Europe: Utility-Scale Energy Storage Booms with High Growth and Strong Momentum
UK: H1 2025 Energy Storage Capacity Up 14% YoY, Planning Applications Hit Record High
In the first half of 2025, the UK’s grid-scale energy storage installations increased by 14% year-on-year, while total storage capacity rose by 20%. According to Solar Media, as of early May 2025, the UK had 6,424 MW / 9,160 MWh of operational battery energy storage systems (BESS).
In terms of project approvals, 902 MW / 1,703 MWh of energy storage projects received planning permission in June 2025, a moderate level compared with previous months. In contrast, over 6 GWh of projects were approved in May, nearly 3 GWh in April, and more than 3 GWh in March. With the latest round of approvals, the total approved capacity of UK energy storage projects has reached 6.324 GW / 13.183 GWh.
June also marked a record high for planning applications in 2025, with 883 MW / 2,805 MWh of new energy storage projects submitted. The previous record was set in April at 925 MW / 1,849 MWh. As of June 2025, the total submitted capacity for energy storage projects stood at 3.619 GW / 7.489 GWh, highlighting continued strong investment momentum in the UK energy storage sector.
Italy: Utility-Scale Energy Storage Booming, Significant Tenders Expected This Year
Significant Growth in Grid-Connected Storage in 2024: According to ANIE, Italy added approximately 1.3 GWh of grid-connected energy storage systems in Q4 2024, marking a 2.4% year-on-year increase. For the full year 2024, total energy storage capacity reached 2.1 GW, unchanged from 2023, corresponding to 5.9 GWh, a 41% YoY increase.
Market Competition Intensifies; MACSE Mechanism Rolling Out: The energy storage market in Italy is becoming increasingly competitive, with the MACSE (Capacity Market for Storage) mechanism gradually being implemented. According to the EU Commission’s JRC Smart Electricity System Tool, as of April 2025, Italy had 112 energy storage projects, including 72 operational, 24 announced, 13 under construction, and 3 permitted projects.
The first auction under the MACSE framework is scheduled for September 30, 2025, aiming to allocate 10 GWh of new storage capacity to further enhance market competitiveness. The plan is to gradually expand storage capacity under this mechanism, reaching 50 GWh by 2030.
Germany: Utility-Scale Storage Mechanism Optimized, Growth Potential Expands
Increased Subsidies and Capacity Market Reform: Under the Renewable Energy Act, starting in 2025, energy storage projects with 2+ hours duration are eligible for an €90/kWh investment subsidy (up from €60/kWh in 2024) and exempt from grid usage fees, saving €15–25/MWh in operating costs. The capacity market reform now allows storage projects of 1+ hour to participate, locking in 1.2 GW of storage capacity (up from 0.5 GW in 2024).
Surge in Utility-Scale Storage in 2025: In 2024, Germany installed 0.46 GW / 0.73 GWh of utility-scale storage, a 140% YoY increase, with an average duration of 1.6 hours. From January to July 2025, newly installed capacity reached 358 MW / 716 MWh, representing 67% / 113% YoY growth.
Other Countries See Widespread Growth, Strong High-Growth Certainty
In 2024, European countries intensively funded energy storage projects, especially in the second half of 2024, when many large-scale projects began construction. 2025 and 2026 are expected to be peak years for grid connections.
Beyond the mainstream Western European markets, Eastern European countries are also seeing rapid deployment of storage projects, including Poland, Bulgaria, and Romania. Based on planned projects, other European countries installed 1.7 GWh of utility-scale storage in 2024, with 2025 installations expected to exceed 6 GWh.
Italy Introduces High Storage Subsidies in 2024, Other Countries Launch Incentive Policies in 2025
High Subsidies Drive Storage Growth: In 2024, Italy secured €17.7 billion in EU support for energy storage, funding projects totaling 9 GW / 71 GWh, with support continuing through 2033. Starting in 2025, countries such as Spain, the Netherlands, and Poland launched storage incentive policies to provide financial backing for new installations. In Germany, the government initiated substantial energy transition subsidies: in March, the German parliament approved a constitutional reform allowing the country to take on significant new debt for infrastructure and climate investments, allocating €100 billion from a €500 billion infrastructure and defense fund specifically for climate and energy transition projects (KTF), supporting Germany’s goal of climate neutrality by 2045.
Grid Reliability Concerns Boost Storage Demand: On April 28, a large-scale blackout affected over 50 million residents in Spain, Portugal, and southern France. A government report released by Spain’s Ministry for the Ecological Transition on June 17 attributed the outage to “multi-factor overvoltage” and “insufficient reactive power preparedness.” Frequent blackouts in Europe are further driving demand for energy storage solutions.
