EPCG and Japan’s PowerX have signed a memorandum of understanding with an indicative target of about 500 MWh of battery energy storage system capacity in Montenegro over an initial three-year period. The companies plan to coordinate storage with EPCG’s flexible hydropower resources, growing solar generation and regional electricity trading, rather than assess batteries solely as standalone arbitrage assets. The target is significant for Montenegro’s relatively small power system.
Montenegro’s 2026 energy balance envisaged roughly 198 GWh of solar generation, while planning projected solar capacity of around 215 MW as prosumer and utility-scale projects expand. Adding weather-dependent solar generation to a portfolio that also relies on hydrological inflows increases the need to manage output changes and maintain balance. Battery storage systems could help EPCG reduce imbalances across the portfolio.
Storage, hydropower and regional trading
Reservoir hydropower can shift large volumes of energy over longer periods, but its operation is subject to hydrological and water-management constraints. Batteries can respond within seconds, absorb short-lived solar surpluses and support intraday trading without changing water releases. Coordinating the technologies could preserve reservoir value for periods when hydropower’s longer-duration flexibility is more valuable, while batteries manage shorter-term changes in supply and demand.
Montenegro’s power system is interconnected with Serbia, Bosnia and Herzegovina, Albania and Italy. A battery could charge when the country has surplus power or imported electricity is cheap, then discharge to serve domestic demand or meet regional scarcity. Storage could therefore help manage imports and exports as well as local generation within a system linked to neighbouring markets.
The commercial model is intended to optimise EPCG’s overall portfolio, rather than treat the battery energy storage system as an isolated profit centre. Its value should be assessed by its additional contribution to hydropower, solar generation, imports, exports and the company’s balancing position. Benefits from coordinating storage with those activities could support a stronger investment case than day-ahead arbitrage alone. The memorandum sets an indicative target; it does not specify a final investment decision or a project schedule beyond the initial three-year period.
