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EU approves Italy's €17.7 billion state aid for large-scale energy storage deployment

The European Union (EU) Commission has approved a state aid scheme aiming to fund the rollout of over 9GW/71GWh of energy storage in Italy.

The scheme totalling €17.7 billion (US$19.5 billion) will provide annual payments covering investment and operating costs for those developing, building and operating large-scale energy storage in Italy. It will be alloted via a competitive bidding process where developers with the lowest offer win out.

Transmission system operator (TSO) Terna estimates Italy will need 9GW/71GWh of new energy storage to integrate its growing renewables pipeline, an average duration of just under 8 hours.

That duration will be split between battery energy storage system (BESS) and select pumped hydro energy storage (PHES) projects, though even on the BESS side developers have been touting portfolios with durations up to 8 hours.

Terna and its regulators have been busy updating the electricity market in Italy to facilitate the rollout of energy storage and developers and operators have been announcing gigawatt-scale pipelines of projects throughout 2023. The latest was UK-based Octopus, announcing a 1.5GW BESS development partnership with local developer Nexta Capital a week ago.


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