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. The vote opened negotiations with EU member states on the final legislation. For Serbia’s electricity market, the most consequential elements relate to how electricity imported into the EU is treated as a CBAM good.
The proposed framework would adjust several parts of the CBAM electricity methodology, including requirements tied to physical routing and contract structures. It would remove the current need 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 that involve traders and other intermediaries.
In addition, the proposal would adapt nomination rules for markets using implicit capacity allocation and market coupling. It would also change how country electricity default values are calculated. None of these elements is yet binding law, and the EU is still negotiating the final text.
What changes could mean for 2026 electricity exports
For electricity exported during 2026, Serbian generators, traders and their EU counterparties are expected to continue building evidence under existing rules. At the same time, they would be preparing systems for a potentially simpler framework if the revisions are adopted. The timing creates a compliance challenge because current transactions must be documented under today’s methodology even as EU rules could change how those same imports are handled in first definitive-period CBAM declarations.
One of the hardest parts of the current approach has been congestion evidence when actual embedded emissions are used instead of a national default factor. Under the current methodology, multiple conditions must be met at once, including linking the electricity to a qualifying physical PPA and keeping the generating installation below a required emissions threshold.
The current framework also requires that production and firm nomination correspond within an hourly period and that exporters satisfy a network condition. Evidence that physical network congestion did not prevent the claimed route is difficult to assemble hour by hour because relevant information sits with transmission-system operators and market infrastructure.
The proposed reform would delete that congestion condition if retained in final legislation. If adopted, it would remove a major verification bottleneck for Serbian electricity moving toward EU markets while still requiring an evidence chain for actual-emissions claims. Verification would shift toward establishing coherence between the named generator, contract terms, hourly generation, trading route, allocation to the EU buyer and the final CBAM declaration.
Intermediary PPA structures and traceability requirements
The revisions also address how CBAM electricity evidence can accommodate trading arrangements that do not follow a simple bilateral pattern. Serbian renewable electricity is rarely exported through a structure involving only one generator and one EU importer. Instead, transactions often involve multiple steps across suppliers, balance responsible parties, cross-border markets and EU traders or importers.
A typical chain described in the methodology runs from a Serbian RES producer through a supplier or trader and then to a balance responsible party before reaching a cross-border market. The process can continue through an EU trader or importer before ending with an authorised CBAM declarant in the EU. Under current rules, intermediary structures can be difficult to fit into an actual-emissions framework.
The proposed changes would allow intermediaries within the PPA chain provided there is a verifiable contractual relationship connecting the electricity producer, one or more intermediaries and either the EU importer or authorised CBAM declarant. For traders, this could be among the most commercially relevant changes because it aligns CBAM evidence with how generation aggregation and cross-border positions are managed in southeast Europe.
Greater contractual flexibility would not remove traceability obligations for verification purposes. A verifier would still need to confirm that electricity claimed by a particular EU declarant can be traced back to an identified Serbian generating installation for the relevant period without double counting. The key test becomes whether each claimed quantity can be reconstructed through commercial and operational records across the chain.
Hourly data, nomination approach, and market coupling
Even under a simplified regime, hourly data is expected to remain central for actual-emissions claims. For Serbian renewable generators, essential evidence is described as connecting installation details through meters to production hours, then through PPA documentation and trader allocation into cross-border transactions. The chain continues with EU importer or declarant information before arriving at verified quantities.
Where explicit cross-border capacity is used, nomination evidence remains important under existing logic. Where electricity moves through markets using implicit allocation and market coupling, the amended methodology is expected to recognise that traditional bilateral nomination models may not reflect how such markets operate .
The proposal links this issue to deeper integration between Serbian and regional markets with EU day-ahead and intraday market coupling arrangements. As a result, CBAM evidence systems would need to record whether delivery occurred via explicit capacity allocation or via implicit market coupling while retaining producer-specific and declarant-specific evidence needed for verification .
Guarantees of Origin versus actual emissions evidence
The reform should not be interpreted as making Guarantees of Origin sufficient for CBAM purposes. A Guarantee of Origin can demonstrate renewable attributes associated with electricity, but CBAM actual emissions require more than renewable certification alone. Actual emissions claims require an evidence chain linking emissions values to both the generating installation and what is claimed by an EU declarant.
For Serbian renewable producers, this means value depends not only on delivering green MWh but also on providing a verifier-ready package of evidence. That package can include plant identity, meter hierarchy, hourly generation records, PPA chain documentation and trading allocation details . It can also include relevant nomination records, EU declarant information and emissions information accepted by an accredited verifier.
Upstream data needs for EU declarants
Responsibility for submitting CBAM declarations remains with authorised CBAM declarants in the EU. However, much of the information needed to support those declarations originates outside the EU. This implies that EU importers and traders may increasingly seek 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 standard provisions covering price, delivery, balancing, credit and settlement . The information requested from Serbian counterparties may include installation identification; meter and generation records; Monitoring Plan information; verified emissions data; hourly allocation data; PPA evidence; trading and nomination records; documentation supporting relevant cross-border routes; and cooperation with an accredited EU verifier.
Default factors based on grid mix
The proposed reform would also change how default values for country electricity are calculated under CBAM methodology. 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 individual exporters cannot meet all conditions required for actual-emissions calculations.
A cleaner national generation mix could gradually lower default CBAM emissions values applied to Serbian electricity under this approach. The change could create two commercial pathways: exports using applicable Serbian default factors or exports linked to specific renewable installations supported by sufficient evidence enabling lower verified actual-emissions values . Differences between those pathways could influence pricing in PPAs as well as trader margins over time.
Verification timelines from 2026 into 2027
Legislative negotiations are occurring as the EU verification system becomes operational. Accredited CBAM verifiers are entering the Registry system from September 2026. 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 annual declaration cycles could create risk because meter data, nominations, allocations and contractual evidence are generated continuously. Missing records may be difficult or impossible to recreate months later . The practical approach described is running pre-verification during the reporting year by testing whether an evidence chain can withstand an EU verifier’s review before final assurance engagement.
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