Domestic energy production in Montenegro is mostly conducted by the Pljevlja lignite power plant and Perućica and Piva hydropower plants. The country’s dependence on imported energy has fluctuated over the years, although efforts are made to meet the demand solely by relying on state-owned sources. Plans to build a second lignite unit in Pljevlja were made, however, due to environmental concerns, predictions of economic insufficiency, and widespread public outcry the project was announced to be disbanded in 2019, opting to modernize the existing unit instead. The hydropower plants have also faced criticism, posing a threat to habitats of endemic fish and birds. 

A decrease in energy imports was observed until 2020, however, after the lockdown restrictions have been lifted, the economic growth in Montenegro has caused an increase in energy demands, driving imports back up. 

Being a Balkan state, Montenegro has been facing significant issues related to the scarcity of energy sources since 2022. Although the country is not a member of the European Union, it has adopted the same set of sanctions as most of the EU following the start of the war in Ukraine.  This resulted in a shock to the economy, although, in an attempt to salvage the livelihoods of Montenegrin citizens, Elektroprivreda Crne Gore (EPCG), the state-owned energy company, which is responsible for Pljevlja, Perućica, and Piva power plants, did not raise electricity prices in the first half of 2022. This action allowed to mitigate the negative effects of the energy crisis, but this decision came with significant costs to the state. This process has upheld the importance of self-sufficiency in terms of energy production, providing more incentives for development than ever before. 

As of 2023, the effects of the restrictions, although partially mitigated, are still present in the country. Several directions for improvement are possible:

• So far, Montenegro has made little use of its potential for solar power generation. This would be a beneficial route to take, since this source of energy is eco-friendly, and won’t pose such a significant threat to the country’s valued nature as coal and hydropower plants.

• Increased reliance on wind energy could also be a solution, as this source is already used to some extent, and has proven to yield sufficient results. This option is also better for the environment than the current most popular methods of energy production. 

To conclude, Montenegro’s energy sector is in need of modifications, as the demand for energy increases. Efforts should be made to rely on more domestic sources, with these sources having less negative impact on the environment.