A standalone two-hour battery energy storage system (BESS) entering operations in Greece next year could achieve an internal rate of return (IRR) of approximately 11-12%, according to analysis by Aurora Energy Research.
The consultancy says this IRR is around two percentage points higher than an equivalent project commissioned in 2030, with current elevated power market volatility causing global gas market uncertainty and creating near-term opportunities for both battery storage and renewables in Greece.
Greece remains heavily exposed to developments in global gas markets, with gas-fired generation accounting for up to 45% of electricity supply. Aurora’s latest analysis expects Greek wholesale electricity prices to average around €100 ($115.44)/MWh through to 2029.
Beyond the ongoing uncertainty around the Strait of Hormuz, Greece’s wholesale prices are expected to be impacted by the European Union’s planned phase-out of Russian LNG imports, with remaining pipeline gas flows expected to cease next year. Aurora says a complete stop of remaining Russian gas supplies could result in a 27% increase in Greek gas prices and a 13% increase in Greek baseload prices by 2028.
“These findings suggest that, despite expected capital expenditure reductions and increasing price cannibalization by 2030, near-term market volatility continues to support the economics of both utility-scale solar PV and BESS projects entering the market as early as 2027,” Aurora explains.
Sokratis Al Zoampie, Research Analyst at Aurora Energy Research, pointed out that BESS and renewables returns are likely to vary significantly depending on how gas supply disruptions unfold.
“However, history suggests that policy interventions often follow periods of market stress and have the potential to correct market disruptions,” Al Zoampie added. “In this respect, the upside for projects may prove temporary rather than structural.”
Greece supported the development of its battery storage market with a series of three government-backed auctions, the last of which concluded in March 2025, before turning its attention to an unsubsidized scheme. A total 900 MW of standalone storage was approved across the three auctions rounds but Greece has struggled to connect such projects, with some insiders citing institutional blocks.
In March, ESS News reported that investors have submitted applications for over 12 GW of standalone battery projects in Greece, far exceeding a 4.7 GW target set by the government.
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