Serbian exporters and electricity traders face a regulatory split in late 2026: the EU Carbon Border Adjustment Mechanism (CBAM framework) is binding, while proposed changes that could ease Serbian electricity exports are still under negotiation in Brussels. Companies must comply with the rules that apply when imports take place, rather than rely on changes still being discussed.
CBAM entered its definitive phase on January 1, 2026. The European Commission issued definitive-period guidance for electricity, iron and steel, aluminium and other sectors on August 14, then updated its general questions and answers on October 15.
The 50-tonne de minimis threshold for cement, iron and steel, aluminium and fertilisers does not cover electricity or hydrogen. An EU importer buying Serbian electricity therefore cannot treat a small transaction as outside CBAM solely because its volume or value is limited.
Proposed changes to electricity rules
Under COM(2025) 989, the European Commission has proposed substantial revisions to the electricity methodology. The measures would broaden the treatment of power purchase agreements (PPAs) involving intermediaries, remove the existing network condition in Annex IV point 5(b), and revise the nomination test.
The proposal also seeks to encourage decarbonisation in third-country electricity systems by changing how embedded emissions are attributed. It remains politically advanced but has not become final law.
The Council agreed its position on June 12, 2026. The European Parliament adopted its first-reading position on September 15 and returned the file for interinstitutional negotiations.
Serbian developers and traders should model two scenarios: an operating case based on current law and a reform case showing the potential effects if amended rules are adopted and become applicable.
Contracts, historical data and financing
Contracts should distinguish between the current framework and possible reforms. A change-in-law clause could allow a PPA to move to a broader intermediary structure after a clearly defined legal trigger, but that trigger should depend on the publication and application of an adopted rule, not a political announcement.
Evidence for past transactions should remain tied to the legislation in force when the electricity was imported. Reconstructing or rewriting historical data using a later methodology could increase audit risks rather than resolve the underlying compliance issue.
Project finance requires the same caution: investors should not capitalise a higher expected export premium solely on the expectation that the Commission’s proposal will make qualification easier. Banks are likely to assess whether projects remain viable under rules currently in force, treating regulatory reform as optional upside until the final legal text, application date and implementing requirements are established.
Potential expansion into downstream products
The European Commission has proposed bringing 180 steel- and aluminium-intensive downstream products into CBAM from 2028. The Council’s position increased the proposed list to around 200 products, while the European Parliament backed a significantly broader list of 457.
The final scope is still under negotiation, but CBAM is set to extend further into industrial supply chains rather than remain focused mainly on basic materials. This matters for Serbia given its strong trade links with the European Union.
In January-August 2026, Serbian goods exports totalled approximately EUR 23.7 billion, up 8.8% year on year. EU member states accounted for 58.3% of Serbia’s total external trade.
Companies whose products are not currently covered by CBAM should start identifying where steel and aluminium inputs are used in goods ultimately sold in the EU market.
Preparing for current requirements and possible reform
Serbian exporters should not wait for the Brussels negotiations to conclude. They should maintain compliance with current rules, develop flexible data systems that can accommodate changes to the electricity methodology, and include suitable conversion mechanisms in long-term contracts.
Regulatory flexibility can create commercial value, but assuming a benefit before it becomes legally effective carries financial risk.
Supported by CBAM.Clarion.Engineer