Energy investment in EMEA hit record levels last year driven by mainstream renewables and power infrastructure. Infralogic’s EMEA team predicts which sectors will keep investors busy in 2026.

Investment in power, renewables and energy across EMEA surged to an all-time high of USD 373bn in 2025, across greenfield, M&A and refinancing, according to Infralogic data.

The standout deal of the year was the financing of UK nuclear power station Sizewell C, with a whopping GBP 38bn cost – the largest transaction ever recorded by Infralogic globally.

Even excluding tens of billions of pounds of government funds backing Sizewell C, the figures mean that the EMEA power, renewables and energy market grew by almost 50% last year.

This is an encouraging sign for investors looking into 2026, after the market failed to climb back to 2021 levels over the previous three years (see chart).

Some predictions of an oil and gas boom made in early 2025, as US President Donald Trump pushed the fossil fuel agenda globally, have not materialised. Investment in EMEA’s energy infrastructure for oil and gas remained flat at USD 86bn, with just 2% growth.

On the contrary, investment in all types of power generation in the region rose by 60% to around USD 200bn in 2025, Infralogic data shows.

Despite some political backlash, investors and lenders still poured capital into building renewables – with greenfield investment in wind and solar power rising by 63% to a record USD 67.6bn.

Power infrastructure such as electricity transmission and distribution grids, as well as smart meters and batteries, was also popular with investors. Deal volumes in grids nearly doubled to USD 19bn, while battery investment almost tripled to USD 9bn and smart meters shot up from USD 3bn to USD 18bn.

The International Energy Agency estimates Europe’s electricity consumption will rise by 1.5% this year, as electrification spreads across Europe, with more power demand coming from data centres, electric vehicles, and heat pumps.

Goldman Sachs predicts the pace of growth will quicken to 2% from 2027, and this will require some USD 3.5trn of investment in grids and generation over the next decade.

Infrastructure investors are looking up and down the power value chain to find the best opportunities to capture this growth.

Some are looking at mega utilities, such as APG, GIC and Norges, which committed EUR 9.5bn to TenneT’s German power grid last year.

Others, including I Squared Capital senior partner Mohamed El Gazzar, believe Europe’s “most compelling opportunities” are in the mid-market, such as small-scale smart grids and last-mile connections. “These are the quiet enablers of decarbonisation and the backbone of a resilient modern infrastructure network,” he says.

More opportunities will emerge in 2026 for investors of all sizes, from deals involving large utilities such as Italy’s Edison, to a proliferation of battery storage across new markets.

The rising deal volumes and plentiful deals do not mean all is well in the sector, however.

Past investments into renewable developers turned out to be over optimistic in some cases, and some players are struggling. These problems may be more acute in the US – where the Pine Gate Renewables restructuring has become a bellwether for the industry – but EMEA is not immune.

Renewables firms in central Europe have seen profitability drop and faced debt restructurings – from BayWa re to ABO Wind in Germany and Obton in Denmark to name a few.

The past year also saw a glut of European renewables IPPs go on the market to raise fresh capital or find new owners, but several deals have been pulled or downsized.

Even in markets that can still count on state-backed tariffs and solid project pipelines, such as Italy, the expected valuation of many developers has come down, according to one local investor.

And in Spain, where power prices are increasingly turning negative, one Madrid-based banker says debt refinancings in 2026 are likely to look a lot like restructurings.

The European offshore wind market enters 2026 with cautious optimism on the back of a successful auction in the UK, and after six major greenfield projects were successfully financed in 2025 across the UK and Poland, totalling a record-breaking USD 22bn of debt.

But the project pipeline is looking shaky, as offshore wind tenders across much of continental Europe were scrapped, delayed or went deserted. Even in the UK, some projects were cancelled after bidding unsuccessfully in the latest round.

The profitability of developers such as Ørsted is also being closely watched as they grapple with problems with US projects, while the sale of others such as Corio has failed to attract much interest.

To navigate these choppy waters, Infralogic’s EMEA team highlighted seven trends emerging in the EMEA power, renewables and energy space in 2026 – from mainstream to niche areas where change is afoot.

By Stefano Berra

New opportunities to invest in UK power grid

By Alexander MacLeod

Amid grid congestion to transport wind power to urban centres and rising payments to wind farm owners to curtail excess production, the UK government is finally ready to press ahead with long-delayed plans to bring new sources of private capital into the grid.

