QAZAQ GREEN.  Analytics firm Aurora Energy Research has published its annual European Co-location Markets Attractiveness Report, covering 20 regions. Germany, Great Britain and Bulgaria have been identified as Europe's most attractive co-location investment markets for 2026, with Spain, Hungary and France highlighted as key markets to watch amid ongoing regulatory changes.

Germany ranks first, driven by its market size and significant internal rate of return upside potential relative to standalone projects. GB and Bulgaria share second place: GB benefits from substantial installed capacity and a contract for difference (CfD)-backed project pipeline that helps offset grid connection delays, while Bulgaria combines strong subsidies, a robust pipeline and favourable project economics.

Europe's co-located renewable capacity reached 6.3 GW in 2025, with solar-plus-storage accounting for over 60% of deployments. Spain, GB and Germany lead in total capacity, while Bulgaria and Romania stand out relative to their size, with co-located solar exceeding 40% of installed photovoltaic capacity.

Grid access remains a critical challenge: over 1,600 GW of renewable and storage capacity is awaiting grid connection across Europe, including around 550 GW in GB alone. In markets such as the Netherlands, Greece and Hungary, co-location can improve grid access or reduce associated costs.

Market pressures are intensifying. Negative price hours surged in 2025, exceeding 500 hours in Spain, the Netherlands and Germany. Curtailment is forecast to rise to around 33 TWh by 2030 across key markets. Against this backdrop, pairing storage with renewables is becoming an increasingly important tool for protecting project economics.

Subsidies remain the dominant route to market, but hybrid power purchase agreements (PPAs) are gaining traction. In 2025, contracted capacity under hybrid PPAs exceeded 700 MW. The greatest value uplift from hybrid structures is expected in France and Portugal, where such approaches could increase contracted volumes and boost PPA capture values by up to 50% compared with traditional pay-as-produced schemes.