Over the past year, Montenegro has adopted two reform laws – on energy and on renewable energy sources – and scheduled its first auctions for market premiums. Admir Šahmanović, Minister of Energy and Mining, told Balkan Green Energy News that the new regulations fully align the sector with the European Union acquis, sending a clear signal to investors that Montenegro now has a stable regulatory framework and market-based prices that safeguard citizens’ interests. Becoming part of the European energy space, he added, is not only a political goal but also the path Montenegro should follow to ensure cleaner and more secure energy for future generations.

Admir Šahmanović served as Minister of Mining, Oil and Gas in the government of Prime Minister Milojko Spajić. In February this year, he became the coordinator of the Ministry of Energy, and since April, he has served as Montenegro’s Minister of Energy and Mining. In an interview with Balkan Green Energy News, Šahmanović discusses his plans to mobilize larger investments, Montenegro’s timeframe for coupling its electricity market with Italy and the EU, the ministry’s steps to prepare the country for the EU’s carbon border tax, and plans for investments in the natural gas sector.

What are the key innovations introduced by Montenegro’s law on renewable energy sources?

The law on renewable energy sources introduced, for the first time, a clear, competitive and fully transparent support mechanism for green energy production – an auction scheme.

Over the past months, we have worked hard to ensure the law really takes hold. We have prepared about 15 by-laws that enabled us to launch the first auctions. I believe this is one of the most important contributions of the new law, as it sends a clear message to investors that Montenegro has a stable framework and market-based prices that safeguard citizens’ interests.

In this way, we are laying a solid foundation for a rapid energy transition, which is both our strategic choice and our responsibility to future generations.

Montenegro has also adopted a new law on energy. What does this regulation bring?

The Law on Energy is our umbrella regulation, providing a framework that fully aligns the sector with the EU acquis. It introduces stricter standards, greater protection of end consumers, better competition, and stronger institutional oversight.

It also opens Montenegro’s energy sector to the European market and creates a stable, predictable environment. This is important not only for investors but also for all consumers, as people are ultimately the ones affected by any change in the system.

You stated that these reforms set a clear strategic path for Montenegro, which sees its energy future within the European market. What will this future bring to Montenegro, its economy, and its citizens?

Our ambition is to make Montenegro a country with clean energy and a stable system. Being part of the European energy space ensures greater security of supply, lower costs in the long term, and a strong inflow of investments. Our economy will have access to a larger market, and our citizens will benefit from safe, sustainable, and environmentally friendly energy.

It is not just a political goal – it is a path I want us to follow in our development, so that we leave our children a country with cleaner and more secure energy.

Admir Šahmanović visiting northern Montenegro with EPCG Director Ivan Bulatović

Applications have been invited for Montenegro’s first auctions for market premiums. What benefits do you expect from auctions?

The auction mechanism allows us to select the most favorable and serious investors through a fair and competitive process. Projects are implemented without budget subsidies and with minimal risk to the state.

We expect auctions to ensure new capacities, create jobs, improve the use of our natural resources, and strengthen overall energy stability. These are the benefits citizens will feel, both on their electricity bills and through new opportunities that will open up in local communities.

Investor interest in wind and solar is strong, with requests to build power plants totaling around 5.5 GW. When do you expect these projects to be realized?

Such strong interest is the best proof that the reforms are yielding results. We expect the first large projects to be online in 2026, with significant capacities ready by 2030. Transparent procedures, good cooperation with local communities, and improved grid infrastructure will be key to making these investments a reality.

What are the main obstacles to these projects? How to remove them?

The biggest challenges are administrative procedures, transmission network limitations, and spatial planning documents. We are working to address them through interdepartmental cooperation, digitalization of processes, and the state’s commitment.

We are strengthening capacities, speeding up permitting, and modernizing regulations. I want to ensure that investors coming to Montenegro know they can work in a clear, predictable, and fair environment.

Admir Šahmanović at the ministerial panel at Belgrade Energy Forum 2025 in May

Preparations are underway to link Montenegro’s electricity market with the EU via Italy, with 2027 featuring as the target year.

Yes, we are working diligently on institutional and market integration. This involves harmonizing the rules, passing the remaining by-laws, and preparing the market operator. With the support of the EU and the Energy Community, I am confident that 2027 will remain the year when we will fully open our market to Europe.

All countries in the region are facing CBAM. How prepared is Montenegro?

CBAM will change the rules for electricity exports to the EU, bringing new costs as well as opportunities. We are aware that it will be a financial burden on our economy, but that is precisely why we view it as an additional incentive to accelerate the implementation of renewable energy projects and increase our own production of green electricity.

We are working on adjusting the regulatory framework, harmonizing economic activities, and ensuring the largest possible share of clean energy to remain competitive and maintain full access to the European market while reducing emissions.

Montenegro also has ambitious plans in the natural gas sector – a gas pipeline, a terminal for liquefied natural gas (LNG), and gas-fired power plants. How far along are these projects?

I see gas as a development opportunity – to ensure greater security of supply, diversification, and new opportunities for the economy. But I also believe that such strategic projects must be developed through dialogue with local communities, with full respect for their views.

We are currently preparing and developing the Ionian Adriatic Pipeline (IAP) project and assessing the potential for an LNG terminal. We are doing this responsibly, one step at a time, and in line with the EU’s energy transition goals.