Albania is preparing a new competitive solar power auction expected to require battery energy storage, reflecting a shift toward renewable projects designed to manage electricity production and delivery more flexibly. The tender is being developed by the Infrastructure and Energy Ministry in cooperation with the European Bank for Reconstruction and Development (EBRD). The auction could launch before the end of 2026 or in early 2027.
Tender development and regulatory framework
The initiative marks a departure from earlier solar procurement approaches that focused mainly on adding generation capacity. It is structured around electricity sector legislation that entered into force in June 2026. That legislation establishes a clearer framework for combining storage facilities with renewable generation assets.
Under the new rules, developers are given greater flexibility to manage electricity production and respond to changing wholesale-market conditions. This regulatory change is intended to support projects that pair generation with storage rather than treating storage as separate infrastructure.
Solar growth and role of storage in dispatch
Albania’s solar sector has expanded quickly, with installed capacity exceeding 600 MW by the end of 2025. During 2025, solar generation accounted for a record 11% of national electricity production. The expansion is notable in a system historically dependent on hydropower, where output can vary with rainfall and reservoir levels.
Battery storage could allow solar developers to move part of their output away from periods of abundant daytime generation toward higher-value trading hours. This would potentially reduce exposure to low-price periods while improving the commercial and operational value of solar electricity.
Auction design, market access and financing considerations
The commercial viability of hybrid solar-storage projects will depend on multiple factors including auction design, storage requirements, grid connection costs, and financing conditions. It will also depend on whether projects can earn revenues from electricity trading and system services. For project economics, these elements determine how value is captured under market rules.
The Albanian Power Exchange, ALPEX, is expected to play an increasingly important role in providing renewable generators with market access. ALPEX enables producers to sell electricity into the organised day-ahead market, adding an option beyond conventional long-term supply arrangements.
For banks and investors, combining solar production with battery storage increases the complexity of financial assessments compared with standalone renewables. Revenues would depend not only on annual output but also on hourly price differences, battery operating strategies, and contractual exposure to balancing costs.
Market liberalisation goals tied to export ambition
The government links renewable expansion, storage development and electricity-market liberalisation to its ambition to turn Albania into a net electricity exporter by 2030. The next auction is expected to test whether Albania can shift from expanding renewable capacity toward projects offering greater flexibility and more reliable commercial delivery.