In 2026, regulator Ofgem is expected to launch the widely anticipated competitively appointed transmission owner (CATO) regime. The scheme aims to build crucial onshore electricity grid infrastructure faster and cheaper than it would be delivered under conventional means by incumbent transmission system operators.

Although often compared to offshore transmission owners (OFTOs), under CATOs, investors will bid to build capex-intensive onshore transmission assets under a 35-year DBFOM model, marking a huge greenfield opportunity.

The scheme, under which GBP 20bn of private capital could potentially be unleashed, could significantly shake up grid ownership, challenging the hold of the incumbents such as National Grid and ScottishPower. “The whole point is it’s intended to break the monopoly and encourage competition”, says a legal advisor specialising in electricity transmission.

Investor preparations are already underway, with strong interest anticipated from infrastructure funds and consortia from mainland Europe and, potentially, the Middle East.

Yet questions remain around CATO returns and whether they will follow the OFTO model, where partially indexed revenues begin once the asset is put into use, or the Thames Tideway approach, under which investors are compensated through construction and operation. According to a financial advisor, compared to OFTOs “there’s an inevitability that returns have to go up” due to the added development and construction risk.

An Ofgem spokesperson tells Infralogic that “ultimately it will be the market that will determine returns on CATO investment, however development and consenting risk will be priced into equity return requirements”.

“We’re confident that the new regime will offer attractive investment opportunities,” the spokesperson adds.

Ofgem plans to launch final market discussions in the coming months, ahead of the tender of the first project. Investors will watch these talks carefully for clear signals that the deals will be attractive to debt and equity, before establishing their CATO teams.

Renewables platforms to fuel M&A activity

By Tanu Pandey

Plenty of renewable power platforms came to the market across Europe in 2025, but not many found a buyer. The IPPs that did not trade last year, as well as a new cohort of developers, will keep the market active in 2026.

“IPP owners, both strategic and financial, need to recycle capital and that is set to continue in 2026,” says a lawyer focused on this market. “The positive interest from various investors has also continued despite a transformation of the renewables sector and a valuation mismatch.”

Among the largest, multi-billion-dollar renewables firms that could come back to market are Canadian pension funds-owned Cubico, which held talks with Qualitas, and Saudi-owned FRV, which was in Apollo’s crosshairs.

On top of that, Brookfield’s Madrid-headquartered solar and energy storage company X-Elio and TPG’s platform Matrix Renewables are among new transactions expected in the market this year.

A sale of Macquarie-backed offshore wind developer Corio Generation may also come back to the market, according to market participants, while JERA Nex Bp has been considering bringing in a new investor. These may be harder sells, say industry sources.

“[In] segments such as onshore renewables and storage, it has been easier to narrow down the bid-ask price and negotiate but the buyers are still wary of pumping billions into an offshore wind platform”, says a Clean Energy investment banker.

“Having said that, there will still be ample processes in renewables sector in Europe but deal structuring will become a key factor,” the same banker notes.

Many IPPs built sizable portfolios of development projects years ago, when cost of capital was lower and project development was cheaper. But rising costs and shrinking returns, caused by changes in subsidy regimes, mean they now need new investors to finance and build their pipeline, explains an industry source.

While sellers are pricing assets at double digit EBITDA multiples, buyers tend to give lower valuations to platforms, based on today’s cost of capital and risks including volatile electricity prices, notes the same source.

Some IPPs also need more capital to diversify solar and wind power platforms and invest in different technologies such as storage, efficiency, and niche areas.

This means the M&A train for renewables platforms in Europe cannot stop, and will keep moving this year.

Battery storage to take off in Spain

By Antonio Fabrizio

When the lights went out in Spain during the 28 April 2025 blackout, one technology was sorely missed to help stabilise the grid – battery energy storage systems (BESS).

Spain has one of the highest solar power penetration rates in Europe but less than 40 MW of utility-scale BESS in operation to mitigate volatility.

Sector experts predict this will begin to change in 2026.

Government subsidies for batteries are growing, with EUR 800m allocated in December, while capex needs are falling, strengthening the business case for new battery projects.

What’s more, the need to add co-located batteries to solar PV plants is becoming more pressing, to hedge against “revenue cannibalisation, curtailment and exposure to zero and negative prices”, says Baringa director Alexis Stavropoulos.

