CBAM is changing the commercial conditions for selling electricity generated outside the European Union, creating new revenue and financing risks for renewable projects in Serbia, Montenegro and the wider Western Balkans. The Energy Community Secretariat identified difficulties involving verification, power-purchase-agreement eligibility and access to favourable EU market prices in its assessment for the second quarter of 2026. The European Commission is cited in connection with the electricity CBAM methodology and certificate pricing.
Export treatment shapes revenue cases
Wind, solar and hydropower projects in the region have historically relied partly on cross-border electricity sales to support merchant revenues and long-term power purchase agreements. Higher wholesale prices in neighbouring European markets can give generators revenue beyond domestic sales. Yet a project can be connected to the grid, operational and capable of delivering electricity without being able to demonstrate that its output qualifies for actual-emissions treatment under the applicable EU methodology.
If the conditions for actual-emissions treatment cannot be met, default emissions treatment may materially change the economics of importing the electricity into the EU. The difference can affect the export price a generator can achieve, while uncertainty over the treatment of electricity creates questions for lenders about projected export revenue and the allocation of carbon-related obligations.
Financing assessments may need to distinguish among three revenue cases: domestic electricity sales, cross-border sales under default emissions treatment, and exports that meet the requirements for actual-emissions treatment. Domestic sales do not give rise to export-related CBAM obligations. Cross-border sales under default treatment carry cost exposure, while an export structure that satisfies actual-emissions requirements may preserve a stronger commercial relationship with EU buyers.
Differences among these cases can materially affect electricity-price assumptions, operating cash flow, debt-service capacity and project valuation. The exposure applies to both operating renewable projects and projects still under development. Even when a long-term export power purchase agreement provides a relatively predictable electricity price, allocating CBAM costs among the generator, trader and EU importer can substantially alter the revenue available to the project company.
Contracts and evidence affect project bankability
Export-oriented renewable power purchase agreements increasingly need clear provisions on emissions evidence and verification responsibilities, as well as on changes in CBAM legislation. The agreements also need to address transmission capacity, balancing electricity and liability if required evidence cannot be provided. Inadequate allocation of those responsibilities could lead to disputes among generators, electricity traders and EU importers after commercial delivery has taken place.
Banks and investment funds need to assess whether an assumed export route is commercially realistic, whether nominated electricity can be linked to eligible generating assets, and whether contractual counterparties can provide the required regulatory evidence. The availability of accredited verification services and the technical capability of project metering and scheduling systems are also relevant to financing due diligence.
Montenegro’s connection with Italy and Serbia’s interconnections with Hungary, Romania and Croatia are particularly relevant to projects seeking access to European wholesale electricity prices. Developers that address CBAM requirements during project preparation may be better positioned to negotiate export agreements and demonstrate revenue resilience to lenders. By contrast, projects based on unverified assumptions of unrestricted EU market access may face higher financing risk or more conservative lender revenue forecasts.
CBAM readiness is becoming part of renewable-project bankability rather than a compliance matter that can be postponed until exports begin. The emerging investment standard is a project with an electricity-sales structure, documentary controls and contractual risk allocation capable of supporting its intended market revenues, not merely one that can produce electricity at a competitive cost.