Enel to build 1.6 GW/6.6 GWh of storage under Italy’s capacity market scheme

Italian power utility Enel has announced it secured 12.9 GW of the 41.5 GW awarded by Italian grid operator Terna in its latest capacity market auction.

“Enel was awarded 10.4 GW of existing capacity, 1 GW of foreign capacity, and 1.5 GW of new capacity, over two thirds of which will be met by battery energy storage systems (BESS) and the remainder by renewable facilities, as well as by the upgrading and refurbishment of some gas-fired plants already in service that are necessary to ensure the adequacy and safety of Italy’s electricity system,” the company said in a press release.

In a statement to pv magazine, a spokesperson from Enel revealed that the awarded storage capacity will come from 20 projects totaling 1.6 GW, with contracted capacity accounting for 1 GW. “Half of the project will be located on the island of Sardinia and the other half on mainland Italy,” the spokesperson added.

The storage facilities will be built with lithium-iron phosphate (LFP) batteries and are expected to come online in 2024. Their combined storage capacity is 6.6 GWh.

The company’s spokesperson also revealed that around 40% of the remaining 11 GW of capacity awarded to Enel in the auction will come from renewable energy sources, while the remaining 60% will come from natural gas power plants.

Italy began capacity market auctions in 2019. These procurement exercises have often been seen by the renewable energy industry as mechanisms to help conventional power producers retain market share.