Croatia’s distribution system operator, HEP ODS, now considers the regulatory framework for battery storage sufficiently robust. Three connection models are available, though key rules for congestion management and system services remain under development. Restrictions on charging storage systems from the grid are likely to apply for investors.
€30 billion required for storage in the Balkan region
Figures presented at the Green Energy Fair highlight the scale of ongoing transformation: by 2030, €600 billion will need to be invested in electricity grids across Europe, with approximately €30 billion required in the Balkan region. As a well-connected part of Southeast Europe’s power system, with extensive interconnectors, Croatia now faces the central challenge of integrating battery storage into the grid and defining the regulatory conditions for its deployment.
Ivan Burul, a contract management specialist at Croatian DSO HEP ODS with expertise in connecting large generation facilities, offers a nuanced perspective: “I believe the regulation is sufficiently advanced for battery storage to be connected to the grid.” Burul closely monitors electricity sector regulation and contributes to drafting the relevant rulebooks at HEP ODS.
Complete connection procedure for large storages
There are three specific connection models that investors should understand. The first applies to large, standalone storage systems connected directly to the grid through a dedicated metering point. In this case, storage operators must follow a full connection procedure, identical to that for generation facilities and clearly defined in the regulations. “First, an energy sector permit must be obtained. Once this is issued, the standard connection process begins,” Ivan Burul explains. “During this process, the project is described in detail and connection contracts are signed.” The process follows the usual steps, including proof of ownership and submission of technical documentation.
The second model involves integration with existing generation facilities, such as photovoltaic plants. A key restriction applies, which has an impact on profitability calculations. “These battery storage systems must not be charged from the grid. Their sole function is to shift the feed-in of self-generated electricity,” Burul notes. For new installations designed with battery storage from the outset, the connection procedure begins with a technical description. The battery storage is considered part of the solar installation and does not require a separate energy sector permit. If storage is added to an existing PV facility, no new connection process is required, provided the connection capacity remains unchanged. In this case, an application for electricity sector approval is sufficient.
Market potential of battery storage still limited
The third model applies to so-called active customers. “For households with a small capacity up to 10.8 kilowatts, only electricity sector approval is required,” says Burul. For systems above this threshold, a full connection process is necessary.
Despite these clear pathways, Burul notes that the full market potential of battery storage remains untapped. “Battery storage cannot reach its full potential until rules for congestion management and the provision of non-frequency ancillary services are finalised,” he says. These rules have already been drafted, completed public consultation and are now awaiting final approval. “We expect them to be approved soon, and with their introduction, the range of possible market roles will increase,” he adds.
BayWa r.e.: “Co-located storage is a more complex challenge”
For investors, core connection options are already in place. However, more lucrative business models beyond self-consumption optimisation — such as balancing market participation or providing system services — will only become fully accessible once the remaining rules are enacted. In addition, the restriction on grid charging for storage systems connected to generation facilities limits flexibility and reduces potential arbitrage revenues. (su)
