Grid-Forming Technologies and Their Emerging Role in Greece’s Energy Transition

The Grid Bottleneck: Greece is at a pivotal moment in its energy transition. The country has made remarkable progress in deploying renewable energy sources (RES) in recent years. RES deployment itself has been accelerating rapidly.

The Grid Bottleneck

Greece is at a pivotal moment in its energy transition. The country has made remarkable progress in deploying renewable energy sources (RES) in recent years. RES deployment itself has been accelerating rapidly. Solar alone added a record 2.6 GW in 2024, bringing total PV capacity to nearly 9.6 GW by year-end, while wind and solar together kept RES at the top of Greece’s power mix through the first half of 2025.^[1] However, grid infrastructure development and battery energy storage system (BESS) adoption have lagged behind. This mismatch stems from delays in approving new grid projects and in establishing a regulatory framework for BESS licensing. Since August 2022, regulations have become increasingly restrictive regarding new RES grid connections, further slowing the pace of integration. In addition, this progress has been overshadowed by an ever-increasing grid system congestion. In the first half of 2025, grid operators curtailed approximately 1,327 GWh of renewable electricity, equivalent to about 9.6 percent of total RES output, with single-month curtailments spiking as high as 12 percent in June. Industry analysts warn that without intervention, total curtailed energy could exceed 2 TWh by the end of 2025.^[2]

Without rapid modernization of transmission system infrastructure, deployment of BESS at scale, and the introduction of more flexible regulatory tools, Greece risks slowing its energy transition and undermining investor confidence in what has otherwise been one of Europe’s fastest growing RES markets.

The significance of grid forming

Unlocking Greece’s full RES potential requires rethinking how the grid operates. As the country gradually phases out fossil-fueled plants and increases the share of renewables, maintaining grid stability becomes a central challenge.^[3] Traditional power systems relied on large thermal plants, which naturally provided stability by setting the system’s voltage and frequency. In contrast, renewable generation is largely inverter-based and does not inherently provide these stabilizing services.

This is where the concept of grid-forming inverters becomes crucial. Unlike conventional inverter-based resources, which depend on existing grid conditions and merely “follow” them, grid-forming inverters can actively establish voltage and frequency in much the same way as traditional synchronous generators. In doing so, they provide the backbone for a reliable electricity system even when most of the generation comes from solar, wind, and storage.

Industry reports and energy regulators increasingly emphasize that grid-forming capability is a prerequisite for power systems aiming to operate with very high shares of renewables. For Greece, which already experiences significant curtailments and is targeting near-total decarbonization in the coming decades, adopting this technology would allow the grid to operate more flexibly, reduce reliance on fossil-fueled “backup” plants, and strengthen investor confidence in new renewable projects.

Lessons to be learned from our peers

Grid-forming systems offer developers and investors a range of advantages, including enhanced grid stability, reduced curtailments, improved project economics, and reliable integration into weak or isolated networks. Internationally, large-scale adoption of grid-forming technology is already under way, enabling participation in ancillary service markets such as inertia provision and system restoration.

Recent projects and events across Europe provide valuable lessons, demonstrating both the technical feasibility and strategic importance of grid-forming technologies. In Germany, Amprion has launched a pilot near Cologne, deploying a reactive power compensation system with grid-forming capabilities. The installation can deliver 300 MVar of reactive support and provide inertia through inverters and battery storage.^[4] In addition, SMA, together with Cologne University, demonstrated the technology in Bordesholm, where a simulated power outage left the local grid isolated. During the test, local businesses and 8,000 households continued to receive uninterrupted power supplied exclusively from renewables supported by a grid-forming BESS.^[5] Finland and the Netherlands have also advanced with commercial-scale projects. In mid-2025, Merus Power commissioned a 38 MW/43 MWh grid-forming battery storage system in Lappeenranta, while in the Netherlands RWE brought a 35 MW/41 MWh unit online and is preparing to commission a smaller grid-forming installation.^[6] The United Kingdom has pursued a market-based path. Through multi-year tenders, National Grid ESO has been procuring inertia, short-circuit strength and grid-forming capability, with contracts expected to cover roughly a third of the system’s minimum stability requirements once all projects are operational in 2026.^[7] In Southern Europe, events have underscored the urgency of adopting such solutions. An April 2025 blackout affecting parts of Spain and Portugal reignited political debate about grid resilience and placed renewed emphasis on grid-forming technologies as a safeguard against similar incidents.

