How important are trading and aggregation services for the ongoing development of PV in South-East Europe?
In the Balkans and South-East Europe, renewables have grown faster than the grid can absorb. There is strong investor appetite to build new capacity, but the grid and demand side cannot yet adapt to the volatility of these sources, and we are seeing significant curtailment on the production side, which effectively means wasted energy. Aggregation services address this directly. Most renewable projects in the region are small and decentralised, and their owners rarely have a trading department, so aggregators pool these assets, balance them and open access to revenues from day-ahead, intraday and balancing markets. This is now essential for stabilising the system and making output more predictable for grid operators.
Is this challenge specific to South-East Europe or common across the continent?
It is a common European challenge wherever renewable penetration is high, from Germany to Greece. What differs is the regulatory environment and the maturity of the local trading infrastructure. In South-East Europe, the imbalance between rapid renewable build-out and grid readiness is particularly visible, which is why aggregation and optimisation services are booming here.
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Many companies now offer aggregation and trading. What sets the technology you work with apart?
Dispatch decisions in this new market are highly complex. To extract the best performance from an asset every day, you need to participate in multiple revenue streams and make decisions very quickly, which exceeds what a classical trading desk can deliver. The platforms and technology Capalo AI works with integrate machine learning, artificial intelligence, forecasting algorithms and automated decision-making into the virtual power plant. Speed is the critical competitive advantage. Deciding when to buy from the grid at lower prices and when to inject at higher prices is what secures higher revenues, and it also protects assets from unnecessary degradation.
What regulatory and structural challenges remain across the region?
The biggest challenge is that every market is different. Licensing procedures, required documentation, financial guarantees and even the tax framework vary significantly, and while EU passporting helps in theory, the moment you move to on-the-ground licensing you see how fragmented the reality is. Grid codes, capacity mechanisms and platform integration all differ from country to country.
How do you address that fragmentation operationally?
The most effective approach is to build local teams, experts who understand their national systems from the inside and can respond quickly to regulatory or operational changes. We hold weekly calls with local TSO and DSO operators, run seminars and maintain continuous communication with authorities, so that any local issue is understood and addressed immediately.
In which markets are you currently active?
We have a 1.6 GW pipeline of BESS and hybrid assets across 11 markets, with live assets in six European markets: Finland, Sweden, Poland, Lithuania, Latvia and Bulgaria. We will shortly start trading in Romania and Greece as well, with Portugal, Spain and Estonia to follow later this year. In each of these markets we are at various stages of licensing, either as balance service provider, balance responsible party or trader, or through first contracts with asset owners.
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How is cross-border cooperation developing in the region?
There has been noticeable momentum in the past months. Ministries and grid operators across South-East Europe are meeting more frequently and working to align directives and remove regulatory obstacles.
What role does the European Union play in supporting this integration?
The EU is actively supporting cross-border initiatives between grid operators. In its most recent announcements, funding has been extended to cross-border digitalisation, not only to projects contained within a single member state. That is an important signal, because digital infrastructure is what will ultimately allow flexibility services and trading to operate seamlessly across borders.
Where do you see the priorities for the next phase?
Three areas stand out. First, raising awareness among asset owners that optimisation is not something they can realistically manage alone. Second, ensuring seamless integration with local grid systems through strong local presence. Third, strengthening the bankability of flexibility platforms so that the financial sector recognises them as a reliable revenue component. Better integration of renewables, storage and trading will be one of the defining tasks of the coming decade.
Interview by Hans-Christoph Neidlein
