In 2023, USD 1.8 trillion was invested in clean energy, with the United States, China, and the United Kingdom leading the global market for battery energy storage systems (BESS), according to EY's 2024 Renewable Energy Country Attractiveness Index (RECAI). However, when considering attractiveness for renewable investments supported by significant political commitment, Germany replaces the UK in the top three, with the US and China remaining dominant. Notably, Italy is also making significant strides in this ranking. Despite the substantial investment in clean energy, including USD 660 billion in renewables and an increase in capacity by 507 GW, the investments are still insufficient to meet COP28's goal of tripling renewable capacity by 2030. Years of underinvestment in infrastructure have caused grid congestion in many mature markets, eroding investment value and stifling growth. For instance, annual investment in Europe's distribution networks must double to EUR 67 billion by 2050 to achieve these goals, as per the EY-Eurelectric Grids for Speed study.
The solution may lie in energy storage, particularly BESS, which can help stabilize and strengthen grid infrastructure and offer profitable opportunities for investors. Arnaud de Giovanni, EY Global Renewables Leader, stated that increasing battery energy storage can address multiple issues hindering clean energy progress, including stabilizing the grid and enabling the connection of more distributed energy resources. According to the RECAI 2024 ranking, the US leads in attracting BESS investments, supported by a 30% tax credit from the Inflation Reduction Act, with California applying BESS in all buildings. Italy has risen to sixth place in the RECAI BESS ranking, following Germany (5th) and ahead of France (9th), India (8th), and Japan (10th). Italy aims to attract new investors with a goal of 71 GWh of grid storage through Terna's new forward market, offering long-term contracts indexed to inflation. The first auctions are set for December 2024, with capacity delivery expected in 2027. This is a significant leap from 17th place in 2020 and 14th in the previous edition, highlighting Italy's competitiveness in the BESS market. Southern regions such as Sicily, Sardinia, Puglia, and parts of Calabria are particularly attractive due to grid congestion and abundant renewable energy sources.
