Montenegro’s state-owned electricity utility Elektroprivreda Crne Gore (EPCG) has asked for government approval to take a long-term loan of up to €64.22 million. The financing is intended to support ten renewable-energy projects with combined installed capacity of 95.87 MW. The request is tied to the Budget and Fiscal Responsibility Law requirements for state-controlled companies entering long-term borrowing arrangements.
Government consent is required because EPCG would be entering the borrowing arrangement as a state-controlled entity. The proposed loan would not include a state guarantee, and it is not expected to create a direct obligation for Montenegro’s national budget.
Renewable portfolio and project list
The renewable portfolio includes the Solari 5000+ programme and the Željezara solar power plant. It also covers solar installations at the Vrtač, Slano, and Krupac dams. Additional components are the Kapino Polje L1, L2, B1, and B2 projects.
The package also includes the first phase of the Krupac solar development. Together, the ten projects are projected to generate approximately 124,518 MWh annually. Based on the stated capacity, this corresponds to a portfolio-wide capacity factor of around 14.8%.
Output, revenue and financial assumptions
EPCG forecasts annual revenue of approximately €20.7 million and EBITDA close to €20 million during the first full year of operation. The estimates point to an unusually high EBITDA margin and an average realised revenue of roughly €166/MWh. The company indicates that power-price assumptions, customer repayments, and any regulated or contracted revenue elements will be central to the final economics.
EPCG also estimates an internal rate of return of 30.44%, with net present value of approximately €196.2 million. The payback period is estimated at slightly above three years. These projections are described as requiring close validation of production forecasts, tariff assumptions, operating costs, customer-credit performance, and construction schedules.
Financing structure and risk review
EPCG has already invested approximately €18.9 million from its own resources. Part of the proposed financing would enable the company to recover previously deployed capital and improve liquidity. Under the Solari 5000+ programme, participating customers are expected to cover around 90% of investment costs, reducing EPCG’s effective long-term burden.
An independent risk analysis concluded that the investments should generate sufficient cash flow to service the debt, including under less favourable scenarios. The Ministry of Finance recommended stronger risk management, investment planning, and liquidity controls given the scale of EPCG’s wider capital programme.
Role of ministries in approving the loan
The Ministry of Energy and Mining supported the proposal, describing the projects as strategically important for domestic production, supply security, and reduced import dependence. The financing structure would provide EPCG additional capacity without an explicit sovereign guarantee. Lenders will still need to assess factors including project documentation quality, procurement control, connection readiness, and production monitoring.
