing detailed urban development plans and unresolved property and legal relations.
In 2021, the purchase program was implemented to an extent substantially lesser than planned. The
value of infrastructure that CEDIS planned to purchase in 2021 accounts for 3.91% of the CEDIS
property value at the end of the reporting year. According to the legal framework in place,
infrastructure owned by third parties may be used by CEDIS until the purchase contract is concluded,
while the owner of such infrastructure is required to keep it functional. Due to unsatisfactory pace
of the purchase program implementation, shown in Table 3.2.1, intersectoral cooperation should be
used to determine whether the issue is caused by deficient or improperly implemented legal
framework, all in order to ensure better protection of the owner of infrastructure used by CEDIS, and,
ultimately, uninterrupted functioning of the distribution system.
87.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
The planned value of investment projects in the secondary network, planned to be implemented in
2021, is €9,168,499, of which €482,328 was spent. The plan of investments in the secondary network
was implemented to a lesser extent due to lengthy public procurements procedures, deficient or
non-existing detailed urban development plans and unresolved property and legal relations.
The status of secondary network investment projects is as follows:
− 48 investment projects have been completed,
− in 10 investment projects, field works have been completed and the projects are at the final
stage,
− in six investment projects, preparation is in progress for executing the works,
− in eight investment projects, property and legal relations are being addressed,
− in two investment projects, the tendering process is in progress,
− in 36 investment projects, engineering documentation is under preparation,
− in 113 investment projects, the preparation necessary for creating the conditions for their
implementation is in progress, and
− the implementation of two investment projects has been taken over by the investor.
Taking into consideration the condition of the secondary network, particularly as regards overhead
10 kV and low voltage network, CEDIS opted for making significant investments in this network in
order to create conditions for improving the voltage profile also in the least populated parts of
Montenegro. Investments are related to revitalization and reconstruction of 10 kV and low voltage
network. Special attention is paid to shortening the length of low voltage overhead lines by building
new 10/0.4 kV substations. In addition to the aforementioned, the network revitalization also creates
conditions for the connection of new facilities, which, in particular, creates favorable conditions for
the development of rural tourism and agriculture.
− Region 1 (Nikšić and Plužine) – 30 power lines in the 10 kV and 0.4 kV low voltage network and
67 pole-mounted substations in the 0.4 kV network, amounting to a total of €1,070,920;
− Region 2 (Cetinje, Danilovgrad, Golubovci, Podgorica and Tuzi) – 51 power lines in the 10 kV
and 0.4 kV low voltage network and 83 pole-mounted substations in the 0.4 kV network,
amounting to a total of €2,360,180;
88.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
− Region 3 (Andrijevica, Berane, Gusinje, Petnjica, Plav and Rožaje) – 19 power lines in the 10 kV
and 0.4 kV low voltage network and 36 pole-mounted substations in the 0.4 kV network,
amounting to a total of €1,864,923;
− Region 4 (Bar, Budva and Ulcinj) – 19 power lines in the 10 kV and 0.4 kV low voltage network
and 36 pole-mounted substations in the 0.4 kV network, amounting to a total of €1,589,840;
− Region 5 (Herceg Novi, Kotor and Tivat) – 15 power lines in the 10 kV and 0.4 kV low voltage
network and 21 pole-mounted substations in the 0.4 kV network, amounting to a total of
€294,881;
− Region 6 (Bijelo Polje, Kolašin and Mojkovac) – 31 power lines in the 10 kV and 0.4 kV low
voltage network and 35 pole-mounted substations in the 0.4 kV network, amounting to a total
of €1,450,844;
− Region 7 (Pljevlja, Šavnik and Žabljak) – 9 power lines in the 10 kV and 0.4 kV low voltage
network and 39 pole-mounted substations in the 0.4 kV network, amounting to a total of
€1,137,828.
According to the 2021 Investment Plan, a total of €9,100,000 is planned to be invested in MV and
LV Network Revitalisation. As at 31 December 2021, the realization of this investment amounted to
€9,769,416.
The planned value of investment projects related to AMR and metering instruments, which are
planned to be implemented in 2021 amounts to €2,040,500, of which €846,922 or 42% were spent.
Apart from this amount, in 2021, CEDIS invested for this purpose additional €96,363 relating to the
previously planned activities.
The implementation of an advanced electricity metering system has greatly contributed to the
reduction of electricity losses that significantly burden the operations of CEDIS. This is confirmed by
the fact that in 2012, when the implementation of the AMM project began, total losses amounted
to 20.84%, while at the end of 2021 they were reduced to 12.39%. During the replacement, the
meters were relocated to the boundaries of ownership and reconstruction of the network, which had
a positive effect on the entire distribution system due to increased reliability and quality of electricity
supply to users, and reduced the possibility of unauthorized electricity uptake.
As at 31 December 2021, 80.16% consumers had modern metering systems in place, while 341,910
new meters were installed at customers, producers and at control metering points.
89.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
Table 3.3.1 State of implementation of the approved investments in the 2021 Updated Investment Plan
Implemen Implement
Classificatio 2021
O.no tation in ation in
n of ID no. Investment plan
. 2021 2021
investment (000 €)
(000 €) (%)
Construction of 400 kV OHL
Lastva - Čevo
IPI006a
Construction of 400/110/35 kV SS
1 Project IPI007 4,637 5,506
Lastva 119
IPI006b
Construction of 400 kV OHL Čevo
- Pljevlja
Construction of 400 kV OHL
2 Project IPI009 30 8 26
Pljevlja 2 – Bajina Bašta - Višegrad
Construction of 110/35 kV SS
3 Project IPI030 Luštica (Radovići) including 2,887 45 2
connection to the 110 kV network
Construction of 110/35 kV SS
4 Project IPI013 800 12 1
Žabljak
Construction of 110kV OHL Lastva
5 Project IPI017 450 15 3
- Kotor
Reconstruction of the 110 kV
6 Project IPR088 busbar system at 110/35 kV SS 198 7 3
Budva
Reconstruction of 110kV Lastva -
7 Project IPR010 250 12 5
Tivat
Reconstruction of 110 kV OHL
8 Project IPR089 Podgorica - Danilovgrad - 300 3 1
Perućica
90.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
91.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
Development of Preliminary
Design including geomechanic
33 Program IPR060 research for the reconstruction of 87 5 5
110 kV OHL Podgorica 1 -
Trebješica - Andrijevica
Renewal of computers and
34 Program NDC113 147 60 41
computer equipment
Procurement and implementation
35 Project NDC120 1,142 799 70
of the ERP system
Development of the Main Design
36 Project IPD008 500 58 12
for OHL marking and labelling
Reconstruction of the fire-fighting
37 Project NDC104 160 3 2
system in NDC
38 Project IPD014 Procurement of a motor vehicle 20 - 0
Reconstruction of 110 kV Budva-
39 Project IPR009 220 19 9
Lastva
Instalment of the 250MVAr
40 Project IPI058 1,500 10 1
variable inductor in SS Lastva
Revitalization of OHL Podgorica 1
- Perućica, lines II, III (section from
41 Project IPR090 150 1 1
portal HPP Perućica to pole no.
16)
Revitalization of the 110 kV OHL
42 Project IPR091 96 1 1
Herceg-Novi - Tivat
Procurement and installation of
43 Project IPR092 the 400/110 kV transformer, 300 1,700 1,655 97
MVA for PG2- phase II
New portable telecommunication
44 Project NDC126 110 7 6
system
SCADA for the new dispatch
center with EMS (including
45 Project NDC005c 36 12 32
assessment of N-1 security factor
in the EPS in real time) – phase II
Implementation of the system for
NDC114 remote access to process
46 Project 28 3 10
b networks and inclusion of new
facilities in NDC SCADA – phase II
Expansion and improvement of
NDC119
47 Project remote-read metering system 55 34 61
b
(AMR) – phase II
Procurement of inventor for
48 Project NDC304 80 84 104
substations
Procurement of a network analysis
49 Project IPD018 software for planning and 100 100 100
development purposes
Procurement of servers and
50 Project NDC128 equipment for the EES software in 110 109 99
RDC
Procurement of transformer for
self- consumption and
51 Project IPR095 40 - 0
procurement of generators for the
400/220/110 kV SS Pljevlja 2
52 Program IPI019 SS 400/110/35 kV Brezna 85 6 7
Podgorica 4, meeting 110 kV n-1
53 Project IPI021 50 13 25
security criterion
92.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
These projects are part of the Trans-Balkan Corridor, involving the Montenegrin electricity
transmission system, and are included in the ENSSO-E Ten-Year Network Development Plan – TYNDP
and the Projects of Energy Community Interest – PECI list, while the submarine interconnection is
included in the Projects of Common Interest – PCI list.
The submarine interconnection was commissioned in the late 2019, while cooperation between
Italian and Montenegrin regulatory bodies ensured timely creation of the regulatory and legal
framework necessary for cross-border electricity exchange modelled upon relevant EU legal
framework and practice.
The cooperation between REGAGEN and the Italian regulatory body also resulted in the selection of
a regional auction house - Coordination Auction Office in South East Europe (SEE CAO), located in
Podgorica, to allocate cross-border capacity at the first border of the Montenegrin electric
transmission system with that of an EU member - Italy in 2020, 2021 and 2022. Annual, monthly and
daily auctions were conducted in conformity with the European legislation and standards, while SEE
CAO proved to be a successful example of multilateral cooperation in South-East Europe.
93.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
The effects of the commissioning of the submarine cable can be seen below, reflected in the cross-
border energy flows and the revenue that CGES generates based on the allocation of cross-border
capacity.
The data on realized cross-border energy flows, i.e. quantities of energy that entered and exited the
Montenegrin electricity transmission system in 2021 and their comparison with the data from
previous years can be seen in graphs 3.3.1, 3.3.2 and 3.3.3.
7.000
6.000
5.000
4.000
GWh
3.000
2.000
1.000
0
2016 2017 2018 2019 2020 2021
Energija koja
Energy that je ušla
entered u sistem
the system Prosjek 2016-2019
Average 2016 - 2021
Graph 3.3.1 Comparison of the energy volume that entered the electricity transmission system
between 2016 and 2021
It follows from the comparison of the energy volume having entered the system of Montenegro in
2021 and 2020, as shown in Graph 3.3.1.1, that the volume of energy in 2021 decreased by about
10% compared to the energy that entered the transmission system in 2020. However, comparison
of the 2021 value with the average value before the commissioning of the submarine interconnection
leads to the conclusion that the volume of energy that entered the Montenegrin transmission system
in 2021 increased by approximately 71 % compared to the average value in 2016-2019, while also
being three times higher than in 2018 and 2.5 times higher than in 2019.
Graph 3.3.2 shows the electricity volume that exited the Montenegrin transmission system in 2016-
2021.
94.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
7.000
6.000
5.000
4.000
GWh
3.000
2.000
1.000
0
2016 2017 2018 2019 2020 2021
Energija koja
Energy that jethe
exited izašla
systemiz sistema Prosjek
Average 2016-2019
2016-2021
Graph 3.3.2 Comparison of the energy volume that exited the electricity transmission
95.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
In 2021, the energy volume that exited Montenegrin electricity transmission system decreased by
about 6 % compared to 2020, but it is higher by 94% when compared to the average value in 2016-
2019.
