Across Europe, one rule has hardened into received wisdom on the financing side of battery storage. As a senior owner-operator put it at this year’s Energy Storage Summit, no project above 100 megawatts is fully merchant. To raise non-recourse debt against a battery, you need a toll or a floor, a contracted revenue stream a lender can underwrite, and around 80 percent of UK capacity is wrapped in exactly that.<\/p>\n
There is one problem with applying that rule to Central and Eastern Europe. The contracted-revenue toolkit that makes UK, Italian and Polish batteries bankable, long-term tolls, capacity payments, 15-year auction contracts, does not really exist yet across most of the region. So when the EBRD closed a non-recourse project financing for a large, predominantly merchant standalone battery in Romania in June, it did something the textbook says should be hard. The way it was structured, the Scornice\u0219ti deal, is a template, and it answers the question every lender and fund underwriting non-subsidised storage in the region is asking: how do you make a merchant battery bankable before the market has tolls.<\/p>\n
Start with why batteries are harder to finance than the wind and solar projects that came before them. A renewable generator signs a long-term PPA and earns a relatively predictable price per megawatt-hour. A standalone battery does not. Its revenue is stacked from several streams at once, capacity payments where they exist, wholesale arbitrage, post-gate balancing, and ancillary services such as frequency response. Those contracts are short, the prices move, and the early reliance on ancillary markets fades as those markets saturate and push batteries toward arbitrage, where the spread is the prize but also the risk. That merchant character is precisely what makes a battery difficult to project-finance.<\/p>\n
The market’s response has been to contract the risk away. Lenders increasingly treat contracted revenue as the gating requirement for non-recourse debt, which has split Europe in two. On one side sit the bankable markets, the UK with its tolls and floors, Italy with 15-year capacity contracts from its MACSE auctions, Poland with 17-year inflation-indexed capacity payments, where leverage near 70 percent and double-digit unlevered returns against a low cost of capital are achievable. On the other sit the merchant-exposed markets, where projects work only when co-located or hedged. The gap between the two reflects regulation, not technology cost.<\/p>\n
Central and Eastern Europe has the demand for storage and the volatility that should reward it, but, with the partial exception of Poland’s capacity market, it has lacked the contracted-revenue products that make Western deals bankable. That is the gap Scornice\u0219ti fills.<\/p>\n
The project is a 127 megawatt, 254 megawatt-hour standalone battery in Scornice\u0219ti, in Olt county west of Bucharest, co-owned by the pan-European IPP R.Power and Eiffel Investment Group through its Eiffel Transition Infrastructure fund. The EBRD is providing up to \u20ac44 million of debt on a non-recourse project finance basis, to cover development, construction and operation. It is billed as one of Romania’s first large-scale standalone batteries.<\/p>\n
Two features make it interesting. First, the revenue model is mainly merchant. The battery will trade across Romania’s developing balancing and ancillary services markets under an optimisation agreement with the regional energy trader GEN-I, rather than sitting behind a long-term toll. Second, and this is the load-bearing part, \u20ac29 million of the EBRD’s financing is backed by an InvestEU first loss guarantee, explicitly there to mitigate the higher risk profile of merchant operations. The financing was arranged alongside the Polish promotional bank BGK, with PKO Bank Polski acting as account bank, and the project had also drawn an earlier capital grant of around \u20ac15 million from Romania’s recovery plan.<\/p>\n
Read the structure carefully and the trick becomes clear. Scornice\u0219ti did not make a merchant battery bankable by turning it into a contracted one. It made a merchant battery bankable by putting a public first-loss layer underneath the debt and a professional optimiser on top of the revenue. That is a different recipe, and it is one that travels.<\/p>\n
Strip Scornice\u0219ti to its parts and you get a replicable structure for non-subsidised storage in a market without tolls.<\/p>\n
