If operational stability defines the present of South-East Europe’s electricity utilities, investment and financing define their future. Across the region, utility balance sheets are repositioning around large capital-expenditure programmes covering renewable generation, grid digitalisation, environmental compliance, flexible backup capacity and storage. The dominant source of capital is not speculative private finance but long-tenor, policy-aligned financing from European Investment Bank, European Bank for Reconstruction and Development, sovereign-backed loans and carefully structured capital-market instruments. The central financial reality of SEE’s transition is therefore that multilateral institutions, sovereign treasuries and utility cash flows are underwriting a structural reinvestment cycle that will reshape the region’s power sector through the 2030s.
Serbia’s EPS illustrates this transition financing logic with particular clarity. Instead of fragmented project funding, the company has moved toward structured, programmatic financing frameworks that align maturity, repayment capacity and technical asset life. Major hydro refurbishments, new generation upgrades and utility-scale solar investments are now embedded in long-dated, concessionally priced loan facilities blended with grants and internal funding. For Serbia, this financing approach matters because it spreads cost over decades, protects the tariff base from sudden shocks and ensures financial predictability while enabling the utility to invest at a level measured in billions of euros rather than episodic hundreds of millions.
Romania provides a dual financing model that is arguably the most sophisticated in the region. At generation level, Hidroelectrica benefits from strong profitability, a strengthened equity base and public-market visibility that lowers its cost of capital and supports larger refurbishment programmes. At distribution level, Electrica relies on long-term financing from European institutions backed by a regulatory framework that ensures gradual cost pass-through and stable returns. This combination of equity-driven strength and debt-financed regulated investment creates one of the most bankable electricity ecosystems in Central and Eastern Europe.
Bulgaria’s capital story is characterised by scale, state consolidation and a mixed funding architecture. Bulgarian Energy Holding manages extremely high investment intensity funded by eurobonds, state-linked borrowing and European institutional lending. A portion of capital goes into power-sector stability, another part into gas storage, cross-border interconnections and broader energy-security infrastructure. For investors this environment creates both opportunity and complexity, because while profitability and state backing are strong, debt layering is intricate and closely tied to broader national policy decisions.
Croatia’s HEP shows a more classical renewable-project finance structure. Solar and wind investments are typically financed with around sixty to seventy percent long-dated institutional debt and thirty to forty percent sponsor equity, allowing Croatia to scale renewable capacity without overwhelming the core balance sheet. Hydropower dominance keeps sustaining CAPEX moderate, allowing new renewable projects to meaningfully increase production capacity without destabilising finances.
Bosnia and Herzegovina sits at the opposite end of the spectrum. Utilities there are planning extremely ambitious capital investments relative to their financial capacity and will depend heavily on loans to deliver them. Large programmes for renewable construction, life extension, environmental compliance and replacement capacity are structurally debt-funded, meaning leverage metrics will tighten unless tariff structures are adjusted or sovereign support is explicitly applied. At the same time, the first wave of renewable financings shows that Bosnia is fully bankable when credible projects are structured under international standards, proving that transition capital is available if governance is strong and projects credible.
North Macedonia’s transition is one of the most strategically important in the region because the entire generation portfolio must be modernised within less than two decades. The financing structure is built around European institutional leadership, sovereign guarantees and carefully layered commercial financing. The first large solar and storage programmes demonstrate how the country intends to replace lignite while simultaneously stabilising security of supply. The financial scale is enormous relative to GDP, but the structure is disciplined: long-tenor borrowing, concessional elements where possible and gradual phasing rather than shock transitions.
Montenegro’s EPCG is combining growth capital and liquidity borrowing in a way that demonstrates the real-world financial mechanics of transition. On the one hand, major wind and renewable investments are financed through structured institutional lending under project-finance-like discipline, anchoring Montenegro’s first genuinely modern generation expansion in decades. On the other hand, liquidity loans are used to bridge periods when hydro output declines and major fossil baseload assets are undergoing environmental reconstruction. This duality means leverage will increase, but in exchange the country acquires diversification, resilience and the first modern renewable platform capable of scaling.
Greece’s PPC represents the most advanced financing evolution in South-East Europe. Its multi-year investment programme is measured in several billions of euros and financed through a balanced mix of internal cash generation, bond market issuance, sustainability-linked instruments, institutional liquidity backstops and growth-oriented green financing. Net debt is rising, but EBITDA growth and disciplined leverage caps ensure that the company remains financially credible and strategically flexible. PPC is effectively becoming a regional energy-transition platform calibrated to Western European investor expectations and banking standards.
Across the region the unifying theme is clear. The cost of capital, availability of long-tenor funding, share of grants within project envelopes, sovereign backing structures and the credibility of corporate governance will determine how fast SEE power sectors can decarbonise while maintaining price stability and energy security. Utilities are increasingly able to self-fund significant portions of their programmes through operating cash flow, while institutional financing fills the gap required to reach transformational scale. For investors, lenders and policymakers, the message is straightforward. South-East Europe is no longer a peripheral power market reacting to external forces. It is actively financing a structural reinvestment cycle driven by strategic national priorities, embedded European policy frameworks and robust institutional capital. The result will be a fundamentally different power infrastructure in the 2030s compared with the legacy systems inherited from the late twentieth century, with every major SEE utility now functioning not merely as an operator, but as a central financial engine of the transition.
Elevated by virtu.energy