Podgorica, (MINA-BUSINESS) – According to representatives of the Government and the management of Elektroprivreda (EPCG), the company’s loan arrangements reflect responsible corporate management rather than covering losses or irresponsible borrowing, while the opposition warns of rising debt, declining profitability, and politically motivated employment practices.

State Secretary at the Ministry of Energy and Mining Dino Tutundzic said that EPCG’s loan arrangements are aimed at managing the company and investments that should ensure Montenegro’s long-term energy stability.

At a meeting of the Parliamentary Committee for Economy, Finance and Budget, where a hearing was held regarding EPCG’s operations in the context of the announced €70 million loan, he explained that the first part of the planned arrangement, amounting to €30 million, is related to refinancing the company’s existing short-term liabilities.

“Last year was one of the most challenging periods for EPCG in the last several decades. Due to the environmental reconstruction of the Thermal Power Plant (TPP), which was out of operation for almost nine months, the company had to secure missing quantities of electricity on the market while at the same time preserving the stability of the power system,” Tutundzic said.

According to him, the second part of the planned borrowing pertains to financing one of the most important energy development projects — the construction of the eighth unit of the Perucica Hydropower Plant, worth around €40 million.

Chairman of EPCG’s Board of Directors Milutin Djukanovic claimed that international financial institutions and commercial banks have confidence in EPCG.

“Salary expenses last year accounted for 5.4 percent of total costs,” Djukanovic specified.

He also recalled projects completed by EPCG, stating that the company had developed 150 megawatts (MW) of new energy sources.

Member of Parliament Nikola Milovic of the Democratic Party of Socialists (DPS) said that until 2020 the energy sector had been one of the strongest promoters of European standards. 

“After 2020, we have seen rising debt, declining profitability, the previous financial year ending with €92 million in debt, negative audit reports, party-based employment, and a serious deterioration of the entire system,” Milovic said.