Serbia has shown that large-scale wind farms can be built, financed and connected, shifting attention to how they operate in the electricity market. The inauguration of Čibuk 2 in September 2026 added 154 MW to the existing 158 MW Čibuk 1. Together, the projects form a 312 MW wind complex in South Banat and represent more than €500 million in investment.
The country’s renewable auction programme has also brought substantial investment into the market. The EBRD says the first two competitive auctions allocated nearly 1,300 MW of wind and solar projects, including the Pupin and Čibuk 2 wind farms. The focus for Serbia’s next generation of wind projects is increasingly on exposure to the operational market.
For the first generation of wind development, the main test was overcoming permitting, financing and grid-connection barriers. As projects move into operation, forecasting and balancing carry greater commercial weight. Wind output must be forecast before delivery, and the balancing responsible party bears the difference between nominated and actual positions under applicable market rules.
Forecasting and imbalance exposure
EMS reports an average upward balancing-energy price used in specified risk and settlement calculations of €154.174/MWh for 2026, compared with €136.523/MWh in 2025 (EMS data). This figure is not the automatic imbalance cost for every wind farm. It does, however, illustrate why forecast deviations can have material economic consequences.
A project can produce the annual volume assumed in its financing case and still face significant balancing costs if actual hourly output repeatedly differs from its nominated schedule. Annual MWh may therefore meet expectations while net cash flow falls short. Forecasting has become a commercial function, not only an operational one.
Weather forecasts, turbine-level production models, real-time SCADA data and the ability to trade intraday increasingly affect project revenue. Bringing a contracted position closer to actual production before gate closure is likely to reduce residual imbalance exposure. Portfolio management can also help when deviations among renewable assets offset one another.
Portfolio and contract arrangements
The value of combining assets depends on their physical correlation. Wind farms in the same meteorological region may deviate in the same direction at the same time. Serbia’s concentration of significant capacity in Vojvodina makes this a particularly relevant consideration.
Balancing responsibility therefore needs to be assessed at the contract level. Key questions include who submits nominations, who owns the forecasting model and who has authority to trade intraday. Contracts also need to specify who pays when measured output differs from the nominated position and how balancing costs are divided between the generator and trader.
These provisions can materially alter the economics of otherwise similar PPAs. Transparency is especially important when a third-party trader or balancing responsible party controls settlement. Wind farm owners should be able to trace the process from forecasts and nominations through measured output to balancing settlement; otherwise, imbalance can become a commercial cost that is difficult to audit.
Flexibility and financing considerations
Greater sophistication in Serbia’s power system could create opportunities as well as costs. EMS procures ancillary services and operates balancing arrangements that include frequency-related reserves and balancing activation. Over time, wind projects paired with storage, flexible portfolios or capable aggregators could move from creating balancing requirements to providing some of the flexibility needed to manage them.
Doing so would require technical qualification, control systems and clear market rules. It would also call for a different approach to financing, with balancing costs no longer treated as a minor, generic operating assumption. Lenders should assess historical forecast-error distributions, trading arrangements, the quality of forecasting providers and the contractual allocation of imbalance.
Financing reviews should also stress periods when several adverse conditions coincide. A wind farm could produce less than forecast while upward balancing energy is expensive; unexpectedly high output could instead arrive during a regional surplus period when prices are weak. The risk is asymmetric.
As a result, market integration is increasingly important alongside generation. Serbia has demonstrated that wind projects can attract international investors and non-recourse financing. The next competitive advantage will come from operating those assets efficiently in a more liquid, volatile and increasingly regional electricity market, turning variable production into predictable cash flow.