The first piece is the public first-loss guarantee. InvestEU sits beneath a tranche of the senior debt and absorbs the early losses, so the lender is no longer underwriting raw merchant cash flow but a credit-enhanced version of it. Instead of a tolling counterparty taking the market risk, a public guarantee takes the first loss. The EBRD is the EU’s main delivery partner for the programme, with InvestEU guarantees of \u20ac777 million set to support up to \u20ac3.8 billion of EBRD financing through 2027, which is what gives this mechanism scale beyond a single deal.<\/p>\n
The second piece is the lender syndicate itself, a development bank leading alongside a national promotional bank and a commercial bank, providing patient, policy-aligned senior debt on non-recourse terms. This is capital that can live with a merchant profile a pure commercial lender would discount heavily on its own.<\/p>\n
The third piece is the route to market. An optimiser such as GEN-I dispatches and trades the battery across the full revenue stack, converting raw exposure into a managed, actively traded revenue stream. Lenders are increasingly clear that, in 2026, bankability follows demonstrated operational performance, and a credible optimiser is central to that.<\/p>\n
The fourth piece, optional but powerful, is a capital grant. A Modernisation Fund or recovery-plan grant reduces the equity and debt at risk on day one, lifting coverage ratios and making the first-loss layer stretch further.<\/p>\n
Put together, first-loss guarantee plus development and promotional bank debt plus optimiser plus grant, and you have a way to finance a mainly merchant battery non-recourse, in a market that does not yet offer a toll. That is how CEE storage becomes bankable ahead of, not after, the contracted-revenue products arrive.<\/p>\n
A template needs the right market to run in, and Romania is close to ideal for non-subsidised storage.<\/p>\n
The need is acute and quantified. Romania added more than 2 gigawatts of solar in 2025 and has cleared 4.2 gigawatts of renewables through two CfD auctions, with solar bids as low as \u20ac35 per megawatt-hour, while its grid struggles to absorb the output. The transmission operator estimates the system will need 10 to 20 gigawatt-hours of storage by 2030. Against that, installed battery capacity has only just passed 1 gigawatt-hour. The supply-demand gap is the investment case.<\/p>\n
The economics are among the best in Europe. Romania runs the widest daily day-ahead price spread in the EU, near \u20ac168 per megawatt-hour, with negative-price hours already appearing as solar floods the midday market. Spread is what a battery monetises, and Aurora Energy Research projects double-digit IRRs for standalone storage entering Romania as early as 2026, ranking it among the most commercially attractive markets on the continent.<\/p>\n
The policy scaffolding is in place. Romania has removed the double taxation of storage by exempting batteries from transmission tariffs and green certificate obligations, grants renewable-plus-storage projects accelerated grid connection, and has an EU-approved \u20ac150 million Modernisation Fund scheme awarding support for at least 2,174 megawatt-hours of standalone batteries through competitive tender. Standalone storage is now a stated part of Romanian energy policy, not just a private bet. And the capital is already arriving at scale: Enery closed a \u20ac460 million green financing for a 761 megawatt-peak solar and gigawatt-hour-plus battery project, and R.Power alone holds more than 1.2 gigawatts of standalone BESS in its Romanian pipeline.<\/p>\n
A high-spread, storage-short, EU-funded market with a deep sponsor pipeline is exactly where a first-loss-backed merchant structure should be deployed first.<\/p>\n
The template is powerful, not magic, and the risks deserve to be named plainly.<\/p>\n
It is still mainly merchant. A first-loss guarantee absorbs a tranche of downside, it does not remove it, and equity continues to carry real exposure to spread compression as several gigawatts of new storage arrive and erode the very spreads that make today’s returns attractive. Ancillary markets saturate first, then arbitrage tightens. The structure improves bankability; it does not make the revenue contracted.<\/p>\n
