LONDON: Independent energy company NatPower and Tesla announced on Tuesday a multi-year agreement to develop 25 gigawatt-hours (GWh) of battery energy storage capacity across Italy and the United Kingdom, marking the first phase of a project valued at up to $5 billion.
The agreement comes as European countries accelerate investment in battery storage infrastructure to support growing renewable energy generation and improve grid stability.
Under the partnership, NatPower will deploy Tesla’s Megapack battery storage systems and utilize the company’s energy trading technology to optimize electricity purchases and sales.
The initial phase includes the construction of five battery storage projects, forming part of a broader programme that aims to exceed 100 GWh of storage capacity in the coming years.
The companies said total construction costs for the full programme are expected to range between $4 billion and $5 billion, while projected revenues could surpass $15 billion over a 20-year period.
NatPower Chief Executive Officer Fabrizio Zago said the partnership was designed to address challenges in delivering energy infrastructure projects on schedule despite the availability of capital and technology.
He said the collaboration creates a framework that aligns financing and project execution and could be replicated in other markets.
Battery storage has become a critical component of Europe’s energy transition, helping balance electricity supply and demand as solar and wind power generation expands across the region.