Jesús Heras, technical director of Wattkraft Iberia , wrote an opinion piece analyzing how Royal Decree 997/2025 is accelerating the development of energy storage in Spain and its impact on the processing of new projects:
"For the past few weeks, I've made it my goal to publish an article every now and then to share my perspective on the sector. But above all, to force myself to stop, organize the information, and better understand where photovoltaics and storage are heading."
I recently heard Carlos Bardem say, "I don't write to explain, I write to understand." Obviously, I don't intend to compare these articles to his literary work. I'm simply left with the idea that writing forces us to stop, investigate, and organize our thoughts.
This week's article stems precisely from that exercise. I wanted to analyze in greater depth the extent to which Royal Decree 997/2025 is facilitating the development of hybrid storage, understand exactly what it contributes, and explain it from a practical, on-the-ground perspective.
At Wattkraft, we don't directly handle the permits and, therefore, we don't experience the entire administrative process firsthand. However, we do see its effects very closely: we are supplying more than 100 MWh of Huawei storage for projects currently under construction, without PINALM funding, and whose permitting process is benefiting from the new simplified procedure.
That experience gives us a direct, albeit necessarily partial, view. That's why I wanted to check if what we're seeing in our portfolio is part of a broader market trend.
To verify this, I have turned to the most direct source: the BOE (Official State Gazette).
Authorization in approximately seven months
The Official State Gazette (BOE) of October 16 provides particularly clear evidence of the effect of Royal Decree 997/2025: a large-scale storage project has jointly obtained prior administrative authorization and construction administrative authorization.
The developer submitted the application on February 13, 2026, corrected it on March 4, the project was released for public comment in June, and the decision was issued on September 14. The joint processing of both authorizations was completed in approximately seven months from the application date.
A single case file does not allow this timeframe to be used as a general benchmark for the entire market. However, it does demonstrate that the simplified procedure is already generating building permits for large-scale projects.
The movement began months ago.
Last week's BOE publications added four more storage projects intended to hybridize existing photovoltaic plants.
All will be installed within the polygons of their respective plants and will reuse already built evacuation infrastructure.
However, these are neither pioneering projects nor isolated cases. A retrospective review reveals more than twenty-five previous projects expressly covered by the simplified procedure of Royal Decree 997/2025. The earliest of these appear at least from February 2026.
The portfolio includes facilities of varying scales and in several autonomous communities. Some projects have already passed the public consultation phase and have obtained both the necessary prior administrative authorizations and construction permits.
Therefore, the effects of Royal Decree 997 are not just beginning to be felt. Its impact is already visible in a growing portfolio that is moving from public consultation to authorization.
What does Royal Decree 997 actually simplify?
Article 6 of Royal Decree 997/2025 declares urgent the authorization procedures for hybrid electrochemical storage projects that are the responsibility of the General State Administration and do not require environmental impact assessment.
The regulation also amended Annex II of Law 21/2013 to allow the incorporation of electrochemical storage to be exempt from simplified environmental assessment when:
- The BESS is located within the polygon environmentally assessed for the original energy project.
- The original project has a favorable environmental impact statement or report.
When these conditions are met:
- The prior administrative authorization and the construction authorization can be processed and resolved together.
- Administrative consultations and public information are carried out simultaneously.
- Certain administrative deadlines are reduced by half.
- The public information period is usually extended to fifteen days.
Regulation alone does not create profitability for BESS. But it does reduce a specific and relevant barrier: the time and administrative complexity required to incorporate storage into existing plants.
Projects that move forward without subsidies
Several of the identified projects were submitted to PINALM, but ultimately did not receive funding. Nevertheless, their administrative processing has continued.
This does not prove that they are financed or that their profitability is guaranteed. It does indicate that some developers believe the combination of operational plants, existing evacuation infrastructure, shorter administrative timelines, and new revenue opportunities justifies continuing their development.
