A proposed 400 kV interconnection between Montenegro and Bosnia and Herzegovina is emerging as one of the more consequential Western Balkan transmission investments of the next decade. The Brezna–Sarajevo corridor is designed to strengthen a part of the regional grid where hydropower, new renewable development, ageing 220 kV infrastructure and access to the Italian electricity market increasingly intersect.
The project, nominated in the 2026 Projects of Energy Community Interest (PECI) process, would connect the planned 400/110/35 kV Brezna substation in Montenegro with the Sarajevo 20 substation in Bosnia and Herzegovina. It also includes a new 400/220 kV Piva’s Mountain substation, creating a stronger connection around the existing Piva hydropower complex and transmission routes between northern Montenegro and eastern Bosnia and Herzegovina.
The promoters are CGES, Montenegro’s transmission system operator, and NOSBiH/Elektroprijenos BiH, working with the relevant energy authorities. The latest preliminary project documentation indicates commissioning around 2032, with stated CAPEX of approximately €70 million in Montenegro and €6.7 million in Bosnia and Herzegovina, giving an initial combined investment envelope of approximately €76.7 million.
The configuration is intended to be developed in two phases. The first would cover construction of the Piva’s Mountain substation, a new 400 kV overhead line towards the Buk Bijela area in Bosnia and Herzegovina, use of the existing high-capacity continuation towards Sarajevo 20 and a stronger connection between the Piva hydropower plant and the new substation. The second phase would extend the 400 kV line from Brezna to Piva’s Mountain.
This structure allows the grid to be reinforced incrementally rather than waiting for the complete corridor to be finished. It also creates interfaces with several other regional projects, including the proposed Gacko–Brezna 400 kV line, the Bajina Bašta–Višegrad–Pljevlja Trans-Balkan Corridor and the rehabilitation of the existing Trebinje–Perućica–Podgorica–Vau Dejës 220 kV route.
Taken together, these investments could reshape electricity flows among Serbia, Bosnia and Herzegovina, Montenegro and Albania. They would also strengthen the inland network feeding Montenegro’s submarine electricity connection with Italy.
The existing Montenegro–Italy HVDC link gave the Western Balkans a direct physical route into one of Europe’s larger and historically higher-priced electricity markets. Its initial operational pole provides approximately 600 MW of capacity. However, the commercial value of the cable depends heavily on the strength of the networks behind it. A submarine interconnector cannot continuously absorb wider Balkan exports when congestion, voltage limitations or security constraints restrict flows inside Montenegro and neighbouring systems.
Brezna–Sarajevo is therefore not simply a bilateral transmission line. It could become part of a wider transmission spine linking hydropower and renewable production in Bosnia and Herzegovina, Montenegro and Serbia with demand and trading opportunities in Italy. This broader function helps explain why ENTSO-E identifies the Bosnia–Montenegro border as an area where additional capacity could reduce congestion and support renewable integration.
The regional investment plan estimates that a more fully optimised 2040 grid could reduce the marginal-cost difference across the Italy–Montenegro interface by approximately €20–30/MWh. The calculation reflects a package of grid reinforcements rather than the Brezna project alone, but it indicates the scale of economic value currently constrained by transmission bottlenecks.
The same analysis suggests that an optimised Continental Southeast European grid could reduce renewable-energy surplus by approximately 5 TWh, avoid around 10 million tonnes of CO₂ and lower regional electricity costs by roughly €7/MWh. These are system-level benefits that do not automatically translate into revenue for an individual TSO. The financing structure must therefore convert part of that regional value into regulated cost recovery, cross-border cost allocation or grant support.
The original €76.7 million CAPEX estimate should be treated carefully. It is a promoter-level planning figure rather than a final bankable budget. A 400 kV corridor through mountainous terrain can face substantial costs related to geotechnical conditions, access roads, foundations, conductors, substations, land acquisition and environmental mitigation. Inflation in transformers, switchgear and other high-voltage equipment has also increased the cost of European transmission projects.
A more conservative development envelope could reach €90 million–€120 million once detailed surveys, contingencies, owner’s costs, environmental mitigation, compensation, financing costs and schedule risks are included. The final figure will depend heavily on the length of new line sections, the extent to which existing corridors can be reused and the technical scope of the Piva’s Mountain substation.
