Montenegro is launching a programme to establish renewable energy auctions that is expected to attract private investments in the sector, the European Bank for Reconstruction and Development (EBRD) said.
The EBRD is helping the Montenegrin capital investments ministry implement the programme with technical assistance, financed by grants from the EBRD, the Austrian federal ministry of finance, and Italy, the international lender said in a press release on Monday.
The programme will support the Montenegrin authorities in drafting renewable energy legislation, which will be followed by assistance in the design and implementation of a competitive bidding process to award market-based support for renewable electricity generators, the EBRD noted.
Montenegro generates most of its electricity at the Pljevlja lignite-fired thermal power plant and the Perucica and Piva hydropower plants. Competitive procurement processes for renewables will allow the country to increase its share of solar and wind projects and decrease its reliance on coal, the EBRD said.
In addition to environmental benefits, boosting investments in renewables could potentially help the country diversify its economy, which currently relies heavily on tourism. The existing underwater electricity cable that connects Montenegro with Italy, as well as other interconnections with neighbouring countries, could help position the country as clean energy exporter, the EBRD added.
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