6.000.000
5.000.000
4.000.000
MWh
3.000.000
2.000.000
1.000.000
0
2016 2017 2018 2019 2020 2021
Tranzit
Transit Prosjek
Average 2016-2019
2016-2021
Graph 3.3.3 Comparison of the transit of energy via the electricity transmission system in 2016 - 2021
In 2021, transit through the transmission system of Montenegro fell by 11 % compared to 2020,
while being approximately 100 % higher than the average value in 2016-2019.
The Transmission System Operator (CGES) generates revenue from the allocation of available cross-
border transmission capacity. Such revenue may be used to guarantee continuous availability of
allocated capacity or invest in maintenance or expansion of existing cross-border transmission
capacities and construction of new interconnectors, in accordance with the law governing cross-
border exchange of electricity and gas. The same law further allows including the revenues not used
for the stated purposes in the allowed revenue of the Transmission System Operator when
determining the prices for the use of the electricity transmission system by REGAGEN. Given that
such revenue is subtracted from the revenue allowed by the regulator, it decreases the portion of
justified costs necessary for the functioning and development of the transmission system, borne by
the transmission system users, thus having a positive effect on the prices at which buyers and
producers of electricity can use the transmission system.
Graph 3.3.4 shows the comparison of revenue from allocation of cross-border capacities between
2016 and 2021
96.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
20.000.000 € 18.638.600 €
18.000.000 €
16.000.000 €
14.000.000 € 11.933.774 €
12.000.000 €
10.000.000 €
8.000.000 €
6.000.000 €
3.745.045 €
4.000.000 € 2.407.756 € 2.850.975 € 2.842.232 €
2.000.000 €
0€
2016 2017 2018 2019 2020 2021
Graph 3.3.4 Revenue from allocation of cross-border capacities between 2016 and 2021
The revenues from the allocation of cross-border capacity generated at annual, monthly and daily
auctions, in 2021, at all borders of the Montenegrin electricity transmission system amounted to
€18,638,600, which is a 56% increase compared to 2020, or six times higher than the average revenue
generated before exploitation of the submarine interconnection (2016-2019).
As already mentioned, revenue from capacity allocation is a deductible item of the revenue allowed
by the regulator, based on which the prices of using the electricity transmission system are
determined; at the same time, it is a category subject to adjustments. In determining the prices of
using the system, applied in 2020-2022, consideration was given to the revenue planned to be
generated from allocation of cross-border capacity, including the revenue from exploitation of the
Italy-Montenegro interconnection. Without including such revenue in the revenue of the
Transmission System Operator for 2020-2022 allowed by the regulator, the prices of using the
electricity transmission system would have been higher than actual ones, by approximately 13% for
the buyers connected to the transmission system and 52% for producers connected to the
transmission system.
In 2020, revenue from capacity allocation exceeded the planned revenue, which was used when
setting the prices of using the transmission system for 2020-2022, allowing for adjustments of the
revenue allowed by the regulator and prices during this period, in accordance with the Law. At the
end of 2021, REGAGEN carried out such adjustments and adopted Decision on determining the
amount of adjustments of the revenue allowed by the regulator and of the prices of using the
electricity transmission system in the regulatory period of 2020-2022 (Official Gazette of
Montenegro 125/21 and 128/21), decreasing the network usage fees to be applied in 2022.
Increased revenue from capacity allocation (compared to the set one) in 2020-2022 will have a
positive effect on the prices to be determined for 2023-2025, allowing for the positive effects of the
exploitation of cross-border capacity to reflect on the system users in a way that ensures stability of
prices.
97.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
60.000.000 €
Network usage Network usage fee
fee €12.02 €13.33
50.000.000 €
40.000.000 €
30.000.000 €
20.000.000 €
10.000.000 €
0€
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Investicije CEDIS
CEDIS investments Investicije CGES
CGES investments Ukupne investicije
Total investments u sistem
in the system
Graph 3.4.1 Overview of total CEDIS and CGES investments between 2011 and 2021
98.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
SUMMARY:
Total EPCG capital investments amounted to €11,753,380, or 45.95% less than in 2020; the
major part of this amount was related to modernization and emergency maintenance of HPP
Perućica (phase II) and HPP Piva (phase II), along with TPP Pljevlja and reclamation of the
Maljevac Landfill (€8,066,376). Net profit amounting to €47,448,507 in the reporting year
(67.38% increase from 2020) is primarily the result of higher electricity prices in wholesale
markets, enabling, together with favorable hydrological situation, the sale of electricity at
prices substantially higher than in the previous period.
Between 2011 and 2021, a total of app. €423 million was invested in the electricity transmission
and distribution systems (CEDIS – app. €238 million, CGES – app. €185 million); the regulatory
framework in place made it possible for these investment activities to be accompanied by a
slight increase in the network usage fee (from €12.02 in 2011 to €13.33 in 2021) and a decrease
in the share of the network usage fee in the average electricity bill of households with dual
tariff metering.
In 2021, CEDIS implemented €13,444,257 worth of investments of the total approved
investment amount of €29,791,194; major part of this amount was invested in the Revitalization
of MV and LV network (€9,769,416). The discrepancy between the investment amounts
approved and implemented somewhat correlates with the absence of planning documents
regulated by the Law on Spatial Planning and Construction. Despite the comprehensive legal
framework regulating the purchase of infrastructure which is not owned by CEDIS, such
purchase clearly does not take place at the planned pace, which leads to the conclusion that
in the framework of intersectoral cooperation, with a view to improving the protection of
owners of the infrastructure used by CEDIS, as well as ensuring uninterrupted functioning of
the distribution system, it should be determined whether the issue is caused by deficient or
improperly implemented legal framework.
Of the approved investment activities worth €24,266,000, in the reporting year CGES
implemented €12,585,000 (52%), majority of which in the section of the Trans-Balkan Corridor
in Montenegro (€5,506,000).
In the reporting year, electricity transiting the Montenegrin transmission system amounted to
4,735,313 MWh, which is more than twice the transit in 2018, being the year preceding the one
when the submarine Montenegro – Italy interconnection was commissioned; this goes in favor
of the argument that the investment has made Montenegro a significant regional energy hub.
The prices of using the system, applied in 2020-2022, were determined while taking into
consideration the planned revenue from allocation of cross-border capacity, which had a
positive impact on the prices which users pay to use the system.
Increased revenue generated from the capacity allocation (compared to the set one) in 2020-
2022 will have a positive impact on the prices to be determined for 2023-2025, thus enabling
the positive effects of exploitation of the cross-border capacity to reflect on the users of the
system in a way that ensures stability of prices.
99.
4. ELECTRICITY MARKET
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
4. ELECTRICITY MARKET
Focus of the European countries on the goals of the green transition and neglecting the possibility
of using energy resources in geopolitical rivalry culminated in the second half of 2021, when the
supply of natural gas to European countries, which predominantly came from one source - Russian
natural gas, was put at risk. In such a complex geopolitical situation, energy prices in Europe have
reached unprecedented levels. The crisis continued in 2022, becoming a major humanitarian crisis
due to the war in Ukraine, which disrupted supply and demand patterns and long-standing trade
relations, which will have far-reaching consequences for energy markets as well.
Ensuring security of supply and adapting energy systems and markets in Europe is becoming
particularly complex, given that it is necessary to meet the set climate goals with greater use of
renewable energy sources and a reduction in the use of energy from fossil fuels, in conditions when
European countries must compensate for the supply of Russian natural gas and diversify sources of
energy supply.
Subsection 4.2.2 of this report provides an overview of prices on the retail markets of European
countries in 2021, which shows how the drastic leaps in electricity prices on the wholesale markets
affected the retail level.
During 2021, in Montenegro, only CGES and CEDIS were exposed to the negative effects of the
increase in electricity prices on the wholesale market, as system operators who have a legal
obligation to purchase electricity to cover losses in the system, with the aim of smooth functioning
of the electricity system and delivery of electricity to customers. The Transmission Operator and the
Distribution System Operator bear the costs of energy procurement to cover losses in the system,
which are based on prices that are freely formed in a transparent procedure, that is, in the stock
market.
During 2021, the system operators made purchases through the " Crnogorska berza električne
energije“ DOO Podgorica (Montenegro Electricity Exchange)" Podgorica (BELEN), from the dominant
producer and trader in the Montenegrin wholesale electricity market - EPCG. The increase in
electricity prices on the wholesale market affected the operation results of CGES and CEDIS, which
is described in more detail in subsection 5.1.1. of this report.
102.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
In addition to electricity trade in the organized market, the wholesale market also includes trade that
takes place on a bilateral basis between market participants, namely: producers, traders, suppliers,
self-supplier buyers, transmission and distribution system operators.
In the Montenegrin wholesale electricity market, EPCG continues to represent the dominant
producer and trader. Despite the opening of the market, the reform of the energy sector and the
harmonization of the legal framework with the EU acquis in the field of energy, which creates the
conditions for market development and improvement of competition, the market in Montenegro is
not sufficiently developed. Any market with a few hundred thousand or a few million inhabitants
cannot be as attractive as a market with 20 million or more inhabitants. Therefore, small markets,
such as the Montenegrin one, can realize benefits through the connection of wholesale electricity
markets, the so-called "market coupling", because by connecting the market, prices are formed
taking into account supply and demand on all connected markets, as if it were a single market, which
leads to price convergence, greater market liquidity due to a greater number of participants and
transactions, and thus lesser price volatility.
Connecting markets into a single pan-European market is gaining more and more importance with
the development of policies aimed at climate change, environmental protection, encouraging energy
production from renewable sources, reducing energy production from coal, other fossil fuels and
other non-renewable sources (nuclear energy). It ensures a more efficient use of production
resources throughout Europe, and therefore the integration of electricity market represents a form
of combining the efforts of countries aimed at jointly overcoming challenges related to the security
of energy supply, increasing competition on the market, increasing the use of energy from renewable
sources, and thus improving the environmental situation. Market integration can also minimize the
risk of abuse of the dominant position of participants in the wholesale and retail market, where it
exists, as is the case with Montenegro.
In addition, one of the recommendations of the European Commission for Montenegro, the
fulfillment of which affects progress in the process of European integration in the field of energy,
refers to the creation of a functional day-ahead energy market and association with neighboring
markets, including Italy.
In 2020, the legal framework was harmonized with the EU acquis, which regulates the process of
connecting the electricity markets, through amendments to the Energy Act. In addition to normative
activities, a project connecting the markets of Albania, Italy, Montenegro and Serbia - AIMS project
- has been implemented since 2018. Transmission system operators, stock exchanges and regulatory
bodies of the mentioned countries are involved in the implementation of this project. Regulatory
bodies are observers in this process. In addition to the above, during 2021, the implementation of
the project "CEI Central European Initiative - Strengthening of energy regulatory bodies in the
Western Balkans" continued, and its aim is to strengthen the capacities of the staff in regulatory
bodies for the new obligations arising from the market connection process.