The credit enhancement is also finite. InvestEU first-loss guarantees are a rationed, catalytic resource, not a standing subsidy, and not every project will secure one. Development-bank-led financings are more bespoke and slower to close than a commercial tolling deal, and their replicability depends on continued public risk-sharing appetite and on genuine project quality, the sponsor, the optimiser, the grid position and a credible commercial operation date. Lenders in 2026 are underwriting live performance, not forecasts, so an unproven asset still has to prove itself. And Romania carries its own execution risks, from grid reliability to a grid-connection regime that is tightening toward competitive allocation.<\/p>\n
None of this undercuts the point. The Scornice\u0219ti structure is a bridge that lets capital underwrite non-subsidised storage now, in a market that needs it, while the contracted-revenue products mature. It is a way to be early, with the downside tail shared.<\/p>\n
We think Scornice\u0219ti is the most useful financing precedent in Central and Eastern European storage this year, precisely because it does not depend on a toll. It shows lenders, sponsors and funds a concrete, repeatable path to underwrite a predominantly merchant battery on non-recourse terms, by combining a public first-loss guarantee, development and promotional bank debt, a professional optimiser and a capital grant.<\/p>\n
For anyone underwriting non-subsidised storage, the read is straightforward. The bankability question in the region is no longer whether a merchant battery can be financed, but whether you can assemble the Scornice\u0219ti stack around a quality asset before spreads compress and before the catalytic guarantees are spent. Romania offers the best conditions to do that: the widest spreads in the EU, a grid that urgently needs storage, policy that now treats batteries as core infrastructure, and a financing template that has just been proven to close.<\/p>\n
The contracted-revenue markets of the West took years and several policy cycles to build. Romania is not waiting for them. With a first-loss guarantee doing the work a toll does elsewhere, the country has shown how merchant storage gets financed in the meantime, and the sponsors and lenders who copy the template now will be the ones holding the assets when the market matures around them.<\/p>\n","protected":false},"excerpt":{"rendered":"
Across Europe, one rule has hardened into received wisdom on the financing side of battery storage. As a senior owner-operator put it at this year’s Energy Storage Summit, no project above 100 megawatts is fully merchant. To raise non-recourse debt against a battery, you need a toll or a floor, a contracted revenue stream a… EBRD Just Financed Romania’s First Large Standalone Battery on a Merchant Model. The Scornice\u0219ti Template Is How CEE Storage Becomes Bankable<\/span><\/a><\/p>\n","protected":false},"author":6,"featured_media":2628,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"neve_meta_sidebar":"","neve_meta_container":"","neve_meta_enable_content_width":"off","neve_meta_content_width":70,"neve_meta_title_alignment":"","neve_meta_author_avatar":"","neve_post_elements_order":"","neve_meta_disable_header":"","neve_meta_disable_footer":"","neve_meta_disable_title":"","footnotes":""},"categories":[43],"tags":[],"class_list":["post-2627","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blog"],"acf":[],"_links":{"self":[{"href":"https:\/\/momentumgroup.ro\/en\/wp-json\/wp\/v2\/posts\/2627","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/momentumgroup.ro\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/momentumgroup.ro\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/momentumgroup.ro\/en\/wp-json\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/momentumgroup.ro\/en\/wp-json\/wp\/v2\/comments?post=2627"}],"version-history":[{"count":1,"href":"https:\/\/momentumgroup.ro\/en\/wp-json\/wp\/v2\/posts\/2627\/revisions"}],"predecessor-version":[{"id":2632,"href":"https:\/\/momentumgroup.ro\/en\/wp-json\/wp\/v2\/posts\/2627\/revisions\/2632"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/momentumgroup.ro\/en\/wp-json\/wp\/v2\/media\/2628"}],"wp:attachment":[{"href":"https:\/\/momentumgroup.ro\/en\/wp-json\/wp\/v2\/media?parent=2627"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/momentumgroup.ro\/en\/wp-json\/wp\/v2\/categories?post=2627"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/momentumgroup.ro\/en\/wp-json\/wp\/v2\/tags?post=2627"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}