Apart from everlasting rhetoric, the Government of Montenegro has not denied any of the information published in the text of MANS Investigation Center concerning the projection of electricity prices by 2040, according to which the price of electricity will increase fourfold, or 376 percent, in order that the construction of the Unit II of the thermal power plant would be cost-effective.
MANS’s analysis is relies entirely on projections of electricity prices shown in the feasibility study on construction of the Unit II of the thermal power plant, based on which the Government proposed the implementation of the project. The study was made by the financial consulting firm Deloitte from Belgrade for the needs of Elektroprivreda Crne Gore (EPCG). Deloitte cites forecasts on wholesale price of electricity in Montenegro, which were made by another consulting firm, Poyry, again for the needs of EPCG.
The study clearly states that „Poyry Management Consulting is hired to examine the electricity market in Montenegro and prepare its projections concerning the electricity wholesale prices“, so Poyry did its task during April and May 2016.
“The forecast covers the period until 2040. It is significant to mention that all the forecasts provided by Poyry are realistic, exclusive of inflation”, says Deloitte, adding that the prices are further adjusted for the inflation rate of two percent.
Out of the three Poyry’s scenarios – high, central and low electricity price, Deloitte chose the central, according to which the wholesale electricity price starts at €38 per megawatt in 2016 and reaches €97 per megawatt in 2040. When Deloitte adjusted the prices with the inflation rate of two percent, it determined that the price of electricity in 2040 would be €143 per megawatt, which is almost fourfold increase compared to the current price.
The Government now argues that the Poyry’s projections concerning the wholesale electricity prices do not apply to Montenegro, or even to the European market, but to the global market. However, it is not mentioned how it is possible that the wholesale prices of electricity are higher in Montenegro than those projected for such markets as German or British, where the projected prices are €83 and €73 per megawatt respectively.
Moreover, the Government argues that the Deloitte’s study, which MANS acquired from unofficial sources and which has been published in the meanwhile on the Government’s website, is not final, and the final study will be ready in few days. This is a matter of great concern, especially when having in mind the fact that the Government has already submitted to the Parliament the draft law on confirming the protocol with the Czech Republic, which represents the institutional framework for implementation of the Unit II project.
Therefore, the Government requires the Parliament to vote for the protocol in advance, despite the fact that not only the project financing model has not been agreed yet with Skoda Praha, the company selected as the most favorable bidder for the Unit II construction, but the adopted study is declared as preliminary and not final.
Apparently, the approach that the Government has taken with regard to the construction of the Unit II of the thermal power plant in Pljevlja, which it presents as a strategic project, is unacceptable. Until now, the Government has not revealed any information that would undeniably show that the project is cost-effective, or that it will not do more harm than good.
MANS