In the EC Country Report for Montenegro for 2021, in the part related to Chapter 15, it is stated as
follows:
103.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
„Montenegro has reached a good level of preparation in this area. Limited progress was made in the
reporting period, with the amendments to the Law on energy that removed legal obstacles to create
day-ahead energy market.“
In addition to harmonizing the legal framework of Montenegro with the European framework in the
part related to the process of connecting the markets, in late 2021 the Law on Supervision of the
Wholesale Market of Electricity and Natural Gas was adopted ("Official Gazette of Montenegro", No.
1/22), which was harmonized with EU Regulation No. 1227/2011 on the integrity and transparency
of the wholesale energy market. Adoption of the aforementioned law is of particular importance for
ensuring the adequate functioning of the electricity market, especially in the context of connecting
the market and forming prices at the regional rather than the national level. Alignment with this EU
regulation and its application are recognized as an obligation in the European Commission Progress
reports for Montenegro for 2020 and 2021, therefore, with the adoption of the aforementioned law
progress has been made in the process of European integration.
The Law on the supervision of the wholesale electricity and natural gas market defines the
obligations of market participants, powers of REGAGEN in the supervision of the wholesale market,
prohibition of abuses in the market and the penal policy. This law entered into force on 18 January
2022, and its application is aimed at:
− establishment of effective supervision of the wholesale market of electricity and natural gas, in
order to prevent, detect and suppress market abuses,
− improving transparency in the wholesale market of electricity and natural gas, in order to
increase confidence in the market, increase the number of market participants and establish a
reliable price signal at the wholesale level,
− provision of additional customer protection through adequate regulatory supervision over the
behavior of participants in the wholesale market, which can affect the retail market as well.
After the entry into force of this law, REGAGEN adopted a series of acts ensuring its application, in a
manner harmonized at the level of the Energy Community. In cooperation with SEE CAO, intensive
communication with market participants was initiated, which resulted in the establishment of records
of participants in the wholesale electricity market. Harmonized application of EU Regulation No.
1227/2011 on the integrity and transparency of the wholesale energy market at the level of the
Energy Community is ensured through participation in the activities of the working group within the
Energy Community Regulatory Board (ECRB).
The functional scheme of electricity market in Montenegro is shown in the figure below.
104.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
3
27
Privileged 1
producers
DSO
Producers 1 CEDIS
EPCG
1
1 Customers
TSO connected to
CGES transmission
Cross-border flows system
(import/export) 1
5
Market 414.030 (21 )
operator Prosumers
COTEE
Customers
1
connected to
Supplier distribution
2 system
EPCG
4
BELEN
1. Producer that was part of vertically integrated company
2. Supplier that had status of a public supplier until 2016 and a supplier
Electricity flows of last resort and vulnerable customers
Electricity flows from the customer to the operator according to 3. Number of producers
principle of exchange at the point of connection 4. Power exchange, which in 2021 did not provide supply and demand
Commercial flows matching services on the day-ahead and intraday market, but it
Commercial flows related to imbalance costs organized auctions for the purchase of electricity to cover losses .
5. Number of prosumers
105.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
End customers were supplied in 2021 again by EPCG, which formed prices respecting the restrictions
prescribed by the Law on Energy, as well as the decisions of REGAGEN made at the end of 2019,
which refer to the extension of the application of restrictions on the increase in electricity prices for
households and small customers who do not belong to the household category for the period 2020-
2022.. The mentioned limit on price increase for this category of customers ceases to be valid at the
beginning of 2023, when EPCG, according to the legal framework in force, will freely form prices on
the retail market for all categories of customers.
During 2021, customers were supplied by EPCG, with the option of choosing one of the supply tariff
models: "basic", "blue", "red" and "green" model. During the year, 277 customers changed the tariff
model of supply (two customers changed from the "red" model to the "basic", three customers from
"basic" to "red", 120 from "basic" to "blue" and 152 from "blue " to the "basic" model), which is
significantly more compared to 2020, in which 73 customers changed their supply model. Of the
total number of customers who signed a supply contract in 2021 (24,979), 24,162 customers opted
for the "basic" model, 810 for the "blue" model, and 7 for the "red" model.
The aforementioned data indicate that the introduction of different supply models for customers
connected to the electrical distribution system has resulted in the improvement of the supply service
and adaptation to the needs of customers connected to the distribution system. Customers are
encouraged to actively participate in the management of electricity consumption by being given the
opportunity to achieve savings by choosing the supply model that best suits the amount and method
of electricity consumption of the individual customer.
Given that the possibility of choosing different tariff packages, provided by the Decision of the EPCG
on determining the prices of electricity connected to the distribution system, applies only to
customers connected to the distribution system ("households and small customers who do not
belong to the household category" and "other customers"), there is no improvement in the supply
service for customers connected to the transmission system. By improving transparency in this
activity of public interest regarding the offer of tariff models for categories of customers who do not
belong to the category of households and small customers, a contribution to the development of
other economic activities could be made, i.e. an increase in the number of customers connected to
the transmission system and their consumption, which would ultimately have a positive effect on the
prices of use of the electricity transmission system.
106.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
In 2021, the invoiced sales of electricity to customers connected to the distribution system were
€214,74 million, which is by €16,63 million or 8,39% higher than in 2020. Invoiced sales of electricity
in 2021 compared to 2020 for the customers connected to:
− 35kV, increased by €0,31 mil. or 5,05%;
In 2021, the average achieved price of electricity, including the incentives for the renewable energy
sources for the customers connected to the distribution system, amounted to 9.06 €c/kWh
(excluding VAT), which is by 0.01 €c/kWh or 0.02% lower than in 2020.
In 2021, EPCG, as the only active supplier, continued to supply households and small customers who
do not belong to the category of households.
Relevant data on the volume of electricity sales, invoiced sales and realized sales prices of electricity
to end customers for the period 2012 - 2021 are shown in tables 4.2.1 and 4.2.2.
107.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
Table 4.2.1 Electricity sales, invoiced sales and realized sales prices of electricity to distribution customers in the period 2012 – 202129
35 kV mil € 4,25 4,41 4,53 4,92 4,94 5,02 5,33 5,86 6,10 6,41 0,31 5,05%
€c/kWh 5,07 5,54 5,48 5,41 5,66 5,44 5,47 6,07 6,15 6,16 0,002 0,04%
GWh 292,80 294,78 292,56 321,55 328,69 348,61 361,87 375,13 328,63 359,81 31,17 9,49%
10 kV mil € 19,82 21,55 21,67 23,60 24,96 25,72 27,99 31,71 26,90 29,14 2,24 8,33%
€c/kWh 6,77 7,31 7,41 7,34 7,59 7,38 7,73 8,45 8,18 8,10 -0,09 -1,06%
GWh 1.678,55 1.676,13 1.640,66 1.748,93 1.767,22 1.829,73 1.834,76 1869,62 1755,26 1907,35 152,09 8,66%
0,4 kV mil € 137,01 143,53 144,28 154,39 154,26 159,49 165,22 175,20 165,11 179,19 14,08 8,53%
€c/kWh 8,16 8,56 8,79 8,83 8,73 8,72 9,00 9,37 9,41 9,39 -0,01 -0,13%
GWh 2.055,18 2.050,52 2.015,88 2.161,48 2.183,28 2.270,76 2.294,06 2341,26 2183,09 2371,33 188,23 8,62%
TOTAL mil € 161,08 169,49 170,48 182,92 184,16 190,23 198,54 212,76 198,11 214,74 16,63 8,39%
€c/kWh 7,84 8,27 8,46 8,46 8,43 8,38 8,65 9,09 9,07 9,06 -0,02 -0,21%
29 Izvor: EPCG
108.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
Table.4.2.2 Electricity sales, invoiced sales and realized sales prices of household electricity in the period 2012 – 2021
REALISATION IN HOUSEHOLDS
Comparison
Voltage level Unit 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2021/2020
0,4 kV – GWh 1.128,66 1.123,55 1.097,74 1.186,48 1.200,65 1.240,77 1.234,99 1264,83 1217,46 1316,54 99,08 8,14%
households with
mil € 89,27 93,82 94,23 102,67 102,78 105,56 108,34 113,80 109,03 117,57 8,53 7,83%
dual tariff
metering €c/kWh 7,91 8,35 8,58 8,65 8,56 8,51 8,77 9,00 8,96 8,93 -0,03 -0,29%
0,4 kV – GWh 96,58 93,04 83,55 64,32 50,47 45,10 37,08 25,46 21,44 17,73 -3,72 -17,33%
households with
mil € 8,63 9,52 8,78 6,97 5,08 4,25 3,64 2,58 2,00 1,65 -0,35 -17,50%
single tariff
metering €c/kWh 8,94 10,23 10,51 10,83 10,06 9,43 9,80 10,13 9,33 9,31 -0,02 -0,21%
GWh 1.225,24 1.216,59 1.181,29 1.250,80 1.251,13 1.285,87 1.272,08 1290,28 1238,90 1334,27 95,37 7,70%
TOTAL mil € 97,90 103,34 103,02 109,64 107,85 109,81 111,97 116,37 111,04 119,22 8,18 7,37%
€c/kWh 7,99 8,49 8,72 8,77 8,62 8,54 8,80 9,02 8,96 8,94 -0,03 -0,30%
109.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
Changes in electricity prices varied across countries. Thus, for illustration purposes, in the mentioned
period there was an increase of 50.19% in Estonia, while in Slovakia there was a decrease of 5.80%.
Electricity prices in the EU depend on various supply and demand conditions, including the
geopolitical situation, national energy mix, import diversification, network costs, environmental
protection costs, weather conditions and excise and tax amounts. During 2021, electricity prices
reached record high levels, and in the first weeks of March 2022, they reached their highest level so
far. The energy crisis that affected the rise in electricity prices, among other things, was caused by
high gas prices, as well as the economic recovery in 2021 as global gas demand returned to pre-
pandemic levels and outstripped supply. Despite the increase in LPG supply to Europe, the sharp
decline in Russian gas supplies, along with geopolitical uncertainty, are exerting strong upward
pressure on electricity prices. An additional factor is the growing price of permits for the emission of
greenhouse gases within the ETS (Emission Trading System) scheme.
Comparing 2021 and 2020, the highest increase in electricity prices for households was registered
in Estonia - 50.19%, Sweden - 49.35%, Cyprus - 35.69%, Latvia - 31.70%, Spain - 22.54%, Denmark -
22, 19% and Greece - 20.29%. Reduction of electricity prices for households was registered only in
Slovakia - 5.80% and Hungary - 0.13%.
Expressed in euros, including all taxes and VAT, the average electricity prices for households in the
second half of 2021 were the lowest in Kosovo - 6.07 €c/kWh, in Georgia - 6.60 €c/kWh and in Turkey
- 7 ,88 €c/kWh, and the highest in Denmark - 34.48 €c/kWh, Germany - 32.34 €c/kWh, Belgium -
29.94 €c/kWh and Ireland - 29.74 €c/kWh.
The price of electricity for households with dual-tariff meters in Montenegro was 9.74 €c/kWh,
including all taxes and VAT, while the average price of electricity in EU countries, as already
mentioned, was 23.69 €c/ kWh.30
30
Source of data: Eurostat (https://ec.europa.eu/eurostat/statistics-
explained/index.php?title=Electricity_price_statistics#Electricity_prices_for_household_consumers). Electricity tariffs or
prices vary from one supplier to another and the way they are calculated varies from country to country. Given that there
is no single calculation of electricity prices, in order to compare them over time and between EU Member States,
EUROSTAT uses a single methodology based on household consumption ranges. Electricity prices for households are
calculated based on the annual consumption range from 2,500 kWh to 5,000 kWh.
