Energy storage has become a strategic priority for Recurrent Energy, which now sees it as central to the future of the renewable business in Spain. This was the key message delivered by Jaime Leirado, General Manager of Spain at the company, during his participation at FES Iberia 2025, a leading energy sector event held in Madrid and organised by Strategic Energy.
“Storage is no longer a question—it is already a reality,” Leirado asserted, explaining how the 28 April blackout acted as a catalyst to accelerate decisions that were already technically and economically necessary.
A Different Business: Technical and Bankability Challenges
Recurrent Energy, part of the Canadian Solar group, has long-standing experience in energy storage, with over 3 GWh developed and 7 GWh manufactured by its in-house unit, iStore, across markets such as the US, UK and Australia. Yet Leirado stresses that storage is not a mere extension of the solar business.
“A battery involves many commercial and operational decisions. It’s a completely different business model,” he explained. Unlike solar plants, which operate in a relatively simple fashion, storage projects require close alignment between technical and commercial teams.
“You basically plug in or unplug a solar plant. But with a battery, you’re constantly deciding when and how to operate it,” Leirado noted. This operational complexity has a direct impact on financing strategies.
One of the biggest challenges is bankability, due to high income volatility. “You might generate 80% of your annual revenue in just two months,” he said. To manage this risk, Recurrent Energy is exploring tolling agreements and hybrid PPAs that combine solar and storage revenues to smooth income streams.
Regulatory Innovation and Market Readiness
Leirado emphasised that storage deployment had previously been hindered by unclear regulation and a lack of economic incentives. “Part of the reason why storage didn’t scale faster in Spain is because we didn’t have the administrative and financial conditions in place,” he said.
Today, that landscape is shifting. Regulatory clarifications have emerged, especially regarding hybrid projects, which previously faced hurdles like double permitting for interconnected assets. “We are starting to see a clearer and faster path for battery development,” he affirmed.
At the same time, technological advances are reducing project CAPEX. Leirado pointed out that increased battery production in China is bringing down prices, and there’s still room for significant reductions. “Prices still need to fall further to truly unleash storage potential,” he added.
Hybrid Models, Merchant Strategies and Market Flexibility
Recurrent Energy is currently focused on hybrid projects in Spain, where batteries share grid access with solar plants. “We’re concentrating on hybrids because obtaining grid capacity for standalone storage is extremely difficult,” Leirado said.
He highlighted the importance of tailoring battery sizing to future market needs. While four-hour batteries may align with upcoming capacity mechanisms, two-hour configurations may work better for hybrid plants with uncertain charging access. “It’s essential to keep options open, as the regulatory and commercial landscape is still evolving,” he remarked.
The company is also open to merchant models, depending on the market. Although these offer potentially higher returns, banks still prefer predictable revenue streams, making PPAs and tolling contracts more attractive in the near term.
“A battery is like an option; it can be worth a lot or nothing at all,” Leirado said, underscoring the need to structure revenue flows in ways that ensure financial viability.
Toward a More Resilient Renewable Architecture
Leirado also reflected on the broader implications of the April blackout, noting that it exposed structural weaknesses in Spain’s energy system, both technical and economic. “Selling solar at zero prices is not sustainable,” he warned.
The combination of regulation, cost decline and system pressures is now forcing a shift toward storage-integrated solar models. According to Leirado, this transformation is well underway: “The debate is no longer if storage is needed, but how much, how fast, and in what form.”
For Recurrent Energy, the direction is clear: without storage, there can be no sustainable energy transition or bankable long-term business model.
Revisit the discussion via Strategic Energy Corp’s YouTube channel
