Market coupling is one of the most important unfinished projects in South East Europe’s electricity sector. For EU member states in the region, coupling is already part of everyday price formation. For much of the Western Balkans, it remains the next major step.
The goal is simple in theory: connect national day-ahead and intraday markets so electricity can flow more efficiently across borders and scarce transmission capacity can be allocated through market-based mechanisms. In practice, coupling requires legal alignment, exchange readiness, TSO coordination, regulatory approval, algorithm integration and operational trust.
The EU model is built around Single Day-Ahead Coupling. ENTSO-E describes SDAC as a mechanism that creates a pan-European cross-zonal day-ahead market, using a common algorithm to allocate scarce cross-border transmission capacity efficiently while considering network constraints. Intraday integration is handled through Single Intraday Coupling, which supports continuous cross-border trading closer to delivery.
For the Western Balkans, coupling matters for three reasons.
First, it should improve price discovery. A coupled market is generally more transparent and more liquid than a fragmented market. Investors can better model revenue, traders can better price congestion, and consumers can benefit from more efficient dispatch.
Second, coupling should improve the use of interconnectors. Instead of relying heavily on explicit auctions and bilateral scheduling, coupled markets allocate capacity together with energy trades. That can reduce inefficiencies and make cross-border flows more responsive to real market conditions.
Third, coupling is now tied to CBAM. The Energy Community notes that electricity market coupling is closely linked to CBAM because the EU framework allows for the possibility of a time-limited exemption for electricity imported from non-EU countries whose electricity markets are coupled with the EU.
The process is moving, but not instantly. In June 2026, the Energy Community reported that Serbia was the first Contracting Party to transpose the Electricity Integration Package, fulfilling conditions for accession to the EU internal electricity market, although European Commission verification and further alignment were still required before final integration.
ADEX’s market-infrastructure view is that the first Western Balkan–EU electricity market coupling could occur around early 2028 or the beginning of 2029, according to Anže Predovnik, Chairman of the Management Board of ADEX Group and CEO of BSP SouthPool.
That timeline is important. It means investors and traders should not assume full integration in 2026 or 2027. The transition period will be messy. Some markets will advance faster than others. Serbia may be among the frontrunners, while Albania/Kosovo, Montenegro and North Macedonia follow different paths depending on regulatory and operational readiness.
Coupling will not eliminate volatility. In some cases, it may transmit EU volatility more directly into Western Balkan markets. Consumers in currently lower-price zones may face stronger convergence with higher neighbouring prices. Generators may gain access to larger markets but also face tougher competition. Traders may lose some explicit-auction arbitrage but gain more liquid short-term markets.
The strategic question is therefore not whether coupling is good or bad. It is how each participant prepares for it. Utilities need trading capability. Regulators need credible rules. TSOs need coordinated capacity calculation and congestion management. Exchanges need liquidity. Investors need revenue models that work both before and after coupling.
Market coupling is not just a technical upgrade. It is the gateway through which the Western Balkans become part of Europe’s real-time electricity economy.
