EPCG and Japan’s PowerX have signed a memorandum of understanding setting an indicative target of about 500 MWh of battery energy storage systems over an initial three-year period. In Montenegro, the opportunity is to coordinate storage with EPCG’s hydro resources, expanding solar generation and cross-border trading, rather than rely on batteries earning returns through standalone arbitrage. The target is material for the country’s relatively small power system.
Planned solar growth adds weather-dependent generation
Montenegro’s 2026 energy balance envisaged roughly 198 GWh of planned solar generation. Planning expected solar capacity to reach around 215 MW as prosumer and utility projects expand. This growth will add weather-dependent output to a power portfolio that also includes flexible hydro resources owned by EPCG.
Reservoir hydro can shift large volumes of energy over longer periods, although hydropower operations are constrained by hydrology and water management. Batteries would provide a short-duration layer, responding within seconds to absorb brief solar surpluses and support intraday trading without changing water releases. Coordinating battery operations with hydro could preserve reservoir value for periods when longer-duration flexibility is more useful.
Storage can support trading and portfolio flexibility
A battery could charge when Montenegro has surplus power or imported electricity is cheap, then discharge to meet domestic demand or during regional scarcity. Montenegro trades across a power system connected to Serbia, Bosnia and Herzegovina, Albania and the Italy link, creating opportunities to coordinate storage alongside cross-border flows. This flexibility could help EPCG reduce imbalances in a portfolio combining solar generation and hydro inflows.
The commercial model should assess storage across the entire portfolio, rather than treat it as an isolated profit centre. The relevant measure is the incremental value to EPCG across hydro, solar, imports, exports and its position in balancing markets. System-level benefits could support a stronger investment case than day-ahead arbitrage alone.