Italian Battery Storage Installations Witnessed a Slump in Q2, 2023

Italian battery storage installations saw a dip in the second quarter of 2023, marking the first drop in over two years. This decline can be linked to the termination of credit incentives, as reported by the National Renewable Energy Association, Anie Rinnovabili. In Q2 2023, battery energy storage system (BESS) installations reached 676MW, marking a notable annual surge but showing a 14.6% quarterly decrease.

During the same quarter, the total units installed were over 69,520 with a cumulative storage capacity of 914MWh. This is a significant increase from the previous year's 370MWh, yet still short of the 1.14GWh observed in Q1 2023. The monthly average for BESS units installed between April and June saw a decline, dropping to 23,174 from about 27,000 in Q1.

The primary factor behind this quarterly drop was the Italian government's February decision to end the "superbonus 110pc" credit scheme, primarily intended for small-scale energy projects. This move, justified by Finance minister Giancarlo Giorgetti due to its strain on the public debt, had a cascading effect. However, installations that had enrolled in the scheme before February 2023 were unaffected, leading to a delayed impact and a surge in the first half of the year. As a result, there was a fourfold increase in the battery storage capacity in H1 2023, reaching a total of 1.5GW.

By the end of June, Italy's cumulative BESS capacity had expanded to 3.1GW/5.1GWh, with Lombardy leading the regions in terms of storage capacity. Notably, 99% of this capacity is distributed across households and businesses, with the majority of these storage units having capacities under 20kWh. The nation has achieved three-quarters of its targeted distributed storage capacity for 2030, while centralized storage lags significantly behind.

In the backdrop, around 50 large-scale projects, representing a potential of 3.8GW, are awaiting the green light from Italy's energy ministry, with grid operator Terna planning to add an impressive 6GW between 2025 and 2030.

According to Procurement Resource, Italy experienced a downturn in battery storage installations in Q2 2023, marking its first decrease in over two years due to the cessation of credit incentives. While the quarter witnessed a decline, the first half of the year overall saw a surge, driven by prior enrollments in the now-terminated credit scheme. Lombardy remains the leading region in storage capacity. As Italy approaches its 2030 energy goals, numerous large-scale projects await approval, indicating a robust pipeline for future growth in the sector.