Electricity is expensive, and there is little investment in the network

CGES and CEDIS explain that significant investments are missing mostly due to public procurement procedures, problems with expropriation and lack of planning documentation
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current, Photo: Shutterstock
current, Photo: Shutterstock
Disclaimer: The translations are mostly done through AI translator and might not be 100% accurate.
Ažurirano: 07.08.2018. 15:48h

Significant investments in the development and improvement of the electric power network were also absent last year, even though the electricity bill is one of the biggest expenses for citizens, and the price of a kilowatt is one of the biggest in Europe if purchasing power is taken into account.

The reports of the Montenegrin Electric Transmission System (CGES) and the Montenegrin Electric Distribution System (CEDIS) on the realization of investments for 2017 show that these companies invested significantly less last year than they had planned, and they justify this by the delay in public procurement procedures, problems with expropriation, tenders. ..

The CGES report stated that the planned value of investments for 2017 was 40.251.000 euros, and 21.586.000 euros were realized. The CEDIS report states that the planned investments are 4.225.775 euros, and 1.401.798 euros have been realized. For the secondary network, the CEDIS plan was to invest 4.107.158 euros, but only 542.312 euros were invested.

The coordinator of the MANS Research Center, Ines Mrdović, states that for years energy companies have been implementing an investment policy to the detriment of consumers, who pay too much for electricity compared to the quality of the service, and this was made possible by the Government and the Energy Regulatory Agency (RAE).

"RAE opened up space for electricity bills to grow, thanks to which energy companies in the earlier period accumulated millions in bank accounts, while at the same time there were no significant investments in the electricity network. We are constantly hearing unfounded excuses for delaying investments due to unprepared projects, lack of planning documentation, and lengthy tender procedures. These are all empty excuses," said Mrdović to "Vijesta".

She stated that in eight years, CEDIS invested about 50 million euros in the development of the distribution network, which is a minor 6,2 million per year (not counting about 70 million for the installation of so-called smart meters, which is the only serious investment).

"We recently witnessed the Government's announcement that the state of the distribution network is desperate and that 81 million euros will be invested in its revitalization over the next three years. We have not heard from which sources the money for that investment will be provided," said Mrdović. He adds that the situation with investments is no better at CGES, for which MANS has repeatedly emphasized that serious investments in the transmission network are absent.

"For all these years, we have not witnessed that the question of anyone's responsibility was ever raised due to the destructive investment policy of energy companies, and until that happens, consumers will continue to pay for such actions," Mrdović said.

She added that while the Italian A2A was managing EPCG, the government was silent and allowed the money to be kept in banks, instead of being invested, and now suddenly remembered that it should be invested, and that when the money from the energy company's account will be significantly "melted". , due to the problematic purchase of the Coal Mine and the announced payments of the until recently "strategic partner".

CGES explained to "Vijesti" that in the previous year, the implementation of the Investment Plan was weaker due to various circumstances, mainly related to large investment projects.

"About eight million euros were planned for the projects whose financing was provided by a grant provided by the EU, which, due to complex financing procedures, could not be realized during 2017. Minor deviations in the planned dynamics do not have a negative effect on the operations of CGES. For some projects, the conditions have not been met to be started due to the delay in the implementation of the public procurement procedure", CGES stated.

They also add that problems with expropriation and securing land for construction are a serious problem. Among the important projects whose implementation is delayed, CGES mentions the construction of the 110/35kV transformer station (TS) "Luštica" worth 22 million euros, for which the planning documents are delayed. Also, the construction of the transmission line TS 110/10 kV "Podgorica 4" worth two million euros is delayed due to problems with expropriation. For the transmission line Virpazar - Ulcinj, worth seven million euros, the tender procedure was published twice and canceled due to incorrect bids and complaints from bidders, and now a third tender is being prepared.

From CEDIS, they say that the limitations that affect the planned dynamics of investments concern, first of all, the provision of extensive documentation, especially in areas that are not covered by planning documents, the resolution of property-legal relations, decision-making on environmental impact assessment, the speed of implementation of complicated tender procedures...

CEDIS plans investments of 2021 million by 76

At the beginning of this month, RAE approved the updated CEDIS investment plan for the period 2019-2021. in the part that refers to investments with a total value of 76,1 million euros. It is estimated that the approved investments will make it possible to improve the voltage conditions, increase the reliability and security of the power supply and reduce losses. It is stated that the level of losses from 2008 to 2017 was reduced from 22,97% to 14,96%. CEDIS stated that due to the long settlement of property-legal relations on private land, the late reconstruction of the 35kV transmission line from the 110/35kV substation "Virpazar" to the 35/10kV substation "Buljarica". Also, the reconstruction of the 35kV transmission line "Šumani-Kosanica" and "Guke-Mataruge" is delayed, due to the need to change the spatial planning documentation. The total value of these two investment projects is about 420 thousand euros. The construction of the 35kV transmission line "Andrijevica-Gusinje", with a total value of about 1,5 million euros, is delayed due to the lack of spatial planning documentation and digital cadastral records.

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