Electricity trading in South-East Europe is no longer defined by short-term arbitrage alone. The region’s leading market participants—MET Group, Axpo, EFT (Energy Financing Team), GEN-I, HSE and PPC Trading—are steadily repositioning themselves as hybrid operators, combining trading desks with control over physical assets, transmission access and structured contracts. This shift is not incremental. It reflects a structural recognition that in a grid defined by persistent constraints and price divergence, the most durable margins sit closer to infrastructure than to pure market timing.
The traditional arbitrage model remains visible across the region’s key corridors. On the Serbia–Hungary border, annual traded volumes exceed 8–10 TWh, with ATC allocations typically ranging between 600 and 1,000 MW against nominal capacity of 1,200–1,500 MW. Price spreads average €5–15/MWh in normal conditions and can expand to €40–60/MWh during winter stress or gas-driven volatility. Traders historically monetised these spreads through day-ahead and intraday positioning, supported by capacity acquired via yearly and monthly auctions.
What has changed is the scale and structure of participation. MET Group, with reported annual electricity trading volumes above 140 TWh across Europe, has expanded its presence in South-East Europe through both trading desks and asset-backed strategies, including renewable portfolios and storage investments. Axpo, trading over 300 TWh annually, has followed a similar path, combining market operations with long-term capacity positioning and structured PPA portfolios. EFT, originating from the Balkans, remains one of the most active regional players, handling 10–15 TWh annually in SEE markets, with deep exposure to cross-border flows involving Serbia, Bosnia and Montenegro.
Capacity rights have become a cornerstone of these strategies. Annual auctions on key interconnections, particularly Serbia–Hungary, Bulgaria–Greece and Romania–Hungary, clear at prices that reflect expected congestion rents. On the Serbia–Hungary corridor, yearly capacity prices can imply forward spreads of €8–20/MWh, effectively locking in a portion of arbitrage value. Traders acquiring these rights are not merely securing transport capacity; they are building portfolios of congestion exposure that resemble infrastructure assets in both duration and predictability.
The Bulgaria–Greece corridor illustrates the scale of this monetisation. With physical capacity of 1,200–1,500 MW and typical ATC of 700–1,200 MW, annual flows exceed 10 TWh, driven by Greek demand and LNG-linked pricing. Congestion revenues on this border have reached €150–200 million annually, making it one of the most valuable trading interfaces in Europe. Firms such as PPC Trading, Axpo and MET actively position across this corridor, combining capacity rights with generation and balancing strategies to capture both spatial and temporal spreads.
The move into storage represents a deeper level of infrastructure integration. Battery projects across the region are now being developed not only by utilities but also by trader-backed platforms. In Greece, where more than 1 GW of battery capacity is under development or tendered, several projects involve participation from trading houses seeking to capture intraday spreads of €30–80/MWh. A typical 200 MWh battery system, costing €80–120 million, can generate annual revenues of €15–35 million through arbitrage and ancillary services, depending on volatility conditions. These returns translate into equity IRRs of 12–18%, aligning closely with infrastructure investment benchmarks.
In Serbia, the market is earlier in its development but moving in the same direction. Pilot projects combining 50–100 MW solar plants with 100–200 MWh storage are being structured with active involvement from traders such as GEN-I and EFT, who provide optimisation services and market access. The financial logic is consistent: storage converts volatile spreads into bankable cash flows, reducing reliance on pure merchant exposure.
Long-term contracts are another area where traders are expanding their role. Industrial PPAs, particularly those linked to export-oriented sectors, are increasingly structured with trader participation. In Serbia and Romania, contracts with industrial consumers in steel, aluminium and chemicals sectors are being negotiated at €65–85/MWh, with premiums of €5–10/MWh above merchant-adjusted prices reflecting carbon compliance requirements. Traders act as intermediaries, aggregating supply from renewable projects and delivering structured products to offtakers. In some cases, they assume partial price risk, effectively providing a hedge while retaining upside exposure.
The integration of trading and generation is becoming more explicit. MET Group, for example, has built a renewable portfolio exceeding 1.5 GW across Europe, including assets in Central and Eastern Europe, allowing it to combine physical supply with market optimisation. Axpo operates a similar model, with investments in wind and solar alongside one of Europe’s largest trading operations. In South-East Europe, this approach is increasingly visible in smaller-scale but strategically positioned assets, particularly those located near key interconnections.
The Montenegro–Italy HVDC link, with capacity of 600 MW and annual flows of 4–5 TWh, has become a focal point for this integration. Traders active in the region position across Italian and Balkan markets to capture spreads of €20–50/MWh, using the cable as a controllable arbitrage channel. Annual congestion revenues of €70–150 million are effectively distributed among system operators and market participants who can access the capacity. Control over access—whether through long-term rights or contractual arrangements—provides a significant competitive advantage.
Platforms such as Electricity.Trade increasingly track these flows, providing visibility into capacity allocation, price spreads and congestion patterns. For traders, this data is not only a tool for short-term decision-making but a foundation for strategic positioning. Identifying persistent bottlenecks allows firms to target investments in capacity rights, storage or generation that align with structural market features.
Financially, the shift towards infrastructure-linked strategies is altering risk profiles. Pure trading margins, while potentially high, are volatile and dependent on continuous repositioning. Infrastructure-backed revenues—whether from capacity rights, storage or long-term contracts—offer more stable cash flows. The combination creates hybrid portfolios where predictable income supports base returns, while trading activity provides upside. For investors, this model is increasingly attractive, particularly in a region where traditional infrastructure assets are limited.
Partnerships between traders and financial investors are beginning to emerge. Private equity and infrastructure funds, seeking exposure to energy markets, are collaborating with trading houses that bring operational expertise and market access. These partnerships are particularly relevant for storage projects, where capital requirements of €80–150 million per asset align with institutional investment thresholds, and revenue models depend on sophisticated optimisation strategies.
Regulatory developments are shaping the pace of this transformation. The expansion of market coupling, including the integration of Greece and Bulgaria into broader European frameworks, is expected to reduce some cross-border spreads. However, the increase in renewable penetration is simultaneously creating new forms of volatility, particularly within intraday markets. Traders are adapting by shifting focus from purely spatial arbitrage to a combination of spatial and temporal strategies, supported by physical assets.
For developers, the presence of trader-backed infrastructure creates additional routes to market. Instead of relying solely on utilities or bilateral PPAs, projects can be structured with trader participation, combining contracted revenue with active optimisation. This approach is particularly relevant in constrained nodes, where storage and flexible operation can unlock value that would otherwise be lost to curtailment.
The evolution of trading in South-East Europe reflects a broader convergence of roles within the energy sector. Traders are no longer external participants reacting to market conditions; they are becoming embedded within the system, influencing flows, shaping prices and capturing value through control of assets. Infrastructure, once the domain of regulated utilities, is increasingly part of the competitive landscape.
The underlying driver remains the structure of the grid. As long as transmission capacity is uneven and renewable generation introduces variability, opportunities for arbitrage and optimisation will persist. The difference is that these opportunities are now being secured through ownership and control, rather than accessed opportunistically. In this environment, the distinction between trading and infrastructure is less relevant than the ability to position within the system.
For market participants across South-East Europe, the implications are clear. Success will depend not only on understanding price movements but on securing access to the assets and pathways that generate them. The transition is already underway, and those who adapt their strategies accordingly are redefining the economics of the regional power market.