EP Produzione secures 170 MW battery storage in Italian capacity market auction

Italy’s latest capacity market auction for power to be delivered next year assigned 42.2 GW of capacity, data published by transmission system operator Terna showed. These includes nearly 37.6 GW of existing capacity, around 233 MW of new capacity, as well as 4.36 GW of capacity from abroad. 

While Terna has not announced how much battery storage capacity was catalyzed by the auction, Rome-headquartered power generation company EP Produzione, a subsidiary of Czech energy group EPH, said it had won contracts for two projects.

EP Produzione will build 170 MW of battery energy storage systems with a two hour storage duration at two sites. One project will be located at the company’s Fiume Santo coal-fired power plant in Sardinia, originally set up in 1960s.

The project will be a further step forward “in the conversion of the plant, after the coal phase-out, into an integrated energy hub based on renewable and low-carbon technologies capable of contributing to the energy security and sustainable transition of the island,” the company said.

The second battery system will be delivered at Ferrara Energy Center, Emilia-Romagna, northern Italy, with the goal of reusing the current industrial area.

EP Produzione was awarded a total of five projects in the 2025 capacity market auction, each with a 15-year offtake contract.

The other three projects involve introducing further efficiency measures to the company’s operating combined cycle gas plants (CCGT) in a bid to increse thier power by around 100 MW. EP Produzione currently operates six thermal power plants with a capacity of around 4.4 GW.

The total investment for the new projects amounts to EUR 170 million ($183 million).

“We are very satisfied with these results,” says Luca Alippi, CEO of EP Produzione. “This will allow us to make important new investments and therefore strengthen the role of EP Produzione in the Italian electricity market and contribute to the security of the energy system.”

In its official statement. Terna has reveled the valorization premiums for the accepted quantities across all groups of projects.

The existing capacity was assigned at the maximum fixed price of EUR 45,000/MW a year – with more than 22 GW located in the north of Italy. The total new capacity, which already has permitting approval, was allocated at EUR 67,500/MW a year, well below the EUR 85,000/MW a year maximum fixed price determined by the Italian energy market regulator Arera.

Besides domestic capacity, an additional 4.36 GW were awarded to virtual capacity, with prices ranging between EUR 3,491/MW a year and EUR 4,788/MW a year.