BayWa r.e. Signs Eight-Year Contract To Operate Major 137 MW Alfeld Battery Storage System In Germany With Scale Fund

BayWa r.e. has expanded its Asset Operations business by signing an eight-year service agreement with a Danish investment fund, the Scale Fund, for the “Alfeld” battery energy storage system (BESS) in Lower Saxony, Germany.The Alfeld project is on track to become the largest battery energy storage system in Germany. It will have a total output capacity of 137 MW and an energy storage capacity of 282 MWh.

The system is currently under construction, with commercial operations expected to begin at the start of the third quarter of this year. Once operational, it will primarily be used to deliver ancillary grid services, especially primary control reserve, helping to maintain grid stability and ensure a reliable electricity supply as renewable energy penetration increases.

This agreement is also an important milestone for BayWa r.e., as it marks one of the company’s first major engagements in the operation of external, standalone battery storage assets. Until now, BayWa r.e. had mainly focused on managing its own storage systems integrated within hybrid renewable projects such as solar and wind co-located installations.

This contract therefore represents a step into a broader asset management role within the standalone storage market.Dr. Daniel Gäfke, Chief Operating Officer of BayWa r.e., described the agreement as a significant development for the company’s operations in battery storage management, both in Germany and internationally.

He highlighted it as an important milestone in expanding the company’s capabilities in managing large-scale energy storage assets.Simon Slapka, Managing Director of Data Services GmbH, noted that battery energy storage systems are still a relatively new and technically complex area of the energy sector. He explained that their operational approach combines deep technical expertise with advanced digital asset management tools, supported by collaboration with software specialists such as TWAICE.

He also emphasised that the contract was secured through a competitive tender process, reflecting strong competition in this emerging market segment.From the investor side, Poul Mogensen, Managing Director of the Scale Fund, highlighted the strategic importance of large-scale battery storage in modern energy systems.

He explained that systems like the Alfeld BESS are essential for stabilising power grids and enabling the efficient integration of variable renewable energy sources such as wind and solar. He also noted that the project will become part of critical energy infrastructure and will contribute meaningfully to broader sustainability and decarbonisation goals.

He expressed confidence that BayWa r.e.’s technical expertise, operational track record, and use of advanced software solutions will ensure long-term and reliable performance of the asset.More broadly, battery energy storage systems are increasingly being recognised as a foundational element of the renewable energy transition.

As the share of wind and solar power continues to grow across electricity markets, the need for flexibility, fast response capability, and grid stability is becoming more important. BESS technologies are positioned at the centre of this transition, enabling energy balancing, supporting grid reliability, and enhancing system resilience.

At the same time, the sector is becoming more commercially competitive, with operational efficiency playing a key role in determining long-term success. Advanced asset management, digital monitoring, and optimisation tools are now essential for maximising returns and ensuring that large-scale storage assets deliver consistent performance over their operational lifetime.