On 23 August 2024, issue 82 of the Official Gazette carried two acts with consecutive register numbers. Number 1257 was a new Law on the Use of Energy from Renewable Sources. Number 1258 was a one-article amendment to the Concessions Act which added, to the energy item on the list of what can be a concession, the words except the production of electricity from renewable sources.
One statute took a sector out. The other set out where it went. They were published on the same day, in the same issue, one after the other.
Anyone still planning a Montenegrin renewables project as a concession file is planning the wrong procedure — and most of the English-language material describing Montenegro's renewables regime predates that day.
Sources, checked on 20 September 2026: Zakon o korišćenju energije iz obnovljivih izvora, "Sl. list CG" 82/2024 of 23 August 2024, registarski broj 1257, shown as in force — Articles 10, 12, 13, 14, 15, 16, 17, 18, 19, 24, 25, 26 and 29 to 34, read from the Katalog propisa consolidation. Zakon o izmjenama i dopunama of the same act, "Sl. list CG" 119/2026 of 11 August 2026, registarski broj 2149, read from the Gazette's own page images; it amends Articles 7, 8, 11, 14, 18, 19, 20, 21, 22, 23, 30, 32, 34, 39, 40, 41, 43, 51, 52, 58, 60, 75, 107 and 109, and does not touch Articles 12, 13, 15, 16, 17, 24 or 25. Zakon o dopuni Zakona o koncesijama, "Sl. list CG" 82/2024, registarski broj 1258. This page states Montenegrin law; it is not technical or commercial advice on a project.
What the support system actually is
Article 12 states the frame: support is awarded in an open, transparent, competitive, non-discriminatory and economical procedure, to integrate renewable electricity into the market on a market principle. A privileged producer may hold only one support system for the same capacity, and a market premium may be awarded for the whole plant or for part of its capacity — where it is part, the supported electricity is the percentage of capacity that entered the quota multiplied by the electricity delivered in the accounting period.
Then the sentence that reorders a project timetable:
Support may be obtained for a plant for which, before submitting the application to participate in the auction, the investor has filed a construction notification or obtained a building permit under the construction legislation.
You do not bid and then build. You reach the construction gate first, and then you bid. The permitting chain that has to be completed before that point is set out in the building permit process, and Article 10 of this Act adds its own permitting procedure for project realisation on top.
Which technologies qualify, and the two exclusions
Article 16 lists nine sources: solar, wind, hydro, geothermal, biomass, landfill gas, wave and sea energy, gas from wastewater treatment plants, and biogas.
Two limits sit in the same article and decide whole business plans:
- hydropower qualifies only where installed capacity does not exceed 10 MW;
- pumped-storage hydro has no right to support at all.
Article 16 also lets the Ministry run technology-specific auctions where supporting all technologies would not give an optimal result, judged against the long-term potential of new and innovative technology, the need for diversification, integration costs, grid and system-stability constraints, and — for biomass — the need to avoid disturbing the raw materials market.
The quota and the three-year plan
Article 15 puts the volume in the Government's hands. The Government adopts a three-year support plan, based on general energy policy guidelines, the National Energy and Climate Plan and obligations under ratified treaties, and that plan sets:
- quotas for renewable energy projects;
- the technologies qualified for support;
- the schedule of auctions for the market premium;
- separate quotas for a feed-in tariff for small plants and demonstration projects, the acceptable technologies and the schedule for allocating those quotas;
- quotas for projects to be realised by renewable energy communities.
So two instruments, not one: the market premium by auction, and a feed-in tariff confined by Article 24 to small plants and demonstration projects — the market premium cannot be obtained for those, and they cannot bid for it.
The transitional period, and what changes at its end
Article 13 does not set a date. The market premium system applies after a transitional period which ends when the Montenegrin day-ahead electricity market couples with the single European day-ahead market — or with another market, provided annual trade across the interconnector with that coupled non-EU market is at least 1 TWh.
During that period, Article 14(1) gives the privileged producer the right to have its electricity taken off by the authorised contracting party at the price achieved at the auction. Article 14(2), as rewritten by the 2026 amendment, states the consequence of the transition ending: that right ceases, and the producer sells on the market and takes the premium under the market premium contract.
That is a genuine financing variable. Until coupling happens, the revenue line is an offtake at a known price. After it, the revenue line is market price plus premium — with the correction in the next section.
| During the transitional period | After it ends | |
|---|---|---|
| Who takes the electricity | authorised contracting party | the market |
| Price | the price achieved at auction | market price plus market premium |
| Basis | Article 14(1) | Article 14(2), as amended in 2026 |
The premium runs both ways
Article 24(2) is the provision that most summaries omit.
