Only three entrants have participated in Montenegro’s public invitation to lease land owned by the state at Briska Gora, in Ulcinj municipality, for the construction of a 200 MW solar project, issued in early May.
According to the country’s Ministry of Economy, the bidders are a consortium formed by Finnish utility Fortum and local state-owned power provider EPGC; the Malta-based International Renewable Energy Development Limited (IREDL) – itself a JV between Chinese multinational power company and electrical equipment manufacturer Shanghai Electric Power and Malta’s Enemalta Corp utility; and local consortium Montesolar.
“The management of our company, upon the invitation of Fortum, recognized this project as a financially and strategically well positioned opportunity for future development with significant energy potential,” said EPGC in a statement.
According to the Montenegrin utility, the project will be built in several phases, with 50 MW deployed within 18 months from the date of signing the lease agreement and the remaining 150 MW installed within the following 18 months.
The Montenegrin government said the land will be leased for 30 years and the initial – minimum – price of the annual lease will be €0.05/m2 ($0.058). A total 6,621,121m² will be leased for the project, ensuring the government can bank on a minimum return of around €331,000.
The solar plant in the southernmost and sunniest part of the country will sell power to the local grid under a long-term PPA.
The vast majority of Montenegro’s electrical power demand is currently met by the 225 MW Pljevlja thermal power plant in the north of Montenegro, and two large hydropower plants at Perućica (307 MW) and Piva (363 MW). The country, however, utilizes only a small percentage of its hydro potential.
EPCG, meanwhile, has announced a €170 million plan to increase its installed capacity over the next five years. The plan includes, among other things, €40m in funds for the reconstruction of Pljevlja plant and the development of wind power, the company said.