Power markets across South-East Europe moved sharply higher on 31 March, with day-ahead prices posting one of the strongest coordinated gains in recent weeks as tightening system fundamentals, stronger demand and rising gas input costs pushed the region back into a firm pricing regime.
Day-ahead baseload prices climbed across all major exchanges, with Serbia’s SEEPEX clearing at €157.8/MWh, up €51.8 day-on-day, marking the most pronounced increase in the region. Hungary’s HUPX rose to €148.4/MWh (+€9.7), while Romania and Bulgaria converged at ~€141.2/MWh, each gaining between €6–8/MWh. Greece reached €133.8/MWh (+€15.8), while Albania surged to the regional high at €188.1/MWh (+€45.8). Montenegro remained the lowest-priced market at €119.9/MWh, although still recording a significant daily increase of €18.2/MWh
The price rally reflects a synchronized tightening across the SEE system rather than isolated national dynamics, with market coupling effects and cross-border flows increasingly shaping price formation.
System fundamentals point to a clear shift in balance. Regional consumption climbed to 35.7 GW, increasing by +584 MW day-on-day, while net imports rose to 2,009 MW (+408 MW), indicating a growing reliance on external supply. Core inflows from Central Europe, particularly from Austria and Slovakia, reached 4,133 MW, underlining the role of northern markets in stabilizing SEE demand
The generation mix highlights the underlying cost pressure. Gas-fired output increased by +558 MW, reinforcing its role as the marginal price-setting technology, while hydro output rose by +670 MW, offering partial relief but insufficient to offset broader tightening. Solar generation expanded by +459 MW, yet remained structurally unable to suppress evening peak prices. Coal output declined by -521 MW, reflecting both economic and structural displacement amid high carbon costs
Intraday price profiles show pronounced evening peaks, with hourly prices exceeding €230–270/MWh, while minimum levels remained elevated above €100/MWh, signaling a system under sustained stress rather than transient volatility. This widening intra-day spread continues to reinforce the value of flexible generation and storage assets.
On the cross-border front, flows confirm a tightening regional dependency on imports. The SEE region remained structurally short, with strong inflows from Central Europe anchoring prices. At the same time, the Hungary–Germany spread narrowed sharply to €30.6/MWh, collapsing by around €50/MWh day-on-day, suggesting rapid price convergence with core European markets
This compression of spreads reduces arbitrage headroom and indicates that SEE markets are increasingly integrated into broader continental pricing dynamics. However, such rapid convergence phases are typically followed by renewed volatility, particularly if underlying fundamentals diverge again.
Fuel markets continue to reinforce the bullish tone in power. Austrian CEGH gas traded around €56.9/MWh, posting a modest increase, while EU carbon allowances maintained an upward trajectory. Coal prices remained under pressure, but the combination of gas and carbon costs continues to define the marginal cost stack across the region
Forward curves, however, point to a more nuanced outlook. Week-ahead power contracts showed declines of -10% in Hungary and nearly -20% in Germany, while gas forwards also softened by 6–8%, indicating that the current spot strength may not fully translate into sustained forward pricing. This divergence suggests a market structure characterized by short-term tightness but expectations of easing conditions in the coming months
Structural developments are also beginning to reshape trading dynamics. Serbia’s SEEPEX exchange confirmed the introduction of negative pricing from May 2026, with a day-ahead floor of -€500/MWhand intraday limits extending to -€9,999/MWh. The move aligns Serbia with European market standards and is expected to significantly increase price volatility, particularly during periods of high renewable output
For market participants, this transition introduces a new layer of complexity in risk management and trading strategy. Negative pricing regimes typically amplify the value of flexibility, favoring assets capable of rapid response, including battery storage and demand-side management.
In the near term, the market remains driven by a combination of demand recovery, limited baseload flexibility and elevated marginal costs linked to gas. While hydro conditions have improved, they remain insufficient to materially ease system pressure, and renewable output continues to exhibit variability that reinforces intraday volatility.
The interplay between tightening spot fundamentals and softer forward expectations defines the current market phase. Prices are increasingly shaped by real-time system stress rather than long-term scarcity signals, creating a trading environment characterized by sharp daily movements, narrowing spreads and heightened sensitivity to weather and cross-border flows.
As the region moves toward deeper integration with European markets and prepares for structural shifts such as negative pricing, SEE power markets are entering a more complex and dynamic phase, where volatility, flexibility and cross-border positioning will play a central role in price formation.