Southern Europe battery revenues set to halve by 2030 as cannibalisation deepens – Aurora

Southern Europe battery revenues set to halve by 2030 as cannibalisation deepens – Aurora Battery storage revenues in Italy, Greece and Romania could drop 50% by 2030 as solar oversupply crushes capture prices. Aurora Energy Research projects that merchant battery revenues in southern Europe will fall by roughly half by 2030, driven by the same solar buildout that is now flooding daytime power markets across Italy, Greece and Romania.³ Battery investors have piled into those markets on the expectation that intraday arbitrage, charging cheap solar at noon and selling it back during evening peaks, would remain lucrative. The consultancy's modelling suggests that as more solar comes online, the midday price trough deepens while the evening peak narrows, squeezing the spread that batteries depend on.³ Germany offers a preview of the dynamic. Grids added a record 8.8 GWh of storage in 2024 across Europe, ten times the 2020 level, yet German negative-price hours rose from 3% of the time in 2023 to 5% in 2024. In the first eight months of 2025 that hit 10%. “The market is screaming for capacity,” Michael Waldner, CEO of Zurich-based consultancy Pexapark, told The Economist.² Southern Europe is more exposed. Italy’s solar penetration is higher on average than Germany’s, and its interconnection capacity to export surplus power is lower. Romanian and Greek grids are even more constrained. The region’s battery fleet is still small, but new projects are being approved quickly, which risks a glut of storage chasing a shrinking revenue pool.^1,4 The revenue squeeze will hit standalone merchant projects hardest. Co-located renewable-plus-storage hybrids, particularly those paired with solar in Germany, currently offer better returns because the battery can charge directly from the plant without paying grid fees. Aurora’s earlier analysis, published on 2026-05-11, identified Germany as the best hybrid location in Europe for investors.³ Italy’s grid bottlenecks may push some data centre and storage investment toward Spain and eastern Europe instead. Up to €60bn of data centre investment is expected in Italy as part of a €100bn-plus European surge driven by artificial intelligence, yet connection delays are already emerging as the critical risk in the north, according to consultancy Key to Energy partner Virginia Canazza.¹ Greece adopted the EU’s 2023 renewables legislation on 2026-05-04, which developers said would accelerate green power uptake. But faster renewables deployment without equally fast grid reinforcement will compress battery capture prices sooner.⁴ For now, the forward signal is unambiguous. Every new solar panel that clears the connection queue pushes midday power prices lower and shortens the profitable discharge window. Battery projects that lock in power purchase agreements or capacity payments may survive the revenue downturn. Those betting purely on merchant arbitrage face a rapidly tightening band.^2,1 The next data point to watch is Q3 2026 capture prices in Italy’s day-ahead market. If the summer solar peak pushes negative-price hours above the 10% threshold seen in Germany, it will confirm Aurora’s trajectory months earlier than the model’s 2030 endpoint.²