IPP Neoen has enlisted BESS supplier NHOA Energy for its first energy storage project in Italy.
NHOA Energy will supply Neoen with the battery energy storage system (BESS) technology for the 10MW/51MWh ‘Broni Battery’ project, in the province of Pavia, Northern Italy.
The project has a 15-year Capacity Remuneration Mechanism (or capacity market) contract awarded by transmission system operator (TSO) Terna in the December 2024 auction, for delivery from Q1 2026.
The auction cleared at €56,000 (US$65,000) per MW of ‘probability-weighted’ power per year, NHOA told Energy-Storage.news, referring to what is more commonly known as a de-rating factor. Four-hour BESS have a 67% de-rating factor, meaning the de-rated or probability-weighted capacity of the Broni project contract is 7MW.
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The successive auction for 2027 delivery was held in February 2025 and cleared at €47k/MW/year.
The business case for grid-scale energy storage in Italy looks set to be driven by the capacity market in the North of Italy and the MACSE scheme (Meccanismo di Approvvigionamento di Capacità di Stoccaggio Elettrico) in the South/Central regions of the country. Both provide 15 years of contracted revenues.
The capacity market, where contract holders are obligated to bid in the day-ahead and ancillary services markets, may make up 30-40% of BESS project revenues, according to some estimates.
The first MACSE auctions will run at the end of September. Winning projects’ capacity will effectively be handed over to Terna for use in a time-shifting platform serving renewable asset owners, and projects in MACSE will derive up to 80% of their revenues from it, analysts estimate.
Together, the two schemes should enable the commissioning by early 2028 of at least 20GWh of BESS capacity in Italy. Terna is targeting 50GWh of new energy storage by 2030. However, one developer-operator we interviewed recently for ESN Premium reckoned that target might be overly ambitious.
BESS will also play in the country’s ancillary service markets, although its future role providing grid-forming services like voltage control and inertia is uncertain following Terna’s self-procurement of substantial synchronous condenser capacity.
Though it’s gone through several changes of ownership and name, NHOA was originally founded in Italy in 2005 as Electro Power Systems (EPS), before being acquired by utility and power firm Engie, which then sold it to Taiwan Cement Corporation (TCC), a deal which completed in late 2024. NHOA therefore has plenty of experience in the Italian energy storage market, recently working on 39MWh and 50MWh projects for customers.
While it is Neoen’s first BESS in Italy, the Brookfield-owned independent power producer (IPP) is highly active in the energy storage market elsewhere. We’ve recently reported on its projects in Canada, Australia, Finland, Sweden and Germany.
