Greece is facing a critical challenge in its energy transition: the rapid expansion of renewable energy has overloaded the power grid, leading to high levels of curtailment (unused energy being wasted).

To reduce these losses and enhance system stability, the country has implemented a new regulatory framework for granting final connection offers to independent energy storage stations (Σ.Α.Η.Ε.). The regulation establishes a maximum capacity of 4,700 MW for new storage installations, although industry experts warn that this figure may not be sufficient to absorb all the excess renewable energy.

Rapid Renewable Growth Without Sufficient Storage

Greece’s renewable sector has grown at an accelerated pace in recent years. However, this expansion has also resulted in increased energy curtailment, as the transmission and distribution infrastructure has struggled to absorb all the electricity generated during periods of low demand.

In 2024, nearly 900 GWh of green energy was curtailed, accounting for approximately 3.5% of the country’s total renewable generation, according to Stelios Psomas, an energy and sustainability expert, in an interview with Strategic Energy Europe.

According to the Hellenic Association of Photovoltaics, Greece requires at least 8 GW of storage to prevent curtailment of solar and wind energy in the coming years. “Without adequate storage infrastructure, more than 1.5 TWh of clean electricity could be lost in 2025 due to grid capacity constraints. These losses represent millions of euros in unrealized revenue for renewable producers and a major obstacle to achieving the country’s climate goals,” the association stated in an interview.

In this context, they claim that 7.5 GW to 8 GW of storage capacity is needed to address the issue. Studies conducted in Greece suggest that for every GW of standalone battery energy storage systems (BESS), energy curtailment is reduced by between 0.62 and 1.18 TWh, depending on storage capacity.

The decline in energy demand has become a major barrier to Greece’s energy transition, reflecting the challenges of an electricity system struggling to keep pace with rapid renewable energy growth.

The New Regulatory Framework: A Partial Solution to the Problem

To address these challenges, the Greek government has approved a regulation granting 4,700 MW of connection capacity for storage projects, with the following distribution:

Transmission System (ΑΔΜΗΕ): 3,800 MW

• Group A1, A2, and A3: 900 MW
• Group B: 250 MW
• Group C: 2,650 MW

Distribution System (ΔΕΔΔΗΕ): 900 MW

• Group A: 350 MW
• Group B: 150 MW
• Group C: 150 MW
• Group D: 250 MW

This capacity will enable the capture of excess renewable generation during low demand periods and its release when needed, thereby enhancing energy security and grid stability.

Additionally, the plan aligns with the National Climate and Energy Plan (PNEC), which projects a total storage capacity of 4,700 MW by 2030.

Storage Auctions and Investment Limits

To date, Greece has supported 900 MW of standalone storage projects through three previous auctions. Under the new plan, investors will have up to 18 months to submit their applications to the system operator.

Specific rules have been implemented to prevent market concentration and ensure fair competition:

• Individual companies can apply for storage projects of up to 250 MW.
• In the distribution segment, this limit is lower, at 50 MW.
• Each entity will be able to install up to 500 MW of total battery capacity by 2029, including previous storage auctions and batteries operating as part of renewable plants.

A financial guarantee has also been set for projects:

• €200,000 per MW for the transmission network.
• €50,000 per MW for the distribution network.

Benefits of Storage for the Greek Power Grid

The implementation of storage projects will not only reduce energy curtailment, but also bring several key benefits to the electricity system:

• Greater flexibility and grid stability: By storing energy during low demand hours and releasing it during peak times, grid congestion is reduced, and supply security is enhanced.
• Reduced reliance on fossil fuels: Greece still relies on gas and coal-fired power plants during high-demand periods. With more storage, these sources can be replaced with stored clean energy.
• Optimization of transmission infrastructure: Instead of investing in expensive new transmission lines, storage allows for better management of already-generated and distributed electricity.
• Higher renewable energy integration: Storage facilitates the connection of additional solar and wind projects without compromising grid stability.

Investment Challenges and Lack of Operational Subsidies

One of the key aspects of the new regulatory framework is that storage projects will not receive operational subsidies, meaning they must operate under market-driven mechanisms. This presents a challenge for investors, as the profitability of these systems will depend on their ability to generate revenue through price optimization and ancillary grid services.

To attract investment, the government has established strict technical and financial criteria, including:

• A reference cost of €200/kWh for storage installation.
• A minimum operational storage capacity of two hours.
• Compliance with all technical requirements for connection to the Hellenic Electricity Transmission System (E.S.M.H.E.).
• Participation in Frequency Maintenance Reserve, Manual and Automatic Frequency Restoration Reserve (ΕΔΣ, χΕΑΣ, and αΕΑΣ) procedures.
• Mandatory recycling and dismantling at the end of the project’s life cycle, in accordance with European legislation.

Conclusion: Greece Needs More Storage to Secure Its Energy Transition

The new regulatory framework for energy storage in Greece is an important step toward mitigating renewable energy curtailment and improving grid stability. With 4,700 MW of approved connection capacity, the country aims to optimize its energy infrastructure and reduce reliance on fossil fuels.

However, the solar sector warns that this capacity is insufficient, as at least 8 GW of storage is required to prevent significant energy losses in the coming years. If the government does not increase this limit, Greece risks continuing to waste large volumes of renewable energy, which could negatively impact the profitability of solar and wind projects.

In this context, energy storage is emerging as a fundamental pillar for the future of the Greek electricity system, enabling greater renewable energy integration, reduced curtailment, and a more efficient and profitable energy transition. The challenge now will be ensuring that storage capacity expands at the necessary pace to absorb excess clean energy and maximize the potential of renewable energy in the country.