Serbia had around 2 GW of battery energy storage system connection agreements reported in 2026, while its first standalone projects still need to establish a domestic financing template. The terms adopted for those projects are expected to influence leverage, security, revenue haircuts and sponsor support. There is not yet a widely replicated local model for the sector.
Procedures set by EMS, Serbia’s transmission system operator, require sponsors of transmission-connected projects to provide a construction bank guarantee within 60 days of receiving a connection study. The guarantee must be in place before the connection-contract process can proceed. This requires sponsors to have balance-sheet capacity before projects generate operating revenue, creating an early financing hurdle.
Financing conditions and risk
Domestic commercial banks can finance construction if they are comfortable with exposure to merchant revenues. A contracted industrial offtaker, an optimiser floor or a balancing-services agreement could materially increase bank leverage compared with a project relying solely on arbitrage. These revenue arrangements could therefore influence financing terms for Serbia’s first standalone batteries.
Participation by international financial institutions, risk guarantees or blended financing structures could allow local banks to take part with less exposure to early-market uncertainty. Equipment-vendor finance and sponsor equity are also potential ways to bridge the first projects. This could be particularly relevant for batteries co-located with solar or wind generation.
Regional precedent and financing benchmarks
Romania provides a regional precedent for non-recourse financing through the 127 MW / 254 MWh Scornicesti project. The European Bank for Reconstruction and Development (EBRD) provided non-recourse funding for Scornicesti.
The first Serbian standalone battery financing deal is expected to establish the assumptions banks apply to spread compression, degradation, reserve accounts and terminal value. After a financing structure closes and performs, the cost of capital for the next wave of standalone projects in Serbia should become easier to price. Domestic banks’ willingness to finance construction will depend on their comfort with merchant risk.
