Allianz GI buys 50% stake in German battery storage projects from total

TotalEnergies sells 50% stake in German battery storage projects to Allianz GI

Major Investment in German Renewable Energy Market

By America Hernandez

Transaction Details and Financial Commitment

BERLIN, March 3 (Reuters) - French oil major TotalEnergieshas sold a 50% stake in 11 battery projects under construction in Germany to Allianz Global Investors , the companies said on Tuesday, as interest grows in Germany's fast-growing renewables market.

The companies did not disclose the value of the transaction.

To finish construction of the projects, the pair will invest 500 million euros ($581 million), 70% of which will be financed by debt, they said.

The projects comprise 789 megawatts and will be operational by 2028. 

TotalEnergies’ Strategic Focus on Germany

In its bid to build 100 gigawatts of gross installed renewable capacity by 2030, Total has focused on Germany, Europe's largest power market, as a priority.

It purchased several German battery developers in the belief they will be increasingly needed to balance electricity grids by storing excess renewable production when there is too much wind or sun, then re-supplying it when demand is high.

Business Model and Asset Sales

TotalEnergies has also been regularly selling 50% stakes in renewable assets at a profit once it has invested in building them, and confirmed on Tuesday this was also the case for its battery projects.

"In line with our business model, this transaction enables us to optimize our capital allocation in our integrated power activities and helps improve the sector's profitability," Stephane Michel, Total's president of gas, renewables and power, said in a statement. 

Allianz GI’s Entry into Battery Storage

Allianz, which has previously invested in wind and solar farms as well as green hydrogen, said this was its first direct equity commitment to a portfolio of battery storage projects. 

"The shift to cleaner energy depends on strong infrastructure... These eleven projects across Germany will help reinforce the country's energy resilience, accelerate the energy transition, and deliver long-term value for our clients," Edouard Jozan, head of private markets at Allianz GI, said in a statement.

Project Implementation and Partners

The projects are being built by Kyon Energy using batteries by Saft, both subsidiaries of TotalEnergies, which will operate the sites.

Additional Information

($1 = 0.8604 euros)

(Reporting by Linda Pasquini and America Hernandez; Editing by Thomas Seythal and Emelia Sithole-Matarise)