110.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
40,00
35,00
30,00 24,74
[€c/kWh]
25,00
20,00
34,48
23,69
32,34
29,94
29,74
28,16
15,00
26,04
23,60
23,04
22,85
22,06
21,70
21,21
20,22
19,89
19,74
19,39
18,86
18,83
18,40
10,00
17,11
16,24
16,02
15,74
14,77
14,49
13,87
13,17
13,13
Bulgaria 10,91
Hungary 10,01
Montenegro 9,74
Albania 9,37
5,00
Moldova 8,88
Bosnia and Herzegovina 8,68
North Macedonia 8,40
Serbia 8,11
Turkey 7,88
Georgia 6,60
Kosovo 6,07
0,00
Ireland
Malta
Spain
Slovakia
Estonia
Sweden
Latvia
Austria
Cyprus
Germany
Denmark
Netherlands
France
Luxembourg
Portugal
Liechtenstein
Croatia
Lithuania
Romania
Poland
Slovenia
Norway
Belgium
Iceland
Finland
Czech Republic
Greece
Italy
Electricity prices EU 27 Euro Area
Graph 4.2.1 Average price of electricity for households in European countries in 2021
For the purpose of better comparison of electricity prices for households, Graph 4.2.2 shows
electricity prices for households brought to purchasing power parity, in Europe for 2021. In that way,
the differences in the standard of living that exist among European countries were taken into
account. In this case, too, the price of electricity for households in Montenegro is below the EU
average.
35,00
30,00
23,80
25,00
[€c/kWh]
20,00
23,69
30,97
29,99
29,27
27,47
15,00
26,97
26,84
25,83
25,55
25,50
25,15
25,02
24,81
24,17
23,86
23,76
21,66
20,35
20,29
20,24
20,22
20,17
19,99
19,31
18,58
18,28
17,92
10,00
16,95
16,15
15,38
15,26
15,02
14,79
14,55
12,51
Iceland 9,21
5,00
0,00
Bosnia and…
Norway
Hungary
Slovakia
Slovenia
North Macedonia
Sweden
Italy
Greece
Estonia
Luxembourg
Lithuania
Poland
Latvia
Romania
Finland
Malta
France
Ireland
Germany
Czech Republic
Netherlands
Serbia
Austria
Denmark
Spain
Bulgaria
Croatia
Portugal
Belgium
Albania
Montenegro
Turkey
Cyprus
Graph 4.2.2 Price of electricity at purchasing power parity for households of European countries in 2021
The Austrian regulator E-Control, the Hungarian regulator MEKH and the research and consulting
company VaasaETT publish a study on monthly basis showing the prices of electricity for households
111.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
for 33 cities in Europe. Graph 4.2.3 shows electricity prices for 33 cities for December 2021, including
Podgorica.31
45,00
40,00
35,00
30,00
[€c/kWh]
23,55
25,00
39,82
39,58
20,00
37,04
36,23
22,50
34,29
29,32
29,29
28,45
15,00
27,14
27,14
26,36
26,14
24,57
23,38
22,76
22,55
22,20
22,08
21,97
21,62
21,16
19,17
10,00 19,01
16,99
16,02
15,20
13,70
12,34
12,32
Podgorica 10,54
Budapest 10,46
5,00
Belgrade 8,11
Kiev 5,46
0,00
Valleta
Berlin
Brussels
Oslo
Luxembourg
Stockholm
Nicosia
London
Riga
Vienna
Madrid
Amsterdam
Vilnius
Ljubljana
Bratislava
Athens
Prague
Bucharest
Sofia
Warsaw
Bern
Paris
Lisbon
Zagreb
Tallinn
Rome
Copenhagen
Dublin
Helsinki
Graph 4.2.3 Average electricity price of households in the capitals of European countries as of December
2021
For better comparison of electricity prices for households, Graph 4.2.4 shows electricity prices for
households brought to purchasing power parity, in some of the capitals of European countries in
December 2021. In this case, the price of electricity for households in Podgorica is at the level of the
average of capitals in Europe.
60,00
50,00
40,00
[€c/kWh]
26,47
30,00 51,04
38,09
36,05
20,00 25,34
33,20
32,92
32,79
32,65
31,23
30,83
29,83
29,61
29,62
27,47
27,38
26,31
25,62
23,73
22,89
22,29
21,16
21,11
20,90
20,40
19,06
18,94
17,07
16,88
10,00
Belgrade 15,25
Helsinki 15,03
Oslo 14,26
Valleta 14,05
Bern 13,27
0,00
Berlin
Stockholm
London
Amsterdam
Nicosia
Madrid
Brussels
Luxembourg
Bratislava
Prague
Vienna
Ljubljana
Podgorica
Riga
Vilnius
Warsaw
Sofia
Athens
Bucharest
Budapest
Paris
Dublin
Zagreb
Rome
Lisbon
Copenhagen
Tallinn
Grafik 4.2.4 Price of electricity at purchasing power parity for households in the capitals of European
countries as of December 2021
31
Source of data: E-Control, MEKH and VaasaETT
112.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
The provisions of the Law on Energy related to the protection of end customers have been
elaborated in the General conditions of electricity supply (Official Gazette of Montenegro, no. 70/16),
Rules on switching the electricity suppliers of end customers (Official Gazette of Montenegro, no.
50/16), Rules on minimum quality, Rules on operation of supplier of the last resort and vulnerable
customers (Official Gazette of Montenegro, no. 83/16) and Methodology for establishing electricity
prices applied by the supplier of last resort and vulnerable customers (Official Gazette of
Montenegro, no. 83/16).
In accordance with the Law on Energy, the body of rights of electricity customers includes the right
to connect to the grid, to choose and switch suppliers, access to data on own consumption,
elimination of technical or other obstacles in the supply of electricity, as well as ensuring the
necessary quality of electricity supply. In addition, the aforementioned law also stipulates the
obligation to inform the customer, which implies the obligation of the supplier to publish on its
website the prices it applies at least 15 days before the start of supply, changes in prices and fees;
to inform them of the possibility of terminating the contract if they do not accept the price change;
as well as to inform them once a year about their rights, including information regarding submission
and resolution of complaints.
In addition, the Law also envisages measures for the protection of vulnerable customers, as a special
category of customers who are medically and/or socially vulnerable, which includes:
− prohibition of electricity supply suspension to households with disabled persons, persons with
special needs or poor health conditions whose life or health can be endangered due to supply
restrictions or suspensions, and
− prohibition of electricity supply suspension to households with persons whose social
vulnerability is established by the relevant public institution, i.e. state administration authority
responsible for social welfare, from the beginning of October to the end of April, irrespective of
possibly unsettled liabilities for consumed electricity.
More detailed criteria for determining vulnerable electricity customers, the amount of subsidy for
vulnerable customers who are medically and socially vulnerable, as well as the f monthly electricity
consumption cap which allows the right to subsidy to be exercised, are prescribed by the Decree on
supplying electricity to vulnerable customers (Official Gazette of Montenegro, number 81/18).
According to EPCG data, there were 378 vulnerable customers as of 31 December 2021, whose
electricity bills were subsidized in the amount of 50% in accordance with the mentioned Decree.
113.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
In addition, in 2020, the bills were subsidized in accordance with the Instruction on the procedure
and method of implementation of the electricity bills subsidy program, which was prepared by the
Ministry of Finance and Social Welfare. In accordance with that act, the beneficiaries of: financial
support, care and assistance allowance, personal disability benefits, rights to family placement or
foster care and financial support of war veterans had the right to subsidies.
Besides, in line with the mentioned instruction, the right to subsidized bills was also granted to:
− unemployed persons who have acquired the status of category 2 or category 3 disabled worker
in terms of pension and disability insurance, if their personal income does not exceed the lowest
amount of temporary compensation,
− unemployed developmentally disabled persons classified in a specific category and degree of
disability pursuant to a special law, with education acquired in a special school, or regular school
special classes, and
− unemployed persons who have completed their education, with an adapted implementation of
the educational program and the provision of additional professional assistance or a special
educational or upbringing program, in accordance with a special law.
Beneficiaries of financial support, beneficiaries of the entitlement to family placement – foster care
and family placement and beneficiaries of the entitlement to financial support of war veterans, in
accordance with the mentioned Instruction, had a discount of 40% for the amount of the bill up to
€60, and for amounts exceeding €60 they had reduction to the bill by €24. Other groups of customers
had 30% discount for the bills up to €60, and for the bills exceeding €60 they had reduction of the
bill by €18. In December 2021, according to EPCG data, 15.283 customers were entitled to subsidized
electricity bills of 30%, and 4.877 customers were entitled to subsidy in the amount of 40%.
During 2021, the Government of Montenegro adopted the support measures for the economy and
citizens for the second quarter of 2021, which in the field of energy included a 40% reduction in bills
for pensioners with a pension lower than €222.00 and unemployed persons from the records of the
Employment Agency of Montenegro as of 31 March 2021, so the customers' bills were also reduced
on that basis, based on the lists submitted by the Employment Agency of Montenegro and the
Pension and Disability Insurance Fund.
In addition to the above, the supplier plays a very important role in protecting consumer rights by
deciding on the complaints related to non-compliance with the minimum quality of electricity supply
and other complaints related to electricity supply, in accordance with the powers defined in the Law.
According to EPCG data, in 20201 a total of 7.715 complaints were submitted to the supplier, of
which 7.146 were resolved in 2021, and 569 were transferred to 2022.
The data on the filed and resolved complaints in 2021 are shown in Table 4.2.3, as follows: by type,
number and outcome
114.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
Due to non-fulfilment of liabilities established by the consumed electricity bill, according to EPCG
data, 9.865 customers were subjected to electricity supply suspension in 2021.
The legal obligation of the supplier includes, inter alia, the development of a program of measures
to assist end customers in fulfilling their due contractual obligations as to prevent the suspension of
supply. In accordance with this legal obligation, EPCG provided a discount for regular payment of
electricity bills, the possibility of signing agreements on settling liabilities for electricity consumed in
instalments, termination of interest charging for customers that have signed the agreement, as well
as free service information to customers.
In 2021, 17,766 agreements were concluded on the fulfillment of obligations for consumed
electricity, in installments, of which the most were concluded in the period September - November
2021 (10,985 agreements) due to the fact that an offer to conclude an agreement was made in that
quarter under favorable conditions, which included repayment of the previous debt in fixed monthly
installments, in the amount of 20 euros each, and exemption from forced collection methods as long
as the agreement is respected. In addition, EPCG did not charge default interest on the debt to
customers who paid their obligations under the aforementioned agreement in a timely manner.
In order to stimulate the regular settlement of bills for consumed electricity, EPCG calculated a
discount on the bill for consumed electricity, for the item active energy, in the amount of: of 13% to
households - members of the "Golden Team", i.e. to customers who continuously settled their
obligations every month, and 5% to customers who settled their debts by the end of the month., In
addition to the above discount, from May 2021 a discount was also provided on the network service
item, namely: 13% to members of the "Golden team", and 5% to other regular customers from the
"household" category. The number of customers who received discounts in 2021 changed from
month to month, and in December of the reporting year there were 216,018 customers, namely:
143,004 customers who had a 13% discount, and 73,014 customers with a 5% discount.
