The aid measure has been approved in favour of energy storage operator IE-Energy to partially finance the battery installations. Taking the form of a direct grant, the measure will cover approximately 30% of capital expenditures.
The measure will contribute to the modernisation of Croatia’s energy network, increase the country’s and the EU’s energy security and accelerate the decarbonisation of the Croatian energy sector.
Although no details have been released on specifics for the storage projects, it is believed that independent TSO HOPS (Hrvatski operator prijenosnog sustava) will be utilising the grid balancing services to coordinate grid management in the country.
According to the European Commission, TSOs use grid-scale batteries to maintain a continuous balance between electricity supply from power stations and demand from consumers, and to electricity when needed.
The Commission assessed the measure under Article 107(3)(c) of the Treaty on the Functioning of the European Union, and in particular its Guidelines on State aid for climate, environmental protection and energy.
The Commission has also concluded that the aid is necessary to address an existing market failure, as there is a lack of incentives to provide balancing services to TSOs through grid-scale energy storage facilities.