Electricity trading in the Western Balkans moved in two opposite directions during the second quarter of 2026, with commercial exchange with the European Union falling while regional day-ahead activity increased across all markets. Gross scheduled electricity exchange across Western Balkan–EU borders dropped by approximately 15% year on year, from 8,828 GWh to 7,494 GWh. The decline followed a 23% contraction in the first quarter.
Total cross-border exchange during the first half of 2026 was around 19% below H1 2025, at 15,567 GWh compared with 19,323 GWh a year earlier. Hydrological conditions weakened over the period, and the region returned to its usual net-import position. Imports from the EU reached 4,271 GWh, down 14%, while exports fell 16% to 3,223 GWh.
The resulting net import balance was approximately 1,048 GWh, broadly in line with the level recorded in Q2 2025. The regional trade balance therefore normalised, but the volume of electricity traded commercially across the EU border did not. This split between physical balance and commercial cross-border activity is reflected in the quarter’s trading patterns.
Cross-border capacity allocation remains high despite lower schedules
A decline in transmission capacity alone does not explain the fall in cross-border volumes. Allocation rates stayed close to 100% on the main export corridors whenever capacity was offered. Market participants continued to purchase transmission rights but scheduled less electricity across them.
This points to factors beyond available interconnection capacity, including commercial caution and uncertainty over carbon-related costs. Changing route preferences were also cited as part of the explanation for reduced scheduled flows. As a result, lower cross-border volumes occurred alongside continued demand for transmission rights.
Day-ahead trading expands across ALPEX, MEPX, MEMO and SEEPEX
Regional power exchanges showed a different direction in Q2 2026. Combined day-ahead trading volumes increased by 19% to 2.70 TWh, from 2.26 TWh a year earlier. ALPEX, covering Albania and Kosovo, recorded the strongest growth at 52%.
Montenegro’s MEPX rose by 49%, North Macedonia’s MEMO increased by 31%, and Serbia’s SEEPEX returned to growth with a 7% increase. SEEPEX had been the only regional exchange to contract in the first quarter. Its earlier decline was linked to greater exposure to transit-based trading.
The Q2 rebound coincided with more stable EU ETS prices and narrower directional price spreads. It also aligned with a strengthening role for Serbia as an electricity route towards Hungary. These changes were reflected in higher day-ahead volumes on SEEPEX.
Divergence between local liquidity and weaker EU-linked trade
The divergence between domestic market liquidity and external electricity trade indicates a shift in how regional markets are functioning. Local exchanges are increasingly used for portfolio management, balancing and short-term price discovery. However, the commercial link connecting those markets with EU price benchmarks carried less electricity.
This development raises concerns for regional market integration because greater domestic liquidity cannot replace market coupling or predictable cross-border pricing. It also does not provide access to higher-value EU demand that can support convergence outcomes expected by renewable energy investors. A liquid local exchange operating behind carbon and regulatory barriers can improve internal trading without delivering that revenue convergence.