Also, as stated in the EPCG report, in 2021, customers from the "Other consumption" category, with
the exception of small customers, who settled their obligations by the end of the month, were given
115.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
a discount of 3% on active energy until May, and starting from May on network services as well,
again in the amount of 3%. The number of consumers who received a discount in this way changed
during the year, and in December of the reporting year there were 9,606 of them. In addition, health
and educational institutions (855) belonging to the customer category "Other consumption", as of
May 2021, had a 10% discount on active electricity and network services items.
In 2021, customers were informed via the free info line - 19100, the EPCG website and Facebook
account.
In the reporting period, in accordance with the provisions of Article 56 paragraph 1 of the Law on
Energy, appeals were filed to REGAGEN against the decisions of EPCG, due to: the suspension of the
delivery and supply of electricity, and the decisions that decided on consumer complaints, submitted
on the basis of non-fulfilment of individual minimum quality, so that administrative-law protection
of customers was ensured in those procedures.
In the procedure based on complaints filed due to the suspension of electricity supply, which was
carried out at the order of the supplier due to non-fulfillment of the obligations established by the
contract, i.e. the invoice for the supplied electricity, REGAGEN also examined compliance with the
regulations that regulate the procedure for the suspension of electricity supply. There were five such
complaints in 2021, compared to 9,865 suspensions, that were executed in the reporting year. In
three cases, complaints were upheld, while two were rejected (one as untimely and the other as
irregular).
Decisions of suppliers taken in respect of the complaints filed by electricity customers with regard
to the individual minimum quality of electricity supply were also subjected to legality assessment
under the proceedings on complaints in 2021. On that basis, REGAGEN received 54 complaints in
2021, of which 21 were upheld, and 33 rejected.
Namely, in accordance with the Law and the Minimum Quality Rules, the customer is entitled to
financial compensation if it has been determined that the customer is affected by the violation of
minimum quality of service of the electric power undertaking - Transmission System Operator,
Distribution System Operator or the supplier. This right can be exercised by the customer if, within
30 days from the event that resulted in non-compliance with the minimum quality, the customer
files a complaint to the supplier on the basis of non-compliance with the minimum quality, which
the supplier is obliged to resolve within 15 days.
According to the EPCG data, on the above basis, in 2021, 2,289 complaints were submitted, of which
most of them were due to interruptions in the electricity supply, i.e. due to the fact that the re-
establishment of the power supply in the electricity distribution system was not carried out within
the period established by the Rules on minimum quality (2,277), while other complaints related to
the quality of electricity voltage (12). EPCG resolved 2,108 complaints in 2021, while the resolution
of the remaining complaints (181) was transferred to 2022. Due to non-compliance with the
minimum quality of services of the undertakings, according to EPCG data, customers were paid
116.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
€32,260.00 in the name of financial compensation. The cost of payment of financial compensations
represents exclusively the cost of electricity undertakings.
The analysis of cases before the REGAGEN has shown that customers still have doubts about the
established quality mechanism, which refers to inability to distinguish financial compensations
established by the Minimum Quality Rules from the compensation for damages decided on in a
special procedure, which is not under the competence of the REGAGEN. Given that the REGAGEN is
a second instance authority in the matter in question, information on how to obtain damage
compensations is contained in its decision on the customer's complaint.
In addition, during the reporting period, REGAGEN acted on appeals filed against the decisions of
CEDIS, that decided on the request for the issuance of consent for the connection of facilities to the
electricity distribution system, and related to procedures that began before 14 August 2020, that is,
before the entry into force of the Law on Amendments to the Law on Energy (Official Gazette of
Montenegro, number 82/20). In 2021, two appeals were submitted to REGAGEN, based on the above,
and both were accepted, the decisions were annulled and the cases were returned to the first-
instance authority for repeated procedure and decision-making.
In 2021, 63 complaints were submitted to REGAGEN that it is not competent to resolve. The
aforementioned complaints mainly related to the bill for consumed electricity, calculation of
unauthorized electricity consumption and compensation for damages., Applying the Law on
Administrative Procedure, REGAGEN forwarded such complaints to the competent authority for
action, or made decisions rejecting the complaints due to lack of jurisdiction.
The Law on Consumer Protection ("Official Gazette of Montenegro", 02/14, 06/14, 43/15, 70/17,
67/19, 146/21) (LCP) perceives the supplier from the Law on Energy as a trader (Article 2 paragraph
2 of LCP), who provides a service of public interest - electricity supply (Article 35 paragraph 1 LCP)
to the consumer. According to the aforementioned Law and the Decision on determining the list of
authorities responsible for inspection supervision over the implementation of laws containing
provisions on consumer protection ("Official Gazette of Montenegro", no 53/21), REGAGEN is
recognized as one of the authorities that supervises the implementation of laws containing
provisions on consumer protection. In accordance with the above, REGAGEN is obliged to keep
records of received consumer complaints and their resolution and to enter data into the Central
Information System for Consumer Protection - CISZP (www.potrosac.me), and the contact point is
the Administration for Inspection Affairs.
During the year 2021, in cooperation with the Administration for Inspection Affairs and other
competent authorities, REGAGEN participated in the implementation of a campaign of public
interest in the field of consumer protection, aimed at raising public awareness about the legislative
framework that protects consumer rights, as well as the role and the importance of the Central
Information System for Consumer Protection in the exercise of those rights.
Namely, REGAGEN requested 58 economic undertakings that it supervises in the field of electricity,
oil and gas and regulated utilities to display stickers with a QR code on their business premises,
117.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
which takes the users to the website www.potrosac.me, thus ensuring, in accordance with the LCP
and other laws, a more efficient and complete application of the provisions on informing consumers
about their rights and significantly easing access to the mechanism for the protection of consumer
rights.
Besides, in cooperation with the Administration for Inspection Affairs and other competent
authorities, in late 2021 and the beginning of 2022, REGAGEN controlled 10 economic undertakings
that it supervises, including economic undertakings in the fields of electricity and oil and gas. The
control referred to the compliance with the provisions of LCP regarding online trade in goods and
services in the whole of Montenegro.
Complaints from consumers, received during the course of 2021, after the establishment of CISZP,
as well as REGAGEN's decisions based on them, were recorded in CISZP, which enabled a
comprehensive insight into the state of consumer protection in the area of providing electricity
supply services, and this is one of the conditions for the successful completion of pre-accession
negotiations with the European Union for chapter 28 - Consumer and Health Protection.
118.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
SUMMARY:
The European Union's strategic determination to achieve "carbon neutrality" by 2050, in
the conditions of the sudden increase in energy demand in 2021 and the market that
could not keep up with this increase with an adequate supply, ultimately led to a large
increase in prices in the electricity market, to which CGES and CEDIS were most exposed
in Montenegro, due to the legal obligation to purchase in the Montenegrin stock
exchange electricity to cover losses.
In the reporting year, EPCG was the dominant producer and trader on the wholesale
market in Montenegro, which, despite its formal opening, implemented reforms and
harmonization of the legal framework with the EU acquis, is not sufficiently developed.
One of the recommendations of the European Commission for Montenegro, the
fulfillment of which affects progress in the process of European integration in the field of
energy, refers to the creation of a functional day-ahead energy market and association
with neighboring markets, including Italy.
With the adoption of the Law on Supervision of the Wholesale Market of Electricity and
Natural Gas, in the preparation of which the Agency took an active part, harmonization
with EU Regulation No. 1227/2011 was carried out, with the expectation that its
application will ensure adequate functioning of the electricity market, especially in the
context of connecting markets and forming prices at the regional level.
In the retail electricity market in Montenegro, in 2021, six undertakings had a license for
electricity supply, of which only one was active - EPCG. Retail prices were formed in
compliance with the restrictions prescribed by the Law on Energy, which will cease to be
valid at the beginning of 2023, when, according to the legal framework in force, prices will
be formed freely on the retail market. The possibility of choosing a tariff model is enabled
for those connected to the distribution system, while it does not exist for customers
connected to the transmission system.
The price of electricity for households with dual-tariff meters in Montenegro, according
to EUROSTAT, was 9.74 €c/kWh, including all taxes and VAT, while the average price of
electricity in EU countries was 23.69 €c/kWh, which, taking into account purchasing power
parity in Europe, indicates that the price of electricity for households in Montenegro is
below the average in the EU.
According to EPCG data, in the reporting year there were 378 vulnerable customers whose
bills were subsidized by 50%. In December 2021, 20,160 beneficiaries of financial
allowance, beneficiaries of the right to family placement or family accommodation/foster
care and beneficiaries of financial compensation for veterans, exercised the right to
subsidies of 30% or 40%. In the reporting year, there were 17,766 agreements on the
fulfillment of obligations for consumed electricity in installments.
A total of 2,289 complaints were submitted based on the minimum quality, and €32,260.00
was paid out as financial compensation.
119.
5. BUSINESS RESULTS OF ENERGY UNDERTAKINGS
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
The reform process primarily involved the separation of energy activities into regulated and
unregulated, i.e. market activities. Regulated activities include the transmission of electricity,
distribution of electricity, organization and management of the electricity market, while
unregulated activities include production, trade and supply of electricity.
An overview of the financial operations of undertakings in the electricity sector is given below.
Energy undertakings that perform regulated activities and whose regulatory allowed revenue
and prices are defined by the REGAGEN are: CGES, CEDIS and COTEE.
The established regulatory allowed revenues of regulated undertakings for 2021 amounted to:
CGES generated profit of €16.852.684 in 2021, which is 26% higher than in the previous year.
122.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
25.000.000 €
20.000.000 €
15.000.000 €
10.000.000 €
5.000.000 €
0€
2016 2017 2018 2019 2020 2021
Regulatorno dozvoljeni
Regulatory allowed revenue prihod Neto rezultat
Net profit Ostali prihodi
Other revenues
Analyzing the six-year period, it can be seen that CGES has been operating with a profit since
2016, which has a rapidly growing trend since 2019. The extremely good results from
operations after 2019 are predominantly conditioned by the increase in revenues from the
allocation of cross-border transmission capacities, the increase of which was made possible by
the multi-year realization of investments in the development of electricity transmission
capacity and the commissioning of the submarine interconnection between Italy and
Montenegro at the end of 2019. The largest investment is related to the construction of related
and additional infrastructure for submarine interconnection with Italy, and it also constitutes
the investment with the largest share in total investments in the observed period (total realized
value of around 106 million euros).
The following graph shows a comparison of the net results of operations in relation to realized
investments over a six-year period, and it is noted that positive results of operations were
achieved during the entire observed investment cycle.
123.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
60.000.000 €
50.000.000 €
20.000.000 €
10.000.000 €
0€
2016 2017 2018 2019 2020 2021
Realizovane investicije
Realized investments Neto rezultat
Net profit
Graph 5.1.2 Overview of CGES investments and net results in the period 2016 to 2021
The realization of investments made it possible to overcome the negative effects left behind
by the COVID-19 pandemic (decline in consumption and thus income) and the rise in electricity
prices on the wholesale market (increase in the cost of purchasing electricity to cover losses in
the electricity transmission system). Due to the realization of investments and the successful
exploitation of the submarine interconnection, as well as other cross-border transmission
capacities, CGES managed to achieve an exceptional business result in 2020 and 2021, which
were characterized by extremely complex and difficult economic and social circumstances.
