Electricity

EU members offer 272 financial instruments to back energy storage – report

eu study energy-storage financial instruments

Photo: iStock

Published

February 15, 2024

Country

Comments

comments icon

0

Share

Published:

February 15, 2024

Country:

Comments:

comments icon

0

Share

The European Union (EU) member states have put in place 272 financial instruments for energy storage projects, totaling up to EUR 113 billion, according to a study on investment schemes for energy storage in the EU.

The study on financial instruments and models for energy storage was carried out as part of the Investors Dialogue on Energy – an initiative launched by the European Commission and its Directorate-General for Energy in 2022. The aim was to assess and upgrade financing schemes and propose new ones to mobilize financing in the context of the European Green Deal.

According to the study, wider deployment of energy storage solutions can help lower electricity prices during peak hours, minimize price fluctuations, and enable consumers to utilize their own energy. However, storage project “financeability” is affected by their technology readiness level (TRL), the levelized cost of storage, and the range of services they can provide, the study reads.

Loans and grants are the most popular instruments across the EU

The energy storage sector faces obstacles such as the lack of revenue mechanisms and limited access to capital. Financial instruments, however, can address some of the barriers to investment by making projects more appealing for investors.

A mapping of financial instruments at member state level resulted in data on 272 instruments available for financing energy storage in the 27 EU member states.

“Among these 272, loans and grants are the most popular instruments across the EU. All instruments together provide an estimated cumulative financing for up to EUR 113 billion,” according to the study.

The amount allocated to grants, EUR 57 billion, is more than twice the size of what is allocated to loans – EUR 25 billion.

Only three schemes are specifically designed for energy storage, most schemes target at least one more energy segment, and 176 schemes target all segments of the energy value chain.

Three key characteristics for a financial support scheme to be effective

Most of the mapped instruments only support mature and market-ready projects, favoring SMEs and larger companies, but smaller companies and households should not be at a disadvantage, the study finds.

The authors of the study identified three key characteristics for a financial support scheme to be effective in the energy storage sector: the seamless provision of different types of financing, long-term stability and visibility, and the provision of technical assistance services together with financing.

The expansion of the offering of financial schemes emerged as particularly important for countries with lower market maturity, and the use of equity and guarantee schemes should be leveraged more to mobilize private financing, particularly in countries with high storage capacity targets, according to the study.

Comments (0)

Be the first one to comment on this article.

Enter Your Comment
Please wait... Please fill in the required fields. There seems to be an error, please refresh the page and try again. Your comment has been sent.

Related Articles

Shopping mall operator break ground major solar power plant Romania

Shopping mall operator to break ground on major solar power plant in Romania

01 December 2024 - Monsson Group sold a 50 MW photovoltaic project in northwest Romania to shopping mall operator NEPI Rockcastl

croatia renewable energy projects hgk marija sculac

Around 40 renewable energy projects pending in Croatia

29 November 2024 - Power grid bottlenecks could jeopardize connecting new power plants to the system but also the operation of the ones already online

Serbia Energy Sector Development Strategy 2040 2050

What does Serbia’s new Energy Sector Development Strategy bring

29 November 2024 - The National Assembly in Belgrade passed the Energy Sector Development Strategy of Serbia up to 2040 with Projections up to 2050

European Commission energy affordability decarbonization

New European Commission weighing energy affordability versus decarbonization goals

28 November 2024 - The European Union wants to maintain the rapid pace of decarbonization while enabling affordable energy prices