How storage is reshaping Italy’s energy system

During a chat with pv magazine on the sidelines of the Smarter E trade show in Munich, Germany, Federico Brucciani, secretary of Italia Solare, offered a broad and candid assessment of the state of photovoltaics and energy storage in Italy, touching on market dynamics across the residential, commercial & industrial (C&I), and utility-scale segments.

Brucciani described the storage sector in particular as being in a strong growth phase, while stressing that the expansion is far from uniform. In particular, he drew a clear distinction between residential and other segments, noting that “the storage market in Italy is booming,” but adding that “you have to distinguish the residential segment, which is driven by the the eco-bonus – which is an income tax (IRPEF) rebate.”

According to his account, recent incentive schemes, including regional rebate schemes, have fundamentally reshaped the residential market, not only stimulating demand but also changing the very nature of system design. As he put it, “with the Superbonus, residential installations have become PV-plus-storage systems,” reflecting a structural shift in how households approach self-consumption.

This evolution has led to a highly mature residential storage segment. “Brucciani pointed out that “”In 2025, 80% of residential PV systems were installed with storage,” Brucciani stated. This highlights a profound market transformation.

As a result, Italy has already built a significant distributed storage base, estimated at around 18 GW of installed capacity. This, he suggested, is beginning to represent a relevant system-level asset.

The picture changes markedly when moving to the commercial and industrial segment. Here, Brucciani was notably critical, arguing that “C&I in Italy does not yet have a real storage market.” One of the main constraints, he explained, is the lack of in-house energy expertise within companies. “Business owners don’t have anyone following the energy side,” he said, referring especially to SMEs.

This is compounded, in his view, by a fragmented and unstable support framework. He noted that “the C&I segment is subject to regional tenders, so it goes through constant stop-and-go cycles,” making long-term investment planning difficult.

As a result, storage deployment in the segment remains minimal. “In C&I, we are basically still without batteries,” he said bluntly, adding that most installations remain PV-only systems.

Even in volume terms, the segment remains limited relative to its potential. While acknowledging ongoing activity, Brucciani stressed its inconsistency, noting that “around 300 MW per year are being installed, but with continuous stop-and-go dynamics.”

Turning to utility-scale storage, Brucciani outlined a significantly more optimistic trajectory. “By 2030, we will be close to 50 GWh of standalone storage,” he said, referring to large-scale batteries not necessarily co-located with renewable generation, but primarily used for grid services and system balancing.

In this context, he highlighted the central role of Terna, the country’s grid operator, which effectively controls the deployment of large-scale storage assets. “The large batteries are managed by Terna,” he said, noting that this regulatory choice has created a more orderly but also more rigid market structure.

Another key constraint is the cautious stance of the financial sector. According to Brucciani, banks are open to storage projects, but only on a merchant basis, indicating a preference for more conservative and standardized risk structures.

A central theme of the discussion was the untapped potential of grid flexibility. Brucciani emphasized that distributed storage could play a transformative role in system operation, describing the situation as “quite extraordinary” in terms of its potential impact on distribution networks.

However, he argued that the main barrier is regulatory rather than technological. “Flexibility has been introduced through pilot projects,” he said, but added that “we are still stuck at the pilot stage,” underscoring the lack of a fully operational market framework.

This situation also concerns distribution system operators such as e-distribuzione, which have implemented several pilot initiatives but have not yet transitioned to a fully commercial flexibility market.

More broadly, Brucciani offered a somewhat counterintuitive assessment of the Italian regulatory environment, stating that “the Italian regulatory framework is one of the most stable and clearly defined,” especially when compared with other European markets, which are often perceived as simpler but not necessarily more effective.

In closing, he shifted to policy instruments, stressing that he is reluctant to frame current measures as traditional incentives. “I don’t like talking about incentives,” he said, suggesting instead the need for structural support mechanisms such as guarantee schemes.

In particular, he argued that “for both residential and C&I, this would be a huge lever,” as such mechanisms could reduce uncertainty associated with annual tax deduction schemes, which currently remain the primary market driver.

He concluded by acknowledging that, at present, “tax deductions are the main driver,” while implying that the next phase of market development will require more stable, long-term instruments to ensure predictable growth of the sector.