Recently, the German energy storage system operator MW Storage announced a collaboration with optimization service provider Entrix. This partnership aims to assist MW Storage in commercializing a portion of its 100MW/200MWh battery storage system located in Arzberg, Germany, specifically the 50MW/100MWh segment.
Following optimization, this 50MW/100MWh portion is set to commence operations in April 2025. Entrix will utilize this capacity in the ancillary services market and the wholesale electricity market, claiming that through close technical integration, they can minimize downtime and extend battery lifespan.
The MW Storage fund is primarily backed by investments from Reichmuth Infrastructure and MW Storage itself. This collaboration comes at a time when the commercial models and risk strategies for large-scale energy storage systems in Germany are under significant discussion. While the ancillary services market is becoming increasingly saturated, many analysts believe that the volatility and liquidity of the German wholesale electricity market indicate that revenues for grid-scale storage systems will not decline as sharply as those in the UK market between 2023 and 2024.
With improved market transparency and the emergence of public benchmarks, the income and performance of storage projects are becoming clearer. To address long-term risks, the German energy storage sector is exploring fixed fee models. Last December, Nofar Energy claimed to be the first to introduce such a model in Europe, and this topic was extensively discussed at the recent EU Energy Storage Summit held in London.
Entrix has not disclosed whether its collaboration with MW Storage will employ a fixed fee model or a revenue-sharing approach. Given the scale of the company, it is typically challenging to bear the financial pressure required for a fixed fee model. MW Storage has also not specified how the remaining capacity of this battery storage project will be commercialized.
As the project owner and operator, MW Storage has previously completed its first battery storage project in Switzerland and has recently expanded its operations into the Finnish market.
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