Where, in an accounting period, the reference market price is higher than the price achieved at auction, privileged producers are obliged to pay the difference to the authorised contracting party — a negative market premium — for the electricity produced, in accordance with the market premium contract.
The instrument is symmetrical. It is not a floor with unlimited upside; it is a two-way settlement around the auction price. Any model that treats high-price years as pure upside is modelling a different contract.
Article 25 sets the other end: the Government determines the maximum price a bidder may offer, and may set it differently by technology and plant type, on eight criteria — investment costs, operating costs, discount rate, plant lifetime, capacity factor, the duration of the support period, planned annual output, and the expected purchase price on the reference exchange.
Article 26 allows compensation for energy a privileged producer could have produced and made available but was prevented from delivering because of delivery constraints imposed by the system operator — curtailment risk has a statutory answer rather than only a contractual one.
How long the support lasts — and why the answer is now per auction
Article 18 originally ran the support period for up to 12 years from the entry into force of the decision granting privileged-producer status.
The 2026 amendment changed both halves. The period now runs up to 12 years from the day the decision granting that status under Article 43 becomes final, and a new paragraph adds:
The length of the support period is determined in the tender documentation for each auction separately, and applies to all privileged-producer statuses acquired by participants in that auction.
So twelve years is a ceiling, not a term. The actual term is an auction parameter, fixed before bidding and identical for everyone who wins in that round. Reading the tender documentation is therefore not a formality — it is where the tenor of the revenue stream is set.
The stabilisation clause
Article 17 is short and unusually strong, and it was not touched by the 2026 amendment.
A temporary privileged producer or a privileged producer has the right to support under this Act and the regulations made under it as they stood at the time the right was acquired. The conditions under which that right was acquired, where they were predictable and stable, cannot subsequently be changed in a way that reduces or limits acquired rights or threatens the economic benefit of the installations receiving support.
There is one exception, and it is narrow: support measures may be changed later in accordance with objective criteria, provided those criteria were established in the support system in force at the moment the right was acquired. In other words, a variability that was written into the scheme at the outset is permitted; a variability introduced afterwards is not.
For a fifteen-year investment horizon in a small jurisdiction, a statutory stabilisation clause of that shape is worth more than most incentives.
The two auction routes
Articles 29 to 34 split auctions for the market premium in two.
Undetermined locations. The Ministry launches the procedure by public call, followed by a qualification procedure for the bidders. The site is the bidder's problem, which is why the Article 12 construction gate bites hardest here.
Predetermined locations. The state identifies the site, and the procedure runs through a pre-qualification stage and then a qualification stage, with the decision on the most favourable bid taken by the Ministry. An auction commission with an odd number of members conducts the procedure.
The distinction matters commercially: on a predetermined location the land question is framed by the state; on an undetermined one, land, grid and permits are all the bidder's risk before a bid may even be lodged.
What this means if you were planning a concession
Three consequences.
- The Concessions Act route is closed for renewable electricity. The carve-out in Article 6(1) of that Act is express. What remains inside the concession regime, after four amendments, is set out in what can be a concession in Montenegro.
- A conventional energy facility on state-property natural resources is still a concession. The carve-out is drafted by reference to renewable sources, not by reference to electricity generally.
- Your permitting sequence comes first, your bid second. Article 12's construction condition is a precondition of participation, not a post-award obligation.
Where the counterparty or the site is held through a company, the diligence side is covered in share deal diligence; for the contract and delay side of a build, see contractor risk, fixed price and delay.
What this page does not decide
Whether a particular site is grid-connectable, what the current three-year plan's quotas and auction schedule are, and what maximum price the Government has set for your technology are all live facts that change and must be read from the instruments in force at the time you bid. Nor does this page cover the guarantees of origin regime, the renewable energy communities chapter, or the self-consumption rules for a customer-producer. The dispute clause in any contract with the state is governed by general law, treated in the Foreign Investments Act.
Who we act for
We act for one side and we name it at the start — the developer, the incoming investor, or a party challenging an award. Fees are fixed and published, and a first consultation is charged and credited against the engagement if it proceeds.
Before the auction application goes in
Send the project's permitting position — construction notification or building permit — the site's title and grid documentation, and the tender documentation for the round you are considering. We come back with a written note: whether Article 12's precondition is satisfied on your facts, what support period that tender documentation actually sets under the amended Article 18, how the negative premium in Article 24(2) will behave against your price assumptions, and what Article 17 will and will not protect.
