What is Spain's battery storage market?

Spain’s battery storage market is dominated by customer-sited systems. Utility-scale storage remains nascent. Currently, Spain’s storage market is mainly composed of small-scale batteries co-located with solar PV. Spain’s household electricity prices now stand at over EUR 0.30/kWh on average.

Why do we need battery energy storage systems in Spain?

Due to the large capacity of installed hydroelectric and thermal storage systems and the resilience of the Spanish power grid, the need for Battery Energy Storage Systems (BESS) in Spain has been relatively low. The lack of a clear regulatory framework for BESS has also hindered its development in Spain so far.

How much does electricity cost in Spain?

Spain’s household electricity prices now stand at over EUR 0.30/kWh on average. In addition, Spain’s reliance on fossil gas has increased price volatility in recent years.16,17,18,19 This variability, combined with Spain’s excellent solar resources, make the economics of combining solar with storage increasingly favorable.

How much energy storage capacity does Spain have?

When it comes to installed energy storage capacity in general, Spain is one of the leading countries within Europe (see figure 2). Currently, Spain has 6.3GW of hydroelectric and 1GW of thermal storage capacity installed. In fact, the non-BESS storage capacity in Spain is higher than in any other European country.

Is Spain's oversupply causing a decline in energy prices?

The overproduction is so vast that increased top-end storage may not be enough to even out the market. The company notes that Spain’s oversupply is causing the average price generators can earn in comparison to the overall average energy price (“solar capture rates”) to fall.

Will California's solar projects be replicated in Spain?

The state still “faces challenges from oversupply”: a trend that could be replicated in Spain. However, 98% of California’s solar projects are co-located with BESS, whereas Spain only has 3.8% of its planned projects with BESS. California required a constant production of 25 GW avg. to meet demand in 2023.