ASP: Private companies that mainly manage small hydropower and wind farms have been paid around 95 million euros in subsidized fees

Around 95 million euros, excluding value added tax (VAT), is the amount of subsidized compensation that was paid for about a decade, that is, until August last year, to private companies that mainly manage small hydroelectric power plants (SHPs) and wind power plants (WPs).

As announced by the Action for Social Justice (ASP), these are data from the Montenegrin Electricity Market Operator submitted to ASP based on the Law on Free Access to Information, and ASP considers them reliable only if they are submitted as such.

"Subsidies have been paid since 2014, when the first private small hydropower plant went into operation, and are paid according to legal and non-legal regulations established since the time of the governments of the Democratic Party of Socialists (DPS) and its allies. The general assessment among the public is that these regulations were harmful to consumers, and very privileged for known and unknown tycoons and investors. This business is mainly run by companies and individuals close to the top of the DPS, as well as relatives of that party's top, while the ownership of the Krnovo and Možura wind farms is foreign. The Možura project is under the heavy shadow of corruption, and the business of generating electricity from small hydropower plants and wind farms in Montenegro has become one of the exemplary examples of the functioning of a 'captured' state," the ASP statement states.

The non-governmental organization (NGO) added that in 2014, when the first small hydropower plant was put into operation, the amount of subsidies paid was 80 thousand, and that it increased significantly in the following years.

"In 2015, subsidies were 624 thousand, a year later 2,3 million, in 2017 they reached 4,5 million, and in 2018 they amounted to 13,2 million. In 2019 they were 14,9 million, in 2020 19,2 million, and in 2021 over 21 million. During 2022, since the huge jump in electricity prices was recorded on the European market, the subsidies shown are over six million, in the following year they are 5,7 million, and last year until August around 7,5 million," the ASP statement reads.

The NGO said that the business scheme for these energy facilities included the granting of concessions for electricity production for a period of 27 to 30 years, and that the concessionaire was entitled to subsidies in the first 12 years, which were predominantly paid by consumers through electricity bills, or a portion was allocated from the state treasury.

"According to official data, 33 small hydropower plants were built under the incentive scheme, and eight are now not in that scheme, but on the market. They were built mainly in the north, where locals have been saying for years that small hydropower plants have destroyed their rivers. In addition to electricity from small hydropower plants, subsidies are currently being paid for two large wind farms, Možura and Krnovo, as well as several solar power plants. The largest amount of subsidies has been allocated precisely for the two wind farms, because they produce the most electricity," the statement reads.

ASP said that last August, "the Law on Renewable Energy Sources was passed, which retains incentives for the production of electricity from renewable sources, and since mid-2022, based on a controversial legal solution, in one of the first moves of the then minority government, dozens of urban planning and technical conditions have been issued for the construction of large wind farms and large solar power plants."

"The projected installed capacity of future wind and solar power plants, which are planned to 'pave' millions and millions of square meters of land, is almost three times greater than the current installed capacity of all energy facilities for electricity production in the country. The data shows that a significant part of the companies or persons associated with that DPS plan to continue their business in the energy sector, but now through the construction of huge electricity production capacities," ASP said.