Scatec is approaching its Romanian investments as an integrated portfolio of solar, wind and battery storage rather than a collection of individual projects, with batteries playing a central role in managing the part of renewable output that remains exposed to the market after Contracts for Difference.
The model reflects a broader shift in renewable-energy economics. CfDs can provide the contracted revenues needed to finance new generation, but they do not eliminate market exposure. In a conversation for the Energynomics podcast WATTs Next, Scatec CEO Terje Pilskog argued that the commercial challenge is increasingly to combine contracted revenues with flexible assets and active market operations.
“It’s important not to think on an asset-by-asset basis, but it’s important to think on a portfolio basis,” Pilskog said.
The reasoning starts with the structure of the Romanian CfD scheme. According to Pilskog, the mechanism creates the basis for bankable projects, but only part of the electricity generated is covered by the contract.
“The contract for difference covers 60 to 70% typically of the energy generated in a project and then the energy on top of that you need to sell into the market,” he said.
For Scatec, that residual market exposure changes the role of battery storage. Storage is not treated only as a standalone asset seeking revenues from arbitrage or ancillary services. It becomes part of a broader portfolio that can change when and how renewable electricity reaches the market.
Scatec is currently moving forward with three projects in Romania representing an investment portfolio of about 300 million euros: a solar project of around 190 MW, a wind project of around 77 MW and a standalone battery-storage project of close to 200 MWh. The solar and wind projects have secured 15-year CfDs, while the battery can be managed commercially together with the generation assets.
The standalone battery can still be managed commercially together with the solar and wind projects. Pilskog said Scatec intends to manage electricity sales across the assets in the same Romanian market, using storage to give the portfolio greater flexibility. The approach also affects Scatec’s capital-recycling strategy. Pilskog said that, at this stage, selling individual projects does not make sense for the company, while capital recycling could be considered at portfolio or platform level.
Scatec expects the storage component to grow further.
“We are also intending to add more battery storage capacity so that we can continue to manage a portfolio in a flexible way,” Pilskog said, adding that batteries could also be added to existing projects in the future.
The commercial model requires more than owning generation and storage. Scatec plans to build its own Romanian capabilities for market operations, electricity sales, portfolio balancing and trading, while buying the software required to support those activities. Pilskog pointed to the company’s experience in the Philippines, where Scatec operates a large hydropower asset in a deregulated market and has a team dedicated to trading and market operations.
In Romania, the first objective is to use storage to manage the renewable portfolio itself. Additional revenues from balancing and ancillary services can then be layered on top. Later in the conversation, Pilskog described how batteries can help shape intermittent renewable output into a more attractive profile for customers, shift electricity sales towards periods with higher prices and reduce balancing costs across the day-ahead, intraday and balancing markets.
That distinction matters as Romania adds more variable renewable generation. The business case for storage is often discussed through individual revenue streams, but Scatec’s approach starts from a different question: how much value can flexibility create across the entire generation portfolio?
The same portfolio logic applies to financing future projects. Pilskog said that if new capacity is developed without CfD-backed revenues, Scatec would need to combine other forms of contracted income, including corporate PPAs, with some merchant exposure. The Romanian PPA market, however, remains relatively limited, increasing the importance of putting together portfolios with enough predictable revenue to support investment while retaining the flexibility to participate in the market.
Price will also be decisive in attracting corporate buyers.
“If you are going to attract PPAs, we have to compete based on price,” Pilskog said. He added that companies willing to pay a premium for green electricity appear to be less common than before, while renewables are becoming increasingly competitive on price.
For Scatec, the Romanian market therefore points towards a model in which CfDs, PPAs, merchant sales and battery flexibility are not separate business cases. They are components of the same portfolio strategy. CfDs can anchor financing, batteries can reshape and optimise the remaining market exposure, while trading and balancing capabilities help monetise that flexibility.
The result is a different way of looking at renewable development. The value of the next solar or wind project may increasingly depend not only on its own production and contracted price, but on how well it complements the rest of the portfolio and how much flexibility the investor can place around it.