Middle East: Explosive Order Growth in 2024, Utility-Scale Installations Set to Surge in 2025
Project Tenders Expected to Reach 50–60 GWh in 2025: In 2024, Sungrow secured a 7.8 GWh second-phase project in Saudi Arabia, scheduled for grid connection in 2025. In January 2025, several major Middle East storage project orders were announced: BYD won a 12.5 GWh SEC Phase III order, SmartPropel Energy secured the 20 GWh Masdar Data Center project in Abu Dhabi, and Trina Solar partnered with Zhejiang Huadian to develop a 300 MWh Abydos storage project in southern Egypt. Additional projects totaling 40–50 GWh are expected to be announced later in 2025.
Utility-Scale Installations to Surge in 2025–2026: Middle East energy storage installations were approximately 4 GWh in 2024, projected to reach 20 GWh in 2025, doubling to 40 GWh in 2026, with steady growth expected in subsequent years.
Emerging Markets: Utility-Scale Energy Storage Surges First in Middle East, South America, Australia, and Southeast Asia
Chile: Diversified Energy Storage Market Takes Shape, 2025 Construction Set to Reach Record High
Operational Capacity and 2030 Target: As of March 2025, Chile has 954 MW / 3.66 GWh of operational solar lithium ion battery energy storage systems, accounting for 48% of the national 2 GW 2030 target. Based on current project progress, this target is expected to be achieved ahead of schedule in January 2026.
Market Dynamics: Chinese companies continue to dominate orders, while European and American firms focus on high-end projects, and local firms participate in EPC roles. Energy storage system prices currently range between 1.0–1.2 CNY/Wh, significantly more competitive than the Middle East market.
Key Projects and 2025 Outlook: Major projects, including those in the Atacama region, are progressing steadily. By H2 2025, 500 MW of projects are expected to complete testing and begin operations, reinforcing Chile’s position as the most dynamic energy storage market in Latin America.
Australia: Large-Scale Utility Storage Under Construction, Grid Connection Peaks Expected in 2025–2026
- The scale of energy storage under construction increased significantly in 2024. In Q4 of 2024, two new large-scale energy storage projects in Australia were connected to the grid, totaling 419MW/1277MWh, marking the first quarterly grid connection figure exceeding 1GWh. For the entire year of 2024, 619MW of new large-scale energy storage was connected to the grid — a year-on-year decrease of 15% — corresponding to a capacity of 1677MWh, a year-on-year increase of 77%. The average storage duration increased from 1.3 hours to 2.7 hours.
- In 2024, 11.3GWh of new large-scale energy storage projects received investment commitments, essentially the same as the previous year. Meanwhile, 11.1GWh of new large-scale energy storage projects were under construction, a year-on-year increase of 41%, reflecting rapid growth in the construction scale — supported by the rising adoption of 200kW/372kWh industrial and commercial energy storage lithium-ion battery systems and other high-efficiency modular storage technologies.
India and Southeast Asia: Major Energy Storage Projects Rapidly Deployed, Led by Chinese Companies
India – A policy-driven boom:
- Mandatory energy storage policy implemented: Starting in 2025, new wind and solar projects must include four hours of energy storage (some states require six hours), driving a 180% year-on-year surge in tenders in the first half of the year.
- Increased fiscal subsidies: The central government increased subsidies for energy storage projects to 30% (capped at $50/kWh), spurring local giants such as Adani and Tata to accelerate their deployment.
Philippines – Island energy transition sees a breakthrough:
- Diesel substitution is a rigid demand: Island microgrid policies shift diesel subsidies toward energy storage ($0.10/kWh), driving a 400% year-on-year surge in installed capacity in the first half of the year.
- Chinese capital dominates the supply chain: BYD holds a 60% market share in battery cells, while Sungrow and Kehua Data secure 70% of system integration orders.
- Business model innovation: The emergence of energy storage leasing models (such as Aboitiz Power’s 15-year capacity lease agreement) reduces the initial investment pressure on developers.
- Disaster Adaptation Upgrade: Projects in typhoon-prone areas are required to have IP67 protection and emergency black start functionality, increasing costs by $30/kWh.
Summary: The large-scale energy storage market in emerging markets is set to boom from 2024 to 2026, with growth expected to continue through 2030. In 2025, installed capacity in emerging markets is projected to reach 34 GWh, representing a 221% year-on-year increase, driven by expanding deployment of 100kW/215kWh air-cooled solar LiFePO₄ lithium battery system and other advanced energy storage solutions.
Regional highlights include:
- Middle East: expected to grow 4× to 20 GWh
- Chile: expected to double to 4 GWh
- Australia: expected to increase 75% to 3.5 GWh
- Philippines & India: each contributing 2 GWh
