EXECUTIVE SUMMARY
A 10-year tolling agreement will support the planned 207 MW / 830 MWh battery energy storage project in northern Italy. The partnership provides revenue certainty, supports grid flexibility and renewable energy integration, with construction expected in 2027 and commercial operations planned for 2028.
Companies: Axpo, Zelestra
Project: Utility-scale Battery Energy Storage System (BESS)
Location: Friuli-Venezia Giulia, Italy
Capacity: 207 MW / 830 MWh
Agreement: 10-year physical tolling agreement
Construction Start: Expected in 2027
Commercial Operation: Planned for 2028
Axpo, a Switzerland-based energy company active across electricity trading, renewable energy and energy services, has signed a long-term tolling agreement with renewable energy developer Zelestra for a planned 207 MW battery energy storage system (BESS) in northern Italy. The agreement marks Axpo's first battery storage tolling contract in the Italian market and supports the deployment of utility-scale energy storage infrastructure.
The project will be developed, owned and operated by Zelestra in the Friuli-Venezia Giulia region of northeastern Italy. Once operational, the battery energy storage system will provide approximately 830 MWh of storage capacity to support renewable energy integration and improve flexibility within one of Italy's most industrialised regions.
The 10-year physical tolling agreement is designed to provide long-term revenue visibility for Zelestra while allowing Axpo to optimise the battery system's participation in Italy's electricity market.According to the deal, Axpo would offer optimisation services in order to ensure smooth integration of renewable energy production and provide flexibility services necessary for the stability of the electricity grid in the country.
The construction of the storage system is likely to commence in 2027 and become operational in 2028. The project is among others in development across Italy, as part of utility-scale battery storage systems that are being used to provide flexibility of the electricity grid in light of increased generation of renewable energy.
As per Axpo, battery energy storage solutions are getting more popular to manage supply and demand of electricity and facilitate renewable generation as well. Tolling contracts have been playing a crucial role for the developers to earn reliable income in order to invest in big energy storage facilities.
Zelestra stated that the agreement strengthens its battery storage portfolio in Italy. With the planned project, the company said it will hold approximately 970 MW of authorised battery storage capacity in the country, making it one of Italy's largest authorised battery storage owners.
The partnership reflects the increasing role of commercial agreements between energy companies and storage developers in supporting renewable energy integration, improving grid flexibility and enhancing electricity system resilience. As battery storage deployment continues to expand across Europe, similar long-term agreements are expected to support investment in flexible infrastructure needed for the transition to a low-carbon electricity system.