What Greece should do next – An ambitious policy agenda

By drawing on lessons from other European markets, leveraging EU grid modernization initiatives, and updating its regulatory framework accordingly, Greece could seize the momentum and position itself as a frontrunner in Europe’s clean energy transition. Specifically, Greece should focus on a practical, results-oriented agenda built on four immediate priorities:

Launching pilot projects: Greece should strive for the installation of multiple pilot projects across mainland Greece and the islands in collaboration with experienced vendors (e.g., SMA, Fluence). Those projects will provide valuable data to Greek grid operators, IPTO^[8] and HEDNO,^[9] to measure effectiveness in inertia provision, curtailment reduction, and voltage/frequency support. Recently, an off-grid installation in Mount Athos, where a 3 MW / 6 MWh BESS, equipped with grid-forming capabilities, entered trial operation. This system will collaborate with a 1.1 MW PV power plant and stabilize the local micro-grid which has been developed to procure electricity to the local Monastery of Vatopedi.^[10]
Fast-tracking regulatory alignment with EU Grid Codes: The EU Grid Code, established by virtue of Commission Regulation (EU) 2016/631, sets out harmonized technical requirements for electricity generators across all member states. This Regulation defines standards for grid connection, frequency and voltage stability, fault ride-through, and reactive power capabilities, aiming to ensure the secure and efficient operation of interconnected European electricity networks.

The anticipated next-generation Requirements for Generators Network Code (RFG 2.0) is being drafted by ENTSO-E under the guidance of ACER and the European Commission. It is expected to modernize the current EU Grid Code, inter alia, by giving power to the Transmission System Operators (TSOs) of the member states to mandate certain categories of plants to be capable of providing grid forming capabilities at the relevant interconnection points. These provisions are designed to ensure that inverter-based resources can replicate the system support functions historically delivered by synchronous machines. For Greece, early transposition of RFG 2.0, which is expected to be ratified by virtue of a new EU Regulation, into its national Grid Codes would be crucial to avoid regulatory lag. Amending the Greek framework now, even before the ratification of RFG 2.0, to require grid-forming functionalities in new RES and BESS projects, would put Greece in the forefront of next-generation grid development within the EU.

Creating secure revenue streams: The creation of remuneration mechanisms and incentives is critical. Greece should introduce tools such as long-term contracts for inertia services, preferential curtailment treatment for projects with grid forming capability, and ancillary service compensation to ensure commercial viability for such types of projects. The UK is already leveraging this trend via an inertia market, offering long-term contracts for grid-forming storage, a commercially viable model for Greece to consider.^[11] Establishing “inertia credits” or dedicated reserve markets for producers deploying grid-forming technology, modeled after successful market-based mechanisms adopted in the UK, would provide a strong foundation for investment and accelerate large-scale adoption.^[12]
Taking advantage of interconnections: The Greek grid operators should integrate projects that incorporate grid-forming capabilities into existing and future interconnector zones, ensuring Greece enters the wider European grid network as a grid-stability stability partner, not just an exporter of clean energy.

Closing remarks

Greece’s energy transformation demands the alignment of state-of-the-art technology with market-ready regulation. This way, grid-forming technology will not only stabilize a system that is increasingly dependent on intermittent renewables, but may also unlock new business models, funding streams, and strategic partnerships.

For investors, developers, and authorities, the time to act is now. Greece’s leadership in Europe’s clean energy future will be determined not by observation, but by decisive action. Greek grid operators, the Ministry of Environment and Energy and the Regulatory Authority for Waste, Energy and Water, should move swiftly to amend Grid Codes and establish a bankable remuneration framework that enables the deployment of grid-forming technologies. On their end, investors should recognize that Greek regulation often follows the trajectory of more mature EU markets, with incentives typically favoring early adopters or innovative technology. By proactively designing projects with grid-forming capabilities now, before such requirements are codified, investors can position themselves at the forefront, proactively capturing emerging regulatory trends and investment opportunities.

*Senior Partner - Chairman of the Management Committee, KG Law Firm

**Senior Associate, Energy Infrastructure, KG Law Firm

[1] https://www.pv-magazine.com/2025/02/05/greece-installs-2-6-gw-of-pv-capacity-in-2024/?utm_source=chatgpt.com

[2] https://www.ot.gr/2025/07/03/green/ape/ape-sto-89-oi-perikopes-tis-prasinis-ilektroparagogis-sto-proto-pentamino/

[3]Sources: 1) https://eepublicdownloads.entsoe.eu/clean-documents/Publications/SOC/High_Penetration_of_Power_Electronic_Interfaced_Power_Sources_and_the_Potential_Contribution_of_Grid_Forming_Converters.pdf

2) https://www.em-power.eu/news/interview-duckwitz-prabhakaran-grid-forming-technology-important-part-energy-transition

[4] https://www.em-power.eu/news/business-models-for-robust-grids

[5] https://www.sma.de/en/large-scale/stand-alone-grid-bordesholm-region

[6] https://www.energy-storage.news/rwes-first-dutch-bess-online-commissioning-ongoing-for-grid-forming-second/

[7] https://modoenergy.com/research/stability-pathfinders-inertia-short-circuit-level-battery-energy-storage?utm_source=chatgpt.com

^[8] The Independent Power Transmission System Operator

^[9] The Hellenic Distribution Network Operator