The renewable energy fund KGAL ESPF 5 has announced a partnership with Italian energy firm IMCS to jointly develop four battery energy storage systems (BESS) in Italy. The planned projects have a combined capacity of 1.1 gigawatts (GW) and aim to address the increasing fluctuations in electricity production from renewable energy sources.
The fund highlighted that energy storage systems are gaining political backing due to their ability to stabilize the grid, a key factor in the growing importance of renewable energy. “This strengthens the basis on which we can continue to offer our ESPF 5 investors a double-digit return in the future,” said Florian Martin, co-chief executive of KGAL.
The joint venture allows KGAL and IMCS to develop these BESS assets from an early stage, with plans to sell them once they reach the ready-to-build phase. The anticipated returns from this venture are expected to exceed the fund's target return.
IMCS, which has a long history of developing large-scale solar projects in Italy, is considered an ideal partner for this initiative. “With its highly qualified interdisciplinary team, IMCS is the ideal joint venture partner for developing BESS projects efficiently and promptly through to approval,” said André Zücker, another co-chief executive of KGAL.
Raffaello Giacchetti, CEO of IMCS, emphasized the strategic timing of the venture, noting Italy's need to build at least 15 GW of new energy storage systems by 2030 to meet national energy targets. “We are pleased to enter the emerging market for battery energy storage systems in Italy with our trusted partner KGAL at a strategically favourable time,” Giacchetti added.
Institutional investors have until October 2024 to participate in the final closing of the KGAL ESPF 5 fund.
