Electricity.Trade’s May 2026 analysis identifies hydrology as one of the hidden drivers behind Southeast Europe’s market split. The month was not uniformly wet or dry across the region. Instead, hydro output increased sharply in some systems and declined heavily in others, creating a clear division between markets able to export and markets forced to import.
Greece saw the strongest hydro recovery, with production up 40.80% month on month. Italy followed with a 12.45% increase, while Bulgaria recorded a 7.30% rise. These markets were better positioned to manage domestic balance, reduce thermal pressure and support cross-border flows. Greece became a major net exporter with 874.20 GWh of net exports, while Bulgaria also exported 258.65 GWh. Italy remained a net importer, but its imports fell by 16.41% to 3,706.01 GWh, helped by stronger hydro and renewables.
The opposite trend appeared in Serbia, Hungary, Croatia and Romania. Serbia’s hydro output fell by 31.68%, Hungary’s by 29.10%, Croatia’s by 21.17% and Romania’s by 6.96%. These declines had direct market consequences. Serbia moved into net imports of 422.97 GWh, Croatia’s net imports rose to 583.90 GWh, Hungary remained deeply import-dependent with 1,076.31 GWh, and Romania recorded 440.59 GWh of net imports.
Hydro matters in SEE because it is not only generation. It is flexibility. When hydro output is strong, it can displace thermal generation, support exports and help manage daily peaks. When hydro weakens, systems lose one of their most valuable balancing tools. That effect becomes more important as solar and wind output grows, because hydro is one of the few domestic resources able to respond quickly to intraday variability.
Serbia’s case is particularly important. The country still relied on coal/lignite for 56.99% of its May electricity mix, but weaker hydro and higher demand forced imports. Croatia’s case is different but equally instructive: with net imports at 43.78% of its mix and hydro at 22.83%, lower hydro output directly increased exposure to neighbouring markets.
For Electricity.Trade, May’s hydrology signal should be treated as a structural market theme. SEE is not one hydro region; it is a set of connected basins with very different monthly outcomes. Hydrological divergence can change trade flows, price spreads and import requirements faster than annual capacity statistics suggest. In a renewable-heavy future, hydro variability will remain one of the main determinants of regional price risk.
