Rapid battery deployment across Southeast Europe is expected to narrow the price spreads underpinning merchant arbitrage and lower prices for some balancing services. As storage capacity expands, investors in long-term projects will need revenue models that account for competition from batteries. Those models also need to remain viable if current arbitrage and ancillary-service prices fall materially.
Storage capacity expands across Southeast Europe
Bulgaria’s storage fleet exceeds 6.2 GW of power capacity and 19 GWh of energy capacity, according to the latest estimates. Romania had 1,162 MW of storage power capacity and 2,312 MWh of storage energy capacity on 1 October; the year was not specified. Hungary has moved above 1 GW of grid-scale storage capacity.
Greece commissioned the 330 MW / 790 MWh Larissa BESS in Thessaly in October 2026. A separate 100 MW / 200 MWh battery project is at HELLENiQ ENERGY’s facilities in Thessaloniki. The available information does not say that the Thessaloniki project has been commissioned.
Battery deployment puts pressure on market revenues
Batteries charge during low-price hours, increasing demand, then discharge during high-price hours, adding supply. As more capacity operates, midday price troughs may become less deep and evening peaks less extreme. This squeezes the spread between solar-heavy midday hours and evening demand peaks, with the regional fleet developing quickly enough to change the price curve within a single investment cycle.
Balancing services face a separate pressure: relatively small amounts of fast-response capacity can saturate high-value services and push clearing prices lower. A narrower spread does not necessarily make new storage uneconomic. However, investors need to test revenues against reductions in both arbitrage capture and ancillary-service prices.
Project design and operating strategy can create value beyond standalone arbitrage. Four- or five-hour batteries can compete in different time windows from one- or two-hour systems, while co-location with renewable generation can reduce curtailment and support shaped power purchase agreements (PPAs). Industrial batteries can monetise demand optimisation and resilience, and portfolio batteries can improve a trader’s imbalance position as standalone arbitrage margins shrink.
According to the regional outlook’s investment guidance, projects entering service in 2028 or 2029 should not be valued using 2026 price spreads. The market is shifting from first-mover economics towards operating excellence. Long-term battery storage revenue models that assume some erosion of current arbitrage opportunities are central to a credible investment case.