In 2021, CEDIS operated with a net loss of €9,846,752, the first time since 2016 when it was
separated from a vertically integrated company – EPCG. After 2020, marked by the COVID-19
pandemic and a drop in consumption, which resulted in lower realized revenues and lower net
profit compared to previous years, 2021 was marked by a significant increase in CEDIS costs.
One of the categories of costs where a large increase was observed refers to the costs of
purchasing electricity to cover losses in the distribution system, which were significantly higher
than the previous year, due to the increase in electricity prices on the wholesale market. The
transmission system operator and the distribution system operator have a legal obligation to
purchase electricity to cover losses in the system in a transparent procedure, i.e. on the stock
market. During 2021, energy to cover losses was purchased on the stock market, i.e. through
" Crnogorska berza električne energije" DOO Podgorica (BELEN).
CEDIS, as well as CGES, bore the costs of purchasing energy to cover losses in the system,
which are based on prices that were freely formed on the stock market, i.e. prices depended,
on the one hand, on interested suppliers and their business decisions on the price at which
they which they are willing to offer the requested amounts of electricity, and, on the other
124.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
hand, on the operator who procures energy and formulates the request for energy
procurement.
In the mentioned auctions, energy was procured by EPCG, and the costs incurred by CGES and
CEDIS on the basis of the procurement of energy to cover losses, and which they reported in
their income statements, were the result of prices that were freely formed at these auctions.
On the other hand, the costs arising from justified losses in the system, which are transferred
to system users, are determined in accordance with the regulations issued by REGAGEN, and
the price based on which, at the end of 2019, the costs of justified losses (which are related
only to technical losses in the distribution system) for 2021 were established, amounted to
€53.3920/MWh.
In the procurement of energy to cover losses in the distribution system in 2021, an average
weighted price was approx. €80/MWh, whereby around 74% of energy was procured at prices
that were not higher than the price used when determining the costs of justified losses, while
the rest was purchased in the second half of 2021 at significantly higher prices. Unlike CGES,
which, despite the increase in costs for the purchase of electricity to cover losses in the
transmission system, realized a net profit due to significantly higher revenues based on the
allocation of cross-border capacities, the revenues of CEDIS were lower than the costs.
In addition to the costs for the purchase of energy to cover losses in the distribution system,
the actual loss in CEDIS' operations was largely influenced by the higher costs of depreciation
and wages in comparison to originally projected.
An overview of the determined regulatory permitted income and the actual net result of CEDIS
from 2016 to 2021 is given in the graph below.
125.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
80.000.000 €
60.000.000 €
40.000.000 €
20.000.000 €
0€
Graph 5.1.3 CEDIS business results in the period from 2016 to 2021
Comparing the net results of operations in relation to the actual investments over a six-year
period, which are shown in graph 5.1.4, it is noted that CEDIS, despite a very challenging
period, realized significant investments in the distribution system in 2020, while in 2021 it
made smaller investments than in previous years.
70.000.000 €
60.000.000 € Increase in
electricity prices in
50.000.000 € Separation from COVID19 the wholesale
EPCG pandemic market
40.000.000 €
30.000.000 €
20.000.000 €
10.000.000 €
0€
-10.000.000 €
2016 2017 2018 2019 2020 2021
-20.000.000 €
Realizovane investicije
Realized investments Neto rezultat
Net profit
Graph 5.1.4 Overview of CEDIS investments and net results in the period 2016 to 2021
126.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
COTEE ended 2021 with a net profit of €6,263. From its foundation until today, the Market
Operator has been provided with business stability through the application of the regulatory
framework established by REGAGEN, and this company has continuously achieved positive net
results.
The text below contains a presentation of the business results in 2021, achieved by market
energy undertakings, from which it can be concluded that 12 companies had a positive and 5
negative business results32. The financial operations of these companies are not subject to
supervision by REGAGEN in accordance with the Law on Energy.
In addition to EPCG, there are five other companies licensed to supply electricity (DOO
"Energija Gas and Power", DOO "Uniprom" Nikšić, DOO "Petrol Crna Gora MNE" Podgorica,
DOO "Montenegro Bonus" Cetinje and DOO "Twinfin Tesla" Podgorica).
However, as these companies are not active suppliers in the retail electricity market, the
presented business results do not reflect the results from the electricity supply business.
32
Source: Uprava prihoda i carina Crne Gore - Taxis portal
127.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
UNIPROM 8.468.651
(9.000.000) (6.000.000) (3.000.000) - 3.000.000 6.000.000 9.000.000 12.000.000 15.000.000 18.000.000 21.000.000 24.000.000 27.000.000 30.000.000
128.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
Below is a presentation of the business results for the reporting year of those undertakings whose
primary activity is in the petroleum and gas sector, from which it can be concluded that 51 companies
had a positive and 14 negative business results
10.000.000 €
9.000.000 €
8.000.000 €
7.000.000 €
6.000.000 €
5.000.000 €
4.000.000 €
3.000.000 €
2.000.000 €
1.000.000 €
0€
PETROL CRNA GORA…
HIFA OIL CG
AP PETROL
LUKANA
AVIO PETROL
KALLABA COMPANY
ZETA PETROL
HEMOSAN
KALAMPER
IK REAL
JUGOPETROL
MONTENEGRO BONUS
PETROBART
E.C. AUTO TRADE
HUMCI BS
ALBA PETROL
ČELEBIC PETROL TRADE
SUTOMORE PETROL
KIPS
INTOURS
MESO-PROMET
LUKOIL MONTENEGRO
90.000 €
80.000 €
70.000 €
60.000 €
50.000 €
40.000 €
30.000 €
20.000 €
10.000 €
0€
AMD ZARUBICA…
PDG PROFESS. DEVELOP.…
RAPAX
HUMCI
VJENIKO PETROL
PIGO-PETROL
NOVI GAS
D TRANS
VN-COMMERCE
MIVIS
PIŠTET B
S&M
SMN TRANSPORTI
MILTRANS
JUNČAJ PETROL
ČELEBIĆ INVEST
EKO PETROL
Z PETROL
EKO VLADOŠ
VV TRANS
FAB PETROL
PETROL TANK
DON TRANS
S & L TRANS
DEKAR
SENIĆ PETROL
ASMIRA & CO
EURO PETROL CG
129.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
0,00 €
ENERGOGAS
MONTENEGRO GAS
MERCATOR CG
PEPIĆ COMPANY
NEKSAN
VVIN COM
SAMCOMMERCE PLUS
JET TRANS
VIHOR
INA CRNA GORA
ADRIATIC MARINAS
MONTENEGRO PETROL
UNIPROM ENERGY
PAVGORD CG
-1.000.000,00 €
-2.000.000,00 €
-3.000.000,00 €
-4.000.000,00 €
-5.000.000,00 €
-6.000.000,00 €
-7.000.000,00 €
-8.000.000,00 €
-9.000.000,00 €
-10.000.000,00 €
-11.000.000,00 €
-12.000.000,00 €
-13.000.000,00 €
-14.000.000,00 €
-15.000.000,00 €
Graph 5.2.1 Business results of the market undertakings in the petroleum and gas sector in 2021
130.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
SUMMARY:
In the reporting year, 20 licensed undertkings operated in the electricity sector of
Montenegro, of which 17 undertakings are engaged in market activities, and three in
regulated activities, for which the Agency established the regulatory permitted income for
2021 (CGES - €29,114,806, CEDIS - €82,015,904, COTEE - €742,794).
The profit earned by CGES in 2021 amounts to €16,852,684, which is 26% more compared
to the previous year, and is predominantly caused by the increase in revenues from the
allocation of cross-border transmission capacities.
In 2021, for the first time since its establishment, CEDIS operated with a net loss of
€9,846,752, which is mostly a consequence of the increase in energy procurement costs
to cover losses in the distribution system, due to the rise in electricity prices on the
wholesale market, but also higher wages and depreciation costs than projected. About
74% of the energy to cover the losses was purchased by CEDIS at prices that are not higher
than the price determined by the Agency in the process of determining the regulatory
allowed revenue for this operator for the year 2021 (€53.3920/MWh), while the remaining
energy was paid to EPCG at prices significantly higher than the stated price, within the
auction procedure on BELEN.
COTEE ended the year 2021 with a net profit of €6.263.
Out of 17 undertakings engaged in market activities in the energy sector, 12 operated
with a positive business result in the reporting year. At the end of the reporting year, 65
undertakings were operating in the petroleum and gas sector, of which 51 were operating
with a positive result.
131.
6. LEGISLATIVE, ADMINISTRATIVE AND
INTERNATIONAL ACTIVITIES OF REGAGEN IN 2021
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
− Methodology for determining the regulatory permitted income and prices for the use of the
electricity transmission system (Official Gazette of Montenegro, no. 71/22),
− Methodology for determining the regulatory permitted income and prices for the use of the
electricity distribution system (Official Gazette of Montenegro, no. 71/22),
134.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
− Methodology for determining the regulatory permitted income and remuneration for the work of
the electricity market operator (Official Gazette of Montenegro, no. 71/22),
− Methodology for determining prices, terms and conditions for the provision of auxiliary services
and balancing services of the electricity transmission system (Official Gazette of Montenegro,
no. 71/22), and
− Rules for adjustment of prices and fees (Official Gazette of Montenegro, no. 71/22).
Due to changes in the way of treating unwanted deviations at the level of the European Association
of Electricity Transmission Operators (ENTSO-E), in 2021 it was necessary to change the text of the
Methodology for determining prices, terms and conditions for the provision of auxiliary services and
balancing services of the electricity transmission system (Official Gazette of Montenegro, no. 44/16,
40/17 and 50/19), and REGAGEN did so in a timely manner with the adoption of amendments to this
methodology in June 2021.
As already pointed out, in 2021, REGAGEN adopted the Rules for the drafting and monitoring of
implementation of ten-year plans for the development of the electricity transmission system, and
the Rules for the drafting and monitoring of implementation of ten-year plans for the development
of the electricity distribution system, and these new texts represent legislative improvements
compared to the texts that were previously in force, in terms of more precise regulation of certain
issues, and the creation of a legislative framework, the application of which will result in the adoption
of optimal guidelines for the development of the distribution and transmission system in
Montenegro. To that end, an integral part of the texts of the aforementioned acts are the annexes,
which define and elaborate the structure of the proposed plans that are submitted to REGAGEN for
approval.
In 2021, through membership in the Working Group established by the Ministry of Capital
Investments, REGAGEN actively participated in the process of transposition of the regulation
governing the supervision of the wholesale electricity and gas market (Regulation (EU) No.
1227/2011 on the integrity and transparency of the wholesale energy market (REMIT)). On 29
December 2021, the Parliament of Montenegro adopted the Law on Supervision of the Wholesale
Electricity and Gas Market (Official Gazette of Montenegro, no. 1/22), thus transposing the
mentioned regulation into the Montenegrin legislative system.
