Recurrent Energy, a subsidiary of Canadian Solar, has signed its first optimization agreement with Octopus Energy for a co-located battery energy storage system in Italy, marking one of the earliest utility-scale deployments of its kind to reach commercial operation in the Italian market.

The Asset and Its Location

The agreement covers a 14MW/43MWh battery energy storage system co-located with a 35 MWp photovoltaic plant known as "Montalto La Viola," situated in Montalto di Castro, Italy. Both assets are majority-owned by Recurrent Energy.

The photovoltaic plant has been operational since 2025, while the battery system was recently connected to the grid. The deal represents Recurrent Energy's first co-located BESS asset to reach commercial operation in Europe.

How Octopus Energy Will Manage the System

Under the terms of the optimization agreement, Octopus Energy will serve as the trading partner, taking responsibility for managing and optimizing the battery energy storage asset.

The company will deploy Kraken, described as an AI-powered operating system for energy, to control, dispatch, and manage the battery in real time. According to the announcement, Kraken's role will include maximizing asset value, optimizing the balance between demand and generation, and reducing imbalance costs. The system will manage the solar and storage assets together rather than treating them as separate units.

Revenue Models and Grid Benefits

The deal is structured around what Recurrent Energy describes as multiple revenue streams, a central element of its strategy for energy storage assets. Dylan Marx, CEO of Recurrent Energy, said the optimization agreement "underscores our strategy of combining multiple revenue streams while strengthening grid security, performance, and adaptability."

The project is described as among the very first co-located utility-scale battery energy storage systems to enter commercial operation in Italy, with Kraken specifically supporting the optimization of innovative revenue models in that market.

Alex Schoch, Director of Electrification at Octopus Energy, highlighted the broader significance of battery storage in the energy transition. "Batteries can store cheap, clean power when it's abundant, which can then be used or exported when it's needed most, helping to balance the grid and reduce reliance on expensive fossil fuels," he said. Schoch added that greater grid flexibility not only supports a more resilient energy system but also has the potential to reduce household energy bills.

Devrim Celal, Chief Flexibility Officer at Kraken, pointed to the financial and infrastructure benefits of managing solar and storage together. "By managing solar and storage together, in real time, Kraken helps bring down costs, unlock new revenue streams and delay expensive upgrades to the grid," Celal said.

Strategic Significance for Both Companies

The announcement identifies the partnership as a key milestone for both Recurrent Energy and Octopus Energy in the Italian storage market. Marx described it as a benchmark transaction at both national and global levels, noting that it involved the successful integration of technical, commercial, and financial capabilities across the full project lifecycle.

For Recurrent Energy, the Italian deal represents a first in two respects: it is the company's inaugural optimization structure as well as its first co-located BESS asset connected in Europe. The company framed the transaction as consistent with its commitment to advancing decarbonization and supporting grid stability in markets where it operates.

Recurrent Energy's Global Footprint

Recurrent Energy has to date developed, built, and connected approximately 12 GWp of solar projects and 6.2 GWh of energy storage projects across six continents, excluding China.

As of March 31, 2026, the company held a global solar project development pipeline of approximately 22 GWp and a battery energy storage development pipeline of 74 GWh. The company also manages nearly 15 GW of solar and energy storage projects under operations and maintenance contracts.

Recurrent Energy operates as a subsidiary of Canadian Solar, which was founded in 2001 and is headquartered in Kitchener, Ontario. Canadian Solar has delivered nearly 177 GW of solar photovoltaic modules to customers worldwide over the past 25 years.

Through its subsidiary e-STORAGE, Canadian Solar had shipped over 20 GWh of battery energy storage solutions to global markets as of March 31, 2026, and held a contracted backlog of $3.5 billion as of May 8, 2026. Canadian Solar's project development pipeline includes 24 GWp of solar and 81 GWh of battery energy storage capacity at various stages of development.

Octopus Energy's Role in Italy

Octopus Energy is described as a global clean energy and technology business. The company serves customers under its own retail brand and operates Kraken as a technology platform offered to energy businesses.

The Italian optimization agreement extends Octopus Energy's presence in the European storage market and reflects what both parties describe as a shared commitment to delivering flexible, cost-competitive renewable energy solutions. The partnership, according to Schoch, represents a step toward building what he called "a smarter, more flexible energy system in Italy."

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