In 2025, Europe’s utility-scale energy storage sector continues to lead growth and is projected to achieve a near twofold expansion. Large-scale energy storage markets have particularly stood out, with utility-scale storage already dominating newly operational energy storage projects commissioned in the first half of the year.
The UK, Italy, and Germany are the top three countries in Europe by installed energy storage capacity and key overseas markets for Chinese energy storage companies.
* In the first half of 2025, the UK grid-connected 1.9 GWh of new battery energy storage system (BESS) capacity, a 78% year-on-year increase. Earlier this year, the operational BESS capacity in the UK stood at approximately 5,922 MW/8,175 MWh. Following the latest round of project approvals, the total permitted storage capacity has reached 6.324 GW/13.183 GWh.
This growth is closely linked to policy support from the UK government: the 2023 Energy Security Act proposed a £1.6 billion dedicated fund for energy storage, focusing on supporting R&D for long-duration energy storage (LDES) technologies. In December 2024, the newly elected Labour government released the Clean Power 2030 Action Plan, setting a target for clean electricity production to at least match consumption by 2030. “The growth rate of the UK energy storage market has exceeded expectations,” multiple industry analysts noted. They attribute this to accelerated project approvals, shorter construction cycles, increasingly mature business models, and improved project returns, which together have attracted more investors.
* Italy’s market growth has also been remarkable: in 2024, it added over 6 GWh of new energy storage capacity, a surge of 58% year-on-year. Large-scale storage accounted for 3.4 GWh of this, setting a European record and achieving a 15-fold increase in total new installations compared to the previous year. This brings Italy’s cumulative energy storage capacity to approximately 12.9 GWh.
This growth benefits from intensive policy support: in 2023, the EU approved a €17.7 billion energy storage plan to build over 9 GW/71 GWh of storage facilities. The 2024 National Energy and Climate Plan set a target of 65% renewable energy in power generation and 20 GW of energy storage capacity by 2030. As the share of renewables increases, so does the demand for storage. Coupled with substantial government subsidies and high project returns, the Italian market has attracted numerous companies.
* Germany’s market performance is equally impressive: by the end of the first half of 2025, the official national energy facility registry showed nearly two million battery storage systems connected to the grid. After July, this number surpassed two million, with a total installed power of 14.535 GW and available storage capacity nearing 22.1 GWh.
This growth is driven by energy transition policies: Germany aims to achieve 80% renewable energy in power generation by 2030 and carbon neutrality by 2045. To meet these goals, the federal government has long promoted its “Energiewende” (energy transition) strategy, which includes phasing out nuclear and fossil fuels, advancing renewable energy integration, and establishing distributed energy systems. A series of federal policies related to PV energy storage continue to deliver benefits, accelerating market growth.
Furthermore, emerging markets such as Finland, Romania, Bulgaria, and Poland are gaining momentum.
* Finland is promoting energy storage development through innovative tax policies. Companies installing PV and storage for self-consumption can receive a tax reduction of 20% of the project value (capped at €150 million). This reform has spurred rapid growth in Finland’s energy storage market, with 359 MW of industrial-scale projects announced for the next five years.
* Romania has exempted energy storage systems from various grid fees for electricity fed back into the grid (including transmission, distribution, system service, and green certificate fees), reducing operational costs by 20 to 30%. The country has also launched multiple subsidy schemes: the first round of PNRR allocated €80 million to support 1,300 MWh of projects (subsidies of €50,000-65,000/MWh). The Modernization Fund will invest €150 million to support solar and wind projects paired with storage (expected to add 3 GW) and another €150 million for standalone storage. Driven by these incentives, Romania plans to add 5 GW of battery storage capacity by the end of 2026.
* Although Bulgaria has long relied on coal and nuclear power (accounting for 29% and 40.5% of its electricity mix in 2023, respectively), it is accelerating the phase-out of coal power due to stricter EU emission reduction requirements. Leveraging its abundant solar resources, the country is developing solar energy, which in turn drives demand for storage. Currently, Bulgaria’s energy storage industry is still in its early stages. Aside from a small amount of battery storage, there is only one large-scale pumped hydro storage plant with 1.2 GWh of capacity, and grid balancing primarily relies on nuclear or thermal power. Predictions indicate that with the launch of the RESTORE plan, Bulgaria’s energy storage capacity is expected to reach 8-10 GWh in 2025.
* Poland is also active: in early 2025, the National Fund for Environmental Protection and Water Management launched a capital expenditure support program for grid-supporting energy storage (supervised by the Ministry of Environment). The program aims to enhance grid stability and energy security by supporting storage projects of at least 2 MW/4 MWh. Power producer PGE plans to invest approximately 18 billion Polish złoty (€4.3 billion) over the next decade to develop energy storage projects, deploying 10 GWh of new capacity and bringing its total to 17 GWh.
Driven by these countries, the European energy storage market is expanding at an accelerating pace.
Source: WeChat Official Account—高工储能
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