Volkswagen has commissioned its first 20 MW/40 MWh battery energy storage system project in Germany.

Following several months of construction, the Volkswagen Group is broadening its business model to encompass stationary energy infrastructure. The company has launched its first large-scale Battery Energy Storage System (BESS) project, aiming to enhance its energy trading portfolio.

In a press release, Volkswagen Group announced that its subsidiary Elli is officially entering the energy storage and trading markets with this initiative. The Group’s energy subsidiary, Elli, has connected its first large-scale battery storage system to the grid in Salzgitter, Germany. This facility has a capacity of about 20 megawatts (MW) and can store 40 megawatt-hours (MWh) of energy.

The Elli PowerCenter signifies a measurable advancement in transitioning from a charging provider to a comprehensive mobility and energy technology enterprise. Concurrently, performance tests are being conducted for trading on the European power exchange, EPEX SPOT.

Additional storage projects are already being planned. Large-scale battery storage systems will capture excess power during times of high renewable generation and return it to the grid when wind and solar output is limited, aiding in the balance of supply and demand.

“Energy storage and trading represent a new strategic business area with substantial growth potential for us. As the Volkswagen Group, we are electrifying vehicles while considering the entire system holistically. With PowerCo, we are enhancing our technological independence, and through Elli, we are managing, storing, and trading energy in a market-responsive manner. This is crucial for our goal of becoming a leading Global Automotive Tech Driver,” stated Oliver Blume, CEO of Volkswagen AG.

Entering the Energy Storage Business Segment
For the first time, PowerCo is delivering energy storage solutions for industrial applications. At the Salzgitter site, the company has developed a closed-loop battery ecosystem that integrates cell manufacturing, stationary storage systems, and energy market optimization by Elli.

The battery systems created by PowerCo serve as the technological basis for this initiative. Through its Energy Storage Solutions (ESS) division, PowerCo designs and produces industrial-scale storage systems using the established Unified Cell format, which serves as the universal standard for electric mobility and facilitates stationary storage applications.

Thomas Schmall, a Member of the Board of Management of Volkswagen AG responsible for Technology, remarked, “Electric vehicles and sustainable energy are interconnected. The growth of renewable resources necessitates robust temporary storage options, which is precisely where our PowerCenter plays a crucial role. We are significantly contributing to the expansion of renewable energy while utilizing our team’s concentrated expertise in batteries and energy. Together with Elli, PowerCo, and Volkswagen Group Components, we are establishing a completely new industrial ecosystem. The Unified Cell is the global technology platform uniting mobility and energy.”

Energy Trading: Elli As An Active Market Participant
The system consists of 13 storage containers integrated into a virtual power plant and operates using a multi-market approach. Elli’s trading team continuously manages and optimizes the assets with algorithm-based strategies and direct market access, maximizing revenue while simultaneously providing ancillary services to the grid.

“With the PowerCenter, we are stepping into the role of an active storage operator in the European energy market for the first time. This launches our Managed Battery Network— a platform that intelligently connects large-scale storage systems and will incorporate vehicle batteries and other assets in the future.

Physical storage capacity transforms into digital system intelligence. We are evolving Elli from a charging provider into an energy company that trades and delivers flexibility for its customers,” said Giovanni Palazzo, CEO of Elli (Volkswagen Group Charging GmbH).

Energy As A New Growth Field
With the launch of the PowerCenter, the Volkswagen Group is transitioning from an automotive manufacturer to an integrated energy player. The merging of mobility and energy transitions is a core strategic aspect of the Group’s transformation.

The Salzgitter production site illustrates this integrated strategy. Here, cell manufacturing, battery system expertise, large-scale stationary storage, and digital energy platforms come together in a collaborative project involving Elli, Volkswagen AG, PowerCo, and other Group entities.

By coordinating cell production, energy storage solutions, digital trading platforms, and operational market access, synergies are realized throughout the entire energy value chain—achieving a level of vertical integration that only the Volkswagen Group can provide.