As CBAM definitive phase takes effect next year, coal-reliant economies in the Western Balkans are bracing for significant economic repercussions. Coal-powered electricity, a major export of the region, will be subject to new levies on carbon-intensive imports, making it more expensive to trade with the EU—its primary economic partner. With coal accounting for the majority of power generation in countries like Bosnia and Herzegovina, Serbia, and North Macedonia, the financial impact could be severe. Analysts suggest that while the tariffs may push governments to accelerate their clean energy transition, the shift will likely be difficult and costly. Nations that fail to decarbonize quickly may face considerable losses, with Bosnia and Herzegovina alone projected to forfeit over €220 million annually from electricity exports.

Despite available EU funding to support green energy projects, the financial resources currently allocated may not be enough to cover the full cost of the transition. The estimated €40 billion investment required to modernize energy infrastructure in the region does not account for the economic and social consequences of moving away from coal, such as job losses and worker retraining. Without significant local policy reforms, continued subsidies for outdated coal plants and a lack of investment in renewable energy could hinder progress. As the deadline for CBAM implementation nears, Western Balkan nations must decide whether to adapt to the new regulations or risk further economic strain as the EU moves forward with its climate commitments.

To help businesses navigate these challenges, CBAM Reports provides support with calculating embedded emissions, preparing CBAM reports in XML format, validating data, and ensuring seamless import into the CBAM registry. Contact CBAM Reports today for tailored assistance in achieving CBAM compliance efficiently.

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