There is now a BESS pipeline of over 35 GW, according to Stavropulos, and new legislation introduced after the blackout should speed up the permitting process, at least for co-located BESS.

Utilities such as Naturgy are moving forward with their first projects. IPPs are also seeking to take advantage of the new rules, with OPTrust-and USS-backed Bruc adding an accordion feature in its latest debt raise to accommodate up to 650 MW of future BESS.

The market is lacking government-backed revenue support schemes for standalone projects such as a capacity market, says Green Giraffe head of Iberia Raul Santos. However, this has not stopped M&A activity for projects at advanced development stage from kicking off, he adds.

Possible buyers include investors that want to “[seize] a strong opportunity to monetize price volatility through arbitrage”, according to Santos, effectively investing in merchant projects. For more risk-averse investors, tolling agreements are also starting to become available to reduce merchant exposure, he says.

Some of the first large-scale standalone BESS projects in Spain are expected to become ready-to-build by Q2 2026, according to another sector advisor. The moment for first-movers to jump into the market is now.

Mixed year ahead for European interconnectors

By Brendan Malkin

Last year was a relatively high watermark in UK interconnectors sales, given Partners Group’s sale of the UK to Ireland interconnector Greenlink to an Equitix-led consortium last summer for an enterprise value of around GBP 1bn. The market looks tougher this year, although some opportunities are in the works.

iCON last year hired Perella Weinberg Partners as its financial advisor to seek a co-investor for its GBP 1.2bn GridLink interconnector project between the UK and France. But sources questioned the likelihood of such a sale taking place. France’s energy regulator, CRE, rejected GridLink’s application in 2022, partly to do with reduced benefits post-Brexit (the UK has approved the project, which was due to move to FiD this year under the original timetable).

Meanwhile interconnectors have become harder to build since Greenlink won regulatory approvals between 2018 and 2021.

“The regulator if looking at an interconnector today has to think about customer benefits. Given the higher costs, it has a lot more questions than it did in the past,” says Steffen Pleser, global head of power & utilities at UBS.

As well as costs having risen due to inflation, it has also been harder to source HVDC cables and converters. Delivery times are also longer, according to Baringa.

The 1.4 GW Tarchon Energy electricity interconnector project between Germany and the UK meanwhile also has not yet received German regulatory approval, although Ofgem has greenlit the scheme. Copenhagen Infrastructure Partners was said in 2024 to be considering a sale of the project, although as it stands this looks unlikely given the regulatory uncertainty and rising costs.

At the time of the Greenlink auction last year, rumours emerged that National Grid was planning to offload stakes in its portfolio of six interconnectors between the UK and Europe, a sprawling portfolio with some 7.8 GW of combined capacity.

But industry sources are sceptical whether such a sale will take place any time soon. National Grid is flushed with cash thanks to its GBP 7bn capital raise in 2024. Since then it has offloaded its Isle of Grain project to Centrica and Energy Capital Partners for an EV of GBP 1.5bn and also sold its onshore renewables portfolio in the US to Brookfield.

Notwithstanding this, National Grid needs to invest some GBP 35bn into its electricity transmission network in the UK by 2031. While much of this will be paid for by debt, it will also have to inject some equity, too. Amidst this, some sources say National Grid has not ruled out a partial sale of its interconnectors.

Other UK greenfield interconnectors have faced mixed fortunes so far. The 700 MW LirIC interconnector between Scotland to Northern Ireland backed by TAQA’s Transmission Investment Group does not as yet have planning permission. However, the Northern Ireland Utility Regulator is due to decide this year on the nature of the interconnector’s regulatory support regime.

One interconnector to look out for is the NeuConnect power link between the UK and Germany. The project, which is owned by Meridiam, Allianz Capital Partners and Japan’s Kansai Electric Power, has received all regulatory approvals and is currently under construction. The Greenlink deal has shown there is strong investor appetite for interconnectors with regulatory approvals and incentive package (Neuconnect has a cap and floor support package). Should this come to market then expect a cost of capital shoot-out.

Another project that should be on investors’ radars is the Wales to Ireland 750 MW interconnector, MaresConnect, which is owned by Foresight Group and the project’s developer, Etchea Energy Nominees. The project has received in principle support from regulators in Ireland and Wales as well as the EU. This year it is eligible for funding from the EU’s Connecting Europe Facility, which covers up to half of the project’s development costs.

