EPCG restarts battery storage tender with a smaller pilot after two failed rounds

Montenegro’s push to add battery energy storage is entering a more cautious phase, after the country’s state-owned utility Elektroprivreda Crne Gore (EPCG) restarted procurement for BESS following two unsuccessful rounds. The relaunch highlights both the growing need to stabilise a grid increasingly stressed by distributed renewables and the execution hurdles that have limited momentum in the market.

Third tender targets a pilot system

EPCG has issued its latest call as a scaled-down, pilot-stage approach. The tender is valued at around €120,000 and seeks a relatively small battery system with 100–130 kW of power output and 200–260 kWh of storage capacity. Bids are due by mid-May.

Earlier plans ran into financing and demand gaps

The new procurement marks a sharp departure from EPCG’s original ambition. In 2025, the first tender aimed for two large-scale battery systems of 30 MW each, with 120 MWh capacity per unit—amounting to 240 MWh total storage and an investment envelope of approximately €58.8 million. That project was cancelled after the government withheld approval for debt financing.

A second tender followed at a much smaller scale, valued at €75,000, but it also failed—attracting no bids. The lack of participation underscored weak market appetite under the initial structure for pilot-scale deployments.

Why batteries matter as solar expands

While the procurement details have changed, the underlying drivers have not. Montenegro’s power system is shifting toward distributed renewable generation, particularly solar, following the rollout of prosumer programmes such as Solari 3000+ and related schemes. This transition has introduced operational stresses on distribution networks that were originally designed for one-directional power flows.

Battery storage is increasingly viewed as a tool to manage these dynamics. By storing surplus electricity during periods of high renewable output and releasing it during peak demand, BESS can help stabilise voltage levels, reduce balancing costs and limit reliance on imports during high-price periods.

Investors face financing bottlenecks; EPCG is de-risking

EPCG also appears to be leaning on an improving economic rationale: storage supports arbitrage between low-price and high-price periods and can provide flexibility in a market where renewable penetration is rising alongside price volatility.

Still, repeated tender failures point to structural constraints. Financing remains a key bottleneck—especially for larger storage assets that require substantial upfront capital and clear regulatory pathways for revenue. At the same time, limited bidder participation suggests that contract design, risk allocation or project scale has not yet matched supplier expectations.

The move toward a smaller pilot indicates EPCG’s intent to test battery integration before scaling up investment. By validating technical performance and operational integration on reduced terms, the utility aims to de-risk future decisions while building practical experience integrating storage into its network.

In a broader regional context across South-East Europe, Montenegro’s experience reflects an uneven pattern: while battery storage is widely recognised as strategically important for renewable expansion and system balancing needs, actual deployment continues to be constrained by financing frameworks, regulatory uncertainty and market design challenges. EPCG’s third tender therefore functions as more than another procurement attempt—it is an early-stage effort to bridge policy ambition with operational reality in the country’s transition toward a more flexible power system.