Serbia has emerged as the key short-term stress market in Southeast Europe’s electricity sector after a sharp increase in day-ahead prices during Week 27, driven by rising import dependence and weaker domestic thermal generation.
Average day-ahead power prices in Serbia climbed to EUR 139.93/MWh during the week of 29 June–5 July, marking a 26.3% week-on-week increase. While Serbia remained below Romania, Hungary and Croatia in absolute price terms, it traded above Greece and Bulgaria, highlighting growing tightness in its domestic market.
The strengthening price trend was reinforced by a significant shift in cross-border electricity flows. Serbia moved from a marginal net import position of 7 GWh in Week 26 to 90 GWh in Week 27, reflecting a much greater reliance on imported electricity and increased exposure to regional supply conditions and wholesale price movements.
Domestic supply conditions also deteriorated during the week. According to the report, thermal generation declined sharply due to the absence of lignite-fired output. As lignite remains a key source of baseload generation in Serbia, lower production reduced domestic supply and increased the country’s dependence on imported electricity, particularly during periods of higher demand.
Serbia’s market position is especially important because it sits within the Romania–Hungary–Croatia high-price corridor. During the same week, Romania recorded average day-ahead prices of EUR 164.31/MWh, Hungary averaged EUR 162.04/MWh, while Croatia reached EUR 142.57/MWh. Rising Serbian import requirements therefore coincided with elevated prices across neighbouring markets, limiting access to lower-cost electricity.
For market participants, the main question is whether Serbia’s thermal generation recovers in the coming weeks. A return of lignite-fired output would likely reduce import dependence and ease upward pressure on wholesale prices. However, if thermal availability remains constrained, Serbia is likely to continue acting as one of the region’s most supportive markets for higher electricity prices.
Weather conditions and renewable generation will also play an important role. Stronger wind production or improved hydro availability across Southeast Europe could increase regional supply and reduce import costs. Conversely, another period of weak renewable output would leave Serbia increasingly reliant on imported thermal generation, particularly during the evening peak hours, when solar production declines and demand remains elevated.
Market outlook: Serbia is expected to remain the primary stress market in Southeast Europe over the near term. Traders should closely monitor lignite availability, cross-border import flows, regional price spreads and evening peak prices, as these factors are likely to determine whether the current price premium persists or begins to ease.