Albania has formally opened its electricity market to battery storage and aggregation, establishing regulatory groundwork for a more flexible system as solar generation grows in a hydro-dominated power sector. The Electricity Sector Law 59/2026 recognises storage and aggregation as regulated electricity-market activities. It also introduces the concept of active customers that can generate, consume, store and sell electricity.
Electricity Sector Law 59/2026 and regulator implementation
The energy regulator ERE moved the framework towards implementation on 19 August by approving rules covering notification and registration of energy-storage operators. The regulatory changes are positioned as commercially relevant for Albania given the structure of its power system. Albania’s generation mix relies heavily on hydropower, resulting in a low-carbon profile but linking supply and trading conditions to rainfall and reservoir levels.
Strong hydrology can support Albania’s role as a substantial exporter, while dry conditions can reverse that position and increase import requirements quickly. Solar expansion is described as providing diversification, but it also adds a different type of variability to the system. Photovoltaic output is concentrated during daylight hours and can weaken sharply into the evening.
Role of batteries alongside hydropower variability
Storage is presented as a mechanism to manage both hydropower and solar resources more efficiently. Batteries can absorb solar output during low-price periods and discharge later, while reservoir hydro can be conserved for longer-duration or higher-value needs. This arrangement can reduce the need to use hydro for short intraday balancing.
The framework also recognises aggregation as a significant development for market participation. It enables portfolios of batteries, small renewable plants and flexible consumers to take part collectively in future balancing or wholesale markets. Industrial and commercial users could similarly combine behind-the-meter solar and storage to reduce peak demand and potentially trade excess electricity.
Cross-border market links and implementing details
Albania’s policy shift aligns the country more closely with power-market structures developing elsewhere in Europe. Cross-border implications are described as important because Albania is interconnected with Montenegro, Kosovo and Greece. It also participates in the ALPEX market structure with Kosovo.
Greater domestic flexibility would support managing exports and imports around hydrological conditions. The framework indicates that storage could retain more value within the system instead of selling large volumes of surplus electricity during weak-price periods and buying back power during scarcity. Detailed implementing rules will influence how quickly investment activity develops, including grid charges, balancing-market access, connection procedures, and how charging and discharging are treated for project economics.
The regulatory foundation is now in place, shifting attention from adding solar capacity alone towards storing, aggregating and trading renewable electricity around Albania’s volatile hydro balance.