The split between Montenegro and Bosnia and Herzegovina is another bankability issue. Montenegro carries the majority of the stated investment, while regional benefits extend well beyond its domestic consumers. Without grant funding or cross-border cost allocation, CGES customers could bear a disproportionate share of an asset that also supports Bosnia and Herzegovina, Serbia, Albania and electricity trading with Italy.
PECI status can improve access to technical assistance, regulatory coordination and financing through EU and Energy Community channels. It can also support applications for funding through the Western Balkans Investment Framework, EBRD or EIB. The designation, however, does not remove the requirement for a robust cost-benefit analysis, environmental assessment or enforceable agreements between the project promoters.
The environmental and social process will be central. The corridor crosses mountainous areas with potentially sensitive habitats, forests, water resources and local communities. Civil-society concerns around the Brezna area have already entered the PECI consultation process. These concerns cannot be treated as a communications issue to be addressed only after route selection.
Early routing should examine biodiversity, bird and bat interactions, protected areas, landscape impacts, cultural heritage, forestry, erosion and cumulative impacts from connected hydropower, renewable and transmission projects. Alternatives analysis must demonstrate that the selected route balances system need with environmental and social effects.
Land acquisition could become the critical path. Overhead transmission lines affect long corridors containing numerous parcels and rights holders. The legal right to construct towers and maintain conductors does not eliminate compensation disputes or local resistance. A credible schedule requires cadastral verification, access planning, stakeholder engagement and grievance management before the EPC contractor mobilises.
The planned 2032 commissioning date leaves a nominal six-year development and construction window. That is reasonable for a cross-border 400 kV investment, but it contains little room for institutional delay. Intergovernmental agreements, regulatory approvals, environmental permits, spatial plans, expropriation, financing, procurement and cross-border technical coordination must advance in parallel.
A 12–18-month delay would increase interest during construction, extend exposure to equipment inflation and postpone congestion benefits. For regulated TSOs, the effect differs from that faced by a merchant renewable project: equity returns may be protected through the regulatory asset base, but timing mismatches can still pressure cash flow, debt drawdowns and tariff recovery.
Technical design must account for the region’s long-standing voltage-management challenges. Long 400 kV lines can generate reactive power during lightly loaded periods and may require shunt reactors or other compensation equipment. The Balkan system already experiences significant seasonal and hourly flow changes driven by hydrology, tourism demand, thermal availability and exports towards Italy.
The 2024 regional blackout demonstrated how rapidly voltage deterioration can spread across several systems when operators lack complete visibility and corrective measures. Brezna–Sarajevo can strengthen system security, but it will also change regional power-flow patterns. The project therefore requires coordinated dynamic, voltage-stability and contingency studies covering the wider network rather than only the two terminal substations.
Protection settings, telecommunications, SCADA, synchrophasor measurements and operational procedures should be designed as one regional system from the outset. CGES and NOSBiH will need aligned data exchange, outage coordination and emergency controls, supported by the relevant Regional Coordination Centres.
The renewable connection benefit must also be translated into transparent transmission capacity. Developers in eastern Herzegovina and western or northern Montenegro will want to know whether the new corridor creates firm connection capacity, reduces curtailment or simply accommodates transit flows already expected elsewhere. Connection studies should distinguish between thermal limits, voltage constraints, stability limits and N-1 security requirements.
Wind and solar will affect the corridor differently. New solar capacity can create concentrated midday exports followed by steep evening reversals. Wind output is less synchronised with the solar profile and generally has a higher capacity factor, giving it different transmission and system value. Hydropower around Piva can provide controllable output and balancing, although reservoir and environmental constraints limit its availability.
The most valuable configuration is therefore not maximum renewable export in every hour. It is the coordinated use of wind, solar, hydropower, storage and cross-border capacity to reduce curtailment and serve the highest-value market periods. The line’s commercial benefit increases when generators can participate in coupled day-ahead, intraday and balancing markets rather than relying solely on explicit border capacity.
Brezna–Sarajevo sits at the point where transmission planning, renewable investment and Western Balkan market integration converge. Its relatively modest stated CAPEX could unlock a much larger portfolio of generation and cross-border trading opportunities, but only if environmental permitting, cost allocation and operational integration are treated with the same seriousness as the overhead line itself.