The continued administration of some non-beneficiary projects demonstrates that the absence of aid has not automatically led to their abandonment, although it still does not allow us to affirm that they will be financed or built without a subsidy.
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PINALM deadlines and supply chain
PINALM is the abbreviated name used by IDAE for its call for aid to Innovative Energy Storage Projects, co-financed by the European Regional Development Fund, ERDF 2021-2027.
The program awarded €818.3 million to 126 projects. Of these, 69 are for hybrid storage, 39 for stand-alone batteries, 15 for thermal storage, and three for pumped storage. Collectively, the selected projects will add 2.2 GW of power and 9.4 GWh of storage capacity.
Generally, beneficiaries have 36 months from the date of notification of the favorable decision to carry out the actions. Since the final decision was published at the end of December 2025, the standard timeframe for applications notified at that time is approximately the end of 2028. Any extensions cannot postpone the implementation beyond September 30, 2029.
PINALM could be mobilizing a significant volume of power and storage capacity. Its implementation, however, is contingent upon the maturity and available capacity of the European supply chain, as the winning projects have committed to generating added value within the European Union.
The call for proposals did not establish a general minimum percentage of European content. However, it awarded up to six points based on the percentage of added value generated within the European Union and required a minimum score in the value chain and resilience contribution criteria for the project to be eligible.
In subsidized projects, the commitments used to obtain a score and justify the funding must be respected. If, during technical due diligence, changes to components, suppliers, or the integration scheme are proposed, it will be necessary to verify whether the modification reduces the score obtained or affects the grant conditions.
At the same time, European industrial capacity is beginning to expand through investments driven by Asian manufacturers. These investments can progressively strengthen the availability of batteries manufactured in Europe and reduce some of the dependence on foreign suppliers.
However, much of that capacity is not yet operational.
Unsubsidized projects generally have greater freedom to subsequently select the solution that the promoter, its funders, and its technical advisors consider most appropriate.
The grant reduces investment costs, but it may limit some of the flexibility to adapt the technology solution once it's been awarded. This isn't necessarily a problem, but it is a condition that must be incorporated into the procurement strategy from the outset.
Bankability depends on the evidence
In a utility-scale BESS, the initial price and geographic origin are only part of the decision.
Banks, investors, and technical advisors must verify that the system will be able to deliver the committed energy, power, and availability for fifteen or twenty years.
The main elements of a technical due diligence include:
- Installed base and experience in comparable projects.
- Operational data on availability and degradation.
- Certifications and safety tests.
- Performance and capacity guarantees.
- Manufacturer's financial solvency.
- Industrial capacity and meeting deadlines.
- After-sales service and availability of spare parts.
- Integration between battery, PCS, transformer station, PPC and EMS.
- Clear responsibility in the event of a team failure.
My inference is that some unsubsidized projects could face this process with greater flexibility if they opt for mature platforms that are widely deployed and supported by manufacturers capable of providing long-term warranties.
It is a market inference, not a conclusion proven by the published records.
Nor is it a simplistic debate between European and Asian technology. Europe needs to develop its value chain and reduce strategic dependencies. But geographical origin does not replace operational experience, scalability, quality of integration, or the ability to fulfill contractual obligations throughout the asset's lifespan.
The real challenge begins after authorization.
The large-scale authorization published on October 16 and the files released over the past few months confirm that the movement has already begun.
A growing portfolio of hybridizations is taking advantage of existing plants, built evacuation infrastructure, and simpler administrative procedures.
Royal Decree 997 does not, by itself, resolve the main economic challenge. Arbitrage, balancing markets, technical constraints, hybrid PPAs, and future capacity payments will need to provide sufficient revenue visibility.
But regulation is eliminating some of the administrative friction that was delaying these projects.
The question is no longer whether a portfolio exists. The question is how many projects will manage to secure financing, pass technical due diligence , obtain operating authorization, and actually become operational.
And that's where technology, guarantees, integration, and bankability will start to make the difference."
