The co-existence of the capacity market (CM) mechanism and the Macse incentive scheme this year offers many options for battery energy storage systems (Bess) operators, Optimize Energy country manager Pablo Lopez de Rego Lage told Argus.
Which of the two mechanisms is more attractive for Bess?
There is no universally correct answer — it depends on the investor, the portfolio structure and the risk-allocation strategy. Both mechanisms ultimately serve the same fundamental purpose: providing a contracted revenue base that help make a Bess project bankable. The choice between them is therefore a strategic portfolio decision, rather than a project-level one.
Bess assets are following, at an accelerated pace, the same path that renewables took over nearly a decade — from dependence on public support schemes to a mature ecosystem of contracted revenue structures, power purchase agreements and direct market participation. The difference is speed, enabled by the availability of proven financial models and a regulatory environment that has rapidly developed bankability tools specifically for storage.
Developers managing diversified pipelines increasingly build an optimal mix of Macse, CM and private structures — such as tolling agreements, floor contracts with revenue sharing, and merchant arrangements — tailored to the overall risk-return profile of their portfolio. Macse — with its 15-year duration and public offtaker — can become the foundation that helps stabilise the portfolio cash flows and lower the cost of capital; the CM and alternative structures allow to capture flexibility and upside potential.
The second Macse tender has already been scheduled for 24 November, while the CM auction for 2029 delivery has been pushed "past the summer break". If the CM auction were to be held after the Macse one, would that timeline be intended to discourage Bess from participating in the former?
The interpretation is understandable, but probably incomplete. Grid operator Terna treats the two mechanisms as communicating vessels: final Macse procurement volumes may be adjusted close to the auction to reflect capacity already procured through the CM, and vice versa.
Since the incentive mechanisms are mutually exclusive, capacity contracted under Macse cannot be offered again into the CM. The sequencing therefore reduces the pool of Bess capacity available for the second mechanism, but the effect is structural rather than punitive.
The more interesting question is whether this framework is sufficiently adapted to a market in which sophisticated operators increasingly optimise asset allocation between the two mechanisms using complex portfolio-management strategies.
Energy regulator Arera has proposed annual maximum remuneration for the second Macse tender of €22,000/MWh/yr, well below the 2025 level. What are your expectations for the premium after the first auction held in September last year surprised everyone on the downside?
The outcome of the first auction — approximately €13,000/MWh annually, compared with a reserve premium of €37,000/MWh — was not an accident.
It reflected a rational combination of structural factors that are unlikely to be repeated: an already-developed project pipeline, available grid connections linked to decommissioned capacity, lower equipment costs and a market eager to secure the first long-term bankable contract in the Italian storage sector. In that environment, Macse was effectively the only available bankability vehicle.
For 2026, the context has changed. Tolling agreements, floor structures with revenue sharing, settlement-based swaps, and combinations involving the CM now represent credible alternatives. This changes how sophisticated operators price their bids. The premium is no longer determined solely by capital expenditures or by Macse being the only bankable structure available, but also by the opportunity cost relative to these alternatives, the investor's return targets and the project's role within a broader development pipeline.
The price offered into Macse implicitly reflects the level of contracted revenue that a developer wants within its overall portfolio mix, while recognising that competitors may have very different cost structures and return requirements.
On the equipment side, trends in commodity markets and evolving Chinese export conditions introduce uncertainty that could significantly influence bidding levels. With more than 32GWh in advanced permitting stages against a requirement of 16GWh, competitive pressure remains intense. However, the final clearing price will reflect the quality of each operator's value chain, as much as broader market conditions.
Enel secured over 60pc of available capacity in the first Macse auction. Is there a risk of market concentration in the coming tender?
The Macse framework does not include any award cap for a single operator or corporate group.
The issue is already being discussed by regulators. In its comments to the February 2026 CM consultation, solar association Italia Solare explicitly called for the introduction of such limits, acknowledging the excessive concentration observed in Macse auction outcomes. For the second auction, however, the rules remain unchanged.
Several structural factors continue to favour large players: extensive authorised project pipelines in eligible zones, economies of scale in equipment procurement, shared grid-connection infrastructure across multiple assets and the ability to spread development costs across larger portfolios. These advantages create a structural gap that is difficult — but not impossible — for smaller developers and investors to overcome.
Will Bess also dominate the CM for 2028 delivery, or will there be room for combined-cycle gas turbines (CCGTs)?
The answer depends primarily on derating factors. Terna has proposed reducing the coefficients applied to batteries — a four-hour storage system would see its qualified capacity fall from 67pc to 53pc of nominal power.
Each MW of battery capacity would therefore contribute less to the auction, creating more room for other technologies and likely pushing clearing prices upward. In such a scenario, the most efficient CCGTs could become competitive again.
However, there is a more fundamental dimension. Bess and gas-fired generation provide different and complementary adequacy services: batteries excel at rapid response and energy arbitrage, while CCGTs provide dispatchable generation during periods when renewable output is insufficient. The key variable will not simply be who participates and at what cost, but whether the CM design is calibrated to properly recognise this complementarity.
