BESS Crucial for Germany's Energy Transition: Key Contract Aspects
Battery Energy Storage Systems (BESS) are crucial for Germany's energy transition. Here's a rundown on recent developments and key aspects in BESS delivery contracts.
BESS purchasers are usually Energy Project Companies (EPCs) or operating companies, while sellers are often German subsidiaries of Chinese manufacturers. Key German companies involved include the Hager Group, which acquired E3/DC, focusing on decentralized energy solutions.
Performance descriptions should detail modular architecture, state of charge determination, overall efficiency, maximum charging capacity, redundancy, cooling concepts, ambient temperature requirements, software interfaces, fire and water protection, and data acquisition. Delivery contracts often include assembly services, with a Site Acceptance Test (SAT) to ensure these services are up to par.
Binding delivery dates with liquidated damages and agreement on Incoterms, preferably DDP, benefit buyers. Product and performance guarantees are vital for financability, covering material defects and parameters like charge-discharge cycles and end-of-life capacity.
Project developers and EPCs must carefully structure contracts to minimize risks in construction, operation, and financing. Direct purchase from manufacturers carries risks, with purchasers becoming 'importers' under EU regulations. Under German law, defects are governed by §§ 437 et seq. BGB, covering deviations from performance descriptions and technical requirements.
As BESS plays a central role in Germany's energy transition, understanding the intricacies of delivery contracts is essential. Careful contract structuring, performance guarantees, and adherence to legal provisions ensure a smooth and risk-minimized BESS implementation.
