BayWa r.e. (global renewable energy developer) has signed an eight-year service contract to operate the Alfeld battery energy storage system in Lower Saxony, Germany, a project that is set to become the country's largest battery storage installation upon its completion later this year.

Contract Details and Project Scale

The agreement was signed with the Scale Fund, a Danish investment fund, and covers the full operational management of the Alfeld battery energy storage system.

The project is currently under construction and features 137 MW of output alongside 282 MWh of storage capacity. Commercial operation is scheduled to begin at the start of the third quarter of this year.

The eight-year contract was secured through a competitive tender process. Simon Slapka, Managing Director of Data Services GmbH at BayWa r.e., noted that the contract was won "against strong competition" and highlighted the company's use of advanced digital asset management methods and collaboration with software specialists, including TWAICE.

A Milestone for BayWa r.e.'s Asset Operations Business

The Alfeld contract represents a significant expansion of BayWa r.e.'s Asset Operations portfolio. Prior to this agreement, the company had operated only its own storage systems, and exclusively within hybrid projects combining solar and wind co-location. The Alfeld system marks one of the first external standalone battery assets the company has taken on as an operator.

Dr. Daniel Gäfke, Chief Operating Officer of BayWa r.e., described the deal as "a significant milestone for BayWa r.e. in the operational management of battery storage systems in Germany and beyond.

" The company's expansion into third-party standalone battery assets signals a strategic shift in how it positions its operations and asset management capabilities within the broader energy storage market.

Grid Services and Infrastructure Role

The Alfeld system is designed primarily to provide ancillary services, with a particular focus on primary control reserve. This function places the installation at the center of efforts to maintain grid stability and security of supply across Germany's electricity network.

Poul Mogensen, Managing Director of the Scale Fund, described large-scale battery storage as "crucial to stabilizing the power grid and reliably integrating wind and solar power into the grid," adding that the Alfeld project would, given its considerable size, form part of Germany's critical infrastructure.

Mogensen expressed confidence in BayWa r.e.'s selection as asset manager and operator, citing the company's expertise, track record, and software capabilities as key factors in the decision.

Growing Demand for Battery Storage Operations

The contract comes as demand for flexible grid assets continues to intensify across Europe. As wind and solar generation capacity grows, grid operators require increasingly reliable mechanisms to balance supply and demand in real time.

Battery energy storage systems have emerged as a central technology in meeting this need, with their ability to respond rapidly to fluctuations in generation and consumption.

BayWa r.e. noted that economic success in battery storage operations depends heavily on operational efficiency, and that the sector represents one of the most active areas of innovation within the renewables industry.

The company's approach to the Alfeld project combines what it describes as deep technological expertise with advanced digital asset management tools and close collaboration with specialist software providers.

Lower Saxony Project Timeline

The Alfeld battery storage system is currently under construction in Lower Saxony and is expected to reach commercial operation at the beginning of the third quarter of 2026.

Once operational, it will hold the distinction of being Germany's largest battery energy storage system by both output and capacity. The project is owned by the Scale Fund (investment fund), which is investing in large-scale energy storage as part of its commitment to the sustainable energy transition.

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