AFD approved a loan to Montenegro's electricity transmission system (CGES) for supporting modernization of the power grid and energy transition

The French Development Agency (AFD) and Montenegro's Electricity Transmission System (CGES), the operator of the electricity transmission system in Montenegro, signed a loan agreement today worth 25 million euros with a state guarantee, for the modernization of strategic substations Perućica and Pljevlja 2 and supporting the country's energy transition. The loan agreement was signed by Ivan Asanović, CEO of CGES, and Arnaud Dauphin, Director of the AFD Regional Office for the Western Balkans, while the guarantee agreement was signed by Minister of Finance Mr. Novica Vuković and Arnaud Dauphin. This financing represents AFD's first investment in Montenegro's energy sector and demonstrates the shared commitment of France and Montenegro to accelerate the country's energy transition and strengthen the resilience of the power grid. Reconstruction of the Perućica substation will enable the integration of up to 350 MW of hydroelectric capacity into the transmission network, while the modernization of the Pljevlja 2 substation will strengthen connections with the Transbalkan network and support Montenegro's gradual shift from coal-based electricity production to more sustainable sources. "Modernizing key energy infrastructure will strengthen the resilience of the transmission network, enable greater integration of renewable energy sources, and contribute to further alignment with European energy standards," said Admir Šahmanović, Minister of Energy and Mining. He emphasized that Montenegro has begun an energy investment cycle that can no longer be stopped. Arnaud Dauphin, Director of the AFD Regional Office for the Western Balkans, highlighted that this operation reflects AFD's broader commitment to supporting Montenegro on its path toward EU membership through financing, technical expertise, and long-term partnerships in key sectors such as energy.