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Financing BESS Projects in Germany: What Makes a Project Bankable?
At the Energy Storage Summit Germany 2026, experts discussed the factors making BESS projects in Germany bankable. Key considerations include risk management, standardized due diligence, and balancing contracted revenues with merchant exposure. Hybrid financing models and portfolio financing are seen as the future, with Germany playing a leading role in Continental Europe.
The Energy Storage Summit Germany 2026 in Berlin commenced today with a significant discussion on the bankability of BESS projects in Germany. Project owners, lenders, and optimizers convened to explore the critical factors that render a project suitable for banking finance.
Key Risks and Due Diligence
Marcus Starke, Senior Director at NORD/LB, highlighted three primary risks that banks scrutinize. Firstly, project timelines demand ample buffer, not only for grid connection but also for the integration of all components. Secondly, grid restrictions and Flexible Connection Agreements (FCAs) are paramount; a thorough verification of these is essential. Lastly, a comprehensive and standardized due diligence package is required. According to Mr. Starke, such standardized packages are often lacking in the BESS sector, unlike in, for instance, the wind energy sector.
Hybrid Revenue Models and Merchant Exposure
Marie-Sophie Braun from Kyon Energy, a project owner, indicated that the willingness to assume risk can influence a project's design parameters, such as its duration. A key topic was the interplay between contracted revenues and merchant exposure. Coen Hutters of Rabobank noted that Germany is leading the way in Continental Europe in this regard. There was a consensus that the market is trending towards hybrid approaches, combining a degree of contracted revenues with room for merchant exposure. Felix Stephan added that greater merchant exposure can lead to a higher Internal Rate of Return (IRR) and that lenders appreciate project owners having some "skin in the game."
Fully Merchant Projects and Portfolio Financing
Grace Kankindi of Aquila Clean Energy EMEA elaborated on the requirements for financing fully merchant projects. She emphasized the importance of a lender capable of understanding and pricing the risk, robust asset fundamentals, a diversified revenue stack, and selecting a suitable optimizer with a proven track record. Aquila reportedly financed the first fully merchant BESS project in Germany this year, potentially setting a precedent. However, Marcus Starke of NORD/LB observed that lender liquidity is significantly higher for projects with some contracted revenues, although fully merchant projects are viable under the right structure.
Marie-Sophie Braun of Kyon Energy pointed out the benefits of portfolio financing, including a mix of offtake providers and structures, and the ability to create internal benchmarks, which banks find appealing. While combining different routes-to-market (RTM) within a single offtake agreement is feasible, it must remain bankable, a practice not yet widespread in Germany.
These insights provide valuable guidance for the continued development and financing of energy storage projects in Germany and beyond.
Source: Energy-Storage.News
Energy Storage Summit Germany
19 September 2026
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