Electricity.Trade’s May 2026 analysis highlights hydrological conditions as one of the key factors shaping Southeast Europe’s electricity market, revealing a clear divide between countries benefiting from stronger hydro generation and those facing declining output. Rather than experiencing uniformly wet or dry conditions, the region saw significant variations in hydroelectric production, influencing electricity trade flows, market balances and import requirements.
Hydro generation increased substantially in several markets during May. Greece recorded the strongest month-on-month growth, with hydro output rising 40.80%, followed by Italy with a 12.45% increase and Bulgaria with a 7.30% gain. Improved hydro availability strengthened domestic supply, reduced dependence on thermal generation and supported cross-border electricity exports. Greece emerged as a major net exporter with 874.20 GWh of net exports, while Bulgaria exported 258.65 GWh. Italy remained a net importer, but its electricity imports declined 16.41% to 3,706.01 GWh, supported by stronger hydro and renewable generation.
In contrast, hydro production weakened across several other Southeast European markets. Serbia recorded the sharpest decline, with hydro output falling 31.68%, followed by Hungary at 29.10%, Croatia at 21.17% and Romania at 6.96%. The reduction in hydro generation translated directly into higher import needs. Serbia imported 422.97 GWh of electricity during the month, Croatia’s net imports climbed to 583.90 GWh, Hungary remained heavily dependent on imports with 1,076.31 GWh, while Romania recorded 440.59 GWh of net imports.
Hydropower remains one of the region’s most valuable resources because it provides both electricity generation and system flexibility. Strong hydro output helps reduce reliance on fossil-fuel generation, supports electricity exports and enables power systems to respond efficiently to fluctuations in demand and renewable generation. As solar and wind capacity continues to expand across Southeast Europe, the balancing role of hydroelectric plants becomes increasingly important in maintaining grid stability.
Serbia provides a clear example of this dynamic. Although coal and lignite still accounted for 56.99% of the country’s electricity generation mix in May, weaker hydro production combined with higher electricity demand increased the need for imports. Croatia faced a different challenge, with net imports representing 43.78% of its electricity mix while hydro accounted for 22.83% of generation. The decline in hydro output further increased the country’s reliance on neighbouring electricity markets.
According to Electricity.Trade, the hydrological trends observed in May underline an important structural characteristic of the Southeast European power market. The region is made up of interconnected river basins with highly variable monthly hydrological conditions, meaning changes in water availability can rapidly alter electricity trade flows, price differentials and import requirements. As renewable generation continues to expand, hydro variability is expected to remain one of the most significant drivers of regional electricity market risk and wholesale price dynamics.