135.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
− Methodology for determining the regulatory allowed income and prices for the use of the gas
transmission system (Official Gazette of Montenegro, no. 97/2021),
− Methodology for determining the regulatory allowed income and prices for the use of the gas
distribution system (Official Gazette of Montenegro, no. 97/),
− Methodology for determining regulatory permitted income and prices for the use of liquid natural
gas facilities (Official Gazette of Montenegro, no. 97/2021).
The texts of the remaining two methodologies that will complete the legislative framework in the
field of natural gas: Methodology for determining the regulatory permitted income and
compensation for the work of the gas market operator and Methodology for determining the
regulatory permitted income and prices for the use of the gas storage system, have been prepared
and will be adopted in in the upcoming period, thus creating legislative prerequisites for the
development of natural gas infrastructure.
136.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
undertakings, from the aspect of compliance with the provisions of other regulations and
methodological-professional processing in accordance with the Legal and Technical Rules for
drafting of regulations, as well as making comments (general and/or comments on individual
provisions). Once the energy undertakings eliminated the deficiencies in the submitted texts of the
regulations, the conditions for adoption of the relevant decisions were met.
Considering the number of remarks that REGAGEN made in the process of giving consent, i.e.
approving the submitted documents, and the fact that the Law on Energy foresees significant
legislative activities of the system operator, the conclusion is that it is necessary to further strengthen
the HR capacities in the energy undertakings to work on legislative issues.
In the reporting year, REGAGEN did not issue consent to the key acts of the undertakings that
regulate the functioning of the energy sector: Rules of operation of the electricity transmission
system, Rules of operation of the electricity distribution system and Market Rules. Namely, in March
2021, CEDIS submitted to REGAGEN for approval the Proposal of Rules of Operation of the Electricity
Distribution System, and by the end of the reporting year, it failed to eliminate the deficiencies in
the text of the aforementioned act, which REGAGEN pointed out to it in May of the same year.
However, it is important to note here that in July 2022, the conditions were met for making decisions
by which REGAGEN approved both the aforementioned act and the Methodology for determining
the fee for connection to the electricity distribution system, as well as the Price List for the purchase
of constructed infrastructure at voltage level 0.4 kV, since CEDIS has incorporated in the text of the
mentioned by-laws all remarks of REGAGEN given in its acts from 2021, in all previous
correspondence, and in direct communication with CEDIS representatives.
In July 2021, COTEE held public consultations regarding amendments to the existing Market Rules
(Official Gazette of Montenegro, no. 44/17, 25/19). However, by the end of 2021, the proposal for
this act was not submitted to REGAGEN for approval. CGES submitted to REGAGEN the Proposal of
Rules for the Operation of the Electricity Transmission System for approval in November 2021, which
was being processed by REGAGEN during the reporting period.
With regard to the new competences that, through the adoption of the Law on Amendments to the
Law on Energy, were assigned to REGAGEN in mid 2020, and that relate to the connection of the
day-ahead and intraday electricity market, in 2021 the transmission system operator (TSO) did not
submit to REGAGEN any requests for the approval of methodologies and other acts governing the
matter in question, noting that in the reporting year the Government of Montenegro did not
designate a nominated electricity market operator (NEMO), in accordance with Article 132a of the
Law.
Based on the Law on Energy, REGAGEN approves the rules on guarantees of origin that the market
operator adopts in accordance with the regulation of the Government of Montenegro and the rules
of the European association of organizations that issue guarantees of origin, as well as the act of the
market operator determining the fee for using the register of guarantees of origin, that the users of
the registry must pay. In 2021, COTEE did not submit the documents in question to REGAGEN for
approval.
137.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
Failure to adopt the listed by-laws makes it impossible to pass related by-laws, which regulate both
the relationship between energy undertakings, as well as the relationship between undertakings and
users of their services. Since further elaboration of legal provisions is the fundamental purpose of
by-laws, the enactment of which is under the competence of the aforementioned energy
undertakings, it is indisputable that, from the perspective of the Law on Energy, these undertakings
have the role of main implementers of the legislative activity in question, which also implies the need
for their more active approach in harmonizing the pace of adoption of by-laws with amendments to
the legal framework.
In line with the obligation prescribed by Article 98 paragraph 2 of the Law on Energy, and at the
request of the Ministry of Capital Investments, REGAGEN issued an Opinion on the Draft Regulation
on Amendments to the Regulation on the Method of Implementation and the Amount of Incentives
for Electricity Produced from Renewable Sources and High-Efficiency Cogeneration, number
21/1617-4 dated 15 June 2021. The aforementioned draft was not discussed by the Government of
Montenegro in 2021.
The aforementioned procedure was carried out in accordance with the Methodology for determining
the regulatory allowed income and compensation for the work of the market operator ("Official
Gazette of Montenegro", number 6/21), adopted by REGAGEN in June 2021. This methodology
introduced a three-year regulatory period, which aligns the duration of the regulatory period for
which market operator fees are determined with the duration of the regulatory period for which the
prices of services provided by the operator of the transmission system and the operator of the
electricity distribution system are determined. Bearing in mind the legal provisions regulating the
adoption of long-term and one-year energy balance, as well as the fact that the Long-term energy
balance refers to the period 2020-2022, there is an exception prescribed by Article 20 of the
methodology in question, which establishes that the first regulatory period in accordance with this
methodology is a one-year period (2022).
Based on the above, on 30 November 2021, REGAGEN adopted the Decision on determining the
regulatory permitted income and remuneration for the operation of the electricity market operator
for the period 1 January 2022-31 December 2022 (Official Gazette of Montenegro, no. 125/21).
138.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
In addition to the above, during 2021, the procedure for determining adjustments during the
regulatory period was carried out, as a result of the previously implemented control of operation of
the regulated undertakings, on the basis of which it was determined that the conditions prescribed
by the Law on Energy for determining adjustments to the regulatory permitted income and prices
for 2020 for the Transmission System Operator are met. The conditions for making adjustments
during the period have been met due to significantly higher revenues based on the allocation of
cross-border capacities compared to the projected, i.e. the determined amount. The procedure
ended with the adoption of the Decision on determining the amount of adjustments to the
regulatory allowed income and prices for the use of the electricity transmission system during the
regulatory period 2020-2022 (Official Gazette of Montenegro, no. 125/21 and 128/21), which
establishes adjustments in favor of users of the electricity transmission system.
The investment projects in the approved Updated Investment Plan are divided by groups of assets
into the following categories: primary network, secondary network, AMR and metering points, other
fixed assets and unforeseen projects. Of the total approved investments in the amount of
€34,943,798, 6.18% is planned for the primary network, 72.20% for the secondary network including
the revitalization of the medium-voltage network and low-voltage network, 5.98% for AMR and
metering devices, 12.80% for other fixed assets and 2.84% for unforeseen projects. In the process of
giving consent to the "Updated investment plan of CEDIS for 2022", REGAGEN did not give consent
to the investments: "Metering equipment for the improvement of the metering system (AMM project
- expansion of the third phase)" and "Replacement of meters in the existing AMM system - improving
the reading and reporting system", as well as part of the investments: "Metering equipment for new
consumers, producers and TS" and "Metering equipment for replacement with existing consumers,
producers and TS". REGAGEN did not give consent to the mentioned investments, among others,
for the following reasons: CEDIS did not present a comparison of functions of the new technology
of metering devices that it planned to procure with the already installed metering devices in earlier
procedures, and did not provide an explanation for the higher unit price of the metering devices.
139.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
In addition to the above, acting on the request of the CGES from November 2020, in the first half of
2021 REGAGEN approved the "Updated Plan for the Development of the Transmission System of
Montenegro 2020-2029" (except in the part related to: connection of SPP Briska Gora, connection
of SPP Velje brdo, connection of WPP Brajići), "Updated CGES investment plan for the period 2020-
2022.", in the part that includes investments worth €50,773,000 for 2021 and 2022, as well as the
"Infrastructure purchase program for the period 2020-2022". During 2021, CGES submitted the
"Updated program for the purchase of infrastructure of Crnogorski prenosni sistem AD (Montenegro
transmission system) for the period 2020-2022", as well as "The second updated CGES investment
plan for the period 2020-2022", to which REGAGEN gave consent in the part that includes
investments worth €24,317,000.00 for the year 2022.
In 2021, REGAGEN issued one license for the activity of electricity generation, to the undertaking
DOO Hidroenergija Andrijevica.
During 2021, REGAGEN issued 21 licenses for performing energy activities in the field of petroleum
derivatives and liquid petroleum gas. In addition to the issuance of new licenses, during 2021, due
to changes in the scope of energy activities, 29 license changes were made. Also, four licenses were
revoked, mainly due to the sale of gas stations and/or means of transport to other entities, as well
as due to the termination of activity for which the license was issued. In addition, one license was
extended and five requests for licenses were rejected.
In July 2021, the Government of Montenegro adopted Conclusions, number 04-3550/4, by which it
adopted the Information on the degree of implementation of the National Action Plan for the use
140.
REGAGEN Regulatorna agencija za energetiku i regulisane komunalne djelatnosti
of energy from renewable sources until 2020 for the period 2018-2019, with the Report on
implementation of the National Action Plan for the use of energy from renewable sources until 2020
for the period 2018-2019, which was submitted by the Ministry of Capital Investments, and
concluded that the national goal of 33% of the share of energy from renewable sources in the total
final energy consumption in Montenegro by 2020 has been met, and tasked the aforementioned
ministry to inform REGAGEN of the obligation to act in accordance with Article 98 of the Law on
Energy.
The National Action Plan for the use of energy from renewable sources until 2020 , to which the
aforementioned report refers, was adopted by the Government of Montenegro, at the session of 11
December 2014, and the Government then accepted the obligation to fulfill the national target for
2020, to have 33% of the total share of energy from renewable sources in the total final energy
consumption in Montenegro. The obligation to adopt this document and fulfill the aforementioned
national target stems from the fact that with the Law on the Ratification of the Agreement between
the European Community and the Republic of Montenegro on the Establishment of the Energy
Community (Official Gazette of the Republic of Montenegro, no. 66/06), Montenegro also undertook
the obligation to implement the Decision (2012/04/MC-EnC dated 18 October 2012) adopted at the
10th meeting of the Ministerial Council of the Energy Community.
Article 98 paragraph 3 of the Law on Energy stipulates that the Government will stop encouraging
the construction of new facilities for the production of energy from renewable sources, and
REGAGEN will stop awarding the status of privileged producer, in case of reaching the national target
from the mentioned National Action Plan for the use of energy from renewable sources until 2020,
if the construction of these facilities would result in a higher than mandatory share of energy from
renewable sources in the total final energy consumption; this Article also stipulates that before the
achievement of the national target the Government and REGAGEN will temporarily limit incentives
in case of serious negative impacts on the economy and social status of end customers.
On 26 July, REGAGEN was informed about the adoption of the Conclusions of the Government of
Montenegro, number 04-3550/4 dated 22 July 2021, by a letter from the Ministry of Capital
Investments, which stated: “Acting upon the aforementioned Conclusion, and taking into account
the fact that the Government has concluded that the national target of 33% share of energy from
renewable sources in the total final energy consumption in Montenegro has been met, we inform
you that the conditions have been met to apply the provisions of Article 98 of the Law on Energy
(Official Gazette of the Republic of Montenegro, no. 5/16, 51/17 and 82/20) and to stop granting
the status of a privileged producer".
