Hagag Europe and Airengy plan 5 GWh energy storage project in Romania

Hagag Europe and Airengy signed a strategic cooperation agreement to develop a compressed-air energy storage project in Romanian salt caverns, with a total estimated investment of €55 million. The two-phase buildout is designed to reach about 25 MW of discharge capacity and up to 5 GWh of storage, as Europe pushes for longer-duration grid support for renewables.

Why it matters: - Romania is adding more renewable generation and needs storage that can last longer than typical lithium-ion systems. - The project is designed to provide multi-day electricity storage, grid-balancing services and access to day-ahead and intraday power markets. - Long-duration storage in salt caverns could offer lower operating costs and more flexibility than conventional battery storage.

What happened: - Hagag Europe signed a strategic cooperation agreement with Airengy to develop and operate a compressed-air power plant project in Romania. - The project will use Airengy’s AirBattery technology for electricity storage in natural salt caverns. - The total estimated investment for the two-phase project is €55 million. - The agreement was led by Arik Derekh and Roy Brilant for Hagag Europe, together with Tal Raz for Airengy.

The details: - The project includes feasibility studies, design, construction and operation of commercial electricity storage facilities. - The planned site uses natural salt caverns as underground storage space for compressed air. - The project will be developed in two phases through a special purpose company. - Hagag Europe will hold 40% of the SPC, Airengy will hold 40%, and a third party will hold 20%. - Phase A calls for a facility with about 200 MWh of storage capacity. - Phase A has an estimated construction cost of €4.5 million. - Full operation of Phase A is expected within 12–18 months from the start of works. - Phase B is designed to raise average discharge capacity to about 25 MW. - Phase B will expand storage capacity to about 5 GWh, or 5,000 MWh. - Phase B has an estimated cost of €50 million. - The parties intend to secure dedicated project financing for Phase B. - Under the agreement, Hagag Europe will secure usage rights for the salt caverns. - Airengy will handle planning, design, construction and operation of the AirBattery system. - AirBattery stores energy by compressing air, injecting it into salt caverns and releasing it through a hydraulic system to generate electricity. - The system uses only water and air, with no polluting materials or rare metals. - Airengy says the technology is designed for storage over days or weeks and can complement lithium-ion batteries.

Between the lines: - Hagag Europe is widening its Romanian energy footprint beyond real estate and natural gas infrastructure. - Airengy is moving from technology development toward commercial-scale deployment of its compressed-air storage model. - The deal fits a broader European push for grid resilience as renewable power grows and storage needs extend beyond a few hours. - Romania’s interconnected electricity market makes the country attractive for projects that can buy power cheaply, store it and sell into more than one market window.

What’s next: - The partners will move into feasibility, design and permitting work for the first phase. - Construction of Phase A is expected to begin before the 12–18 month operating timeline starts. - The parties will seek project financing for Phase B once the initial phase advances. - Airengy has also signed cooperation memoranda in the UK with Kistos and in Germany with SEFE, signaling broader European expansion.

The bottom line: - Hagag Europe and Airengy are betting that salt-cavern compressed-air storage can become a new class of grid asset in Romania and beyond.