Electricity trading in South-East Europe has expanded significantly over the past decade as regional power exchanges matured and cross-border market integration improved. However, despite these developments, the liquidity of South-East European electricity markets still remains noticeably lower than that of Western and Central European exchanges. The trading data observed in early 2026 highlights both the progress that regional exchanges have achieved and the structural limitations that continue to shape electricity trading behaviour across the Balkans.
Power exchanges provide the infrastructure through which electricity is traded transparently in day-ahead and intraday markets. Liquidity on these exchanges is measured primarily by the volume of electricity traded and the number of market participants actively buying and selling electricity. High liquidity allows electricity prices to reflect market conditions accurately because many buyers and sellers compete within the auction process. Low liquidity, by contrast, can lead to greater price volatility because individual trades may exert a larger influence on market outcomes.
The electricity exchanges operating in South-East Europe have gradually expanded their trading volumes as more market participants migrate from bilateral contracts toward exchange-based trading. The Croatian power exchange represents one of the most established markets in the region. Trading activity during February 2026 reached approximately 905,983.6 MWh, demonstrating that significant volumes of electricity now pass through the exchange platform. Within this total, the day-ahead market accounted for around 673,794.7 MWh, while the intraday market contributed approximately 232,188.9 MWh of electricity trading. These figures illustrate that the Croatian exchange has developed a meaningful level of activity across both forward scheduling and real-time balancing markets.
Nevertheless, the comparison with previous years reveals that trading volumes remain sensitive to broader market conditions. Electricity traded on the Croatian exchange during February 2026 was approximately 15.4 percent lower than the same month one year earlier, suggesting that market participants continue to rely heavily on bilateral contracts and long-term power purchase agreements. These arrangements remain common throughout the Balkans, particularly among large utilities that dominate electricity generation and distribution in many countries. As long as a substantial share of electricity continues to be traded outside exchange platforms, liquidity within power exchanges will remain limited relative to the total size of regional electricity markets.
The Serbian power exchange provides another example of the evolving structure of electricity trading in the region. Day-ahead market activity on the Serbian exchange reached approximately 414,520.1 MWh in February 2026, equivalent to an average daily trading volume of roughly 14,804.3 MWh. Although this represents a moderate increase of about 2.4 percent compared with the previous month, the longer-term comparison again reveals the volatility of regional trading activity. Electricity volumes traded on the Serbian exchange during February 2026 were approximately 12.4 percent lower than the same period in the previous year, highlighting the continued importance of bilateral trading arrangements within the Serbian electricity market.
Price dynamics within these exchanges further illustrate the structure of regional electricity trading. The average day-ahead base price on the Croatian exchange during February 2026 reached approximately €107.49 per megawatt-hour, while peak-hour prices averaged around €113.69 per megawatt-hour. Intraday trading prices averaged approximately €104.68 per megawatt-hour during the same period. These levels were significantly lower than the prices observed in the previous month, reflecting seasonal demand patterns and fluctuations in renewable generation across the region.
A similar trend was visible in the Serbian electricity market. The average base price on the Serbian day-ahead market during February 2026 fell to approximately €68.61 per megawatt-hour, while peak prices averaged roughly €74.05 per megawatt-hour. These values represented a substantial decline compared with January price levels, with the base price falling by approximately 41.9 percent and the peak price declining by around 45.7 percent month-on-month. Such large fluctuations illustrate how electricity markets in the region remain sensitive to seasonal variations in demand, hydrological conditions affecting hydroelectric generation, and fluctuations in cross-border electricity flows.
The relatively modest trading volumes observed in South-East European exchanges reflect the broader structure of the regional electricity sector. Many electricity markets in the Balkans remain dominated by state-owned utilities that control both generation and retail supply. These companies frequently rely on internal trading arrangements or long-term bilateral contracts rather than participating actively in exchange-based markets. As a result, a significant portion of electricity generation never reaches the public exchange platforms where transparent price discovery occurs.
Transmission infrastructure also plays an important role in shaping electricity trading liquidity. Limited interconnection capacity between certain markets can restrict cross-border trading opportunities, reducing the number of potential market participants able to access a particular exchange. When electricity flows cannot move freely across borders due to transmission constraints, traders may be less inclined to participate in neighbouring markets because the ability to arbitrage price differences becomes more limited. Improving cross-border transmission capacity is therefore an essential step toward increasing liquidity in regional electricity exchanges.
Despite these structural limitations, the gradual integration of European electricity markets is beginning to strengthen the role of exchanges across South-East Europe. Market coupling initiatives have connected several regional exchanges with larger European trading platforms, enabling electricity to flow automatically toward markets with higher prices. These arrangements improve the efficiency of electricity allocation across interconnected systems while also encouraging greater participation in exchange-based trading.
The participation of international trading companies has also increased in recent years as regional markets become more accessible. Global energy trading firms often bring significant liquidity to electricity exchanges because they operate across multiple markets simultaneously. By linking price signals from Western Europe with opportunities in South-East European markets, these traders help integrate regional electricity systems more closely into the broader European trading network.
Intraday trading represents another area of growth within regional exchanges. As renewable generation expands across Europe, electricity supply has become more volatile due to the intermittent nature of solar and wind power. Intraday markets allow traders to adjust positions closer to real time in response to changes in renewable generation forecasts. The increasing share of intraday trading observed in several South-East European exchanges reflects this broader structural transformation within electricity markets.
For example, the Croatian exchange recorded approximately 232,188.9 MWh of intraday electricity trading during February 2026, demonstrating that market participants are increasingly using real-time trading mechanisms to manage fluctuations in supply and demand. Although intraday volumes remain smaller than day-ahead trading volumes, their importance is expected to grow as renewable generation expands across the region.
The evolution of electricity trading in South-East Europe must therefore be understood within the context of broader European energy market integration. Regional exchanges may currently exhibit lower liquidity than their Western European counterparts, but they are gradually becoming more sophisticated as market participants adapt to changing regulatory frameworks and evolving generation portfolios. The continued expansion of renewable generation, improvements in cross-border transmission infrastructure, and the growing participation of international trading firms are all likely to strengthen liquidity within regional electricity exchanges over time.
The electricity trading data observed in 2026 therefore reflects a transitional phase in the development of South-East European power markets. Exchanges such as those operating in Croatia and Serbia are no longer marginal trading venues but increasingly important platforms for price discovery and electricity allocation. While liquidity remains lower than in more mature European markets, the steady expansion of trading volumes suggests that regional exchanges are gradually assuming a more central role in electricity trading.
As electricity markets across Europe continue to integrate, the depth and liquidity of South-East European exchanges will likely increase further. Greater transparency in electricity pricing, improved transmission connections between countries, and the continued expansion of renewable generation will all contribute to the growth of exchange-based trading. Over time, these developments may allow regional electricity markets to converge more closely with the highly liquid exchanges operating in Western and Central Europe, creating a more unified and efficient European electricity trading system.