Electricity trading between the Western Balkans and neighbouring European Union markets remained sharply below last year’s level during the first half of 2026, suggesting that the introduction of CBAM has begun to reshape regional arbitrage and transit routes.
Gross commercial exchange across the Western Balkan-EU border was about 19% lower in the first half than in the corresponding period of 2025, according to Energy Community analysis.
Trade declined by approximately 23% year on year in the first quarter, when strong hydropower production pushed Western Balkan prices below EU benchmarks. It remained about 15% lower in the second quarter, even after the hydro surplus faded and the region returned to its usual net-import position.
The figures do not isolate CBAM from hydrology, fuel costs, plant availability and demand. But the continued weakness in cross-border activity indicates that the change cannot be explained solely by an unusually wet first quarter.
Domestic power-exchange liquidity moved in the opposite direction. Combined day-ahead trading on the observed Western Balkan exchanges rose around 19% to 2.70 TWh in the second quarter, including a recovery at Serbia’s SEEPEX.
That creates an increasingly divided market structure: more electricity is being traded within the region, while less is crossing the border with the EU.
National CBAM default factors are a major part of the calculation. At the second-quarter certificate price, the indicative import cost was €86.42/MWh for Bosnia and Herzegovina, €78.37/MWh for Serbia and €73.70/MWh for Montenegro. Albania’s default cost was zero.
Those differences influence where traders schedule electricity even though physical flows continue to follow the interconnected network. Electricity may be commercially routed through lower-carbon jurisdictions or kept within the Western Balkans when the EU price premium cannot absorb the CBAM charge.
The resulting market is less efficient. Cross-border capacity can remain underused despite large price differences, while supply and demand no longer converge as they did before 2026.
Price correlations recovered in the second quarter as the Western Balkans became a net importer and again followed EU benchmarks. But gross cross-border trade did not return to its 2025 configuration.
If the pattern persists, CBAM will do more than attach a carbon price to electricity imports. It will alter capacity values, trading hubs and the direction in which power is commercially moved across Southeast Europe.