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Hydroelectric Plant Perucica

The hydroelectric power plant “Perućica" has been in operation since 1960 and is the oldest and largest plant in Montenegro.
It is located in the municipality of Niksic, on the northern plains of Bjelopavlici. Other smaller hydroelectric plants are present however, in the municipalities of Danilovgrad, Podgorica, Cetinje and Savnik.
The installed capacity is 307 MW, with an annual power production of approx. 1,300 GWh. For the production of electricity, the "“Perućica” " plant is fed by the catchment area of the Gornja Zeta River, whose waters flow in the fields of Niksic and having a favourable decline in the short distance that separates the Niksic field from the plains of Bjelopavlici. It is a very capacious reservoir with a flow equal to 353 h/m³, while the catchment basin of the "“Perućica” " plant is 850 km².

The engine room of the "“Perućica” " plant consists of seven "Pelton" turbine generators with property horizontal flow rate of 307MW, five units with an installed capacity of 40 MVA and two of 65 MVA. The installation of an eighth generator of 65 MVA is planned.

The average annual production of the Perucica plant was approximately 860 GWh over the last ten years. Annual production in 2016 amounted to 939 GWh.

Hydroelectric plant Piva

At the hydroelectric power plant "Piva" there is one of the most impressive concrete arch dams in the world. Its main activity consists of the production of electricity in peak mode, as it can be started quickly and can be synchronised to the main grid at 220 kV. The "Piva" plant is located in the mountain range to the northwest of Montenegro. Given the specific topography of the land, the plants were installed downstream.
The hydroelectric power plant "Piva", opened in 1976, serves the power grid of the Republic of Serbia operating under the system of electricity exchange in accordance with the Agreement on long term technical-corporate cooperation of 25 year duration that came into force in 1991.

The average annual production of the Piva plant was approximately 753 GWh over the last ten years. In 2016, the annual production reached approximately 792 GWh.

In 2004, Phase 1 of the project of reconstruction and modernisation of equipment at the "Piva" plant was set on foot with funds partly from the European Investment Bank and partly by EPCG. To date the work has almost been entirely completed.
In early March 2008 Phase 2 of the project of reconstruction and modernisation of equipment and plant was launched at the "Piva" plant, in order to reconstruct and modernise the facilities, equipment and hydropower plant, to obtain a higher performance in terms of safety and reliability of the plants as well as an increase in the total energy production.

Thermoelectric power plant in Pljevlja

The thermoelectric power plant "Pljevlja" started its activity in 1982; it is the first condensation electricity production plant in Montenegro and contains two units of 210 MW.
It uses coal as fuel coming from "Pljevlja" and has guaranteed calorific power equal to 9211 kj/kg (220 kcal/kg).

It was built at a height of 760m, and has a stack of 250 m high that allows the elimination of emissions to 1000 m above sea level.

The power plant uses cooling water from the "Otilovici" basin, which has a capacity of 18 million m³, located on the banks of the river Cehotina and is about 8 km from the plant which is connected by a paved road. The dam has a concrete arch and is 59m high.

From 2006 until 31st December 2016, the Pljevlja power plant produced approximately 33.2 TWh of electricity. In particular, in 2016 annual production amounted to approximately 1.2 TWh.

In 2009 and in 2010 major projects were launched as regards its environmental and technological stabilisation, including:

  • The replacement of the electric filtration system;
  • The replacement of the management and control systems:
  • The replacement of the auxiliary consumption systems of 6 and 0.4 kV;
  • Replacement of the generator stress system and installation of the generator switch.

For Montenegro, whose production depends mainly on the electrical power plant "Pljevlja", this is the main system and has the most significant impact on the load charts.
After the reconstruction of the turbines in 2009, the production of power from the plant has reached 218.5 MW. In addition to the reconstruction of the turbines and boiler, the modernisation activities have created the conditions necessary to raise production to 225 MW. The various initiatives planned include action that will enable the plant to reduce significantly its environmental impact.

Acquisition agreement of the shareholding in EPCG by A2A

Questions and Answers Back

The answers to some commonly asked questions on the operation of A2A in Montenegro.

The offer price was determined on the basis of the assessment carried out by the advisor Mediobanca and also taking into account the capital value of EPCG, below which the Government of Montenegro would not have sold the quota especially if you consider that a part of the privatisation was carried out through an increase in capital.

On 29 August 2016, A2A SpA and the State of Montenegro signed the new Shareholders' Agreements for the management of the Montenegrin company EPCG; the agreement ended on 31 December 2016 and was renewed until 30 June 2017.
The main points of these new agreement were: i) the maintenance of the A2A management rights in EPCG, with main executives appointed by A2A, ii) the necessary sharing of decisions, between A2A and the Montenegrin government, on some "confidential matters" particularly important for EPCG, iii) the possibility of exercising a put option - valid until 1 July 2017- on the entire shareholding held in EPCG by A2A towards the State of Montenegro, upon expiry of the shareholder's agreement.

Up until and including 30 June 2017, A2A SpA had close contacts with the Government of Montenegro, in order to define a renewal of the agreement, but they did not find a consensual solution.

Therefore, on 3 July 2017, A2A SpA, having noted the impossibility of further extending the Shareholders' Agreements, exercised its put option. The put option involves the transfer of the entire shareholding held in EPCG by A2A, which is equal to 41.75% of the EPCG's total share capital, at the price, already agreed upon between the parties, of Euro 250 million. The transfer will take place in seven equal annual tranches, starting in May 2018.  The number of shares fully owned by A2A - which will maintain their associated rights (to vote, to dividends) - will therefore decrease progressively until the transfer of the seventh tranche currently scheduled for 2024.

However, with a press release dated 17 April 2018, A2A announced that it completed the negotiation of an agreement with the Government of Montenegro for the put option exercised on 3 July 2017 to be actually implemented in 4 tranches between 1 May 2018 and 31 July 2019. Such an agreement would therefore lead to acceleration in the exercise of the put option compared to the timing set forth in the Shareholders' Agreement dated 29 August 2016 (i.e. 7 tranches between 1 May 2018 to 1 May 2024).
Finalisation of the agreement is subject to prior approval from the Parliament of Montenegro. Should such approval not be granted by 30 April 2018, the Shareholders' Agreement shall apply, with consequent execution of the first tranche of the put option (transfer of ownership of 1/7 of the shareholding against payment € 35.712 million approx.) starting on 01.05.2018.

As of 31/12/2017, investment in EPCG was booked at € 224 million in the A2A's separate financial statements.

Following the BoD decision of 1 July 2017 to exercise the put option on the entire shareholding in EPCG, the investment was reclassified as "non-current assets held for sale" in accordance with IFRS 5.

EPCG is the only distributor and the key player in Montenegro electricity generation. Since about ¾ of the installed capacity consists of hydroelectric plants, actual production heavily depends on weather conditions.

EPCG plants produced a total of 3 TWh in 2016 (an increase of 4.5% compared to 2015), of which 1.2 TWh came from thermoelectric sources and 1.8 TWh from hydroelectric sources.

The domestic demand for electricity in Montenegro currently stands at 3.5 TWh.

The financial results of EPCG in the last 7 years are as follows:


 Year  2010  2011  2012  2013  2014  2015 2016
 Revenues  298  265  266  278  240  242 233
 EBITA   62  -3  18  80  66  53 69
 Profit  17  -67  -6  25  31  22 40