Renewable energy

State of compliance

 

  • National Renewable Energy Action Plan

    National Renewable Energy Action Plan (NREAP) and progress towards 33% RES target in 2020

    Montenegro adopted and submitted to the Secretariat the National Renewable Energy Action Plan required by Directive 2009/28/EC. The NREAP foresees reaching a voluntary 36% of energy from renewable sources in gross final energy consumption in 2020, beyond the 33% binding target.

    The latest energy statistical data provided by EUROSTAT revealed that Montenegro has reached a 40% share of energy from renewable sources in 2017. This achievement is mostly due to the revision of biomass data and reduction of energy consumption of the largest electricity customer, the aluminium plant KAP. By the end of 2018, Montenegro reached only 754 MW of renewable energy capacities compared with the projections of 892 MW in the NREAP. Since 2009, only 72 MW in wind and 24 MW in small hydropower plants were newly added.

    The third progress report on the promotion of energy from renewable sources, due by the end of 2018, has yet to be submitted to the Secretariat.

  • Quality of the support schemes

    Quality of the support schemes

    The Energy Law adopted in 2015 is currently being amended to fulfil, among others, all the requirements of Directive 2009/28/EC and Guidelines on State Aid for Environmental Protection and Energy 2014 - 2020 introducing market-based support schemes for renewable energy. The adoption of the Law, expected by the end of 2018, is delayed. Secondary legislation introducing rules for auctions for granting support to renewable energy producers remains to be adopted in order to ensure compliance with Guidelines on State Aid for Environmental Protection and Energy 2014 - 2020.

    Due to already having exceeding the 2020 renewable energy target, the Ministry launched in July 2018 an auction for 200 MW solar PV without support, to be built on state-owned land. The consortium of the Montenegrin power utility EPCG and Fortum, a Finnish utility, was declared as the winner of the proposal to build a solar PV plant in Briska Gora on a surface of more than 660 hectares of public land. The awarding criterion was the price offered for the concession of the land. The cost of connection to the transmission network is to be borne by the transmission system operator.

    The support to other renewable energy producers is based on a decree setting feed-in tariffs for privileged producers generating electricity from renewable energy sources and high-efficiency cogeneration adopted in 2015. Power purchase agreements (PPAs) on feed-in tariffs are signed between the market operator and the privileged producers for 12 years. At the beginning of each year, the Government adopts a decree with the revised incentive fee applied to end-customers to compensate the cost of the promotion of electricity from renewable sources. For 2019, the incentive was set at a value of 0,9439 c€/kWh, doubling the 2018 value. The market operator, COTEE, concludes PPAs with electricity suppliers who are obliged to purchase a certain percentage of electricity from renewable sources.


    Cooperation mechanisms

    The provisions related to cooperation mechanisms have been transposed in the 2015 Energy Law. As Montenegro has already achieved the mandatory renewable energy target according to EUROSTAT data, it can benefit from entering into cooperation mechanisms with EU Member States or other Contracting Parties to statistically transfer renewable energy to count to another country’s target.

  • Integration to the grids

    Integration to the grids

    The Energy Law provides for priority access and priority dispatch for the privileged renewable energy producers. However, the requirements related to access to and operation of the grids as well as rules for connection to the grids for renewable energy producers provided for in Article 16 of Directive 2009/28/EC are still not entirely implemented. Due to lack of transmission and distribution capacities, applications for connection to the grid are on hold. This is deterring investors. The transparency of network operators towards investors and new users has to increase. A clear, predictable and transparent connection timetable has to be provided to applicants.

    According to the Energy Law, the costs associated with grid reinforcements have to be borne by the grid operators, however, this is not the case in practice. Developers are required to bear the cost of connection including grid reinforcement, if applicable, and then transfer the assets to transmission or distribution network operators in exchange for compensation paid over maximum 20 annual instalments. The system operators have to develop plans and foster investments in the grids in order to accommodate and integrate more renewable energy in the system.

    Self-consumption of electricity from renewable energy sources acknowledged in the legislation is not implemented yet.

  • Administrative procedures

    Administrative procedures

    No significant progress has been made in the last reporting period. The administrative procedures for permitting, construction and licensing remain quite lengthy and burdensome despite several simplification rounds. The number of procedures for issuing the construction permits and licenses in the Ministry of Sustainable Development and Tourism were reduced from 36 to two. However, there are several procedures involving different authorities resulting in an uncoordinated and non-transparent process, despite the authorisation and permitting procedures being clearly defined by law. A one-stop shop is envisaged only for small projects and only in relation to the technical specifications and building and deployment permits.


    Guarantees of origin

    The 2011 Government Decree on Guarantees of Origin that constitutes the framework for the issue, transfer and cancellation of guarantees of origin needs to be revised in order to comply with the 2015 Energy Law. In its capacity as the issuing body for the guarantees of origin, the energy regulator should develop the standard template and the entire system for issuing, transfer and cancellation of the guarantees of origin in compliance with European practice and therefore increase compliance with respect to the implementation of Article 15 of Directive 2009/28/EC.


    Renewable energy in heating and cooling

    The existing regulation on the use of energy from renewable sources in heating and cooling should be adjusted to the country’s new Energy Efficiency Law. While several programmes for increasing the use of solar thermal and biomass are already operational and producing results, Montenegro must adopt support measures for promotion of the use of energy from renewable sources in heating and cooling in order to fully comply with the Renewable Energy Directive. Launched in February 2019, the new Renewable District Energy in the Western Balkans (ReDEWeB) Programme will provide technical support to Montenegro in order to improve support measures for renewables-based district heating and implementation of pilot projects in the Northern region of Montenegro.

  • Renewable energy in transport

    Renewable energy in transport

    Montenegro is the only Contracting Party making actual progress with regards to the transposition of Articles 17 to 21 of Directive 2009/28/EC related to sustainability of biofuels and bioliquids. Three secondary acts were adopted by the Government in June 2018:

    • the Decree on the Obligatory Share of Biofuels in the Transport Sector,
    • the Decree on Closer Sustainability Criteria for Biofuels and Bioliquids for Achieving the Required Share of Energy in Total Final Energy Consumption, and
    • the Rulebook on Quality and Manner of Control of Biofuels.

    However, the sustainability criteria and the related verification system are still not in place. Thus, the actual share of renewables in the transport sector of 1,1%, which is far from the trajectory set up by the NREAP, cannot be counted towards the target due to the lack of verified sustainability criteria.