By 2025, solar photovoltaic (PV) generation is set to become a fundamental component of the energy landscape in Southeast Europe. The region is witnessing a significant increase in PV output, which is reshaping electricity consumption patterns, influencing market prices, and necessitating enhanced balancing capabilities. This transition is not uniform across countries, but the overarching trend indicates that solar energy is fundamentally altering the dynamics of electricity trading and grid management.
Greece leads the region with substantial solar capacity. By 2025, Greece’s installed solar capacity will surpass 7.8 gigawatts (GW), generating an annual output between 13 and 14 terawatt-hours (TWh). During peak midday hours, solar energy can meet 30-35 percent of instantaneous demand, resulting in significantly lower wholesale prices. This surplus power is increasingly exported to neighboring markets, positioning Greece as a net exporter during daylight hours due to its robust solar and wind generation.
Bulgaria follows closely with impressive growth in solar capacity. By mid-2025, Bulgaria’s installed PV capacity will reach approximately 4.8 GW, up from 3.5 GW at the beginning of 2023. This growth translates to an annual output of around 6–6.5 TWh, representing over 15 percent of the country’s total electricity generation. The increase in solar production has positively impacted Bulgaria’s net export saldo, with nearly 11 TWh exported in the first nine months of 2025, driven largely by spring-summer solar surpluses.
Romania’s solar sector is also expanding rapidly. With about 4.1 GW of installed capacity by 2025, Romania is expected to produce between 5.5 and 6 TWh annually, covering just over 8 percent of its total generation. Solar generation significantly influences intraday electricity flows, particularly during sunny periods when net exports peak between 10:00 and 16:00. Although the annual export saldo remains closely linked to hydro and nuclear resources, solar has introduced a new midday surplus window that enhances market predictability.
Croatia’s smaller but growing solar fleet contributes to energy stability. As of 2025, Croatia will have approximately 1.1 GW of installed PV capacity, yielding about 1.4–1.6 TWh per year. This accounts for roughly 7-8 percent of national generation and has already diminished peak import requirements during low-hydro years. While Croatia’s export balance still fluctuates with hydro conditions and regional prices, solar energy is beginning to influence domestic load curves positively.
The Western Balkans are experiencing emerging growth in solar capacity. By mid-2025, Serbia will have around 400-450 MW of installed PV capacity, producing nearly 0.5 TWh annually—still under one percent of total generation but sufficient to reduce daytime demand peaks. Montenegro’s installation of nearly 100 MW contributes around 0.12–0.15 TWh per year, while North Macedonia’s PV fleet generates approximately 0.85–0.9 TWh annually. Albania’s roughly 350 MW installed by this time will produce about 0.55–0.6 TWh annually, diversifying its energy mix dominated by hydro resources.
Collectively across Southeast Europe, solar generation is projected to reach approximately 30–32 TWh annually by 2025—still below hydropower’s average output but significantly exceeding previous forecasts for this transitional phase. This marks a pivotal shift where solar energy now plays a critical role in determining regional import/export balances and influencing wholesale market prices across major trading zones.
However, the rise of solar power introduces challenges related to balancing energy needs. The inherent variability of PV output necessitates increased investments in flexibility solutions to manage rapid fluctuations in generation throughout the day. As installed capacity approaches around 15–16 GW across the region, systems must adapt swiftly to maintain stability during significant ramp-ups and declines in output.
Hydropower remains a primary resource for balancing energy needs. Reservoirs across Serbia, Bosnia and Herzegovina, Montenegro, Bulgaria, and Romania are crucial for providing flexible capacity due to their ability to adjust output quickly in response to changing solar production levels. However, this reliance on hydropower comes with limitations during periods of low water availability when operators must prioritize energy yield over ancillary services.
Gas-fired plants are also essential for managing residual demand. Countries like Greece and Romania depend on gas units to compensate for declining solar output during evening hours or cloudy days. While these plants generate fewer megawatt-hours in a high-solar environment, they increasingly derive revenue from capacity markets due to their strategic role in maintaining system balance.
Cross-border transmission plays a vital role in balancing efforts as well. Excess daytime solar can be exported to neighboring countries, reducing local balancing requirements; however, as more countries experience high solar penetration simultaneously, this dynamic may shift toward optimization challenges rather than straightforward exports.
The evolution of market design reflects these changes. Day-ahead markets are adapting with more granular pricing structures that account for midday solar saturation while intraday markets gain traction as traders seek arbitrage opportunities based on forecasted peaks versus residual demand. The emergence of balancing markets compensates fast-response assets for providing reserve capacity during steep ramps—creating new revenue streams for flexible plant operators and storage systems alike.
Energy storage systems are becoming increasingly important in capital expenditure planning. Battery energy storage systems (BESS) are among the most actively financed segments within the regional power sector as developers target installations capable of absorbing excess midday PV output for later use during peak demand periods. With collective pipelines exceeding two to three gigawatts under development across Bulgaria, Greece, and Romania by 2025, these systems play a critical role in reducing curtailment and stabilizing pricing amid rising penetration levels.
The transition towards solar energy in Southeast Europe represents more than just an increase in volume; it emphasizes timing and flexibility. As solar output begins to reshape import/export balances and lower fuel costs while depressing daytime prices, it simultaneously elevates the value of balancing energy resources and rapid-response assets within electricity markets. Understanding this evolving landscape will be crucial for utilities and market participants aiming to capitalize on opportunities through the decade leading up to 2030.
