The European Union’s Carbon Border Adjustment Mechanism (CBAM) is affecting electricity trading economics across Southeast Europe, increasing the difference between wholesale power values and the carbon-adjusted cost of electricity imported from the Western Balkans. The additional cost exposure is set to start from 2026 for electricity imports, with no equivalent free-allocation relief described for power compared with transitional arrangements for some industrial sectors.
The latest published CBAM certificate price reached €82.32 per tonne of CO₂ for the third quarter, up from €75.28 in the preceding quarter. Using existing national default emissions factors, the third-quarter price implies gross CBAM exposure of about €85.70/MWh for Serbian electricity, €80.59/MWh for Montenegro and €94.50/MWh for Bosnia and Herzegovina. North Macedonia faces an indicative €73.01/MWh, while Albania’s zero default factor results in no carbon charge under the default calculation.
The figures are described as illustrative based on the third-quarter certificate price rather than final charges for October deliveries. The fourth-quarter certificate price will be established in January 2027, and actual liabilities may reflect eligible deductions for carbon prices paid in the country of origin. The reported levels are presented as a way to show how CBAM can affect conventional wholesale trading margins.
Wholesale spreads versus carbon-adjusted costs
On October 9, Serbia’s SEEPEX day-ahead electricity price rose to €239.96/MWh, up almost 34% from the prior session. Hungary’s HUPX reached €269.43/MWh, leaving a daily average spread of €29.47/MWh. That spread is described as substantially below Serbia’s indicative default-based carbon exposure.
The same day, Montenegro’s BELEN price reached €223.39/MWh. Italian wholesale prices in several bidding zones were around €230–235/MWh, creating a narrow indicative differential for electricity delivered through the Montenegro–Italy interconnection. The source notes that daily average spreads are not executable trading margins and that hourly variations can create individual opportunities.
The Energy Community Secretariat has identified changes in regional electricity flows, including a decline in gross commercial exchange between Western Balkan and neighbouring EU markets of about 19% year on year in the first half of 2026. It also cites hydrological conditions, generation availability and changing import requirements as contributing factors to the observed movement.
Two commercial segments and evidence requirements for exports
The regional market is described as separating into two commercial segments: domestic and regional trading, where EU CBAM import charges do not directly apply, and exports into EU markets, where carbon-adjusted costs affect whether scheduled transactions remain profitable. For Serbian utility EPS, Montenegrin EPCG and power producers across Bosnia and Herzegovina, the new environment places greater emphasis on generation technology, electricity origin and proof of actual emissions.
The rules are described as especially relevant for renewable energy projects exported into the EU market. A Serbian wind farm producing low-carbon electricity is not automatically stated to receive favourable CBAM treatment when its output is exported into Hungary unless EU declarants meet conditions for using actual embedded emissions rather than national default values.
The source lists requirements for using actual embedded emissions, including a qualifying physical power purchase agreement, evidence of the generating installation, compliant cross-border capacity nominations, hourly matching between generation and nominated deliveries, and evidence regarding grid connection or absence of congestion. It also states that an accredited verifier must assess supporting information and that guarantees of origin alone cannot replace this physical and contractual evidence.
Implications for project finance and industrial CBAM liabilities
The source says project developers and lenders face uncertainty over additional value from selling wind or solar power directly into EU markets even when projects generate electricity competitively. It links this uncertainty to projected revenues, long-term power purchase agreements, financing assumptions and investment cases for new renewable capacity.
For industrial manufacturers, it highlights a distinction in how emissions are treated under CBAM. Under current rules, indirect emissions from purchased electricity are included in CBAM liability for cement and fertilisers but not generally for iron, steel and aluminium, where liabilities focus on direct embedded emissions.
As a result, sourcing renewable electricity is described as not automatically reducing the current CBAM certificate obligation of a Serbian steel or aluminium exporter. The source adds that renewable sourcing can still lower operating costs, improve corporate emissions performance and support supply relationships with European manufacturers seeking lower-carbon materials.
For cement and fertiliser producers specifically, qualifying lower-emission electricity can influence carbon intensity used in CBAM calculations subject to applicable methodology and verification requirements. The European Commission has proposed changes to electricity CBAM methodology that could reduce disadvantages faced by renewable generators in countries where default emission factors reflect carbon-intensive thermal production, but adoption is described as incomplete.
CBAM timeline for 2026 imports
Banks financing renewable energy projects, electricity-intensive manufacturers or cross-border trading businesses are described as facing additional revenue, margin and regulatory risk tied to CBAM. New project assessments are said to increasingly distinguish conventional wholesale electricity revenues from revenues supported by verified, CBAM-compliant physical export arrangements.
The first CBAM certificates covering 2026 electricity imports will be purchased from February 2027. Annual declarations and certificate surrender are due by September 30, 2027.
The source describes an ongoing challenge in Southeast Europe: electricity markets remain physically interconnected while commercial economics become differentiated by carbon treatment. A megawatt-hour produced in Serbia or Montenegro can still reach a European buyer through interconnected transmission networks, but whether it can be sold profitably increasingly depends on its carbon classification and supporting transaction evidence rather than only wholesale price differences across the border.