TotalEnergies is reportedly considering selling a stake of ‘about 50%’ in a portfolio of BESS projects in Germany it is deploying via Kyon Energy.
The oil and gas major acquired Germany battery energy storage system (BESS) developer Kyon Energy in January 2024 for around €90 million (US$105 million).
A little over a year later, TotalEnergies took a final investment decision (FID) and started construction on six BESS projects in Germany that Kyon developed, totalling 321MW in capacity.
Bloomberg last week reported that TotalEnergies is now considering selling a stake of about 50% in a portfolio of BESS projects in Germany that Kyon has developed.
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A source familiar with the matter told Energy-Storage.news that TotalEnergies is looking for an investor for a ready-to-build (RTB) portfolio of around 800MW but is also open to selling a stake in the Kyon Energy operating company, which it acquired outright.
The sales process is more likely related to TotalEnergies’ own internal strategy rather than anything in the wider industry, they added.
“It’s common for Total and other big players to sell down assets once they reach a certain maturity,” the source said.
Now could be an opportune time to sell in Germany, which is generally considered Europe’s most attractive energy storage market thanks to its deep wholesale energy market. However, as with most mature markets the peak of project premiums—what developers are paid for RTB or in-development projects—has probably passed its peak in Germany.
Our source said that, based on typical project premiums, a 50% stake in an 800MW portfolio in Germany could be worth €50-100m for the selling developer. But that figure wouldn’t include any value of the equity in Kyon itself, so the total deal could be higher.
It looks like TotalEnergies still wants to be deeply involved in Kyon and the German market, our source added.
“This appears to be mainly about recycling capital as they don’t appear to be seeking a strategic buyer (i.e. another BESS owner-operator), but more an institutional/passive/infra investor one,” they said.
TotalEnergies has its own optimiser in Quadra Energy, which it acquired in late 2023, as well as its own BESS provider in Saft, which was acquired in 2016 and is deploying the technology for the six Germany projects announced earlier this year, as well as other TotalEnergies’ projects across the globe.
TotalEnergies’ acquisition of Kyon in early 2024 coincided with other similar deals in Germany and the UK, something we looked at in an ESN Premium piece at the time.
