​Terna is seeking feedback on new rules for the Italy capacity auction for 2028 delivery. The proposal tightens de-rating coefficients for all battery durations, driven by forecasts of 4 GW of new batteries in the Nord zone and 64 GW of solar nationwide. The consultation closes on March 9, 2026.

Key takeaways

• Terna assumes 4 GW of new battery capacity in the Nord zone, much higher than currently authorized levels. This aggressive assumption reduces qualified capacity for all battery durations by 20-25%.
• Italy currently has the most favorable battery de-rating in Europe. The proposed values would put Italian batteries below Belgium and closer to GB for 4-hour systems.
• Lower de-rating reduces the total qualified volume of the existing fleet, widening the gap between supply and demand and supporting higher clearing prices. However, non-participating renewables and batteries enter the supply curve at 0 €/MW-year by rule, and the projected growth in solar (64 GW, up from 43.5 GW) and BESS pushes the curve right, absorbing much of that space.
• A new bidding floor (Art. 24.2b) requires existing operators to offer full capacity from the first session, compressing auction strategy along with the 4% price-step rule (Art. 24.9).

The proposed capacity market reform reduces battery qualification across all durations

Italy’s de-rating coefficients determine how much of a battery’s nameplate power counts as firm capacity. Currently, a 4-hour system qualifies at 67% of nameplate.

Under the proposal, this drops to 53%, meaning a 100 MW project would contract for 53 MW instead of 67 MW. Shorter durations face even steeper cuts, with 1-hour batteries dropping from 24% to 18% and 8-hour batteries from 90% to 69%.

This reduction reflects a saturation risk. As the battery fleet grows, Terna expects batteries to discharge simultaneously during stress events, so each additional MW is projected to contribute less to system reliability.

These coefficients are specific to the 2028 delivery auction and will be recalculated for future auctions as the fleet evolves.

Italy’s proposed de-rating would put batteries below most European capacity markets

Italy currently leads Europe for BESS de-rating.

But the proposal would change that: at 53%, a 4-hour battery would fall below Belgium, and the gap with GB widens at longer durations.

De-rating methodologies vary widely across markets, but overall, Italy is moving from the top of the European range toward the middle.

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The capacity market supply curve shifts twice: less qualified capacity, more zero-price bids

​The de-rating reduction has a double effect. Each battery qualifies for fewer MW, but the total qualified capacity of the existing fleet also shrinks. If Terna keeps the same adequacy target, the gap between supply and demand widens, opening more auction space for new entrants and likely raising clearing prices.