Pricing pressures boost energy storage uptake in Southern Europe

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Panellists at Large Scale Solar Southern Europe spoke about the solar market in Italy, Romania and Bulgaria.
The opportunities and challenges of solar PV in Italy, Romania and Bulgaria came under the spotlight. Image: Jonathan Touriño Jacobo.

Interest in co-locating solar PV with energy storage is increasing in Southern Europe, as grid curtailments and negative or near-zero prices for solar PV become more frequent in the region.

At yesterday’s keynote panel for the Large Scale Solar Southern Europe event, in Athens, Greece, panellists highlighted the increased interest in the technology, and the co-location of battery storage PV was one of the major topics across the sessions on the first day of the event.

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Velizar Cholakov, international business development expert at solar EPC firm HEC Solar, said that “battery storage is gaining traction” in Bulgaria, as seen by a recent co-located tender in the country. The country is currently facing a “surge in renewable energy”, added Cholakov, with conventional solar PV as the most popular technology in Bulgaria.

Helped by the push of the co-located tenders and increased interest in battery energy storage system (BESS) in the country, Cholakov said Bulgaria expects to install up to 1GW in the next two years.

Stelios Psamos, policy advisor at the Greek trade association Hellenic Association of PV Companies (HELAPCO), struck a similar tone, calling energy storage “a game changer” during the session about the Greek market. Psamos wrote a guest blog for PV Tech on the Greek solar market yesterday.

A modernisation fund in Romania is also pushing renewables forward with funding for solar PV, wind or BESS projects, explained Radu Eremciuc CEO at renewables developer Green Balkans Energy Romania, adding that “the political will is there”. The fund, which is currently in place, would finance projects with up to €460,000 (US$494,000) per MW, with a maximum of €20 million per investor.

Cholakov added that co-located projects – and more specifically, solar-plus-storage ones – are “really advancing” as they have many advantages compared to developing them separately. Among these are the increased efficiency and stability of the power generation, said Cholakov, adding: “Also, you’re going to optimise land use. It is very important too, especially for countries with limited land capacity”.

Italy’s agriPV ban

Looking at the specifics of each of the countries explored during the opening session – Italy, Bulgaria and Romania – Luca Matrone, global head of energy at bank firm Intesa Sanpaolo said that “the reality is that things are progressing” in Italy and Europe in general. Although not yet at its necessary annual target of 100GW of new renewables additions, Europe is getting closer to it and added 80GW last year, said Matrone.

Matrone highlighted that despite the fact that Italy added over 5GW of solar PV, the most in over a decade, more still needs to be done. He singled out the permitting process as one area that particularly needs improving, and alluded to the recent government ban on agrivoltaics in Italy as “jeopardising the installations on agricultural land”.

Despite that blow to the Italian solar market, other incentives are still in place in the country, such as the Decreto FER which pays €85/MW for new solar capacity in auctions. “That’s a massive amount compared to the cost of production,” Matrone said.

Long-awaited CfD in Romania

The Contracts for Difference (CfD) mechanism in Romania, which is expected to be launched later this year, has a €3 billion grant from the European Union and “pushes Romania very far into the green energy market”, explains Radu Eremciuc CEO at renewables developer Green Balkans Energy Romania. The scheme was expected to be launched last year but has continuously been delayed and is not set for the next month or two, said Eremciuc.

Bidding prices are targeted to be around €90/MW, however Eremciuc says that prices might be more towards €70-80/MW.

This is one of the major implementations for the solar industry in Romania, along with a €1 billion fund to reinforce the country’s grid. “Things are getting much more optimistic in the field,” says Eremciuc.

Grid: a common challenge

Frequent readers of PV Tech will be aware that grid issues have been a recurring topic – at the global scale – with several reports indicating a lack of grid capacity to sustain the growth of renewable energy in general and, more specifically, solar PV.

In Romania the grid issue falls more on who pays for reinforcing the network. Eremciuc explains that the cost of reinforcing the grid, which can fall upon the developer in Romania, can be too high. Eremciuc gave the example of a 4MW solar PV plant that was abandoned because reinforcing the grid would have cost €10 million. “The government is preparing a legislation to bid on a specific amount for the grid.”

One of Bulgaria’s major challenges, however, is its political instability, as it has had several parliamentary elections in the past three years. “We need a lot of legislative changes that were supposed to be online and introduce floating PV or agrivoltaics. We also need clarification regarding battery storage regulatory frameworks.”

Risks of financing PV projects in Southern Europe

Finally, Matrone explained that high interest rates continue to negatively impact the funding of PV projects. However, banks are finding ways to sustain the financing of projects with different loans, such as construction loans with shorter maturity. “[With construction loans] you have more flexibility, as you don’t need to have a power purchase agreement (PPA) still in place,” added Matrone. This allows the developer to secure a PPA later on in the phase of the project.

Moreover, Matrone said there has been a positive attitude to financing merchant projects. “It was very concerning in the past, now there’s more openness.” This does not mean that fully merchant projects are being financed but Matrone explained that a 60-40 split between PPA and merchant projects are being realised.

1 July 2025
Athens, Greece
The summit will address the most pressing challenges, opportunities, and trends in the solar power production industry, as well as exploring its complimentary technologies: Energy Storage and Green Hydrogen.

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