The European Parliament on Sept. 15 adopted its negotiating position on a broader revision of the EU Carbon Border Adjustment Mechanism by 464 votes to 50, with 159 abstentions, opening talks with EU member states on final legislation. For Serbia’s electricity market, the key focus is the methodology used for electricity imported into the EU as a CBAM good.
The proposed framework would adjust several elements of that methodology, including removal of the requirement to demonstrate the absence of physical network congestion along the route to the EU. It would also introduce more flexibility for physical power purchase agreements involving traders and other intermediaries, adapt nomination rules for markets using implicit capacity allocation and market coupling, and change how country default values for electricity are calculated. None of these changes is yet binding law.
Implications for 2026 CBAM declarations
For electricity exported during 2026, Serbian generators, traders and their EU counterparties are expected to continue building evidence under existing rules while preparing for a potentially simpler framework. The timing creates a compliance challenge because transactions must be documented against today’s methodology even as negotiations continue that could affect how those same 2026 imports are treated in the first definitive-period CBAM declarations.
Under the current electricity methodology, claims using actual embedded emissions rather than a national default factor depend on multiple conditions being met at the same time. The electricity must be linked to a qualifying physical PPA, the generating installation must remain below a required emissions threshold, production and firm nomination must correspond within the required hourly period, and the exporter must satisfy a network condition.
Network congestion evidence and verification focus
For Serbian renewable projects, the network test has been described as one of the most difficult requirements to operationalise. A wind or solar producer can control generation meters, SCADA records and plant documentation, while a trader or balance responsible party can retain nominations, cross-border capacity and settlement records. An EU importer can document customs entries and its CBAM declarant identity.
Evidence showing hour by hour that physical network congestion did not prevent the claimed route to the EU is harder to obtain because much of it sits with transmission-system operators and market infrastructure. The proposed reform would delete that condition if retained in final legislation, which would remove a major verification bottleneck for Serbian electricity moving toward EU markets.
The reform would not remove evidence requirements. Instead, verification would shift toward establishing a coherent relationship between the named generator, contract terms, hourly generation, trading route, allocation to the EU buyer and the final CBAM declaration.
Intermediary structures in physical PPA chains
The proposed changes also address how Serbian renewable electricity is exported, where transactions often do not follow a simple bilateral structure involving one generator and one EU importer. Instead, actual flows can involve multiple parties: a Serbian RES producer feeding into a supplier or trader, then into a balance responsible party and cross-border market position before reaching an EU trader or importer and an authorised CBAM declarant.
The current methodology can make intermediary structures difficult to fit into an actual-emissions framework. The proposed approach would allow intermediaries within the PPA chain if there is a verifiable contractual relationship linking the electricity producer, relevant intermediary or intermediaries, and either the EU importer or authorised CBAM declarant.
Greater contractual flexibility would not remove traceability requirements. A verifier would still need to confirm that electricity claimed by an EU declarant can be traced back to the identified Serbian generating installation and relevant period without double counting. The critical test becomes whether each claimed quantity can be reconstructed through the commercial and operational chain.
Hourly data under actual-emissions claims
Even if rules are simplified, hourly data is expected to remain central to actual-emissions claims. For a Serbian renewable generator, evidence is expected to connect installation details through meters and production hours to PPA arrangements, trader allocation, cross-border transaction records, EU importer or declarant identification and verified quantities.
Where explicit cross-border capacity is used, nomination evidence remains important. Where electricity moves through markets using implicit allocation and market coupling, the amended methodology is expected to recognise that traditional bilateral nomination models do not fully reflect how such markets operate.
This could become more significant as Serbian and regional markets deepen integration with EU day-ahead and intraday market coupling. As a result, CBAM evidence systems are expected to record whether delivery occurred via explicit capacity allocation or via implicit market coupling while retaining producer-specific and declarant-specific information needed for verification.
Guarantees of Origin versus emissions evidence
The reform should not be interpreted as making Guarantees of Origin sufficient for CBAM purposes. A GO can demonstrate renewable attributes associated with electricity, but CBAM actual emissions require an evidence chain linking emissions values to the relevant generating installation and to electricity claimed by an EU declarant.
For Serbian renewable producers, the product described as increasingly valuable is therefore not only green MWh but green MWh accompanied by a verifier-ready evidence package. That package can include plant identity, meter hierarchy, hourly generation data, PPA chain documentation, trading allocation records, relevant nomination information, EU declarant details and emissions information accepted by an accredited verifier.
Contractual data flows toward EU declarants
Responsibility for CBAM declarations remains with an EU authorised CBAM declarant even though much supporting information originates outside the EU. This implies that EU importers and traders may increasingly need contractual rights to obtain data from Serbian generators, suppliers and trading counterparties.
CBAM-related clauses are therefore expected to migrate into electricity PPAs and trading agreements alongside provisions covering price, delivery, balancing, credit and settlement. EU buyers may increasingly ask Serbian counterparties for installation identification; meter and generation records; Monitoring Plan information; verified emissions data; hourly allocation data; PPA evidence; trading and nomination records; documentation supporting the relevant cross-border route; and cooperation with an accredited EU verifier.
Default factors based on grid mix
The proposed reform would also change how electricity default values are calculated for CBAM purposes. Instead of relying on a factor focused on fossil electricity generation, it would use an average grid emissions factor reflecting the wider electricity mix including renewable generation.
For Serbia this could matter even when an exporter cannot meet all conditions required for actual emissions claims. A cleaner national generation mix could gradually lower default CBAM emissions values applied to Serbian electricity over time.
The changes would create two commercial pathways: exports using applicable Serbian default factors or exports linked to specific renewable installations supported by sufficient evidence enabling use of lower verified actual-emissions values. The difference between those pathways could eventually affect electricity pricing, PPA negotiations and trader margins.
Verification system timeline from September 2026
The legislative changes are being negotiated as the EU verification system becomes operational. Accredited CBAM verifiers are entering the Registry system from September 2026, while installation reviews, Monitoring Plan assessments, evidence testing and site visits are expected ahead of first definitive-period verification reports in 2027.
For Serbian exporters, waiting until an annual declaration cycle is described as creating significant risk because meter data, nominations, allocations and contractual evidence are generated continuously while missing records may be difficult or impossible to recreate months later. A practical approach described in this context is running pre-verification during the reporting year so that an evidence chain can be tested against an EU verifier’s review before final assurance engagement.
The reform described here focuses on easing specific elements of current methodology while keeping traceability requirements intact. The premium attached to each MWh is expected to depend on demonstrating where it was produced when it was produced under which contractual chain it was delivered which EU declarant received allocation and which accredited verifier accepted underlying evidence .
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