Centrica Energy and Zelestra have signed a physical tolling agreement for the 99 MW/297 MWh Hilgermissen battery energy storage system (BESS) in Lower Saxony, Germany. The agreement supports the development of the three-hour standalone storage project, with construction scheduled to begin in 2027 and commercial operations expected in the second half of 2028.

Under the agreement, Zelestra will develop, construct, own and operate the Hilgermissen BESS, while Centrica Energy will trade and optimise the contracted battery capacity through its multi-market optimisation platform.

Engineering and procurement activities for the project are set to be completed this year ahead of the start of construction. Once operational, the battery system will participate in Germany's Day-Ahead, Intraday and Ancillary Services markets through Centrica Energy's optimisation services.

The project is located in Lower Saxony, a region with a strong industrial base spanning the automotive, agriculture and food production sectors, as well as significant wind and biomass generation. According to the companies, the battery energy storage system will provide flexible capacity to support grid stability and resilience, while facilitating the integration of renewable energy and contributing to Germany's decarbonisation objectives.

"This agreement with Zelestra is an important milestone for Centrica Energy in Germany and another step forward in delivering on our strategy," said Cassim Mangerah, Managing Director of Centrica Energy. "The continued growth in our German flexibility portfolio demonstrates the demand for our optimisation capabilities and further strengthens our position in one of Europe's most dynamic flexibility markets."

Mathias Kuenicke, CEO of Zelestra in Germany, said the Hilgermissen project "adds 300 MWh of flexible capacity to one of Europe's most connected grids and largest energy storage markets." He added that the agreement reflects confidence in the company's BESS platform and supports the expansion of its German development pipeline, which includes more than 2 GW of solar, wind and storage projects.