Despite these positive shifts, projects historically have struggled to get the abundance of approvals needed to get them across the line. “I see the interconnector market has not been an M&A development story market for a while now,” says Bora Demiralan, a director at Baringa.

While “capital will still flow” to the sector, he says, “full value will concentrate in assets that can evidence regulated revenue visibility, buildable consents, grid connection and onshore reinforcement readiness”, he adds.

Despite this, in the context of Greenlink’s development and sale, the UK interconnector market overall still looks open to opportunities.

UK’s biogas enters period of consolidation 

By Luke Walsh

UK biogas is entering a period of consolidation started in late 2025 as infrastructure investors hoover up standalone plants and smaller platforms.

“M&A activity has intensified as larger infrastructure funds and utilities seek to build scale in the market, with several portfolio acquisitions of operational assets changing hands at compressed valuations relative to the 2021-2022 peak,” says Chris Negus, CEO of Global NRG Advisory.

Last year closed with a flurry of biogas deals, with buyers of small-scale assets including BioticNRG, Palisade Real Assets‘ UK bioenergy fund; Australian power company EDL Energy; and Copenhagen Infrastructure Partners.

The consolidation will gather pace in 2026 as the sector increasingly focuses on a pipeline of power-to-gas conversions, and several development projects aiming to produce sustainable aviation fuel and renewable diesel, adds Negus.

“This convergence of consolidation, conversion activity, and advanced biofuel integration reflects a maturing market seeking optimal value realisation across the biomethane value chain,” he says.

Gulf energy infrastructure M&A boom continues

By Jennifer Aguinaldo

Global infrastructure investors will be on the lookout for more lucrative opportunities to invest in the Gulf’s oil and gas infrastructure over the next 12 months.

After the first giant sale-and-leaseback deals by ADNOC in Abu Dhabi and Aramco in Saudi Arabia in 2019-2022, the number of transactions dwindled for a few years, before picking up again in 2025.

KKR bought a minority stake in ADNOC’s gas pipelines in Q4, and shortly afterwards BlackRock’s GIP led a USD 11bn deal to acquire a 49% stake in Aramco’s Jafurah gas assets.

Hot on the heels of these deals, Aramco has initiated a process for a potential stake sale in its oil export and storage terminals business, while Kuwait Petroleum Corporation has mandated advisors for a proposed sale-and-leaseback of its pipeline network. Oman is also showing early interest to pursue a similar strategy as its neighbours.

One of the reasons behind the new deals is that GCC oil companies are still ramping up oil production despite falling oil prices, and need cash to finance these plans. A way to raise this capital is to sell stakes in more non-core production assets such as pipelines.

Each of these transactions is expected to require billions of dollars of investment, offering opportunities to infrastructure funds and lenders. Due to their scale and strategic importance to the GCC’s economic and energy diversification agenda, such deals will be hard to ignore over the coming months.

Bulgaria is the next BESS opportunity in CEE

By Luke Walsh

By the end of 2026, between 9 GWh and 12 GWh of battery energy storage systems (BESS) capacity will be connected to the Bulgarian grid, up from only about 1.5 GWh last year.

Severin Vartigov, the CEO for Bulgaria of Amber Infrastructure-backed IPP Enery, says this positions the country among the leading European markets for BESS deployment for investors.

Bulgaria has experienced significant daily power price volatility, with averages of EUR 150 MWh and peaks of EUR 225 MWh, but as investors build out BESS portfolios this should level out.

For Enery, adding BESS to its growing renewables generation portfolio will improve the net margins of its entire fleet, says Vartigov.

“We view the expected stabilization of power prices not as a threat, but as a maturation of the asset class,” he says. “Bulgaria’s strong cross-border transmission capacity means our BESS assets provide flexibility to a much wider market, effectively dampening the rate of spread compression.

“We expect spreads to move from volatility to sustainable and bankable levels, which ultimately reduces regulatory risk and improves the long-term valuation of our portfolio.”

Late last year, Enery already took its first steps, securing financing from DSK Bank AD for a flagship 600 MWh BESS in Nova Zagora, Bulgaria.

Bulgaria has good interconnectivity with neighbouring transmission systems, and adding BESS in the country will in turn help stabilise the wider region’s power prices, adds Vartigov. This should improve the investment outlook for renewables across the entire Southeastern European region in a virtuous circle.