As the Government of Montenegro established in the aforementioned conclusions that the national
target was achieved in the matter in question, the right of REGAGEN establish the status of a
privileged electricity producer ceased to exist ex lege.
In July 2021, the Government of Montenegro adopted a Decree on the termination of the Decree on
the method of exercise and the amount of incentive prices for electricity produced from renewable
sources and high-efficiency cogeneration (Official Gazette of Montenegro, no. 082/21), which
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regulated incentive prices for privileged producers, thereby abandoning the innovation of the act in
question, for which REGAGEN's opinion was requested (more in subchapter 6.2 of this report). It is
important to point out that the Government of Montenegro did not repeal the Regulation on the
method of acquiring the status and exercising the rights of a privileged electricity producer (Official
Gazette of Montenegro, no. 59/16 and 89/20), which is why, in the opinion of REGAGEN, its authority
to determine the temporary status of a privileged producer has not been terminated.
Until the aforementioned conclusions of the Government of Montenegro were adopted, in the
reporting year, REGAGEN, acting on the requests of five undertakings, determined the status of
privileged producers for six production facilities, namely: sHPP "Vrbnica", owned by DOO "sHPP
Vrbnica" Podgorica; sHPP "Elektrana Mišnića", owned by DOO "Manira Hydro" Mojkovac; sHPP
"Štitska", owned by DOO "Hidroenergija Andrijevica" Andrijevica; sHPP "Umska", owned by DOO
"Hidroenergija Andrijevica" Andrijevica; sHPP "Krkori", owned by DOO "Vodovod i Kanalizacija"
Andrijevica; sHPP "Miolje polje", owned by DOO "Benergo" Andrijevica. The aforementioned
production facilities produced 22,292,444 kWh of electricity in the reporting year (data on the
production of individual facilities are given in Table 6.6.2).
In 2021, the duration of one temporary status was extended – to the undertaking "Water and
sewerage" DOO Andrijevica for the production facility of sHPP "Krkori", which, as stated above, also
acquired the status of a privileged producer in the same year.
Data on all assigned privileged producer statuses and temporary statuses are entered in the register
of privileged producers, which is published on the REGAGEN website.
REGAGEN informed the Ministry of Capital Investments, market operators, distribution system
operators and electricity transmission system operators about all issued decisions, in accordance
with the obligation prescribed by the aforementioned decree.
In line with the Conclusions of the Government of Montenegro, number 04-3550/4 dated 22 July
2021, in the reporting year, one request for acquiring the status of privileged producer was rejected,
namely the request of DOO "Zeta Energy", which, as the holder of temporary privileged producer,
contacted REGAGEN with a request to acquire the status of a privileged producer.
In 2021, the periods of validity of temporary privileged producer status expired for three energy
undertakings with 13 generation facilities, namely: DOO "BARSOLAR" Bar (nine generation facilities),
DOO "DEKAR ENERGY" Podgorica (three generation facilities), DOO " C&S ENERGY“ Podgorica (one
generation facility).
Table 6.6.1 gives an overview of producers and associated generation facilities that had the status of
privileged producer at the end of 2021.
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Table 6.6.1 Producers with status of privileged producers in the end of 2021 and their generation facilities
PRIVILEGED PRODUCERS
Status end
No. Name and seat of the producer Name and location of the facility
date
11. Možura Wind Park, Ulcinj WPP Možura, Ulcinj i Bar 29.12.2031
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Suppliers and self-supply consumers are obliged to withdraw the electricity produced by privileged
producers, invoice electricity to their customers at unit prices determined by the Decree on incentive
fees to encourage production of electricity from renewable sources and high efficiency
cogeneration (Official Gazette of Montenegro, No. 29/19), and transfer to COTEE the funds collected
from end customers in this respect. After that, pursuant to the Law, COTEE transfers such funds to
privileged producers from whom the electricity was purchased. The funds collected by COTEE in this
respect do not represent the revenue of COTEE, given that this energy undertaking is an
intermediary in the transactions that it performs on the basis of its legal authorizations.
In addition to suppliers and self-supply consumers COTEE also collects the funds required for the
purchase of electricity produced by privileged producers, which do not represent its income, from
other sources prescribed by the Law on Energy. In accordance with the Decree on incentive fees to
encourage production of electricity from renewable sources and high-efficiency cogeneration, end
customers from the household category are exempt from paying the incentive fee to encourage
production of electricity from renewable sources for the first 300 kWh of monthly consumption,
which is financed from the budget of Montenegro. from funds collected from polluters on the basis
of the Decree on activities that emit greenhouse gases for which a permit for the emission of
greenhouse gases is issued (Official Gazette of Montenegro, no. 8/20). This decree positioned
Montenegro on the energy map of the countries of the Western Balkans as the first country to
establish its "cap and trade" system and begin the process of harmonization with the EU ETS system
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(Emission trading system). The described system is a functional tool for fulfilling internationally
assumed obligations, which contributes to the additional integration of the Montenegrin energy
market with EU markets, sends a clear message to existing and future investors that the "polluter
pays" principle is standardized in Montenegro. In 2021, the Government of Montenegro allocated
budget funds to encourage the production of electricity from renewable sources and highly efficient
cogeneration in the amount of 3.1 million euros.
Table 6.6.2 presents the amount of electricity purchased by COTEE from privileged producers in the
period from 2014 to 2021.
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Table 6.6.2 Volume of electricity purchased from privileged producers in the period 2014 – 2021
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Based on the data in Table 6.6.2, it is evident that in 2021, compared to 2020, there was a significantly
higher electricity generation, by 89,643,094 kWh, primarily due to the entry of new small hydropower
plants, as well as higher production of the existing small hydropower plants, as a result of a more
favorable hydrological situation compared to 2020.
In 2021, in accordance with Article 55 of the Law on Energy, REGAGEN produced the "Analysis of the
share of production from renewable energy sources and cogeneration in the total electricity
generation and consumption", which was published on the REGAGEN website.
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In the observed period, the activities within the Energy Community related to the continuation of
work on amendments to the Agreement in which, in addition to the European Commission and the
Energy Community, all member countries participate in a synchronized manner in order to find
compromise solutions, as well as to the adjustment of the set of regulations that will transpose the
EU package "Clean energy for all" to the national legislation of the member states. To this end, the
Council of Ministers adopted a series of acts: Decision on the incorporation of Directive 2019/944
on common rules for the internal electricity market and Regulation 2019/941 on risk preparedness
in the electricity sector; Decision on the incorporation of directives (EU) 2018/2001 on improvement
of the use of energy from renewable sources and 2018/2002 on energy efficiency; Regulation (EU)
2018/1999 on the governance of the Energy Union and climate action, Regulation (EU) 2020/1208
on the structure, format, submission processes and review of information reported by Member
States; Decision on adaptation and application of Regulation (EU) 2017/1938 of the European
Parliament and of the Council on measures to preserve the security of gas supply.
The representatives of the ministries called on the European Union to include in the draft RED III
Directive a provision that would enable the recognition of guarantees of origin among the member
states and contracting parties of the Energy Community.
Also, the Ministerial Council adopted the General Policy Guidelines on the Adoption of the Roadmap
for Decarbonization for the Contracting Parties of the Energy Community proposed by the European
Union, thus sending an important signal about the readiness of the Energy Community to join the
European Union and other international partners in achieving net zero GHG emissions by 2050. A
controversial issue for all contracting parties to achieve this goal is the financial capacity, and
assistance from EU funds is expected.
In addition to the mentioned activities within the Energy Community, the implementation of the
obligations of the Berlin Process, also known as the Western Balkans 6 that aims to support the
Balkan countries in creating a regional electricity market, continued. According to the prepared “soft”
measures, the conditions for the realisation of an integrated market are the establishment of power
exchanges and a regional balancing market. Among the activities related to the achievement of the
objectives of the Berlin Process, the trainings under the KEP project (Know-How Exchange Program
- central European Initiative Support for Strengthening Energy Regulatory Authorities in the Western
Balkans) organized under the auspices of the Italian Energy Regulatory Authority for Energy,
Networks and Environment (ARERA), are attended by the regulators, transmission system operators,
and power exchanges. The project initially included Montenegro, Serbia and Albania, and
subsequently it extended to Northern Macedonia, Greece and Bulgaria. Transmission system
operators and power exchanges, under the Berlin Process, formed the AIMS group, consisting of
Montenegro, Serbia, Albania and Italy, which analyses the preconditions for market integration.
It is known that in June 2012, Montenegro opened the EU accession negotiations, while on 21
December 2015, Chapter 15 - Energy was opened for negotiation.
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In this regard, in the reporting period, the usual activities of all institutions involved in the process
of EU accession of Montenegro were carried out, from the aspect of the energy sector, and they
refer to the provision of updated information on the degree of fulfillment of the obligations required
by the European Commission.
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SUMMARY:
In 2021, the Agency adopted, that is, established 11 by-laws, and approved 10 regulations,
which were enacted by the system operators. With regard to individual by-laws in the field
of energy, it is necessary to point out the unsatisfactory dynamics of system operators in
the implementation of their legislative activities. Representatives of the Agency, in
cooperation with the representatives of the Ministry of Capital Investments, prepared the
text of the Law on Supervision of the Wholesale Market of Electricity and Natural Gas.
Due to significantly higher revenues based on the allocation of cross-border capacities
compared to the planned ones, in accordance with the conditions prescribed by the Law
on Energy, in the reporting year, the Agency decided on corrections of the regulatory
permitted income and prices for 2020 for CGES, in favor of the user, as well as the
regulatory permitted income and operating fees for COTEE for 2022.
In the reporting year, seven approval procedures for development plans, investment plans
and purchase programs were carried out, as well as one procedure for approving the plan
for replacement and displacement of meters.
In 2021, the Agency issued one license for the performance of electricity generation
activities, as well as 21 licenses for the performance of energy activities in the field of
petroleum derivatives and liquid petroleum gas.
By July 2021, when the Government of Montenegro adopted Conclusions, which
determined that the national goal of 33% of the share of energy from renewable sources
in the total final energy consumption in Montenegro by 2020 had been met, which
terminated ex lege the right of the Agency defined in Article 55 of the Law on Energy, six
statuses of privileged electricity producers were granted and one temporary status of
privileged producer was extended. In the reporting year, 26 privileged producers
concluded contracts with COTEE on the purchase of generated electricity from 39
production facilities, to which EUR 3.1 million was paid from the budget.
Montenegro's obligations under Negotiation Chapter 15 dictated intensive activities of
the Agency in the field of cooperation with regulators from the region and the European
Union in this reporting year as well. The Ministerial Council of the Energy Community
adopted the General Policy Guidelines on the Adoption of the Decarbonization Roadmap
for the Energy Community Contracting Parties, thereby sending an important signal about
the readiness of the Energy Community Contracting Parties to join the European Union
and other international partners in achieving net zero greenhouse gas emissions by 2050.
A contentious issue for all contracting parties is the financial aspect of achieving the stated
goal, in which respect assistance from EU funds is expected.
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