BlackRock-backed developer Akaysha Energy says lenders need 60% to 80% of contracted revenue before they can assign project debt to battery energy storage system (BESS) projects in Germany – a threshold that structured offtake products borrowed from the domestic market can meet.
BlackRock’s Australian BESS developer Akaysha Energy has formed a joint venture with Copenhagen Energy to develop large-scale battery storage sites across Germany. The partnership is backed by a AUD300 million ($217.8 million) corporate debt facility raised in September 2025 from a syndicate including Deutsche Bank, BNP Paribas, ING, SMBC and Westpac.
Paul Curnow, Managing Director and Chief Commercial Officer of Akaysha Energy, said each German project will be financed through non-recourse project financing in addition to potential regional co-investments.
“In Germany we have had positive contacts with Frankfurt-based banks and potential investors early on,” Curnow said pv magazine.
Akaysha Energy is targeting contracted capacity of 60% to 80% at the project level and around 80% across the portfolio, while retaining some exposure to the traders, Curnow said.
Cosima Sagmeister, analyst at Modo Energy, said German trading fundamentals are among the strongest in Europe. “Day-ahead top-bottom spreads for a two-hour battery reached €85,000 per MW in 2025, 60% higher than in Britain, and the intraday market is the most liquid on the continent,” she says.
Modo Energy’s models point to more than 15 GW network-scale BESS in Germany by 2030, according to Sagmeister.
“Last year, grid connection requests reportedly exceeded 720 GW, about nine times Germany’s peak load, and grid access conditions are becoming stricter,” she said. “Continued growth depends on the evolution of infrastructure and regulations in parallel with investments.”
Sagmeister noted that the revenue stack is undergoing a structural shift. “The defining characteristic of the German revenue stack is the shift from ancillary services to wholesale, which will form the structural backbone in the long term,” she explains.
Longer maturities are becoming increasingly attractive, she said, both in discussions with market participants and in Modo Energy’s models. “The toll market is also very active, which is especially relevant for project financing,” said Sagmeister. “Looking at the disclosed revenue structures across Europe, Germany was the leader in toll agreements in the first quarter of 2026.”
Australian playbook
Curnow said the contract structures Akaysha plans to deploy in Germany will build on its Australian experience.
“In Australia, the products that have really accelerated deployment are things like virtual toll structures and revenue sharing structures, and we’ve also seen strong demand for capacity swap arrangements,” he said. “These are highly structured products that start with what the offtake customer actually needs and what risk they can take. Then we design the structure so that it is still financeable. We think these types of products will play a big role in unlocking larger, scalable project financing in a market that is seeing tremendous demand for storage.”
The German grid compensation regime entails significant uncertainty for projects aiming for commissioning in 2029 and 2030. The current exemption from grid capacity fees will expire for batteries put into service after August 4, 2029, and the German Federal Network Agency (Bundesnetzagentur) has not yet finalized the replacement regime. Curnow said Akaysha Energy is managing risk by maintaining flexibility in project sequencing.
“Our intention is to promote a broad pipeline of projects in Germany, with sequencing options that allow us to make final investment decisions with the best possible visibility on the regulations and economics of grid connection,” he said.
Akaysha Energy commissioned Baringa to model the impact of the upcoming dynamic grid tariffs on the German BESS economy. Curnow said the modeling – published in a report titled “Network tariff reform in Germany: the case for dynamic pricing– shows that “upcoming dynamic grid charges are likely to have a neutral to slightly positive impact on the battery economy, while incentivizing batteries to operate in a way that supports the grid.” He said capacity fees in particular could undermine the investment scenario if set too high.
Sagmeister said grid access and usage costs have become a defining variable for project economics over the next two to three years. She highlighted flexible connection agreements, granted under section 17(2b) of the German Energy Industry Act (EnWG), as a growing feature of new grid connections that can materially impact project economics.
“At the project level, access to the electricity grid and conditions of use have become a determining variable for the project economics,” she says. “You have to make sure you know what to take into account, quantify it and price it in.”
A panel at the recent Battery Business & Development Forum 2026 (BBDF 2026) conference heard that banks are increasingly pushing for toll or floor structures and that pure merchant exposure is only tolerated by niche capital providers. Europe almost shrank 24 GWh BESS capacity under flexibility purchasing agreements in 2025, with Germany among the leading markets.
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