Minister of the environment and energy security Gilberto Pichetto has signed a decree allowing Italy to proceed with its energy storage capacity auction, known as MACSE, in the first half of 2025.
Pichetto signed the decree last week (11 October), saying: “Increasing our storage capacity is essential to achieve the objectives of the NECP,” referring to EU member states’ National Energy and Climate Plans (NCEPs), their strategies to achieve EU energy and climate targets by 2030.
“The approval of the regulation marks an important advancement in the new design of the electricity market, focused on the development and integration of renewable sources,” he added.
The MACSE auction will provide 15-year contracts for energy storage projects whereby they will be paid annual premiums to cover operating costs in exchange for making their capacity available on the Dispatching Services Market (acronymised in Italian as MSD). It will be led by transmission system operator (TSO) Terna.
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The EU approved a €17.7 billion package to fund the programme in December 2023, and Terna is aiming for it to support the deployment of 50GWh of energy storage by 2030, which is lower than the initial 71GWh forecast.
The first phase of the scheme is specifically targeting lithium-ion battery energy storage system (BESS) projects while a second auction will be carried out for pumped hydro energy storage (PHES) projects, Terna’s two ‘reference’ technologies chosen for their technological and commercial maturity.
The lithium-ion BESS auction could be held as early as the first half of 2025, the Ministry of Environment and Energy Security said.
The auction, and the broader opportunities in Italy’s grid-scale market, were discussed at Solar Media’s Energy Storage Summit EU 2024 in London in February, with panellists calling the MACSE auction “unlike anything we’ve seen elsewhere” (Premium access article).
Consultancy Timera Energy recently said competition in the MACSE auction will be “fierce”, and suggested BESS operators maintain a merchant tranche of their project to offset potentially lower returns on the MACSE contracted tranche.
The main benefit of the MACSE auction is its long-term guaranteed revenues, which can bring banks to the table for financing projects. So far, the only substantial pipeline of BESS projects being built is from utility and independent power producer (IPP) Enel, in which it sold a 49% stake to fund Sosteneo.
The past two years has seen a flurry of BESS development activity from numerous local and international firms, which you can read about by browsing all our coverage of Italy here.
See the full text of the Ministry’s decree (in Italian) here.
